WebProNews

It's been about two and a half years since Google bought YouTube for $1.65 billion, and according to a new report from Credit Suisse, Google's not going to stop paying for that decision anytime soon.  YouTube might lose in the neighborhood of $470 million in 2009. 

The math is pretty simple.  Credit Suisse analysts Spencer Wang and Kenneth Sena believe YouTube will generate around $240 million in revenue this year.  However, various expenses could add up to roughly $711 million.  Do some subtraction, and you're looking at a negative number.

There's no way for YouTube to avoid part of the problem; Todd Spangler reported, "Bandwidth accounts for about 51% of expenses -- with a run rate of $1 million per day."  Spangler also noted that content licensing accounts for 36% of YouTube's expenses, and judging from recent developments in the UK and Germany, the organization's not having much luck on that front.

So Wang and Sena observed, "In our view, the issue for YouTube going forward is to increase the percentage of its videos that can be monetized (likely through more deals with content companies) and to drive more advertiser demand through standardization of ad formats and improved ad effectiveness."

Count on Google to explore all of these possibilities as it continues to respond to the recession.