How Does YouTube Make Money? YouTube is the most dominant video website in the world. The vast majority of its video is user-generated content (video blogs or amateur short films), movie clips, television clips, music videos, home videos, or bootlegged concert footage.  How does a website like YouTube make its money?

Some of YouTube's revenue comes from sponsored partnerships with major media corporations.  YouTube's enormous audience views billions of videos every day, more than primetime viewership of all the major U.S. television networks combined.  Due to the high viewership, companies like MGM and CBS have partnered with YouTube to post full-length films and television episodes as a way to compete with broadcast television and online video-viewing websites like Hulu.  Viewers in the United States can subscribe to channels or rent films, and the service is scheduled to be launched globally in the near future. YouTube began streaming all cricket matches from the Indian Premier League in March 2010. YouTube claims this is the first free, worldwide online broadcast of a major sporting event.


The other revenue streams for YouTube are business advertising and product placement. The video ads on YouTube function in a similar way to the traditional model for television advertising, albeit more effectively targeting a specific demographic. The Internet Advertising Bureau's recent report of a record-breaking $26 billion spent on online advertisement in 2010 certainly suggests that more and more businesses are capitalizing on the unique qualities of Web video marketing. 

Gearshift is a full-service video production studio in Virginia with extensive experience in producing online video marketing geared specifically toward YouTube and other social media.  Contact us at 877-477-STUDIO to learn more about how producing original Web video content can be a powerful and effective way to market your business.

Jim Folliard
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