News: Here are my preliminary thoughts on YouTube’s business plan, i.e., how it hopes to make a profit.
1. Continually attract millions of viewers, users, and video creators to YouTube
2. Join forces with Google to incorporate YouTube videos in all basic Google searches (thereby helping to serve No.1 priority above), and to deploy Google ads on YouTube’s site. (Because of potential secondary liability under copyright law, Google ads can’t be fully integrated on YouTube, particularly not with videos that constitute copyright infringement).
3. Strike revenue-sharing deals with key “partners” of YouTube who are under contract with YouTube and who supply content to YouTube; such quality content more likely to generate views and more desirable for ads
4. Deploy sleek ads within and at bottom of select videos (“InVideo ads”) created by YouTube partners (some individual creators and some corporate creators). This last prong is what YouTube is testing out right now, and what YouTube is banking on. Higher click-through rate for these ads means YouTube can charge more for these ads than regular Google text ads.