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YouTube Learns to Profit from Ads
By admin | February 15, 2010
YouTube has been a notorious money-losing proposition for years, so much so that many people thought Google was nuts for acquiring it.
And they weren’t far wrong – Google has been losing money on the video viewing website ever since that acquisition. They’re hoping their new ad policy turns that revenue stream around.
Salar Kamangar is the brains behind the new ad-revenue emphasis on YouTube, the same man behind the AdWords system that has been so successful for the search engine itself. He has been pressing YouTube to put more online ads on their videos and to promote more content from media companies, as opposed to allowing users to upload (usually illegal and bootlegged) copies of the same videos and TV shows.
The new ads are coming from such media giants as Time Warner Inc., including CNN and the Cartoon Network. They’re also bringing in Disney’s ABC and ESPN and many other studios are waiting in line to get involved in the new ad emphasis on YouTube as well.
Putting more professional shows online, sponsored by their parent companies and backed by ads, allows the users to get what they want (full-length shows and videos) while the studios get revenue from the new ad streams. The set-up is similar to already-established systems such as Hulu, which only hosts media that has been bought from the parent companies.
YouTube will still host that homemade video of the cat playing piano, but you might just be able to get a full-length episode of your favorite TV show – in better quality, with a 30-second commercial spot at the start.
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