Back in October of 2006, Google Inc. (GOOG) paid $1.65 billion in stock for YouTube.com, a video sharing web site. However, if you look at YouTube's home page, you only see one add on the upper right. If you go to an individual video page, for example, the Evolution of Dance, the most viewed all time video, you won't see any ads [other than an internal ad referencing YouTube Groups]. If you go to Google Video, which I'm sure will be merged with YouTube, you won't see any ads on either the home page or the individual video pages [check out Spray Paint Art if you haven't already seen it; it's pretty amazing].
If Google started running their Google AdSense ads on these sites, the revenues could be enormous. For example, Evolution of Dance has had about 41,800,000 views, just fromm this one video alone. The YouTube.com site has had about 30,000,000 viewers visiting the site in January, 2007 according to ComScore Media matrix.
Author owns GOOG.
The creators of YouTube.com are not financially monetization-savvy. They had a great idea. All they needed to do was provide a framework around the Flash Media server, and they were set. It's a basic video website that rides off the death of Big Media, and shows speculators the success of new business models. I would suspect, however, that Google would rather not advertise with AdSense on their own sites, because then they could be held liable for the extensive click fraud their AdSense model is notable for being subject to. As of right now, they have no real good idea of where all the clicks are coming from, and no good way of determining it. If, however, all these clicks were done on their territory, they'd be held liable for, say, a single IP address responsible for generating thousands of ad clicks per day on these humongous sites.
ReplyDelete