• Forbes, Friday, May 30, 2008 10:03 AM

Nobody dominates its field quite like YouTube dominates online video. Even parent Google's 65% share of search looks highly competitive compared to YouTube: according to comScore, 38% of videos streamed on the Web come from the video sharing giant. No other player has more than a 4% share. As Forbes says, "Google owns the biggest television station on the planet," set to upload 600 years worth of video this year alone.

Meanwhile, Google, frustrated with YouTube's lack of success on the revenue front, is now taking over the place, having replaced many of the video sharing site's original managers. The move looks to be paying off, too, as Google looks set to generate $200 million in revenue from YouTube this year and $350 million in 2009. That may only be about 1% of Google's sales, but it's up considerably over 2007. Google's influence has also helped bring global scale: since its purchase in November 2006, YouTube has launched in 17 new countries. Now, an ad on the homepage costs $175,000 a day, plus a commitment to spend $50,000 more on Google's sites.

Even so, the vast majority of YouTube's content either can't be monetized (copyrighted content) or doesn't scale economically, which is why Google is pursuing deals with professional producers to create branded channels. As JupiterResearch analyst Bobby Tulsiani says, "A studio declining to do business with YouTube would be like a cereal maker not dealing with Wal-Mart."

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