YouTube revenues may rise by 50% to $5.6bn

Report by eMarketer says the online video website, owned by Google, has become a major draw for advertisers.

YouTube
YouTube was bought by Google for $1.65bn in 2006.

YouTube’s advertising revenues will rise by more than 50% to $5.6bn in 2013, according to a report that confirms the threat posed by the internet to traditional TV ads.

The report by eMarketer claims that YouTube has become such a draw for advertisers that it will account for 11% of advertising revenues at Google, YouTube’s parent. The eMarketer estimate tops previous predictions. In May, Morgan Stanley predicted that YouTube’s gross revenues would reach $4bn in 2013, while Barclays suggested a likely figure of $3.6bn.

Google has not revealed YouTube’s earnings, but eMarketer research suggests that the search engine got a bargain when it paid $1.65bn for the site in 2006. However, YouTube does not keep all the advertising revenue and must pay a share to advertising partners and providers of content. Google’s public statistics for YouTube include the fact that the service attracts 1 billion people watching more than 6bn hours of video a month, with 80% of its traffic coming from outside the US, and 40% of its viewing time happening on mobile devices. Advertisers are keen to buy slots on YouTube because of its young audience, who prefer to watch TV programmes through their computers, tablets and mobile phones rather than conventional televisions.

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YouTube revenues may rise by 50% to $5.6bn

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