Is YouTube’s End Coming Soon?

In early April, a provoctive article published on Silicon Alley Insider suggested that due to mounting losses, YouTube could go the way of Pets.com and Geocities (i.e. into Never Never Land).

                    

It seems this article was dismissed or ignored, likely because it stemmed from the comments of a CEO from a rival video start-up, Fliqz.  Another reason may be that it touched on something that may seem unfathomable not only to consumers but also to probably far too many in the industry.

Could YouTube, a huge success in terms of its utility and popularity, actually die before it finds a viable business model?

It seems to me that there is always a subtext to discussions resulting from questions like this.  It seems people assume that something so widely embraced by consumers would never go away and that things/businesses only fail because they are NOT embraced by consumers.  Perhaps people expect that before going away, a company would at least TRY to get us to pay a subscription fee.  The only problem is, I have never heard anyone say they think YouTube could be successful in charging an access fee, not even Google.

What is perhaps most shocking to me about the original article, as mentioned in the follow-up article posted in Ad Age this week, is that the mere suggestion that Google might pull the plug on YouTube went completely unaddressed by Google!  Nobody at Google has come out to say that’s a ridiculous thought or that Google is committed to keeping it going?  That might be a huge red flag.

Despite all the advertising experimentation with YouTube, Google has failed to find a viable business model and continues to bleed hundreds of millions of dollars to keep it running.  YouTube lost nearly half a BILLION dollars in 2009 according to Credit Suisse estimates.  Half a BILLION!!!  Google’s got cash, but NOBODY has half a billion dollars to throw away.  I haven’t seen Google shareholders rioting, but it wouldn’t surprise me at this point.  I wonder if Twitter scheduled maintenace would be postponed if Google shareholders revolted?

Believe me, from a consumer standpoint, I don’t want to see YouTube go dark, but from an industry standpoint it might just be a healthy reminder to us all.

Just because something is useful to the online consumer doesn’t mean it’s worth building.

I sometimes come across an attitude that if a company creates something valuable or useful to consumers online, that the company will magically be rewarded with a positive return on their investment.  I think we all know that’s not true.

If you don’t have a plan for how a positive return will be created, chances are you’ll never see a positive return. 

Twitter may want to give this some thought.  Like YouTube, they have a lot of users and they lack a viable business model, only Twitter doesn’t have half a billion dollars to give away!  It’s been 3 years now, it’s time someone had a good answer to these questions: What’s the point of Twitter?  How do they make money???

You won’t fly away, will you little bird?!?!?

 

Links to related articles:

Silicon Alley Insider:  YouTube Is Doomed

Ad Age: The ‘YouTube Is Doomed’ Guy Has More to Say

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~ by bbroveleit on June 16, 2009.