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2010 May Be the First Year YouTube Turns a Profit

Posted by Soulskill on from the keep-throwing-ads-in-there-we-love-it dept.

eldavojohn writes "Analysts are saying that this year will be the first year YouTube turns a profit. From the New York Times article: 'In the last year, the video site has become a significant contributor to the family business at a time when Google, which makes more than 90 percent of its revenue from text search ads, is seeking a second act. Though Google does not report YouTube's earnings, it has hinted that it is hovering near profitability. Analysts say YouTube will bring in around $450 million in revenue this year and earn a profit. Revenue at YouTube has more than doubled each year for the last three years, according to the company.' Of course a little over a year ago we were being told that YouTube was losing around $1.65 million each day. Regardless, when you pay $1.65 billion for a business, you probably don't expect it to take three to four years before you start making your money back."

89 comments

  1. Google looks to the future by Anonymous Coward · · Score: 5, Insightful

    Regardless, when you pay $1.65 billion for a business, you probably don't expect it to take three to four years before you start making your money back.

    This is why google is eating everybody's lunch. Thinking this far is a good thing when you are able to double revenues year over year. Not a bad long run strategy.

    1. Re:Google looks to the future by MrEricSir · · Score: 1, Funny

      This is why google is eating everybody's lunch.

      Mommy, Google stole my lunch money!

      --
      There's no -1 for "I don't get it."
    2. Re:Google looks to the future by Anonymous Coward · · Score: 0

      Go back to bed, Mr. Ballmer. You'll need lots of sleep to heal that bump on your head. Just remember not to throw chairs at acrylic windows again, okay?

    3. Re:Google looks to the future by rtb61 · · Score: 1

      Lets be honest a far better strategy would have to get google video to beat youtube not to buy it. Consider this, Google management didn't think they would be able to beat youtube even if they invested $1.65 billion into google video. Personally I think the purchase had more to do with google's management not wanting to appear as losers versus youtube management, for google to buy youtube was to admit defeat.

      Video is now sourced from many sites. Google's lack of income out of youtube points to it's anti-net neutrality conspiratorial deal with Verizon ie will google cripple video search (censor google search) in order to promote it's copyright distribution income and seeks to ensure this by hampering bandwidth from competing video content sites.

      Underlying all of this, was the main reason to pay so much for youtube at that time was to create a false impression of the value of low income web sites in the investment market in order to promote google's own perceived value. After all google basically printed the money for the purchase by simply issuing more shares.

      Google all powerful? Lost in social media, lost in video, no big winner in email, so only really wins in search. Now search is under threat now that M$ is throwing out Ballmer's bullshit and waking up to the fact that have to do the hard yards over years to gain market share ie their new street view (haven't used it not interested in dicking around with silverfish).

      --
      Chaos - everything, everywhere, everywhen
    4. Re:Google looks to the future by RoFLKOPTr · · Score: 1

      Google all powerful? Lost in social media, lost in video, no big winner in email, so only really wins in search.

      Not lost in video... just because they -- as you say -- admitted defeat by purchasing YouTube doesn't mean they lost. They now own YouTube, the largest video sharing site on the planet and only growing farther, so they win there. Yes a big winner in email... all the time I see people I know switching to Gmail from Yahoo, Hotmail, whatever, and I know that I wouldn't use any other email service. Yeah, kinda lost in social media to a degree -- at least in the US. Orkut is huge in South America, and YouTube and Google Talk could be considered social media, both of which are huge (Gtalk isn't as huge as AIM/WLM/Skype, but it's not unknown).

      There's also the huge developments that Google has been making over the years that we're hearing about. Google Voice is amazing. Sure it's a result of an acquisition, but the new Voice is a major improvement upon the old GrandCentral that they purchased. Wave was also a major breakthrough. That software itself wasn't really useful for much, but the technologies behind it can be used in so many different applications that the time spent on that program was well worth it. Calendar is awesome, and online... any other good online calendar applications you know of? I don't. I assume that Windows Live has one, but I've never really heard anything about it.

      Then there's Google Chrome, which is not being developed with the goal of gaining market share. Chrome's sole purpose is to push the limits of Javascript processing speed and be a competitor to the rest. Google's services all heavily rely on Javascript and Ajax, which means they all benefit from better Javascript engines. Current browsers at Chrome's release just weren't cutting it, so Google had to go give them some incentive to kick it up another notch. People want a faster browser, and Google wants people to have a faster browser. Whether that browser is Google's does not matter to Google, but people will go to Google's if the other browsers aren't as fast, and other browsers don't want to lose market share, so they speed up their browsers. All of it benefits Google and their services. Higher market share of Chrome is just another number that doesn't really matter but is still one more thing they can use to please shareholders.

      So it's not about "winning". It's about being the best. "Admitting defeat" by making acquisitions still means they made the acquisitions and now own those that "defeated" them, which means they still win. It's simple business strategy, really. Just at a magnitude several billion dollars more than I could ever imagine having under my control.

    5. Re:Google looks to the future by AHuxley · · Score: 1

      I feel the real deal is in ip tracking, ads and real time feedback to customers and about the interests of consumers.
      Google does not care whats on youtube, they care about what your searching for.
      MS seems to be dreaming of a percentage of life itself, from medical, entertainment, finance, just in time solutions, robotics, DRM ect.

      --
      Domestic spying is now "Benign Information Gathering"
    6. Re:Google looks to the future by drsquare · · Score: 1

      It's a sad comment on modern capitalism that four years is considered long-term thinking.

  2. Google's in it for the long haul.... by LostCluster · · Score: 5, Insightful

    In the .com error days, people valued money-losing Internet companies as if they would gain market share and be able to raise prices in the future. Most failed at doing that, and the bubble burst.

    But Google has this insanely profitable AdWords business, and therefore can fund a money-loser and work the ads in slowly... which is exactly what they did with YouTube. Look out phone companies, you're next.

    1. Re:Google's in it for the long haul.... by FuckingNickName · · Score: 3, Insightful

      But Google has this insanely profitable AdWords business

      If only the Mozilla Foundation had the balls to include an ad blocker which dealt with Google Adwords, perhaps we'd start to see an Internet funded by people willing to pay for (or share) quality content rather than an Internet funded by advertisers pushing crap to the lazy and easily persuaded.

    2. Re:Google's in it for the long haul.... by easterberry · · Score: 3, Insightful

      ...perhaps we'd start to see an Internet funded by people willing to pay for (or share) quality content...

      Ask the games and music industry how that's working out for them...

    3. Re:Google's in it for the long haul.... by tftp · · Score: 1

      If only the Mozilla Foundation had the balls to include an ad blocker which dealt with Google Adwords

      Something like http://www.optimizegoogle.com/ ?

    4. Re:Google's in it for the long haul.... by LostCluster · · Score: 1

      Mozilla's on the take... they get paid for featuring Google as the default search engine in Firefox. Besides, Google would be able to get around any attempt to block their ads totally... they've got ways to make them indistinguishable from content.

    5. Re:Google's in it for the long haul.... by pspahn · · Score: 1

      I think quality was the operative word there.

      --
      Someone flopped a steamer in the gene pool.
    6. Re:Google's in it for the long haul.... by Threni · · Score: 1

      Plus Firefox is on the way out. Let's hope for their sake it doesn't take them another 4 years to finish their mobile version...and that they manage to speed it up and slim it down below 20 megs.

    7. Re:Google's in it for the long haul.... by epine · · Score: 1

      Besides, Google would be able to get around any attempt to block their ads totally... they've got ways to make them indistinguishable from content.

      The day Google ad content becomes indistinguishable from the neo-Trotskyite content I enjoy perusing on aldaily.com (until my eyes glaze over) is the day I pull my plug on the grid and run for the hills.

      Ad content has that new car smell, and I think it always will. I don't think a new-car-smell detector is much harder than breaking a CAPTCHA. Unfortunately, anticonsumers seem to lack the motivation and organization of rummy ex-physicists on the make so the problem gets less quality attention.

    8. Re:Google's in it for the long haul.... by e4g4 · · Score: 2, Insightful

      If only the Mozilla Foundation had the balls to include an ad blocker which dealt with Google Adwords

      I like Google AdWords. Well, perhaps it's better to say that I don't dislike them. They are unobtrusive, easy on my battery/processor temp, and occasionally useful. I see no reason to block them.

      --
      The secret to creativity is knowing how to hide your sources. - Albert Einstein
    9. Re:Google's in it for the long haul.... by Fumus · · Score: 1

      Lately, games you PAY for include "unobtrusive" ads anyway.

    10. Re:Google's in it for the long haul.... by vux984 · · Score: 3, Insightful

      I like Google AdWords. Well, perhaps it's better to say that I don't dislike them. They are unobtrusive, easy on my battery/processor temp, and occasionally useful. I see no reason to block them.

      The ads themselves don't bother me. The fact that virtually every website I visit reports to google that I went there does. Sometimes it feels like I might as well be browsing through a google proxy, and just feeding them every url I visit as I go there. This is what they want. And adwords is ubiquitous enough that it almost gives it to them. Add in gmail, youtube, and the other g-services, and google analytics on the backend on a lot of sites that don't have ads and... they are closer than you think.

      I find that offensive. I don't want to be stalked and everything I do recorded by google. And googles reply is essentially... "we're not singling you out" doesn't imrprove my view of it. Just because they are using the technology to stalk everyone at once doesn't change anything... if anything it just makes it worse.

    11. Re:Google's in it for the long haul.... by Anonymous Coward · · Score: 0

      I never knew youtube had ads until a month or two ago when someone mentioned it in passing, turns out my local dns rule that blocks *.doubleclick.net stops all youtube ads too. Fancy that.

    12. Re:Google's in it for the long haul.... by owlnation · · Score: 1

      But Google has this insanely profitable AdWords business, and therefore can fund a money-loser and work the ads in slowly... which is exactly what they did with YouTube. Look out phone companies, you're next.

      That's true, sort of. If they had stuck with adwords that would have been completely fine. That's not, however, what they did. Over the course of a year Youtube has gone from being usable, to completely unusable for me. Flashing ads, ads that pop up over the video content, animated gifs and all sorts of other crap that make it near impossible to watch the actual video playing.

      It's also no longer possible for me to load video at all in Firefox, I have to use Safari. I know it's probably some setting in adblock that's preventing the video loading. I could change this, but honestly it's easier just not to ever use Youtube again.

      A BIG part of Google's do no evil mantra, was not having invasive ads. This has been completely thrown out with Youtube. Sure it's profitable, but it's no less evil than Yahoo and many others.

      Personally, I'm not supporting it. I'm simply not using Youtube. I'm sure I am not alone. To my mind this is evil, and it's a sign that Google will compromise their values for profit.

    13. Re:Google's in it for the long haul.... by Arancaytar · · Score: 1

      Look out phone companies, you're next.

      "Please wait a few moments while we connect your call. In the meantime, here is a message from our sponsors." ;)

    14. Re:Google's in it for the long haul.... by Anonymous Coward · · Score: 0

      What's the point? Just use NoScript. It's a quick fix and takes care of the rest of the ads too. Better to do that than to spark some stupid browser-webmaster-corporate war.

    15. Re:Google's in it for the long haul.... by Anonymous Coward · · Score: 0

      Except 99.99% of people don't want to pay for content, so you have to live with the ads. The free, ad-supported internet is here to stay.

    16. Re:Google's in it for the long haul.... by Anonymous Coward · · Score: 0

      But Google has this insanely profitable AdWords business, and therefore can fund a money-loser and work the ads in slowly... which is exactly what they did with YouTube. Look out phone companies, you're next.

      How times changed. Microsoft did the very same thing, using insanely profitable Windows+Office business to fund money-losing forays into other market sectors (and incidentally destroyed many companies in those markets), and we called MS evil for doing that. But now, /.ers applaud Google for doing exactly the same thing.

      "Do no evil", yeah, such great marketing slogan. /.ers swallowed it hook, line and sinker.

    17. Re:Google's in it for the long haul.... by unixan · · Score: 1

      If only the Mozilla Foundation had the balls to include an ad blocker which dealt with Google Adwords

      Do I detect a non-user of AdBlock Plus? It's been featured on the Privacy & Security page of addons.mozilla.org for ages now, and occasionally featured on the front-page as well.

      Yes, it works just fine with Google text-based ads, too. I haven't seen them in months.

      --
      This signature intentionally left unblank.
    18. Re:Google's in it for the long haul.... by Anonymous Coward · · Score: 0

      This form of phone advertisement has been around. Before 2000 in Sweden.

    19. Re:Google's in it for the long haul.... by h4rm0ny · · Score: 1


      I wouldn't say that YouTube has become "unusable" for me, but it's certainly become really fucking irritating. I spend half the time I'm watching something on YouTube irritatedly clicking to get rid of some add that's just popped over the bottom 20% of the video.

      --

      Aide-toi, le Ciel t'aidera - Jeanne D'Arc.
    20. Re:Google's in it for the long haul.... by Patch86 · · Score: 1

      Seeing as the games industry is still experiencing year-on-year growth almost every single month, I'd say that it's working out pretty well for them...

    21. Re:Google's in it for the long haul.... by Ash+Vince · · Score: 2, Insightful

      The ads themselves don't bother me. The fact that virtually every website I visit reports to google that I went there does. Sometimes it feels like I might as well be browsing through a google proxy, and just feeding them every url I visit as I go there. This is what they want. And adwords is ubiquitous enough that it almost gives it to them. Add in gmail, youtube, and the other g-services, and google analytics on the backend on a lot of sites that don't have ads and... they are closer than you think.

      I find that offensive. I don't want to be stalked and everything I do recorded by google. And googles reply is essentially... "we're not singling you out" doesn't imrprove my view of it. Just because they are using the technology to stalk everyone at once doesn't change anything... if anything it just makes it worse.

      You are singling google out though. Every advertising company does this sort of crap. And the battle against any advertising was lost years ago, mainly becuase too many people actually buy stuff as a result of adverts.

      The only thing I try and remember is that the adverts I am bombarded with are used to finance me getting a free service. If Google moved away from an advert supported model they would have to charge a subscription to voder their costs. Since I use Google a lot this would cost me a fortune.

      --
      I dont read /. to RTFA, I read /. to offend people in ignorance.
    22. Re:Google's in it for the long haul.... by Caetel · · Score: 1

      Considering Mozilla rely on Google for revenue, pissing them off probably wouldn't be in their own best interest.

    23. Re:Google's in it for the long haul.... by vux984 · · Score: 1

      Every advertising company does this sort of crap.

      Google is different.

      Google controls 70% of the online ad market. That, by itself puts it in its own category. Everyone else from Microsoft and Yahoo on down fights over 30%. Google also has 66% of the search market.

      The difference between living under surveillance and not is one of degree. Getting caught on some guys camera on the way to work is not surveillance. Having that guy setup 100,000 camera's in the city and watch me as I move around is.

      The other advertising companies may be -striving- for surveillance -- but even if yahoo, aol, and msn split the 30% without any other players they only have 10% of the market. I'm fine with the reach of a company being around 10%.

      70% is something completely different.

    24. Re:Google's in it for the long haul.... by EdIII · · Score: 1

      That's your experience as a user. It's far worse when you are company and/or developer forced to use YouTube as a business model.

      It's like a twisted horror movie with the psycho asking you to choose between the life of your daughter and your wife. A bit melodramatic, but YouTube is really driving a lot of us crazy.

      Of course, some will say that you have a choice. Not really. Those developers who create sites that only work in Firefox, or even Safari, and then arrogantly state that IE's malfunctions are not their problem have failed and will never make it in the real world.

      YouTube is much the same problem for a large number of businesses right now. They want the benefit of an enhanced online presence and integration with social networking, etc., blah blah blah.

      YouTube has tremendous market share and brand awareness. As a business it's nearly impossible to ignore that if you are going to be putting content out there. Ignoring YouTube is not always possible, and as a developer I don't have a choice but to "just figure it out".

      What I hope is that the profit is dumped right back in to development. The YouTube API offers some functionality, but it really needs some polishing and extra work. We developers have serious challenges right now with getting YouTube to work with automated systems to allow scalability. From my perspective the API development team is not being given the resources and access it needs to get the job done.

      Somebody at Google needs to take this seriously and put more resources towards this. My feeling is that because it is free they are taking a lackadaisical approach, and it is the businesses that are being made to suffer for it.

      What they need is a fully mature API designed to service businesses and their needs. After all, the average YouTube user will never even use an API to upload a video. A business will need to do so constantly. The current state of the API is far from optimal, and in many ways simply could not last a day if it were a paid for service.

      On that note, YouTube would have probably been profitable a lot earlier had it catered towards businesses with a fully mature API. I know with certainty of a few business that would happily pay thousands of dollars a month to have their content hosted on YouTube, ad revenue sharing or not, just to get better service, better development, and better access.

      I could name a half-dozen competitors to YouTube in this regard with fully matured API that beat YouTube hands down in just about every area from marketing, syndication, statistical analysis, video processing, etc. Unfortunately, I bet you may have heard of maybe 1 if I am lucky.

      Once again, YouTube's early entry in to the market, and Google supporting it's losses created a substandard video service (compared to business offerings) that has excellent market share and brand awareness.

      You don't like YouTube as a user? Be happy that you have a choice to close the browser window.

  3. I'm sure Google knew what they were getting. by FooAtWFU · · Score: 3, Interesting

    It's not like Google didn't know what they were getting themselves into. I'm sure they're doing just fine over there.

    --
    The World Wide Web is dying. Soon, we shall have only the Internet.
    1. Re:I'm sure Google knew what they were getting. by Confusador · · Score: 1

      Yeah, I'm pretty sure when you buy a business that's losing money hand over fist you expect it to continue doing so for a while anyway. I didn't see anyone at the time postulate that they were picking it up for the revenue.

  4. How is youtube revenue different from ad revenue by Anonymous Coward · · Score: 0

    The only monetization I see on youtube is advertisements, either as overlays or lead-ins to real content.

  5. Music by MichaelSmith · · Score: 4, Interesting

    I run linux so I can't use itunes, which partly blocks me from buying music on line. Lately if I want to listen to a track I search for it on youtube and watch a video. Once a week I seem to spend an hour or so clicking through links from one video to another. Youtube has a fantastic collection of early Kate Bush demo recordings.

    I bet they charge a lot of money for targeted adds on videos. Google knows my wife wants to buy a new car...

    --
    http://michaelsmith.id.au
    1. Re:Music by h4rr4r · · Score: 5, Insightful

      Amazon sells pretty much everything too, and 7digital, the company behind the ubuntu music store, is another great choice.

    2. Re:Music by crow · · Score: 3, Informative

      And if you save them, and dump the sound track with mplayer, you usually end up with a nice 128kbps MP3.

    3. Re:Music by quercus.aeternam · · Score: 0

      The first -and last- time I got music from amazon, I discovered that it used a special windows client.

      The situation may have changed, but unless it has, amazon is not in the running.

    4. Re:Music by pspahn · · Score: 1

      Try eMusic.com. DRM free, Linux client, tons of music, and no major label garbage.

      --
      Someone flopped a steamer in the gene pool.
    5. Re:Music by Anonymous Coward · · Score: 0

      http://www.amazon.com/gp/dmusic/help/amd.html?ie=UTF8&forceos=LINUX&ASIN=&isTrack=&forceDeluxeUpgrade=0&redemptionToken=

    6. Re:Music by smegmatic · · Score: 1

      it has a linux version. i've been using it for years. http://www.amazon.com/gp/dmusic/help/amd.html

      also, some linux media players are integrating the amazon mp3 store directly: http://abock.org/2010/07/13/amazon-mp3-store-in-banshee

    7. Re:Music by SiMac · · Score: 2, Insightful

      And if you save them, and dump the sound track with mplayer, you usually end up with a nice 128kbps MP3.

      Well, you end up with a 128 kbps MP3, but it's not usually too nice because YouTube compresses the hell out of audio. Depending on the source material, parameters used, and your ears, you may or may not care, but it's hard not to notice. I am pretty sure that YouTube does this for a reason.

    8. Re:Music by Anonymous Coward · · Score: 0

      Try running a real OS and you won't have this problem.

    9. Re:Music by vadim_t · · Score: 2, Informative

      And they sell their data to spammers, unfortunately.

      I registered some time back with an emusic@domain.com email address (I make a new alias for every website), and regularly get spam mailed to it. And I don't mean emusic advertisements, or even some sort of partner thing. It's viagra and xanax spam.

      I only went as far as getting a trial account, and due to this will never go any further.

    10. Re:Music by Anonymous Coward · · Score: 0

      There is an Amazon MP3 app in the Android store, which comes pre-installed in Cyanogen.

    11. Re:Music by mattack2 · · Score: 1

      and no major label garbage

      Translation: No music that the vast majority of people want to listen to.

    12. Re:Music by Wowsers · · Score: 2, Informative

      it has a linux version.

      Yes, but it's only 32bit, and if you want to install it on a 64bit version, you will be shocked at how much 32bit crap it wants to drag into your nice clean 64bit system..... all for a crummy downloader. I passed at the opportunity to mess up my system more (Skype was bad enough but at least that is useful).

      --
      Take Nobody's Word For It.
    13. Re:Music by pspahn · · Score: 1

      /. != Vast majority of people

      I've found a lot of good music from eMusic that I would have otherwise not known about. And they are bands that play shows at any of the many music venues near where I live. They are also the kinds of bands that have no qualms about putting their live shows online, for free.

      --
      Someone flopped a steamer in the gene pool.
    14. Re:Music by Kerrigann · · Score: 2, Interesting

      If there's an mp4 HD version of the video, and you dump (not re-encode) the AAC audio it can actually sound pretty good.

      I'm assuming mp4 on youtube is always h.264/AAC, which it seems to be. Sometimes an flv video will also have AAC audio, but it's usually, like you said, compressed as hell.

    15. Re:Music by Anonymous Coward · · Score: 0

      Check out clamz: http://code.google.com/p/clamz/

  6. Profit != Money back by e065c8515d206cb0e190 · · Score: 3, Insightful

    I assume that profit is "revenue - operational cost", i.e. "advertising - server farm".

    That's very different from "getting your money back".

    1. Re:Profit != Money back by MichaelSmith · · Score: 1

      I assume that profit is "revenue - operational cost", i.e. "advertising - server farm".

      That's very different from "getting your money back".

      On the other hand there is "not losing ad revenue to video streaming sites".

      --
      http://michaelsmith.id.au
    2. Re:Profit != Money back by Anonymous Coward · · Score: 0

      On the gripping hand, there's expecting your company to exist past the next quarterly report, in which case you have some future date where you expect to "get your money back".

  7. Old School Dot Com by hhawk · · Score: 4, Interesting

    While It might be old school dot com to start a business and "try to lose as much $$ as possible" it's clear that Google through YouTube has created something very valued, given the reach and impact YouTube has. What remains to be seen is through Google TV and other technologies can they bring this video from the desktop to the set top?

    Also interesting will be to see if they can get as much corporate content as they already have consumer content. They did do away with Google Video service..

    I would love it if YouTube/Google/Google TV was my one shop stop for searching on video content and then let the technology figure out how best to view it; also figure out the cheapest way. For example I subscribe to HBO on demand but on my cable box when I search for movies they will charge me for watching these movies unless I come in via the HBO interface.. I need a video search service that is looking to minimize my expenses not increase them.

    --
    http://www.hawknest.com/
    1. Re:Old School Dot Com by KimmoS · · Score: 2, Funny

      Google through YouTube has created something very valued

      You must be new to Dot Com 2.0?

      According to Mayan astrology, the data-mining bubble will burst in 2012, resulting in expanded contentiousness regarding privacy issues. That will result in a collapse of the Web 2.0 and Social Media. The majority of all people has at this point lost all their IRL social skills and their ability to interpret exformation in regular IRL social situations == Zombie Apocalypse

  8. Strangly this... by Bobakitoo · · Score: 2, Funny

    Strangly this coincide with the year of linux on the desktop. So it must be due to all the new linux desktop accessing youtube.

    1. Re:Strangly this... by Anonymous Coward · · Score: 0

      Not really. We still don't have decent flash, and not *all* youtube videos can be viewed in HMTL5.

    2. Re:Strangly this... by Anonymous Coward · · Score: 0

      Strangly this coincide with the year of linux on the desktop.

      Are... are you threatening to strangle someone if it's not the year of the linux desktop? 'Cause that's a strategy I'd not thought of.

  9. Impressed by Beerdood · · Score: 1

    Bravo youtube *claps* I would have though you would have been sued into oblivion by copyright lawyers shortly after you spawned (i.e. viacomm suit). Thanks for making work a lot less dull these last few years!

    --
    Global warming and other natural disasters are a direct effect of the shrinking number of pirates - Gospel of the FSM
    1. Re:Impressed by pspahn · · Score: 1

      ...and your employer that much less profitable.

      --
      Someone flopped a steamer in the gene pool.
    2. Re:Impressed by Tubal-Cain · · Score: 1

      Speaking of which, does the profitability that this announcement indicates include court expenses?

    3. Re:Impressed by Beerdood · · Score: 1

      Good point - I would suspect they aren't, and that the lawyers are on the general payroll for google.

      --
      Global warming and other natural disasters are a direct effect of the shrinking number of pirates - Gospel of the FSM
  10. And Nothing of value was gained by Anonymous Coward · · Score: 0

    Unless you're one of the many people who likes singing cats.

  11. Almost there.... by kenrblan · · Score: 2, Funny

    Youtube is just a couple more Bed Intruders away from profitability.

    --
    Make everything as simple as possible, but not simpler. - Albert Einstein
    1. Re:Almost there.... by roman_mir · · Score: 1

      so did they catch the really really dumb homeboy?

      --
      You can't handle the truth.
  12. Odd summary by proxima · · Score: 4, Interesting

    The main point of the article is how Youtube is enabling a shift in how copyright holders deal with unauthorized content. They scan new videos for content matching that provided by content owners and split ad revenue with them. It's certainly less confrontational than DMCA takedown notices, but I imagine it's full of gray areas: what if the video I upload uses 15 seconds of a music video for commentary but is otherwise 9 minutes of my own contribution? Does Youtube still show more-than-usual ads and split the revenue with the artist?

    Is there any way we can reliably well which videos have this revenue sharing? Some things are obvious - official music videos often have more ads and big "VEVO" logos everywhere. But how about these user-uploaded videos?

    --
    "The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
    1. Re:Odd summary by allusionist · · Score: 1

      When you upload the video, if it finds a content match it tells you and explains what that means for you. I did a music video for "Crazy" by Gnarls Barkley and it identified the audio track, told me that it identified the audio track, and placed a link to buy the song under the video. I assume had it been from an artist/label/etc who doesn't want any unauthorized use of their content, it would have blocked the audio (or entire video) and notified me in the same way that it had done so.

    2. Re:Odd summary by pspahn · · Score: 1

      I watch me some YouTube, but I was very unaware of this feature until recently.

      I was drinking with some friends one night while my girlfriend was traveling in Norway. I happened to be karaoke night and her birthday was in a couple of days. Since I couldn't give her anything in person, I had the idea that I would sing one of her favorite songs (Talking Heads, This Must Be the Place) and YouTube it to her on her birthday.

      I was astonished after uploading it that it told me I had uploaded content that contained copyrighted material. What fascinated me was that my singing was horrendous, I completely screwed up the second verse's timing, and there was a bunch of background noise, and yet it still knew that the song was copyrighted.

      At first I thought it would get removed or something, but it's still there in all of its 2 view glory. She loved it. I enjoyed making it.

      --
      Someone flopped a steamer in the gene pool.
    3. Re:Odd summary by proxima · · Score: 1

      When you upload the video, if it finds a content match it tells you and explains what that means for you. I did a music video for "Crazy" by Gnarls Barkley and it identified the audio track, told me that it identified the audio track, and placed a link to buy the song under the video. I assume had it been from an artist/label/etc who doesn't want any unauthorized use of their content, it would have blocked the audio (or entire video) and notified me in the same way that it had done so.

      Okay, so the uploading person knows, but what about the viewer? If nothing else, I'd be really curious to know which artists/labels/studios/etc like their content on Youtube and which still send takedown notices. It's certainly possible to figure it out on a case-by-case basis, but a little note on the video would make things easier.

      --
      "The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
  13. YouTube losing money? by wisnoskij · · Score: 1

    Was the articles about YouTube not having to pay (any/much) money for bandwidth and therefor not actually costing google any/much money incorrect?

    I thought that google losing over a million a day was proved to be false?

    --
    Troll is not a replacement for I disagree.
    1. Re:YouTube losing money? by Anonymous Coward · · Score: 0

      The $1.65 million loss figure was completely wrong. Securing bandwidth at the time (and perhaps even now) was at times like getting operator status in an IRC channel if the bandwidth wasn't being used anyway. Whoever did the analysis completely failed to locate the world\market rather than just the correct figures. /Yes, I'm AC. If someone with more courage wants to verify and\or elaborate, that's good.. and otherwise staying at 0 is fine with me.

    2. Re:YouTube losing money? by Anonymous Coward · · Score: 0

      It is true, Google recently built a cloud based video serving solution, amortizing the bandwidth costs over millions of nodes making it essentially free. They also feed some of the pipeline pressure into their storage systems, which accelerates software compression. Much the same way a car's turbo works, except that computers get faster every year, so it's more like a turbo that accelerates forever. They could sell the excess energy it creates back to the Grid, but net neutrality laws prevent them from doing so. Instead, they choose to reinvest it into more tubes.

    3. Re:YouTube losing money? by Anonymous Coward · · Score: 0

      Yep that's right, the $foo million a day "loss" was assuming Google was paying full retail to push those bits around -- which is absurd considering Google owns the largest fiber optics network in the US. This was debunked on sites like slashdot, in article comments, and so on, but of course the articles were never ammended.

                I definitely won't be surprised to see Youtube making money, the ads that actualy overlay the bottom of the video should certainly bring more money than some banner ad that is just as likely as not off-screen when the video plays.

  14. Better Odd Than Slashvertisement in My Book by eldavojohn · · Score: 4, Interesting

    The main point of the article is how Youtube is enabling a shift in how copyright holders deal with unauthorized content.

    Disclaimer: Summary author here. Honestly, wasn't too interested in that. YouTube's been auto-recognizing songs and videos through fingerprinting for quite sometime now and making an ad for the song pop up at the bottom of the video because you don't own it. I saw this with my friend's account as early as 2008.

    Neat trick but not really fresh news to me. And you know, I read the article and the only thing that caught my eye was that YouTube might be turning a profit this year. I thought it was more newsworthy than your summary and -- frankly -- I get annoyed and feel like I failed whenever I post a summary and someone screams "slashvertisement" and gets modded +5 Insightful. That really does get to me. So instead of gaping in awe at how awesome they are at scanning your videos, I went with the profit angle. Especially since people have been so mixed on whether or not YouTube was a smart play by Google. Viacom trial lawyer fees aside, it's not a cheap outfit.

    You'll just have to beat me to the scoop next time ;-) good luck!

    --
    My work here is dung.
  15. Compared to Microsoft's Xbox by GravityStar · · Score: 1

    It's surprising how little flak youtube is catching in the comments to this story. I would have expected at least one sideways attack on youtube and its reason for existing.

    Usually, in any Xbox story regarding its earnings, we would already have gotten a detailed graph & analysis on how it could never pay back the initial costs before the heat death of the universe.

  16. Didn't happen to me... by FatSean · · Score: 1

    I've been their customer since they opened their doors and I never got any spam. Are you sure it wasn't a lucky guess of a valid email address by the spammers?

    --
    Blar.
    1. Re:Didn't happen to me... by pspahn · · Score: 1

      I stopped my subscription a year or so ago because I wasn't using it enough, but I too wasn't getting spam related. But, then again, my inbox is pretty well trained by now so I almost never see spam anyway.

      --
      Someone flopped a steamer in the gene pool.
    2. Re:Didn't happen to me... by KingAlanI · · Score: 1

      I've never noticed any spam from them, but I stopped simply because I wasn't using the subscription enough. What eMusic needs is for the credits to roll over month-to-month

      They *do* have *some* stuff controlled by major labels, but their availability seems a bit hit-and-miss on both that and indie stuff I was looking for

      --
      I listen to both RIAA and non-RIAA stuff if I like the music, tangential business/politics nonwithstanding.
  17. Coincidence by houghi · · Score: 1

    that it is the same year as the year of the Linux desktop?

    --
    Don't fight for your country, if your country does not fight for you.
  18. Three or four years is fast. by thePowerOfGrayskull · · Score: 1

    Regardless, when you pay $1.65 billion for a business, you probably don't expect it to take three to four years before you start making your money back."

    Actually if you spend that much for a business, it would not be unreasonable to expect ten years or more. 1.65 billion is not an investment you make for a quick turnaround.

  19. Google's view is not just long term.... by tpgp · · Score: 1

    Google's aims in buying youtube were not just long term, but also wide/strategic.

    Owning youtube puts them in a position where they get to decide what the next well supported steaming video codec will be. If they didn't have youtube, they would be in a position where Apple or Microsoft could lock them out of video ads - particularly on the mobile front.

    --
    My pics.
  20. The same idiocy by DerekLyons · · Score: 5, Insightful

    "Regardless, when you pay $1.65 billion for a business, you probably don't expect it to take three to four years before you start making your money back."
     
    Once again, it's pretty obvious that the summary writer (like most slashdotters) knows roughly fuck all about business. Taking three to four years to start earning your money back is neither new, nor unique to Google, nor even notable.

    1. Re:The same idiocy by Anonymous Coward · · Score: 0

      A lot of people know fuck-all about business, including people that make the business decisions. Look at the spate of companies in the last 10 or 15 years that decided to eliminate R&D, basically with the view that they have products to sell now, and R&D won't pay back for years. Cut customer support to nothing, ignoring the fact that at least passable CS means happy customers that'll buy more from you down the road (that money won't come in until later!) It's stupid, but a lot of companies are run by people now where if something doesn't turn a profit this year they won't do it -- and they'll do things that hurt a company long-term if it makes a short-term profit.

  21. defence by DaveGod · · Score: 1

    Looks like it's just turning a profit for the current year. A milestone for sure, but a long way from the investment being profitable, though how you measure that is another question.

    If they paid $1.65b 4 years ago and lost half a billion a year for 3 years (to ~October 2009) and broke even for this year then YouTube would have to be worth around $5.5b by the end of this month just to "break-even" (in real terms) if we were to say that cost of capital+inflation etc is 15%. I seriously doubt a 15% return would be even close to good enough for a dot com investment, but anyway.

    This is probably a naive however. YouTube expanded the reach of the advertising business and more importantly they had to cover off the possibility for someone else to move in, take the momentum and market share. Just like they had to do with smartphones and are now wondering what the hell to do about Facebook. The new revenue opportunities are important, but defending their position far more so.

  22. pop over ads by Lord+Ender · · Score: 1

    Dear advertisers: If you put ads on top of the content, I will not buy your product. If I click your shit, it's because I missed the X button. I will make a conscious effort to never send a cent your way.

    Google: if you can't make a profit without running ads ON TOP OF your youtube videos, everyone will migrate to a site which can do so eventually.

    --
    A slashdotter who didn't build his own computer is like a Jedi who didn't build his own lightsaber.
  23. Re:run for the hills. by TaoPhoenix · · Score: 1

    "The day Google ad content becomes indistinguishable from the neo-Trotskyite content I enjoy perusing on aldaily.com (until my eyes glaze over) is the day I pull my plug on the grid and run for the hills."

    Challenge Accepted!

    ---

    As often, RandallMonroe of XKCD has provided a jumpgate.

    http://www.xkcd.com/788/ (All rights reserved to Randall Monroe, used for educational purposes only.)
    The Carriage
    "Because I could not stop for death, he kindly stopped for me. The carriage held but just ourselves ... ((Action sequence)) ________________________"

    In that blank is an ad.

    By the time you have seen the Ad Exposure, you cannot un-see it. Therefore, the ad wins. With that New-Carriage Smell you have come to lust for.

    --
    My first Journal Entry ever, in 8 years! http://slashdot.org/journal/365947/aphelion-scifi-fantasy-horror-poetry-webzine