YouTube’s head of monetization, Shashi Seth, has now left the company to become the chief revenue officer of Menlo Park, Calif.-based startup Cooliris.
Despite being the largest video-sharing web site, YouTube is still finding it hard to make money. My sources say that YouTube made around $80 million in 2007, a number that could grow by more than 50 percent this year to around $125 million. A Bear Stearns report estimated YouTube revenues at around $90 million for 2008. I’m not sure if $120 million-$125 million is going to make Google CEO Eric Schmidt, who has been publicly talking about YouTube and its money-making potential, happy.
What stands between YouTube and money is the lawsuit by Viacom, as it makes owners of legitimate content a tad nervous.
It’s true that the Viacom suit is a major issue. But I don’t think it’s the only one. I think looming even larger is the culture inside Google, one that does not support traditional approaches to supporting brand marketing. In other words, YouTube is a very large branded media play inside a massive engineering/direct response machine. YouTube is a major conversational media platform. But unlike MySpace, which reports into a media culture at Newscorp (Rupert Murdoch made this point at D last week), YouTube reports into a technology culture. I think it makes a difference.
The company Shashi is going to looks like a competitor to Microsoft’s Photosynth and Silverlight (not directly, but it looks like a market implementation of those two technologies). It just announced a deal with YouTube. Interesting!