welcome to mojo this is show eight my
name is ashton carter solution and I’m
CT more and this week we’re going to go
a little bit more in depth to some
things we touched on last week we’re
going to talk about the fifth year
anniversary of the Google YouTube deal
that’s how we’re going to take a look at
facebook credits and then in lightning
round we got a few things lined up for
yahoo hewlett-packard yeah lots talk
about also about Microsoft as well as
Google so let’s get right to it october
nine 2011 is the five-year anniversary
of the 1.65 billion dollar deal should
Shane yeah in fact when it closed that
after because it was a stock deal I was
actually even more than that but that’s
just a little footnote okay so five
years into this deal I’m going to read
you a quote from none other than Mark
Cuban he said quote I said it was a huge
mistake back then and I still think it’s
a huge mistake all YouTube is is Google
subsidizing the bandwidth of every
individual in the world end quote now
what makes that even more interesting is
that Mark Cuban sold broadcast calm for
5.7 billion dollars to yahoo in the you
know pre calm bubble days so is Mark
Cuban right I disagree with him
completely I think he’s looking at this
from a kind of a non-tech perspective
you know if you if you look at it
Google’s the number one search engine in
the world YouTube is number two that
means when they got YouTube they they
gave themselves a lead in search that is
almost impossible to close more
importantly they get additional search
history on every user they can target
ads a lot better and let’s even forget
about video ads let’s talk about AdWords
there’s AdWords all over YouTube videos
now and just the way that that search
history can be plugged in to target
people on that level I think it was a
huge huge deal yeah I actually disagree
with Mark Cuban as well but let’s just
hold off on mark for a second i just
want touch on one thing you said the
whole the inventory that youtube get
sorry that Google gets through youtube I
remember one day flipping a switch for
something called Adsense for content
host which I had no idea what it was and
our revenue had watched a youtube com /
watchmojo like triple so the revenue
that YouTube and I think I’m allowed to
say that I don’t think that’s any crazy
NDA breaking stuff but basically so
let’s say we’re making one dollar from
our YouTube channel once we started to
run google ads on our youtube channel we
start
three dollars there’s some big dollar
those are some big dollars and in fact
sometimes that’s how much we make but
the point is that that just in of itself
recouped a lot of the investment now you
know you always joke about oh let me
guess you wrote this article in that
article I remember before here yeah
here’s another one from the closet
before YouTube soul to google we ran
some numbers and out you know I was like
listen YouTube is profitable I don’t
know if you guys are aware of this
YouTube is either profitable or it could
be profitable if it turns on display ads
and then years later after Steve Chen
and chad hurley sold the company they
actually came out and they opened up
their financials and YouTube was making
money like profits not just revenue so I
think the deal was not bad now without a
doubt no one else but Google I think
could have subsidized that massive
bandwidth but even like you saw that
there’s you know analysts came out and
said even the bandwidth is in that much
because of puring we’re basically if one
big-ass media company has excess
bandwidth then Google can use that to
reduce their bandwidth and hosting costs
and you’re right i think just from a
marketing perspective if you compare
where google video was which frankly
google video was ambitious but it wasn’t
really going anywhere relative to
youtube and you you know and google just
decided to buy them and i think when you
think about even two billion dollars
that’s nothing today google is sitting
on like 20 30 billion dollars and it was
two billion dollars to close off that
much more of the web you know they
everyone talks about how Google and
Facebook are always in this war to close
the web well if you own the number one
video destination you own a huge chunk
of the web yeah I want to just now touch
on Mark Cuban I think Mark Cuban is I
love Mark Cuban great salesman great
business guy you got to give him credit
you could say he was lucky I mean luck
and timing are as important as you know
ambition vision execution but the thing
that I find is a bit disingenuous in
Mark Cuban saying that is he sells
broadcast calm to yahoo he gets stock
and then he basically enters into a
caller which is basically a strategy
where as yahoo shares go down he’s
basically unloading those shares so he’s
right and doing that from a financial
perspective but i always think like
whenever an acquisition goes sour right
now if you type broadcast calm you go
nowhere but the Yahoo home page right so
it’s like one company was bought for 5.7
billion in stock ceases to exist pretty
quickly
you could blame yahoo which is what
sellers always do but i think as a
seller you have a responsibility to make
sure that the company that somebody buys
is successful now take a look at youtube
youtube yes steve chen sort of tuned out
pretty quickly i think you want to start
playing golf and investing Chatterley
stuck around and even though google
brought in you know professional
managers google really not just invested
money I actually think Google really
changed their philosophy instead of just
thinking that all the algorithm and
mathematics and technology will make
this a money maker they really have
evolved you know I’ve outlined so many
things that you know YouTube should be
doing better and to give credit to
Google they’re almost doing all of those
things and considering YouTube is so
massive and there’s all these rights
issues and piracy issues you really have
to give them credit so i don’t i don’t
really agree with mark cuban actually on
any level i think at the end of the day
it was two billion in stock which is
like who cares it’s like a drop in the
ocean right and even from a revenue
model perspective you hear about hulu of
serving up four times as many video ads
as youtube i don’t think that matters
youtube also has the whole adwords
adsense plugged in and i would like to
see how much money Hulu’s making off ads
vs. what Google is making off AdWords in
YouTube and one thing video ads are
really intrusive users don’t want them
those adword ads they’re a little bar at
the bottom of the video you can close
them if you want and more often than not
you end up clicking on them by accident
which is crappy for the advertiser but
you just close the window and move on
with your viewing final point on this
and then we’ll move to segment two I
think that’s another really great part
of why Google investing in YouTube and
you know taking it in the right
direction and not sacrificing the user
experience by running pre-rolls non-stop
early on is really really good because
that actually forced the big major media
companies to invest in hula hula makes
over 500 million in revenue hulu has
become sort of you know the yin to
YouTube’s yang and and I think you know
it’s sort of one fed off the other one
sort of became master of the super
premium content at the top the other one
became the master of the premium sort of
torso content YouTube in the middle and
yes there’s obviously all the
user-generated content at the bottom and
the prosumer content that’s become very
popular but but in the end I think huge
Gogol’s investment and
vision in growing YouTube helped hulu
become what hulu became because it
became such a foe when you look at all
of the YouTube clones they all shut down
or went out of business vo on out of
business reber we looked at buying
rubber believe it or not when when r
ever was deciding to sort of yourself
yeah but but that didn’t happen because
I said you know we’re in a leadership
position and you know professionally
produced content why do I want to get my
ass kicked by YouTube as a clone etc so
it didn’t make sense well that’s what
google did by buying YouTube they they
took online video and they forced it
mainstream really early and like let’s
face it companies like VEVO would not
exist or succeed without YouTube yeah
that would make a great segment for an
upcoming show which is just looking at
vivos a case study but today we’re going
to shift gears and come back and talk
about Facebook right after this
name is ashton carter solution and I’m
CT more and this week we’re going to go
a little bit more in depth to some
things we touched on last week we’re
going to talk about the fifth year
anniversary of the Google YouTube deal
that’s how we’re going to take a look at
facebook credits and then in lightning
round we got a few things lined up for
yahoo hewlett-packard yeah lots talk
about also about Microsoft as well as
Google so let’s get right to it october
nine 2011 is the five-year anniversary
of the 1.65 billion dollar deal should
Shane yeah in fact when it closed that
after because it was a stock deal I was
actually even more than that but that’s
just a little footnote okay so five
years into this deal I’m going to read
you a quote from none other than Mark
Cuban he said quote I said it was a huge
mistake back then and I still think it’s
a huge mistake all YouTube is is Google
subsidizing the bandwidth of every
individual in the world end quote now
what makes that even more interesting is
that Mark Cuban sold broadcast calm for
5.7 billion dollars to yahoo in the you
know pre calm bubble days so is Mark
Cuban right I disagree with him
completely I think he’s looking at this
from a kind of a non-tech perspective
you know if you if you look at it
Google’s the number one search engine in
the world YouTube is number two that
means when they got YouTube they they
gave themselves a lead in search that is
almost impossible to close more
importantly they get additional search
history on every user they can target
ads a lot better and let’s even forget
about video ads let’s talk about AdWords
there’s AdWords all over YouTube videos
now and just the way that that search
history can be plugged in to target
people on that level I think it was a
huge huge deal yeah I actually disagree
with Mark Cuban as well but let’s just
hold off on mark for a second i just
want touch on one thing you said the
whole the inventory that youtube get
sorry that Google gets through youtube I
remember one day flipping a switch for
something called Adsense for content
host which I had no idea what it was and
our revenue had watched a youtube com /
watchmojo like triple so the revenue
that YouTube and I think I’m allowed to
say that I don’t think that’s any crazy
NDA breaking stuff but basically so
let’s say we’re making one dollar from
our YouTube channel once we started to
run google ads on our youtube channel we
start
three dollars there’s some big dollar
those are some big dollars and in fact
sometimes that’s how much we make but
the point is that that just in of itself
recouped a lot of the investment now you
know you always joke about oh let me
guess you wrote this article in that
article I remember before here yeah
here’s another one from the closet
before YouTube soul to google we ran
some numbers and out you know I was like
listen YouTube is profitable I don’t
know if you guys are aware of this
YouTube is either profitable or it could
be profitable if it turns on display ads
and then years later after Steve Chen
and chad hurley sold the company they
actually came out and they opened up
their financials and YouTube was making
money like profits not just revenue so I
think the deal was not bad now without a
doubt no one else but Google I think
could have subsidized that massive
bandwidth but even like you saw that
there’s you know analysts came out and
said even the bandwidth is in that much
because of puring we’re basically if one
big-ass media company has excess
bandwidth then Google can use that to
reduce their bandwidth and hosting costs
and you’re right i think just from a
marketing perspective if you compare
where google video was which frankly
google video was ambitious but it wasn’t
really going anywhere relative to
youtube and you you know and google just
decided to buy them and i think when you
think about even two billion dollars
that’s nothing today google is sitting
on like 20 30 billion dollars and it was
two billion dollars to close off that
much more of the web you know they
everyone talks about how Google and
Facebook are always in this war to close
the web well if you own the number one
video destination you own a huge chunk
of the web yeah I want to just now touch
on Mark Cuban I think Mark Cuban is I
love Mark Cuban great salesman great
business guy you got to give him credit
you could say he was lucky I mean luck
and timing are as important as you know
ambition vision execution but the thing
that I find is a bit disingenuous in
Mark Cuban saying that is he sells
broadcast calm to yahoo he gets stock
and then he basically enters into a
caller which is basically a strategy
where as yahoo shares go down he’s
basically unloading those shares so he’s
right and doing that from a financial
perspective but i always think like
whenever an acquisition goes sour right
now if you type broadcast calm you go
nowhere but the Yahoo home page right so
it’s like one company was bought for 5.7
billion in stock ceases to exist pretty
quickly
you could blame yahoo which is what
sellers always do but i think as a
seller you have a responsibility to make
sure that the company that somebody buys
is successful now take a look at youtube
youtube yes steve chen sort of tuned out
pretty quickly i think you want to start
playing golf and investing Chatterley
stuck around and even though google
brought in you know professional
managers google really not just invested
money I actually think Google really
changed their philosophy instead of just
thinking that all the algorithm and
mathematics and technology will make
this a money maker they really have
evolved you know I’ve outlined so many
things that you know YouTube should be
doing better and to give credit to
Google they’re almost doing all of those
things and considering YouTube is so
massive and there’s all these rights
issues and piracy issues you really have
to give them credit so i don’t i don’t
really agree with mark cuban actually on
any level i think at the end of the day
it was two billion in stock which is
like who cares it’s like a drop in the
ocean right and even from a revenue
model perspective you hear about hulu of
serving up four times as many video ads
as youtube i don’t think that matters
youtube also has the whole adwords
adsense plugged in and i would like to
see how much money Hulu’s making off ads
vs. what Google is making off AdWords in
YouTube and one thing video ads are
really intrusive users don’t want them
those adword ads they’re a little bar at
the bottom of the video you can close
them if you want and more often than not
you end up clicking on them by accident
which is crappy for the advertiser but
you just close the window and move on
with your viewing final point on this
and then we’ll move to segment two I
think that’s another really great part
of why Google investing in YouTube and
you know taking it in the right
direction and not sacrificing the user
experience by running pre-rolls non-stop
early on is really really good because
that actually forced the big major media
companies to invest in hula hula makes
over 500 million in revenue hulu has
become sort of you know the yin to
YouTube’s yang and and I think you know
it’s sort of one fed off the other one
sort of became master of the super
premium content at the top the other one
became the master of the premium sort of
torso content YouTube in the middle and
yes there’s obviously all the
user-generated content at the bottom and
the prosumer content that’s become very
popular but but in the end I think huge
Gogol’s investment and
vision in growing YouTube helped hulu
become what hulu became because it
became such a foe when you look at all
of the YouTube clones they all shut down
or went out of business vo on out of
business reber we looked at buying
rubber believe it or not when when r
ever was deciding to sort of yourself
yeah but but that didn’t happen because
I said you know we’re in a leadership
position and you know professionally
produced content why do I want to get my
ass kicked by YouTube as a clone etc so
it didn’t make sense well that’s what
google did by buying YouTube they they
took online video and they forced it
mainstream really early and like let’s
face it companies like VEVO would not
exist or succeed without YouTube yeah
that would make a great segment for an
upcoming show which is just looking at
vivos a case study but today we’re going
to shift gears and come back and talk
about Facebook right after this
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