°•●○ [Reports of inflated YouTube running costs are good for Google] ○●•°
Google watchers have delighted in speculating on the astronomical operational costs of YouTube for quite some time, mostly because it probably seems reassuring that even the mighty Google has some weak spots.
A $1.76bn acquisition for something that costs them a fortune to run? RampRate put it at more like $83m, citing wholesale broadband deals and proprietary Google technology that would save those cash.
Google has confirmed before that YouTube isn't profitable, but never given the extent of the loss. Taking the highest estimate for YouTube's revenues and lowest estimate of running costs, YouTube could actually be just about breaking even.
RampRate also points out that Google is probably quite happy for YouTube to be seen as "a financial folly" because it helps it negotiate cheaper deals with rights holders.
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