Internet Evolution Analysis: Google Losing Up To $1.65 Million a Day on YouTube
NEW YORK, Apr. 14 /PRNewswire-AsiaNet/ --
Income from premium offers and other revenue generating
programs don't offset YouTube expenses of content acquisition, bandwidth,
storage, and other costs, calculations show
It must have seemed a smart idea when Google paid $1.65 billion for
YouTube in 2006. But more than two years later, Google is losing as much as
$1.65 million a day on the Web's most popular video site, according to
calculations and analysis from Internet Evolution.
You can read the full report here:
"The average visitor to YouTube costs Google between one and two
dollars," said Internet Evolution Editor in Chief Terry Sweeney, citing the
estimated $513 million to $663 million in annual YouTube losses divided by
its 375 million unique visitors. The report, written by David Silversmith,
drew from a variety of sources, including Bear Stearns, comScore, Credit
Suisse, and Google itself.
"Google is, in effect, paying YouTube consumers to visit the site,
despite premium offers and other revenue-generating programs that can't keep
pace with the site's expenses -- content acquisition, bandwidth, and storage,
to name a few," Sweeney said. How long Google expects to continue subsidizing
the site or when it expects to break even is less clear. YouTube refused
comment on the problem.
Google's plans to serve up advertising on YouTube have had limited
success. YouTube sells homepage roadblock ads that cost $175,000 per day and
branded channels at $200,000 apiece; neither has been widely deployed,
according to the Internet Evolution report. Google AdWords image advertising
remains the primary revenue source for YouTube.
About Internet Evolution
world-famous Internet experts -- such as Kevin Mitnick, once the most-wanted
computer hacker in the world; Dr. Lawrence Roberts, inventor of packet
switching, and one of the world's foremost authorities on telecom network
architectures; Vint Cerf, Vice President and Chief Internet Evangelist for
Google; and Craig Newmark, the founder of Craigslist.com -- all of whom are
addressing today's critical socio-economic issues within its ThinkerNet
blogosphere. In March 2009, Internet Evolution won three prestigious Min's
Best-of-Web awards, including Digital Team of the Year, Best Community/Social
Networking Site, and Best B2B Magazine-Branded Video.
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*13.3 million business decision-makers: based on number of monthly
connections
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Contact
Amy Averbook
TechWeb's Internet Evolution
(212) 925-0020 x112
averbook@lightreading.com
SOURCE: Internet Evolution
CONTACT: Amy Averbook of TechWeb's Internet Evolution
+1-212-925-0020 x112
averbook@lightreading.com
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