YouTube As A Company Would Have A Worth Of $75B

The YouTube boycott by advertisers didn't seem to faze Google much. Alphabet reported on Monday that YouTube now has 1.5 billion monthly viewers watching an average of 60 minutes per day on mobile devices, which puts viewers closer to Google's mobile search engine.

Advertising revenue was led mostly by "tremendous" results in mobile search with a strong contribution from YouTube, according to Ruth Porat, Alphabet chief financial officer. Alphabet's revenue rose 21% during the quarter compared with the previous year, reaching $26 billion.

Some analysts were most impressed with YouTube's stats. While Ben Schachter, analyst at Macquarie, described the numbers in a research note as "remarkable," Victor Anthony, managing director and internet media analyst at Aegis Capital, told CNBC that if YouTube were a company it would have a value of at least $75 billion.

In the quarter Alphabet released six new ad supported YouTube originals from celebrities including Ellen DeGeneres and Kevin Hart, and YouTube creators like Rhett & Link.



Analysts also were concerned about the rising traffic acquisition costs (TAC) mostly tied to mobile and programmatic, but Ruth Porat took a more positive approach, pointing to the strength in Google's mobile business.

"There are other factors that affect the TAC rate including the mix of paid versus organic traffic as well as changes in partner mix and agreement terms," she said. "But I think the main point of your question here is we do continue to expect Sites TAC to increase, but our focus remains on growing profit dollars."

Google has been helping small businesses build mobile optimized websites, so consumers can find them on their phone. "Small businesses can do it on a mobile phone in under 10 minutes, using the listing information already available on Google Search and Maps," said Google CEO Sundar Pichai, during the earnings call. 

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