Why YouTube Could Make Things Difficult For Google

from the keep-your-friends-close... dept

In all the hysteria over Google’s purchase of YouTube, one angle that’s gone largely unexplored are the implications of the buy for Google’s advertising business. The common thought is that YouTube now gives Google plenty more page views to sell ads, as well as a huge audience to show video ads, but it’s also possible that the YouTube buy could actually hurt Google’s advertising business by alienating external sites with which it has advertising deals. News Corp. is already reportedly seeking some sort of reassurances from Google over the potential conflicts of interest the YouTube buy could create, in light of its $900 million deal for Google to sell and serve ads on MySpace. As Google expands its media empire, this sort of problem will become more prevalent: companies may be happy to partner with Google because it can help them monetize its content, but are likely to grow uneasy when Google comes into a space and becomes a competitor, too. Perhaps this is one reason why Google’s not really done much to build up Orkut lately: it doesn’t want to alienate itself from more popular external social-networking sites that offer it a more immediate and lucrative return through ad deals. Google’s popularity and power already causes it problems with people who see it as somehow unfairly profiting from its work. The same type of conflicts from its advertising-partners-cum-competitors seems inevitable.

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Comments on “Why YouTube Could Make Things Difficult For Google”

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william says:

google is great

They are just looking for some other profitable venture. They only have the ads and search engine biz. everything else is a money pit.

Google search and Gmail are great services but YouTube doesn’t seem to fit with their other businesses. I kind of wonder where they are going with this and if they will be able to make a profit form it after paying for the bandwidth. But I’m sure they are a lot smarter than me and will think of something.

|333173|3|_||3 says:

G Video

I’ll be very surprised if YouTube is not combined with Google video soon, with Google branding instead of YouTube’s, and in the end, it will be as MEoip said, all of Google’s businesses fully integrated.

If google keep on buying, they should be in a good position. the only problem I see is that I won’t have any chance with my own advertising business if I ever set one up, so I’ll just have to start off with Thor (a Game with a fancy Physics engine where the Physics actually are usefull like killing people by falling debris), and VoIPER, an idea for a phone service. Ah well

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