Is it rumor or fact — user generated videos will have to make a big switch if they want to turn a profit. FACT! It appears the everybody is surfing and no one is paying the cost. Google earns $250 million in ad revenue from running ads on Youtube. Great, right? NO — Google’s expenses for running Youtube is a whooping $700 million which $360 million is just for bandwidth. That a $450 – $470 million dollar lose.

The Problem — Youtube is great for users who want to generate they own videos, however big ticket ad publishers don’t want their ads on (something) poor quality videos. Therefore $250 million in ad revenue is quite small in the big picture.

For more information on Youtube go to National Post

The Big Switch — One huge switch as been announced already. Google with no-longer have an Adsense Video unit. So, what’s next? Although roomers are floating around, the fact is — THERE WILL BE A BIG SWITCH. Why? Let’s recap — Google has now retired it’s only stream of revenue from Youtube. That means instead of losing $450 million their on the hook for their entire expense budget. It doesn’t take a rocket scientist to know that Youtube will change and probably not to the benefit of the user generated club.

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