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It's not so much being propped up, as at achieving better efficiencies. Leveraging the larger organizations compute resources and ads technology makes Youtube

• pclmulqdq 4y ago
  This isn't always true. A conglomerate isn't always more efficient than separated entities. You wouldn't get magical efficiencies by combining an oil company with an airline, for example, even though oil is a key cost component of air travel. The same goes for compute resources and ad sales - both are roughly commodity services with lots of competitors. Youtube gets some efficiencies from vertical integration with both, due to incentive alignment, but also gets a lot of inefficiencies from the added complexity and management and the need to keep up with competitors in the commodity part of the business, which can be expensive. The semiconductor industry is a place where you would think you would see an obvious efficiency to vertical integration - designing your process technology specifically for your chips. In practice, vertical integration between the chip design and manufacturing sides is almost gone, with a few notable exceptions. This is because it is actually not more efficient to be integrated. Technical infrastructure seems to be similar to me.