What is in store for YouTube?

YouTube happens to be one of the most popular sites on the net, yet they haven't figured out how to make money and no one seems to be interested in purchasing them. With a burn rate of over $1 million per month and no real signs of revenue I can see why not that many parties would be interested. Throw in the potential copyright lawsuit nightmares and they have no chance. YouTube seems to be digging itself a grave, but do they have a way out?

One Lazy Sunday

Earlier this year, the NBC hit "Lazy Sunday" blew up on YouTube, the video received over 5 million views. NBC actually sent a cease and desist to YouTube over "Lazy Sunday" most likely because they didn't realize the power of viral marketing. Now NBC has a deal lined up with YouTube to populate the site with promotional clips and they are also running a contest on YouTube for "The Office." Despite it being a potential gold mine in the right hands, NBC (or any television network) probably is not best fitted to acquire YouTube.

A potential candidate

NewsCorp could potentially be a good fit for YouTube because of the synergy with MySpace. Those two companies under the same roof could pack a serious punch. NewsCorp is starting to figure out how to monetize MySpace and they could probably turn it around for YouTube. Even though NewsCorp owns FOX they could still allow other networks to advertise. Plus it would be a great platform to distribute FOX's content.

YouTube speaks for itself

Maybe YouTube is just better off being independent. At least that's what founder Chad Hurley recently hinted at when he said that they are not interested in being acquired. Of course, YouTube would sell if there was a decent offer on the table but how much would this offer have to be?

The big gamble

Acquiring YouTube would be a big gamble for anyone. There are a few potential fits but until YouTube shows that their popularity can be turned into a business I don't expect anything to happen. With 150+ video sharing sites, the space is crowded and the companies are going to start dropping like flies. Once that happens, I think we will start seeing some major moves. It's then that we'll have a better grasp on the true value of all these video sharing companies.

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Simon, August 3, 2006

what about google? i think they could aquire it and turn it around, and with their datacenters reduce the monthly costs of running such a thing.

former broadcast.com employee, August 3, 2006

anyone remeber audionet.com back in the late 90s? It later changed its name to broadcast.com and was then bought out by yahoo for $1billion or so making Mark Cuban filthy rich. Mark went on to buy the Mavericks (for fun) and do more great stuff where as broadcast.com flondered until it was no more even tho at one time it was one of the most popular sites on the net. My point is youTube could very easily become another broadcast.com.

Itai, August 3, 2006

No revenues because it's ad-free, 5 seconds ad at the beginning of every 10th video played will cover the $1 million expenses per month.

TV is on it's way to become broadcasted over the internet and YouTube is number one today in streaming videos over the net, that must get some media tycoons interested in them.

YouTube will be bought. Big time.

Word, August 3, 2006

Simon: It's called Google Video.

Cameron, August 3, 2006

Simon - Google already has Google Video but that doesn't necessarily mean that wouldn't ever purchase YouTube... I'm not sure that I could see Google making that big of a purchase though.

Itai - I think I heard somewhere that YouTube won't put ads in the videos. They could certainly put them at the end though where they have the other recommended videos.

Steven, August 3, 2006

YouTube should team up with a production company and create television shows of their own. Be one of the first to make internet-television shows over the net. In 10 years, tv will be over the internet anyways, be the first one to do so.

toSteven, August 3, 2006

To steven. Check out maniatv.com they're branching out and doing that stuff.

Anon, August 3, 2006

This is why ads are not show / shown the way that they are...

"...intellectual-property attorneys also see areas where YouTube risks butting into the DMCA. For example, the law specifically prohibits a Web site from profiting from copyright material. Recently, ads have begun appearing on YouTube alongside individual video clips.

"They hadn't done this before," said John Stickevers, an intellectual-property attorney at the law firm Bromberg & Sunstein in Boston. "The law states that you can't receive profits directly attributable to the infringing content. I think this would make it much harder for them to make an assertion that they weren't profiting."

Levine discounts this concern because "to date, YouTube has never sold an ad against an individual video." "

Source: http://news.com.com/YouTube+dances+the+copyright+tango/2100-1025_3-6097365.html

Ryan, August 25, 2006

Sounds a lot like the Google story to me. Very popular site, but no real revenue streams...and then Google saw what www.goto.com was doing copied it and AdWords was created. They don't necessarily need someone to acquire them, though it would be the quickest way for Hurley to make big bucks.