> Hard to understand why no company has directly taken on YouTube
Up until recent history, it was a money losing business. I’m sure that’s turned around now but mainly through heavily injecting ads. It would be difficult to disrupt them because of the network effects of all the content, viewers, and creators. And it would be hard to compete on price (whether subscription cost or amount of ads) without having the kind of infrastructure Google has.
It might be done in the future, but it will be anything but easy.
> How could a viable competitor to YouTube even begin to pull away YouTube’s inertia without massive vc funding?
I think it depends on what people are trying to do with youtube.
I doubt any one new service could replace all of it. Plenty of people want to share videos but aren't looking to get rich from it though. For them, I think a competitor that does video delivery well, but doesn't pay for views could exist.
People who want to make videos for money would have a harder time replacing google, but lots of creators get direct support already so it isn't hopeless. A lot of people are already on multiple platforms now too so it doesn't have to be a hard cut off.
>YouTube is a huge technical achievement that would require billions of dollars to replicate.
YouTube achieved this in 15 years time with the help of Google's enormous resources. YouTube competitor would need to have some innovation that is hard for YouTube to replicate.
>IMO YouTube on its way to be the MySpace of video.
Highly doubt it. Youtube is one of the hardest thing to compete with, even Google search is much easier to go after. Did you read that article about Youtube where Google pays local ISPs to act as a CDN? That is the best CDN money can buy. A competitor without matching performance is going to be largely ignore by both consumers and publishers.
>That said, I wish that YouTube had multiple competitors of similar size, both commercial and decentralized. It makes me nervous that access to so much great content is ultimately controlled by Google.
If you worked in the SEO world after Google acquired YT it was a common hack to use YT videos to rank for hard keywords because it was proven Google gave YT favorable positions, even compared to other video sites. There were dedicated tools for quickly creating spam videos on topics and then linking people to your website.
YT wasn't completely dominant until they were acquired by Google and had their growth boosted via monopoly tactics using Google Search
> If Youtubes ad revenue were negligible to the value proposition of the platform they would not be profitable and they would not give away the service.
Well, it is neglibie. Youtube has never been reported to be a profitable business. The last time its finances were reported a few years back it was basically ‘break even’.
Would that decentralised idea work? Seems pretty cool.
Individual content creators get access to the entire world without worrying about any technical issues, and getting access to advertisers (however small it may be).
>the evidence of YouTube losing significant amounts of money.
I don't know the specifics, but I do know that hosting video is in the wheelhouse of many well endowed companies like Apple, Facebook, Microsoft, Amazon, etc. They all (presumably) have the capability to build a Youtube competitor over the last 15 years, but the fact that they have not indicates that it is not worth it.
Which leads me to think that this business model of Youtube's where anyone can upload anything they want at any time regardless of how garbage it is and it has to be able to be served to the whole world relatively immediately, is only viable with an enormous ad company (Google) backing it.
But as a stand alone service, it would never be a viable business. The proof is that a non Youtube has never existed before and it still doesn't exist. Nobody is stopping someone from putting up data centers everywhere and offering this service that Youtube does, and not even the companies that can afford it are bothering to touch it.
The Microsoft internet browser situation is not comparable, in my opinion.
> This might not be a popular opinion, but I feel like YouTube is doing their best with a really hard problem.
Of their own making. It's solvable. You throw humans at it.
If Google can't deal with this then they shouldn't be allowed to collect money by running ads. Problem solved.
And other sites will spring up that might actually be willing to deal with the problem correctly because now YouTube isn't a monopoly anymore.
Google (and others) are going to continue to be shit until we hit them with anti-trust actions and big fines. Until then, this is all just a cost of doing business and they will laugh all the way to the bank.
> when the reality is it's been making losses since its inception
They make billions in revenue off of youtube. Where did you see that they're losing money on it? I suspect that even if youtube was not profitable on its own it'd still be valuable enough for google to continue running it and that they can more than afford to keep the light on.
> if there's a possibility that this will shake Youtube from it's dominance.
Yes, I'm sure everyone is fighting for an audience who refuse to pay and block all ads. And of course the audience who do sit through ads or pay are therefore not going to switch and stick with YouTube.
So unless you want to burn money, I really don't see a viable business model there. Unless you think you can take the initial hit to grow a big enough audience and then force ads and paid subscriptions on everyone to make that money back.
>Does YT have a quantifiable monopoly it abuses in an economic sense?
I really don't see how YouTube could be seen as anything but anticompetitive in many of its practices. Primarily, the fact that they have used and continue to use revenue driven by search from Google to maintain the tremendous infrastructure necessary to run YouTube. This means that anyone who wishes to compete with YouTube needs to be able to find investors (or pay themselves, but the number of people or organizations that could do that can be counted on one hand) willing to foot the bill to build billion-dollar infrastructure and then expect to run it at a profound loss, burning hundreds of millions of dollars a year for potentially a decade or more. Google is probably making some money on YouTube now, but they ran it at a mountainous loss for years and years for no reason other than suppressing the possibility of competition being developed. There also other smaller things, like the US government deciding to host all of their video content on YouTube without even considering following the legally-required bidding process - because there was no realistic competitor. That's pretty telling.
I am honestly surprised how Google was able to keep up YouTube for so long despite a severe lack of profits. Even though Youtube made a net loss in the hundreds of millions for years Google kept it up and running and drastically expanded its feature set into areas like live streaming etc.
As far as I know YouTube has now reached break even, but I believe Google deserves credit for having the vision and tolerance for failure to keep YouTube up for such a long time without a dollar of profit, not to speak of the enormous political and financial risk YouTube poses because of copyrighted or harmful material.
> The problem really is that there's not enough revenue generated, to pay people producing the content.
> Even youtube is run at a loss (only offset by the valuable data they collect for google i suppose).
YouTube generates $15B in revenue. [1] I'm sure in the early years when they first acquired YouTube, they ran it at a loss. However, as far as I am aware, Google has never stated whether or not YouTube is profitable. Given the amount of revenue YouTube generates in the present day, I would say it's unlikely they are running YouTube at a loss.
> My big fear is that someday, Youtube will no longer be profitable
Why do you think it's profitable? It makes for a decent chunk of Alphabet's income, but they don't break down costs so we have no way of knowing exactly how much it costs to store and seemlessly deliver zettabytes of video.
>huge upsides to individual content creators who almost always cause YouTube to lose money.
Not seeing the upside nor the evidence of YouTube losing significant amounts of money.
>And I’m not sure what any alternative is
Applying antitrust laws.
We can thank the explosion of Internet startups and innovation to their judicious application to Microsoft in the late 90s (it tied their hands significantly).
> I wonder if there's a possibility that this will shake Youtube from it's dominance.
Sadly, very unlikely. I recommend AdBlockers and YouTube app alternatives without ads to basically everyone and the vast majority of people would rather watch ads than deal with installing something even if it'll take a few seconds.
There's enough of us (adblock users) for Google to want to take profit from but not enough to make a dent in YouTube's monopoly even if we all moved to something else.
It is a disservice to users of the service to whittle down this issue to 2 simple points. Under Google's lead, YouTube has been offering a service - as we've been accustomed to accessing it - since 2006. That's ~17 years.
Suddenly, they want to change the very nature of their business model. It is no longer the YouTube we've been accustomed to accessing for those ~17 years. A no log-in required service, ad-blockers, plenty of browser extensions, etc..
Let's keep in mind that YouTube made ~$29.2 billion in revenue in 2022 [0, 1]. They reported 2.7 billion active users in 2023 - this makes them second only to Facebook.
Its YouTube Premium Service has 80 million subscribers (as of September 11, 2022). Netflix, in comparison, has 247 million subscribers worldwide (3rd qrt, 2023) [2]. Disney+ has 146 million worldwide subscribers (3rd qtr, 2023) but they've been bleeding subscribers [3]. These are actual Premium Video Services.
YouTube is trying to be both an annoying (ad-ridden) general video site and a very expensive premium site. I call this arrogance.
Basically... YouTube is doing very well financially right now ($29 billion). They want to make even more money because $282.8 billion (2022) in revenue for Alphabet is not enough [4]. We can all see the greed.
The problem... Google wants to do this by changing the core of their business as far as access is concerned. It is this change to their core business model that we are up in arms about. It will no longer be the same site.
Up until recent history, it was a money losing business. I’m sure that’s turned around now but mainly through heavily injecting ads. It would be difficult to disrupt them because of the network effects of all the content, viewers, and creators. And it would be hard to compete on price (whether subscription cost or amount of ads) without having the kind of infrastructure Google has.
It might be done in the future, but it will be anything but easy.
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