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by chii 2440 days ago
google derives much more value from youtube's viewership data than the profit in ads it makes imho.

Youtube's profit model is only profitable at google scale - imagine the capital expenditure to build out such a large video platform (not very many other tech giants have been able to build video, and have it be free).
2 comments
sharkjacobs 2440 days ago
I always understood that the viewership data was valuable because it enabled Google to earn more money selling ads.

What is the value of viewership data apart from advertising?

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PeterisP 2440 days ago
I read the parent post as asserting that the value of ads placed on youtube is not as large as the incremental value to non-youtube ads (which is a much, much bigger market) from better targeting enabled by youtube data.

I don't know if that's true - youtube ad revenue seems to be ~10% of total google ad revenue; so for that to be true youtube data would have to provide 10% revenue boost to existing ads over all the other (many!) data sources that google has, and I'm not certain if it's realistic.

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chii 2440 days ago
if it wasn't google who bought youtube, the viewership data would only have been useful for the ads on youtube. But because it's google, they can leverage this data on the entire google platform, and thus derive more value from it. This means they can afford to make less money on youtube and still have it be valuable. That is why google bought it and not microsoft (or another non-advertising company).
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Retric 2440 days ago
Estimates for YouTube are on the order if $15-25 billion in annual revenue and a ~50% profit margin. With very solid revenue growth. The data is clearly worth real money, but I doubt the data alone is worth 5+ Billion on it’s own.

PS: People are watching on the order of 1 Billion hours per day of video so IMO those revenue numbers may be low as that’s 1$ of revenue per ~15 hours of video watched.

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chii 2439 days ago
youtube's revenue remains undisclosed in google's financial statements (see https://www.nytimes.com/2019/07/24/technology/youtube-financ...). The $15-25 billion is merely a guess.

The fact that google chose not to reveal youtube's financials is stark evidence that it's financials aren't great (otherwise, disclosing it should lead to better stock prices for google!).

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Retric 2439 days ago
Google does include YouTube’s financials, they just bundle them with other things. Having a separate line for YouTube has zero impact on the company’s overall financial situation and thus likely has ~zero impact on it’s stock price.

I suspect if anything they don’t want to break out the financials because it would invite more competition. That or YouTube is tied so closely to the rest of the company it’s hard to separate the numbers.

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