Thursday, July 15, 2010

YouTube expected profit model

Sept. 8 news YouTube, despite the establishment of only 19 months, but has become the darling of the Internet video site. The video has reached 100 million, YouTube's success attracted other new startups and giant jealous, Microsoft entered the video sharing market, launched its own service; this summer, SKYPE and KAZAA also introduced a Venice project to become a YouTube killer.

In this hectic situation, people seem to forget that so far the video sharing is still a high investment, low profit, non-profit business. YouTube plans to launch a new business model, each user can put their own video content. It should create their own advertising, and plans to spread through the Googel and Yahoo.

YouTube monthly inputs from 900,000 to 1,500,000 U.S. dollars, most of the inputs to the server provider and broadband provider in the hands. As the YouTube video piracy issues are being addressed, if faced with legal proceedings, the cost will be higher.

More importantly, it faces a difficult problem, how to achieve profitability? YouTube can make money from this growth, while maintaining the user can expand. If the introduction of advertising, the user can be alienating. Given this risk, YouTube founders Chad Hurley and Steve Chen of the advertising business is not eager to implement. In a two or three minutes of video in the tentative 30-second commercials running. YouTube in the development of a new model that allows advertisers to establish a video channel, or to place the home page of YouTube video content.

To open up new channels for advertising, logically possible, but in this competitive environment, how to seek avenues of cooperation? YouTube, Warner Brothers introduced the first branded channels, and promotion of new Paris Hilton CD. But for those who are not content businesses, another method is to build a theme-based management of channels. Or YouTube through technical means and in accordance with the user's browsing interest ads.

Another problem is that, YouTube does not help advertisers achieve the best video content. Gartner analyst Allen Weiner said institutions, YouTube could create separate channels to provide more professional video content.

So far, YouTube executives have been no positive stand on the advertising business. Company wants users to pirated content can automatically filter, for advertisers to establish a creative Fang Shi for community also faces great challenges, such as the film festival or to fund video competitions.

YouTube, a good beginning, but a new generation of mainstream sites and new start-ups than before, its impossible to have too much time to get into video services, real money.

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