That was the initially when YouTube was created. Everyone knows that Google has no problem cancelling anything that’s not profitable.
Comment on YouTube is slowing down for users with ad blockers in new wave
Kidplayer_666@lemm.ee 5 months agoI mean, they didn’t get greedy, as far as everyone knows they are losing a ton of money (at least if you can extrapolate anytbing from the fact that twitch is massively unprofitable)
takeda@lemmy.world 5 months ago
Kidplayer_666@lemm.ee 5 months ago
If it was profitable, then why did google stop posting the financial statistics for YouTube
TwilightVulpine@lemmy.world 5 months ago
Pretty sure YouTube has already been declared to be profitable. But frankly I’m pretty suspicious of claims of unprofitability for services being run for over a decade. Why would any for-profit company bankroll them if it wasn’t worth it? There has to be some creative accounting going on.
Kidplayer_666@lemm.ee 5 months ago
Doubt it, if it was profitable, they would be announcing that to everyone as loud as they could. Besides, if twitch is unprofitable, I doubt that google is in a much better situation
TwilightVulpine@lemmy.world 5 months ago
I wouldn’t apply Twitch’s situation to YouTube, IF it’s even true, because YouTube got a much wider reach and more advertising possibilities than gaming and somewhat related audiences.
It doesn’t seem to me a given that they’d boast about their success either. Because if they hide the situation the way they do, they can do this, turn to the customers saying “Welp, I guess this much is not enough. Gotta put more ads on it and raise prices 🤷”. It’s easier to placate the users if they are convinced it is inevitable. I imagine you are considering of what investors might think if products are said to be unprofitable, but overall Google/Alphabet still gets tens of billions in clean profits every year.
Most of all, again, if this is such a money sink that in over a decade they couldn’t figure out how to make money of it, why would they still keep at it? Why wouldn’t they sell it off or close it? If I assume they are honest about unprofitability, as much as I doubt it, then they must be getting something else from it that is equally valuable as raw money. Maybe it’s user data. Maybe it’s the social clout of controlling a major media platform. But it has to be worth it to them or they wouldn’t be hosting it. It wouldn’t make sense.
But personally I just think they are lying about unprofitability, including Twitch. It’s just a convenient excuse for layoffs and price hikes. It’s not like they are going to show everyone their full balance sheets.
EldritchFeminity@lemmy.blahaj.zone 5 months ago
Interest rates have been low enough for long enough that many companies have been running on the “fake it 'til you make it” philosophy forever. Air BnB, Door Dash, Lyft, and countless others have never been profitable. But they survive by constantly taking out loans and collecting new investor money to increase their market share (the infinite growth scheme), hoping that they’ll either eventually have enough impetus to monopolize a market and bully it into being profitable, or get bought up by Google and co for a rich payout.
This is how YouTube and Netflix got profitable. They ran at a loss until they were popular enough to turn a profit, and then switched to maximizing that profit. I imagine the same is true for the big social media sites as well. Run at a loss until you have a big enough userbase to attract advertisers. And this is exactly why Tumblr was never profitable and Verizon basically killed it trying to make it profitable. Tumblr’s population has always been the groups advertisers like the least - minorities, LGBTQ groups, sex workers, and artists/creatives. So Verizon tried to sanitize it by purging them to make it attractive to advertisers, and consequently killed the userbase that gave it it’s potential for ad profits in the process.