Is Web 2.0 going broke?
There was an interesting article on Slate.com (which I can’t seem to find using their search engine) which got reprinted on the Global website entitled Everybody’s surfing. No one’s paying “User-generated content may have changed the Internet. But ‘Web 2.0′ sites such as YouTube are suffocating under the costs of storing it” which talks about the state of the Internet and how big companies such as Facebook and YouTube are essentially going broke offering access to content. Now I’m not entirely sure that I believe they’re going bust but here’s a few interesting tid bits:
- Google will lose $470-million on YouTube this year alone
- YouTube spent about $250-million to acquire licenses this year
- Yahoo’s investment in Flickr is equally unprofitable
- Facebook spends $1-million a month on electricity
This of course is not good news for Web 2.0 but it reaffirms the questions I’ve raised in posts like Could somebody explain Twitter to me, please?, simply put … if the purpose of a business is to generate a revenue, what is their Revenue Model?
The most obvious revenue model is obvious. The online advestising. Google has gone one step ahead in terms of ideas. They did it by creating their own browser. I feel the Chrome browser is collecting information on user behaviour and is feeding that to Google. This gives them much better position in ad targeting but where is the user privacy? Google claims they are not doing anything illegal with this. Anyway, I believe they are not going bust as all websites you listed are far too important to be get rid of but they may need to change things in the future to see black figures instead of red ones.
Just makes you think… that Mark Zuckerberg the owner facebook should have sold his company when the got that huge offer, I forget from who…. but it was a very large sum of money.
I think… even though youtube is losing money for Google, I still think in the long run Google will be able to turn that around.
Till then,
Jean
Adverts are the only main BIG thing for their earnings. till ders traffic and advertisers .. there will b no loss :)
Google is step ahaed from everyone in advertising.
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googles 470million is nothing to them,, but it could feed an entire country! ahhh to be that rich!
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Non-profit organizations could make money with Web 2.0. Non-profits could make use of some good Web 2.0 and blogging resources that could help them in this regard.