Television

YouTube ad revenue may rise by 50 per cent to $5.6bn

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MUMBAI: YouTube, the online video streaming giant, is growing than ever before. According to a new report by eMarketer, YouTube’s advertising revenue is expected to rise by more than 50 per cent to $5.6 billion in 2013, also posing a threat to traditional TV ads.

The report by eMarketer claims that YouTube has become a huge favourite among advertisers and it will account for 11 per cent of advertising revenue at Google, YouTube’s parent. Earlier in May, Morgan Stanley predicted that YouTube’s gross revenue would reach $4 billion in 2013, while Barclays suggested a likely figure of $3.6 billion and Jefferies & Co’s $4.5 billion

Google has not revealed YouTube’s earnings, but eMarketer research suggests that the search engine got a bargain when it paid $1.65 billion for the site in 2006. However, the streaming site does not keep all the advertising revenue as it has to pay a share to advertising partners and providers of content.

Google’s public statistics for YouTube include the fact that the service attracts one billion people watching more than six billion hours of video a month, with 80 per cent of its traffic coming from outside the US, and 40 per cent of its viewing on mobile devices.

Advertisers are keen to buy slots on YouTube because of its young audience, who prefer to watch TV programmes through their computers, tablets and mobile phones rather than conventional televisions.

About 79 per cent of YouTube’s US ad revenue is from video advertising, with an estimated $850 million for the year. That would give it a 20.5 per cent share of the overall $4.15 billion US video ad market. eMarketer estimates that YouTube video-ad revenue would hit $1.22 billion in 2014, taking a 21.1 per cent share.

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