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OT: 1 Billion Viewers, No Profits

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Andrew Kimery
OT: 1 Billion Viewers, No Profits
on Mar 17, 2015 at 8:38:43 am
Last Edited By Andrew Kimery on Mar 17, 2015 at 8:41:24 am

Recently the Wall Street Journal ran an article called about YT's struggles to monetize its content. Basically, YT has massive amounts overhead and can't facilitate a more advertiser friendly experience.

YouTube: 1 Billion Viewers, No Profit
"The results reflect YouTube’s struggles to expand its core audience beyond teens and tweens. Many YouTube users treat the site as a video repository to be accessed from links or embedded video players posted elsewhere, rather than visiting daily. Google executives want them to turn on YouTube the way they turn on television, as a habit, where they can expect to find different “channels” of entertainment."

The mention of channels is interesting for a few reasons. First off, the idea of channels used to be antithesis to YT's strategy. Second a few years ago YT spend a couple hundred million dollars to make 'premium channels' but I'm pretty sure that experiment fell flat. Finally, some of YT's most recognizable MCNs (multi-channel networks) are struggling so bad that they are branching out away from YT.

Disney Buys Maker Studios In Deal Worth At Least $500 Million
"But while YouTube MCNs have been able to amass large audiences, they have had a difficult time turning a profit on original content distributed on the Google-owned video service. Increasingly, multichannel networks like Maker Studios, Machinima and Fullscreen are looking to migrate their audiences to other platforms, including their own websites, to be able to better monetize that content."

Long story short? Getting someone to watch your video and getting someone to pay for your video are two very, very different things.

Side bar about channels.

Sure, on one hand channels may be limiting, but on the other hand the content curation done by a channel typically gives the viewer (and the advertiser) a reasonable expectation of what to expect both in terms of content and quality (yes, quality is totally subjective). I like streaming and binging as much as the next guy, but once you start drowning in options having someone else cull the herd for you can be nice.

After about 5 years as a cord cutter I signed up for cable again and I didn't realize how much I missed some aspects of channel surfing and having limited options. For example, the GF and I like the TV show Supernatural and it didn't take us long to figure out that during the day SyFy has a block of 3 or 4 episodes of the show. At the appropriate time we will tune in and watch whichever episodes are showing. Contrast that with when we would watch the show on Netflix and we could spend 30 minutes just picking which episode to watch. "Oh, I just saw that one." "No, I'm not in the mood for that one." "How about one where they fight demons?" The limitless choice can lead to paralysis by analysis and sometimes I just close my eyes and pick one at random.

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Scott Witthaus
Re: OT: 1 Billion Viewers, No Profits
on Mar 17, 2015 at 12:48:18 pm

And then there's this:

I just cut the cord, after battling Metrocast for 19 months to extend it's lines down to the end of our neighborhood. I realized that cable is mostly a vast wasteland of infomercials and really bad reality TV (is there good Reality TV?). So I killed the TV account and upped the internet speed to the highest available. While I certainly understand the "limited choices" you speak of, except for NFL and NHL games, I miss very little of having cable. Maybe the future will be these a la carte services of live TV...

Scott Witthaus
Senior Editor/Post Production Supervisor
1708 Inc./Editorial
Professor, VCU Brandcenter

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Andrew Kimery
Re: OT: 1 Billion Viewers, No Profits
on Mar 17, 2015 at 9:47:30 pm

[Scott Witthaus] "And then there's this:"

There is also Sling TV ( ) which looks similar though the details on this Apple rumor are still scant. It doesn't look like true a la carte is in the cards and with many people having the cable company as their ISP I wonder if we'll see even more bundling discounts coming from the cable companies. Sure, Apple might offer a TV package for $40/mo but the cable company might just jack up the rates for people that just pay for Internet. Ultimately though, competition usually works out best for the consumer.

More popular shows like Walking Dead, Justified and Sons of Anarchy I was able to buy on Amazon Streaming (just had to wait until the day after air to watch them) but it's been smaller cable channels like the Science Channel and the Smithsonian Channel that I spend a lot of time watching (the GF loves the horror-centric ChillerTV channel) and these 'little guys' aren't going to be part of the slim bundles like Sling TV.

I hadn't missed cable at all for the 5 years I was a cord cutter, but now that I have it again I'm digging it. When my signup special ends in 2yrs I'll probably cancel it though if they don't keep the discounts flowing. ;)

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tony west
Re: OT: 1 Billion Viewers, No Profits
on Mar 18, 2015 at 12:01:04 am

[Andrew Kimery] "Justified"

i have recent gotten into this. Really good : )

I don't mind paying for the seasons because it's worth it. Also True Detectives.

The thing about YT is, it started off free and people expect it to stay that way.

The up side for us as professionals is that things that people are willing to pay for like Game of Thrones are super high end professionally done. That will keep us working and getting paid for a little while longer : )

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Jeremy Garchow
Re: OT: 1 Billion Viewers, No Profits
on Mar 17, 2015 at 10:49:14 pm
Last Edited By Jeremy Garchow on Mar 18, 2015 at 2:02:03 am

This is a great topic, Andrew. The WSJ is behind a paywall (for which I do not have access to jump over), so apparently it's one thing to link to the article, it's another thing to get people to pay for the article :-)

What is missing from user content media outlets, or streaming outlets, or YouTube is The Selector. With the TV channels, radio stations, DJs (disk jockeys on radios, not night clubs), video stores, record stores, or listening parties, the role of The Selector was the difference between "good" and "bad", or sometimes between knowing and not knowing, and sometimes The Selectors were a real time gauge of what people like or dislike. Every Selector brought their aggregated communications and experiences to a central location in order to share what they've learned with others. The idea of YouTube as provider, even with the channel layout, is a mess. It's too much content, and frankly Google sucks at user interface, at least for the most part. They did a pretty good job with the YouTube Kids app, I'll give them that.

YouTube, as well as device manufacturers on the whole, posits YOU as the selector. It is your life, your cats, your protests, your loves, your humor, your war, and your television. There's only so much of that can be watched, and none of it is worth any amount of significant money. Some of it is, but most of it isn't. If YouTube wants to start culling content, they should charge people to upload video. Isn't YouTube receiving something like 100 hours of footage time per minute of real time? It would be a daunting task to try and monetize all of that.

One of my favorite YouTube channels is the Vice network and some of the Vice satellites, especially Noisey. I enjoy the content, but the viewing format is horrendous.

I think that Netflix should run programs and movies and do some selecting, so while you spend that 30 minutes looking for something, you can have a program or movie running in a window. Perhaps the Netflix payout structure doesn't fit that model, I don't know.

I don't miss cable at all, not one bit, but I do miss checking in on movie channels, watching 15 - 20 minutes of a movie, and then going about my day. After you've done that a number of times, you feel like you've seen the movie many times. Similar to you. it is the only thing I miss about cable, and I feel like streaming services could, perhaps, offer this capability. Vice and Noisey autoplay a video when you visit their channel, but the video that is playing is not the center piece of the channel. Cramming as much shite as possible in the landing page is what the channel seems to be built for, and that interface seems to be designed by Youtube. Now, the Vice website is better, as the content is revolving just like many media websites, and it also looks better and is more engaging because it's an actual website, but eventually if you want to watch a decent amount of Vice content, you end up back on Youtube to check out all that Vice has to offer.

The Netflix way of organization is also going the way of the YouTube. The interface isn't all that great, and I am sure it's an uphill battle to fight new and old content, and premium positioning vs coach positioning as well as trying to design interfaces across so many devices that have different size screens, and keep it all relevant to each user and what they like to watch.

This message has been editing for clarity.

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Aindreas Gallagher
Re: OT: 1 Billion Viewers, No Profits
on Mar 18, 2015 at 12:21:15 am

you were talking at a pace there - I have a youtube channel selection. I sort of tip toed into it.

It's my nerd channel selection but it's starting to develop value? it's lightroom, watches, DP 30 film interviews that aren't replicated elsewhere, the verge, it feels initial but I'm more interested in youtube than I was. the identity of the DJ is some issue.

It's interesting to me how much my own music curation tailed off after its first digital splurge in the ipod. that became an eaten meal. my own habits with music are really slipshod these days. But I'm still tied into trailing video fiction because of how strongly it currently hits culture. music is fighting a lot harder than true detective.

you'd wonder if magic leap and occulus are going to eat that narrative too. youtube is still a form of celluloid. there's no way youtube just doesn't look stupid on some level. If magic leap is true, and they can actually blend the light rays into your eye, then the means of transmission, curation and narrative form are humpty dumpty. and then youtube is just an interregnum that happened waaay back then. promo producer/editor.grading/motion graphics

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