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Think Big. Move Fast.

Today in an article about Tim Armstrong’s departure from Google, the WSJ offhandedly says:

But advertisers mostly haven’t committed a large amount of ad dollars to these emerging areas. YouTube, for example, will account for only roughly 3% of Google’s net revenue this year, or $500 million, estimated Youssef Squali, an analyst at Jefferies & Co.

That Youtube revenue estimate is far higher than other estimates I’ve seen. In November, Screen Digest provocatively claimed that Hulu would catch Youtube in revenues in 2009, but at the much lower level of $180m. Said the FT:

Neither company breaks out its advertising revenues but Arash Amel, analyst at Screen Digest, forecasts that in 2008 YouTube will generate about $100m in the US, compared with about $70m at Hulu. Next year both sites will generate about $180m in the US, he says. YouTube currently earns around half of its revenues in the US, while Hulu has not yet launched internationally.

I suspect the $500m estimate of Youtube’s 2009 revenue is way too high, especially in light of the current advertising recession. What do readers think?

  • http://www.adisn.com Michael St. Hilaire

    Sounds like he was working backwards off that 3% number and got to 500M.

    500M in revenue would be 41M a month, i assume they mean worldwide.

    Lets say they average 50 cent CPM per pageview including in-video plus display ads, that means they would need 80 billion page views a month.

    Last i heard they were around 20B? It’s really hard to find concrete page view numbers though.

  • http://www.chickababes.com/ ChickaBabes

    Maybe it’s because people go to YouTube to watch something they want or something that could entertain them. Users are now becoming intelligent, they’ve learned how to avoid those advertisements, whether it be on a webpage or a video page on YouTube.