YouTube remains unprofitable despite earning $4 billion last year

By Shawn Knight ยท 12 replies
Feb 26, 2015
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  1. wsj youtube google amazon netflix hulu facebook video twitter online video original content video website

    It may come as a surprise that YouTube, the world’s most popular video platform with more than a billion users each month, still isn’t profitable.

    Two people familiar with the company’s finances told The Wall Street Journal that the Google-owned video site brought in roughly $4 billion in revenue last year. That’s an increase of a full billion over the $3 billion it earned in 2013 yet after paying for content and the equipment to run the site, YouTube is more or less breaking even.

    wsj youtube google amazon netflix hulu facebook video twitter online video original content video website

    To put that into perspective, Facebook – a company that continues to work its way into the video market – generated over $12 billion in revenue last year. Its 1.3 billion users helped turn a profit of almost $3 billion.

    As you may know, YouTube’s core audience largely consists of teens and tweens while other visitors primarily drive traffic by following links or watching embedded videos. Google executives are hoping to change that as they’d much prefer for YouTube to be a daily destination – tuning in much like they would television.

    wsj youtube google amazon netflix hulu facebook video twitter online video original content video website

    It’s a task that’ll be up to second-year CEO Susan Wojcicki to try and complete.

    It won’t be easy, even with Google’s backing. YouTube is facing new competition in the video industry from social networks Facebook and Twitter while companies like Amazon and Netflix are luring visitors in with compelling original content – the latter of which might be key to YouTube’s quest to turn a profit.

    If it can create desirable content like its rivals, there’s little reason to think users wouldn’t flock to watch it. If you film it, they will come.

    Permalink to story.

    Last edited by a moderator: Mar 5, 2015
  2. drjekelmrhyde

    drjekelmrhyde TS Addict Posts: 249   +63

    I mostly go there for 'How to videos', and would pay $60 a year just for that.
  3. kuroiei

    kuroiei TS Enthusiast Posts: 93   +31

    Well, maybe if the site would have a nice, WORKING interface and design that doesn't force the user to install a dozen of addons just to make it usable.... the frustration of using it outweighs the benefits, for me.
    oranuro and stewi0001 like this.
  4. Uncle Al

    Uncle Al TS Evangelist Posts: 3,326   +1,974

    I would like it just to maintain my account information. I have had to sign up three different times because they keep losing or deleting it! With that kind of user base they are obviously under pricing their ads or there is some other dynamic in their revenue stream, very possibly just to avoid taxes.
  5. stewi0001

    stewi0001 TS Evangelist Posts: 1,681   +1,080

    Well if they put porn on there, they would get a lot more traffic but lose a lot more reputation.
  6. VitalyT

    VitalyT Russ-Puss Posts: 3,663   +1,949

    Memorable picture, miss Wojcicki... :)

  7. aMerkuri

    aMerkuri TS Enthusiast Posts: 49   +19

    design is pretty modern and up to date and what kind addons we are talking about?
    SirChocula likes this.
  8. AnonymousSurfer

    AnonymousSurfer TS Guru Posts: 452   +40

    I agree that they are underpricing their ads. If you look at the amount of ads Facebook has compared to Youtube, it is no surprise that Facebook is making more. That being said, I don't want Youtube to have as many ads as Facebook, they should just charge companies more for their ads. This way the creators make more, Youtube makes more, and the cycle of content creators and content consumers keeps recycling itself.
  9. Skidmarksdeluxe

    Skidmarksdeluxe TS Evangelist Posts: 8,647   +3,274

    I use YouTube on a daily basis and I've never seen any ads, it must be because the AdBlock add-on is doing it's job properly. At the end of a video I often see it has blocked more than a hundred ads. I don't know about FB or Twitter, I never use them so I've never checked.
  10. cliffordcooley

    cliffordcooley TS Guardian Fighter Posts: 9,715   +3,694

    If a site is going to make money from advertising, then by all means "MAKE MONEY" and stop complaining about being unprofitable. All this low cost pollution drives everyone crazy.

    A site the size of Youtube has no excuse not to recoup their cost in advertising. Youtube is large enough they can demand their own price for AD Real Estate.
  11. VitalyT

    VitalyT Russ-Puss Posts: 3,663   +1,949

    To me YouTube does not exist without Ad Blocker. Good luck with that profit ;)
  12. SirGCal

    SirGCal TS Maniac Posts: 365   +136

    Google pays AdBlocker to allow their stuff. And Google bought Youtube in 2006. Good luck with that. However I run uBlock and Ghostery which both in turn end up breaking a lot of sites cause much less information gets out... Becomes more aggravating. But I don't like data farming on me.
  13. Gamesinner

    Gamesinner TS Rookie Posts: 86

    Please Google sell it so I can dump Google+ from my Youtube account.

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