Social Media

YouTube Ads: YouHate Em


It's no secret that YouTubeYouTube reviewsYouTube reviews needs to make more money: a report this week claimed that the service may lose $470 million in 2009 due to high bandwidth, licensing and other costs. Meanwhile, YouTube is now using much larger banner ads which consume the entire width of the homepage. Additionally, it's been reported that YouTube is set to copy rival HuluHulu reviewsHulu reviews, switching its emphasis to premium shows, clips, and movies in what we called the Huluification of YouTube. The reason is clear: no one wants to advertise on your cat video.

Pre-Rolls and Post-Rolls Appearing on 2-Minute Clips

The latest development: we found clips uploaded to the site in the past few days that include unmutable, unskippable pre-roll ads. Those we found appear to all be from CBS. While YouTube has experimented with pre-roll ads before, these videos include 30 second pre- and post-roll ads on a 113 second Letterman clip - in short, 1 minute of advertising around a video lasting less than 2 minutes.

The video, entitled Letterman - Denis Leary on Dave's Marriage, has one of the lowest ratings of all CBS clips and a string of comments complaining about the ad (warning: lots of strong language in that thread - partial, censored screenshot below).

Other clips carrying pre-roll ads include Heckle U, Survivor and Overcoming the Odds, while videos embedded on external sites don't carry the ads yet.



Rock, YouTube, Hard Place

It's a conundrum: losing hundreds of milllions of dollars a year isn't sustainable, and yet YouTube has an audience that's conditioned to receive unlimited content for free, without interruption.

To say that YouTube users don't like ads is hardly breaking news: the real story lies in where the line will be drawn between appeasing the viewer and paying the bandwidth bills. YouTube viewers are reacting to ads with angry comments and low ratings, but unless those same users are prepared to open their wallets and pay for content (not likely), YouTube will have to continue walking this fine line between monetization and audience retention. What more could they do?

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