Slashdot Mirror

← Back to Stories (view on slashdot.org)

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."

11 of 89 comments (clear)

  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.

  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 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
    4. 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.

    5. 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.
  3. 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".

  4. 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.

  5. 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.

  6. 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.