

How YouTube could make $1.2B a Year - Tippingpoint
http://blog.tippingpointlabs.com/2009/09/most-widely-ignored-monetization-concept-access-to-analytics/
If you’re building anything on which marketers will participate by creating, consuming, or sharing content, this article is for you. Its central message: you can easily and effectively monetize your platform by allowing marketers to pay for deep analysis of their audience and yours.
======
blasdel
_Let’s assume that YouTube has 100MM registered users. Let’s say that only 1%
of those users (1MM) would pay $10/month_

Why in the fuck do you think 1% of registered youtube users have even uploaded
a video, much less original content?

~~~
Tippingpoint
Good point. How many users have actually uploaded video?

------
patio11
I think this gentleman has a radically different understanding of the
proportion of businesses versus content leeches on Youtube than I do. Youtube
has something on the order of 500 content consumers per 1 content uploader,
and that probably overstates how many content creators are involved, because
most users are just reposting things that they have copied.

[http://www.reuters.com/article/internetNews/idUSN17436388200...](http://www.reuters.com/article/internetNews/idUSN1743638820070418?sp=true)

~~~
jeroen
Combining that number with the 1% estimate (10% seems very optimistic) leaves
only $ 20K per month or $240K per year. On googles scale that's probably not
worth the effort and risc.

------
hristov
This is a classic example of the phenomenon that people have trouble
understanding very large or very small numbers. Why would one percent of
registered youtube users pay $10 per month for analytics?

The average registered youtube user is a random person that just watches the
occasional video and had to get registered because on of the videos he wanted
to see was adults only. The average registered youtuber does not give a flying
f#$% about analytics of the random video he watches.

So would one percent pay for a monthly fee? Doubtful. I think the author
thought they would simply because one percent is a very small number.

But it might be a good idea nevertheless. It is good idea from the business
perspective as it is not likely to prevent people from using youtube in
general. A person will usually first upload a video and then worry about who
is watching it. So the fact that youtube charges for analytics is unlikely to
prevent anyone from uploading videos.

So good idea, but it is very unlikely to bring in the enormous amount of money
the author imagines.

~~~
Tippingpoint
I think you're right. It might not bring in 120B, but it's revenue. Recurring
revenue, that's more valuable and stable than ad revenue. Thanks.

------
DarrenMills
I think he is a little too ambitious in terms of who would be willing to pay
for data. For those people who admire their stats out of curiosity, I doubt
many would cough up money for it, especially for more than a month or two.
Only companies who use Youtube for marketing and distribution would actually
NEED their statistics, in any respect. Although I suppose, nevertheless, there
will be a small, small group of super-users who want their demographics for
whatever strange reason.

~~~
jporter
I agree also. Guy Kawasaki calls this the "Chinese Soda Myth" - If we can get
0.X% of the population to buy our soda then we'll make $XX million.

As a VC, he blames hearing this too often from startups as one of the reasons
he has developed tinnitus :)

~~~
Tippingpoint
I love this quote! I'm really just trying to make a point. Access to analytic
data is valuable.

------
qeorge
The author is missing some key knowledge about the industry. Selling analytics
data could be a good fit for Twitter, but not for YouTube. Here's why:

1) YouTube's value is their user generated content. If the content goes, the
site's value does too.

2) The highest-margin videos for YouTube are the most popular ones. These are
often professionally produced and have distribution companies behind them.
With UGC, the short tail subsidizes the long tail.

3) Professional video producers/distributors who consistently have popular
videos already have sophisticated analytics software, often in house. They get
their analytics data periodically and directly from Google, in a fairly raw
format. Its way too much data to practically transfer through an API or web
interface.

4) These users' financial incentive to produce the content is the revshare
agreement they have with Google on the ads which run alongside their content.
YouTube's volume currently makes them the best source of revenue for video
makers.

So when you talk about selling* analytics data to the users, you're talking
about selling a far inferior product for a paltry sum to a partner you already
do orders of magnitude more commerce with each month.

Sure, you can argue that there might be regular folks who would be willing to
pay for analytics data (that they're already getting free now), but I find
that a bit naive. Either way, you don't want to waste your time trying to sell
cheap software to small fish, and its definitely not worth $120B/yr.

*I'd be tempted to say extorting

~~~
Tippingpoint
Thanks for your insight. Here's the deal though -> 1) Agreed! 2) Agreed! 3)
Don't Agree. If there's value to the data there's a way to share it. Saying
that it's too much data is just an easy way to say no. 4) You're right. Google
Ads support YouTube. This won't last forever. Advertising online is falling
apart - slowly - but it's getting cheaper and cheaper and less and less
effective. So, looking at additional revenue streams seems like a good idea to
me.

------
naveensundar
Did anybody else read this as "How You could make $120B a Year". (I should
probably check my spam folder less frequently.)

~~~
Tippingpoint
That's really funny!

------
fizx
Title typo

~~~
tdonia
1.2 billion (100m / month)

------
friendstock
typo -- should be $1.2 B

