Can YouTube's $6 Billion In Video Ad Sales Be An Indicator For TV Networks?

by , Dec 13, 2013, 2:28 PM
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Nearly $6 billion a year went to video advertising on YouTube worldwide, according to eMarketer.

In the U.S., YouTube pulls in about $1.o8 billion of that. Next year, YouTube’s ad sales could grow 60% or more. Advertisers now spend $3.6 billion on all digital video ads in the U.S., according to estimates.

What effect will this have on the $50 billion spent on national advertising with traditional U.S. TV networks? It is something CBS, NBC, Fox and ABC should be concerned about? Not exactly, because these networks also gain from their own digital video businesses.

For example, Hulu -- backed by News Corp., Disney and Comcast – will get over $700 million in advertising sales this year, according to estimates.

Digital video business observers talk a lot about marketers seeking “premium” video content. You might know that stuff as traditional TV network programs.

YouTube numbers keep growing, in part because of a lower threshold of big marketers. Big advertisers had been worried about being attached to inappropriate -- or copyright-infringed –content from new channel partners.

Much of the ad money from YouTube videos doesn’t go to YouTube itself. The big platform shares ad dollars with the likes of  NBC Entertainment, Discovery Communications and others.

YouTube takes about 35% from gross ad spending on the platform. But next year, YouTube will get closer to a 45% share.

Three of the biggest YouTube content partners, according to September comScore rankings, were music sites Vevo (47 million unique viewers); Warner Music (25.4 million) and Universal Music Group (16.0 million).

But number four on the list was NBC Entertainment, with 29.8 million unique viewers.

While YouTube would seem to be a force in the future of digital video advertising, its growth seems to be dependent on powerful content creators to drive the business.

3 comments on "Can YouTube's $6 Billion In Video Ad Sales Be An Indicator For TV Networks? ".

  1. Douglas Ferguson from College of Charleston
    commented on: December 13, 2013 at 3:38 p.m.
    But you're assuming that young people, even twenty-somethings, want to watch programming from the big content creators, and not something more targeted to them! It comes down to time-spent-viewing. Traditional suppliers may have a rude awakening when they see what younger viewers really watch over and over and over again.
  2. Dan Patio Dalton from Content That Works
    commented on: December 13, 2013 at 11:26 p.m.
    Let me make this simple: CONTENT IS KING. End of discussion. [You still here?]
  3. Edmund Singleton from Winstion Communications
    commented on: December 14, 2013 at 4:18 a.m.
    There was once a fear of 'product association' but most young people are better then that, its a 'old world thing'...

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