Eddielogic

– Thoughts on Strategy and Management

Youtubes Revenues

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Olivers last post here cites users who are annoyed that Youtube makes money with the videos thy uploaded there.
Well, for the moment let’s not talk about selling those videos. I would not like that either. But isn’t it a bit weird to complain about Youtubes advertising revenues? Let’s go back from where Youtube started not so long ago. This site provided a free (and user-friendly) platform where everybody could publish and share his videos. That was a real value for the users: You had made a video but you didn’t have own webspace to publish it. And even if you had – who would find your video there. Youtube was the solution to your problem. A place from which you could reach an audience as large as possible and at no charge!
I guess in those early times users didn’t mind some ads around their videos. A platform like this surely is expensive and if the ads helped to cover those costs. That was probably seen as the better solution compared to taking fees from users. If anybody wasted a thought on Youtubes costs at all.

Seen from this point, I can’t understand why Youtubes advertising revenues should be a problem now. It is their business model to make money from the ad clicks of users that find masses of videos for free there and from users that find a free place to publish their videos there. They have costs and they have to cover them somehow. As far as I know, Youtube has never tried to hide this business model.
Somebody who publishes his video there has probably had a look at the site before. So he must be well aware that Youtube places ads beside and around the videos. Chances are good that the same thing will happen to this persons video. So he knows what he is up to and he is free to take his video elsewhere.
In the end of the day, a fact that was widely accepted earlier on has suddenly changed into a fact that is much harder to accept. My personal feeling is that the Internet- and Web 2.0-community is still so exited about the idea of “everything is free” that they tend to forget that everything on the web causes some costs. Even this blog does. Somebody has to pay these costs. Often this is an enthusiastic private website owner, or a large corporation that sees the web as a marketing medium or a sponsor or – users who click on ads.

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