YouTube Woes?

I saw this on MarketingVOX and wanted to pass it along. I've been following YouTube's plight - from the early days when it was cool but known mainly by industry people, until it finally reached the tipping point with consumers - right on to the recent purchase of YouTube by Google for an insane $1.65 BILLION dollars.

The criticism of that purchase has always been simple: Why did Google purchase a company that at this point has very little revenue generation? Sure, loads of people visit YouTube every day, and there are a bazillion links to the site - but how can Google generate revenue to offset the astronomical cost of purchasing the business?

Well, they recently announced that their business model includes a profit sharing aspect. That is, they will likely sell 3 second ads that run before every video. Advertisers will pay for this opportunity, and YouTube will split the profit with the person who uploads the video. It's an interesting idea and I don't think it has been tried before, but it certainly has its drawbacks...

Here's the MarketingVOX article. Good stuff. Later!

-Garret

Harris Poll: Pre-Roll Ads Perturb YouTube Users

YouTube is thinking about adding pre-roll ads to existing video clips, and the site's users say they'll think about spending less time there if the site does ad them, according to a Harris poll released Monday.

Harris's research revealed that nearly 75 percent of YouTube's frequent users say they would likely visit the video-sharing site less if pre-roll ads were inserted into video clips; and among those respondents, 42 percent said they would visit a little less often, and 31 percent said they would greatly reduce their visits, MediaPost reports.

YouTube has not said exactly what type of ads it would add to its video clips, but YouTube cofounder Chad Hurley told the BBC that the site is considering adding 3-second ads before the video clips are played.

The Harris Poll also had good news for YouTube: Almost 33 percent of the site's frequent visitors claim that they watch less TV now because of the time they spend on YouTube; 42 percent of online users say they have visited YouTube, and 14 percent say they are regular visitors to the site; 76 percent of males 18-24 say they have watched a video on YouTube, and 41 percent classify themselves as frequent visitors.