The Wall Street Journal is reporting that YouTube has not turned a profit for Google. Even with attracting more than one billion users each month, it hasn’t become a profitable business.
According to WSJ sources, YouTube posted revenue of about $4 billion in 2014, up from $3 billion a year earlier, and while YouTube accounted for about 6% of Google’s overall sales last year, it didn’t contribute to earnings. Why? AFter paying for the infrastructure that makes it go, as well as its growing multitude of content partners, the result is at the break even mark.
By comparison, Facebook generated more than $12 billion in revenue, and nearly $3 billion in profit, from its 1.3 billion users last year. And its way more annoying.
WSJ also reports that the site’s reach isn’t as wide as previously believed, with one source’s estimate that 12 year old Minecraft players 9% of viewers are responsible for 85% of online-video views. That makes it a much less appealing audience for advertisers than traditional TV programming, despite the outfit’s increasing investment in original content.
Still, we cannot live without the revolutionary service and firmly believe Google will figure out the revenue in the future.
