14 DAY TRIAL // Google's effort to turn YouTube into a money-making machine may finally be starting to come to fruition. While the company isn't releasing any official numbers, the latest reports from analysts paint a very optimistic picture for the video site in terms of revenue. A Citigroup analyst estimates that YouTube will bring in $945 million in revenue this year and $1.1 billion in 2011. The report doesn't cover the expenses part, but, based on previous estimates, it may be possible that the site will be profitable this year.
It's hard to say how accurate these numbers are, though the estimates behind them aren’t particularly complicated. The analyst uses MySpace's revenue per page view and applies it to YouTube. Then, based on YouTube's viewership numbers, coming from comScore, and the increasing number of videos monetized, he draws his conclusions, which are a big step forward from previous predictions.
Of course, assuming that YouTube gets the same money as MySpace for ads is a bit of a rough estimate and comScore's reported web-traffic numbers have come under some criticism lately. The report goes into further details by indicating that the number of videos monetized by YouTube is increasing, something YouTube itself has been saying for a while now.
The analysis measured the number of times a top 100 video on YouTube was monetized and came up with the 54-percent figure. This is well ahead of the 33 percent of videos with ads in June 2008. The number of ads per video is also increasing, with 14 of them showing one ad, while the other 40 displaying two ads.
There has been a lot of speculation over when or whether YouTube will start making a profit for Google, which paid $1.65 billion for the video site in 2006. In recent months, the company has been growing optimistic, indicating that it will likely turn a profit this year.