YouTube to Maximize Its Profit

Popular video-sharing website YouTube recently announced its plan to have a joint venture with media giants in an effort to generate more advertising revenue amid concern that the Internet market is experiencing record-low revenue due to global economic crisis.

Meanwhile, experts said that YouTube should boost its advertising to maintain its economic viability.

Popular video-sharing website YouTube recently announced its plan to have a joint venture with media giants in an effort to generate more advertising revenue amid concern that the Internet market is experiencing record-low revenue due to global economic crisis.


Earlier, YouTube signed a partnership deal with media and entertainment giants including Lions Gate Entertainment, Sony Pictures, Starz, MGM, and CBS. With this business move, the popular site expects that online advertising revenue will jump while attracting more people from visiting the online property.


According to earlier report, Google which owns YouTube, is trying to generate more profits to compensate the operation expenses including bandwidth and storage service and royalty fees given to record producers.


Analysts estimated that Google spends more than $711 million annually to keep YouTube’s operation compared to its $240 million revenue every year.


Meanwhile, YouTube official did not provide comments regarding these estimated figures but said this is an exaggeration.


Because its rival Hulu is fast growing, experts said that YouTube should boost its advertising to maintain its economic viability.


In a recent survey, Hulu, which is owned by NBC Universal and News Corp., became the second most popular video-sharing website on the Internet, an impressive feat for a startup company.
 

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