Monetizing YouTube (before the sharks move in)

October 10, 2006

Now the deals done and the speculation can begin (or already has)! It should be interesting in the coming days and weeks to see quite how Google intends to monetize and make use of it’s latest acquisition. While a lot of the talk is about the copyright problems that are to come you can bet that Google will forge ahead and do as much as they can to monetize YouTube and get it’s ideas bedded in asap. Any legal challenge could take a long time so they might as well make hay…

Monetizing YouTube shouldn’t be too tricky, I’m sure the first step will be to make sure that contextual ads from Google Adsense are displayed on every page. This is a no brainer and opens up a revenue stream really quickly.

Going forwards there are a number of ways Google can try to gain more revenue from YouTube:

  • closer integration with the Google family, always a good thing to cross sell your services (even though they are free), increased stickiness from visitors = increased revenue
  • closed group screenings, maybe some of the content deals signed by both parties this week will result in concerts and screenings being shown on YouTube. These could be charged for access
  • charge broadcasters to have their content on YouTube, unlikely but possible. YouTube has such a massive audience that they might try to charge publishers to have their content included (might help negate some of the copyright issues too)
  • introduce a subscription level for more in demand content (music videos, full movies, TV shows etc)
  • integrate video ads, perhaps an interstitial sequence before every video starts

The traffic and user base that YouTube has will of course guarantee that advertising revenues can be had. I believe Google will begin advertising on YouTube asap so they are making revenue before any lawyers come knocking. Any copyright case could take years so they might as well get on with the job of making use of their new toy…

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