Despite its ever-growing popularity, YouTube’s situation is as fragile as ever: the website brought Google a lot of bills and less revenue. Will Google eventually cut its losses by closing YouTube?
The math is currently working against the video-sharing site: this year’s operating costs will go as high as $711 million. In the mean time, the projected revenue from advertising will go as high as $240 million. That’s a hefty $471 million that Google will have to pay out of its own corporate pocket.
Furthermore, Google, as all companies, has been significantly hit by the recession wave in the advertising department, with companies acting more careful when it comes to spending money on web commercials.
Last but not least, YouTube is losing its audience to other such website. The first example that comes to mind is Hulu, which is currently offering content from FOX and NBC. In ther mean time, professionally-developed content brought YouTube just a couple of lawsuits.
It appears that Google’s marketing team has failed so far in finding the right way to sell YouTube’s huge audience to advertisers. It may indeed be hard to offer a mixture of nice clips and downright dumb videos, but, all in all, YouTube is a brand that should be albel to attract far more revenue than it currently does.
Then again, angry shareholders might see it otherwise and unless something is donw soon enough, YouTube might see itself falling out of Google’s top priorities list.
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