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Apple's removal of built-in YouTube iOS app contributes to tripling of mobile ad sales

post #1 of 52
Thread Starter 
In an interview on Thursday, YouTube's vice president of sales Lucas Watson disclosed that mobile ad sales have tripled over the past six months, suggesting the removal of Apple's ad-free version formerly baked into iOS was a key factor in driving revenue.

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Mobile ads contributed an estimated $350 million to YouTube's revenue over the past half year, reports Bloomberg, as about one quarter of the Internet video service's 1 billion users consumed content from mobile devices.

While not mentioned by Watson, a key driver to the boom in ad revenue could be Apple's decision to deprecate its in-house YouTube app from iOS. In response to the move, Google launched a standalone YouTube app in Apple's App Store just days before iOS 6 debuted in September of 2012 which, as AppleInsider reported at the time, freed the company to show ads ahead of popular videos.

?The commercial business has exploded,? Watson said. ?It?s a huge part of our business, and we know that?s where it?s headed.?

The publication cited estimates from Wedge Partners Corp. analyst Martin Pyykkonen, who said YouTube generates roughly 10 percent of Google's total revenue. Further, the analyst estimated mobile ads account for 20 to 25 of YouTube's ad sales, meaning the sector contributed as much as $350 million to the Internet search giant's reported $14 billion in sales last quarter.

As part of its countdown to the App Store's 50 billionth download, Apple in May announced the most-downloaded apps of all time, with YouTube showing up at the number four spot for free apps.
post #2 of 52

Holy shit. Stats like this just so the massive difference in usage between iOS and Android devices. It's unreal. Android fanatics keep gloating about how Android sales are destroying iPhone sales, yet howcome when a youtube app comes out on iOS ad revenue is TRIPLED?

post #3 of 52
Take the money, Google, and stick it aside for a rainy day.

Because your business practices are making many of us hear thunder in the distance...
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post #4 of 52
Google now has the ability to track, store, and monetize your YouTube experience

Apple did not allow this before in the native app

The contrast between the companies could not be more made more stark than this example

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post #5 of 52
"While not mentioned by Watson, a key driver to the boom in ad revenue COULD be Apple's decision to deprecate its in-house YouTube app from iOS."

The body of the article is far less certain than the title of the article. You might update the title to read: "Apple's removal of built-in YouTube iOS app could be contributing to tripling of mobile ad sales"

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post #6 of 52
@jd, Google replace Apple's YouTube app with one of its own, which made the money. That's what the article is about.

To fight Google, Apple should offer a no-cost ad-free video service with their own app. This might challenge YouTubes dominance and cut into googles income. Of course google would probably sue Apple over this. I still don't understand why people think Apple has to allow any app on their system. After all they own it not third party programmers.
post #7 of 52
Pretty interesting stuff. I doubt Apple cares, but they really did Goog a favor by booting them out of iOS.
post #8 of 52
What this really proofs, is how much internet content iPad users are consuming as Apple has been saying all this time.
post #9 of 52
Quote:
Originally Posted by rob53 View Post

@jd, Google replace Apple's YouTube app with one of its own, which made the money. That's what the article is about.

To fight Google, Apple should offer a no-cost ad-free video service with their own app. This might challenge YouTubes dominance and cut into googles income. Of course google would probably sue Apple over this. I still don't understand why people think Apple has to allow any app on their system. After all they own it not third party programmers.

The big problem with that is only iOS users would be able to upload/view videos whereas youtube allows multi platform uploads/views.
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post #10 of 52
Quote:
Originally Posted by Red Oak View Post

Google now has the ability to track, store, and monetize your YouTube experience

Apple did not allow this before in the native app

The contrast between the companies could not be more made more stark than this example

What was meant to hurt Google is actually helping them plus it threw iOS users under the bus.
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post #11 of 52

Queen takes Knight - Apple I believe would have accessed the pro's & con's in immense detail, who knows what is next...

post #12 of 52
Quote:
Originally Posted by dasanman69 View Post

The big problem with that is only iOS users would be able to upload/view videos whereas youtube allows multi platform uploads/views.

Yeah, Apple would never make a cross-platform app. *cough* iTunes safari *cough*
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post #13 of 52
I wonder if Apple had negotiated a cut of the ad revenue from Google for iOS devices and that is why Apple killed off the baked in app. Just curious but that would make more sense to me over just killing off the baked in app. I am pretty sure Apple had to pay something to Google for ad free access to youtube.

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post #14 of 52
Quote:
Originally Posted by jragosta View Post

Yeah, Apple would never make a cross-platform app. *cough* iTunes safari *cough*

And how well did Safari work out?
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post #15 of 52

Apple should replace Google Search with Siri / Yahoo Search so that Google can get more revenue. lol

post #16 of 52
Originally Posted by dasanman69 View Post

What was meant to hurt Google is actually helping them plus it threw iOS users under the bus.

 

Ah, but Apple can and will hurt Google if the "iRadio" rumors are true.  It's supposedly a free iAd-subsidized music streaming service.

As opposed to Google's All Access, which is $10 a month but ad-free, like Spotify.  The first casualty of "iRadio" will be Pandora,

which is supposedly the reigning free ad-subsidized music streaming service.

 

And how will this hurt Google?  By eventually dominating the free-with-ads streaming audio market.  Never forget that 96% of Google's

revenue comes from ads.  Taking away ad revenue from Google hurts them directly.  Every day that Google lacks an ad-driven streaming

music business, Apple will increase their "iRadio" user base, advertisers will flock to Apple's service, and Apple will earn advertising

dollars that Google isn't.  

 

Of course, it remains to be seen whether or not the $120/year for Google All Access will make up for that lost ad revenue.  But my guess

is that Apple's free service will generate a larger subscriber base than Google's pay model.  Ironic that Google would drop the ball like that.

 

Of course, it's a big wide world of music out there.  Plenty of room for both free-with-ads and pay-without-ads business models.

And it's an even bigger world of movies and TV out there.  Establishing iAd in "iRadio" could pave the way for video iAds in "iTV."

You know, where the big money is.  The money Google has no clue how to get (see "Google TV.")

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post #17 of 52
Quote:
Originally Posted by dasanman69 View Post

And how well did Safari work out?

I don't know - and don't care.

You claimed that any Apple service would apply only to iOS users - and that is demonstrably false.
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post #18 of 52
I have Mc Tube and the only ads I see are the Mc Tube ads that aren't google ads. Plus I kept the old version of Mc Tube so I can cache videos. Bottom line is that I'm better off than I was before Google forced Apple's hand.
post #19 of 52
Quote:
Originally Posted by dasanman69 View Post

Quote:
Originally Posted by jragosta View Post

Yeah, Apple would never make a cross-platform app. *cough* iTunes safari *cough*

And how well did Safari work out?

What does that stupid question have to do with the point he's making?

post #20 of 52
Quote:
Originally Posted by dasanman69 View Post

And how well did Safari work out?

It depends if you think their goal was to dominate the browser market on Windows (which I think is unlikely) or if it was for web developers to have a Windows-based test environment for the growing WebKit-based browsers per Chrome's success (which I think is likely).

But all that's beside the point as jragosta's comment was making a cross-platform app, not about its success.

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post #21 of 52
Quote:
Originally Posted by SockRolid View Post

Ah, but Apple can and will hurt Google if the "iRadio" rumors are true.  It's supposedly a free iAd-subsidized music streaming service.
As opposed to Google's All Access, which is $10 a month but ad-free, like Spotify.  The first casualty of "iRadio" will be Pandora,
which is supposedly the reigning free ad-subsidized music streaming service.

And how will this hurt Google?  By eventually dominating the free-with-ads streaming audio market.  Never forget that 96% of Google's
revenue comes from ads.  Taking away ad revenue from Google hurts them directly.  Every day that Google lacks an ad-driven streaming
music business, Apple will increase their "iRadio" user base, advertisers will flock to Apple's service, and Apple will earn advertising
dollars that Google isn't.  

Of course, it remains to be seen whether or not the $120/year for Google All Access will make up for that lost ad revenue.  But my guess
is that Apple's free service will generate a larger subscriber base than Google's pay model.  Ironic that Google would drop the ball like that.

Of course, it's a big wide world of music out there.  Plenty of room for both free-with-ads and pay-without-ads business models.
And it's an even bigger world of movies and TV out there.  Establishing iAd in "iRadio" could pave the way for video iAds in "iTV."
You know, where the big money is.  The money Google has no clue how to get (see "Google TV.")

If I remember correctly you previously predicted Google's doom during the Oracle suit. I don't see how a ad driven radio would hurt Google since Pandora is the same thing and available on both platforms. If that hasn't hurt Google then 'iRadio' won't either.
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post #22 of 52
Quote:
Originally Posted by anantksundaram View Post

What does that stupid question have to do with the point he's making?

Their track record. iTunes for Windows manages a iDevice. It would've been phenomenally stupid of them no not make a windows version and they wouldn't be the company they are today without it, but Safari never gained much traction. A good amount of youtube videos are viewed on a mobile device and seeing as how there's no iTunes for Android I doubt they'd make a video app for it either.
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post #23 of 52

So what stopped YouTube from releasing a Youtube app right from the word go? Did Apple force them to allow an ad free baked in App by saying they would not approve a standalone app? I don't think so. Therefore one might wonder at the egregious error that the Youtube board made and how much money they lost by trying  to get their App baked in? They were bound to work it out eventually. 

 

So rather than looking at how much more money they are now making one can look at how much money they lost by waiting. For a company that markets itself as an analytics expert, they got this bit bit of analytics pretty wrong.

post #24 of 52
Quote:
Originally Posted by Red Oak View Post

Have you had your IQ level recently tested? I'm genuinely serious. Because only a dumb f*** could post a response like that

Well let's see, it's making Google much more money (which is NOT suppose to happen in a thermonuclear war) plus more of the users info is now relayed to Google (which before iOS users were protected by Apple, now it's fend for yourselves), so how am I wrong?

Were these not your words?
Quote:
Google now has the ability to track, store, and monetize your YouTube experience

Apple did not allow this before in the native app

So how do you feel now that this is the case? Btw there's no need for insults.
Edited by dasanman69 - 6/6/13 at 8:17pm
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post #25 of 52
Quote:
Originally Posted by AnalogJack View Post

So what stopped YouTube from releasing a Youtube app right from the word go? Did Apple force them to allow an ad free baked in App by saying they would not approve a standalone app? I don't think so. Therefore one might wonder at the egregious error that the Youtube board made and how much money they lost by trying  to get their App baked in? They were bound to work it out eventually. 

So rather than looking at how much more money they are now making one can look at how much money they lost by waiting. For a company that markets itself as an analytics expert, they got this bit bit of analytics pretty wrong.

There was a multi year (5 I think) agreement between Apple and Google. Apple chose not to renew thus Google made it a separate app.
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post #26 of 52
Quote:
Originally Posted by dasanman69 View Post

And how well did Safari work out?

It's the only browser I use.
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post #27 of 52
Quote:
Originally Posted by dasanman69 View Post


There was a multi year (5 I think) agreement between Apple and Google. Apple chose not to renew thus Google made it a separate app.

 

Fair enough, but one wonders why google entered into this arrangement, I mean what was in it for them except for (in hindsight) lost revenue. It's not as if YouTube needed promoting.

post #28 of 52
Quote:
Originally Posted by AnalogJack View Post

Fair enough, but one wonders why google entered into this arrangement, I mean what was in it for them except for (in hindsight) lost revenue. It's not as if YouTube be needed promoting.

At the time nobody was watching youtube on a mobile device and ads weren't yet shown before videos. Google had just purchased youtube and I'm sure Apple paid them a nice fee to have it on the iPhone. We all know what happened in those 5 years and the bad blood there is between Apple and Google now, so Apple didn't renew.
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post #29 of 52

To those that are posting that they're upset at Apple for removing the native YouTube app, know that they likely would have been forced to by Google eventually.  Google did that to Microsoft and the Windows Phone YouTube app that MS had made (which also bypassed ads).  I'm sure that was a factor in the tripling of mobile ad sales as well (though obviously not as huge as traffic from iDevices).

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post #30 of 52

Yeah well, unfortunately, I despise being force-fed video commercials… both YouTube and Hulu have all but lost me. I started paying for Hulu Plus thinking it would remove the ads (Netflix style) but no. Way too many BAD ads that repeat incessantly... So I'm not paying for Hulu anymore, and I've already switched to Vimeo for 90% of my 'indy video' viewing… no commercials there...

 

Most of what I watch on YouTube now is older stuff anyway, so they don't force ads onto you as much. But that incredibly annoying 5 second "preview" that you can skip… I don't WANT to be forced to interact with the damned interface every time I want to watch a video!

 

So yeah, I've all but stopped watching vids on YouTube, and head for the alternatives first… their loss I guess.

post #31 of 52
Quote:
Originally Posted by dasanman69 View Post


If I remember correctly you previously predicted Google's doom during the Oracle suit. I don't see how a ad driven radio would hurt Google since Pandora is the same thing and available on both platforms. If that hasn't hurt Google then 'iRadio' won't either.

 

You mean the Oracle/Google suit that is still ongoing?

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post #32 of 52
Quote:
Originally Posted by dasanman69 View Post


And how well did Safari work out?

 

About as well as Internet Explorer on Macs.

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post #33 of 52
Quote:
Originally Posted by dasanman69 View Post


At the time nobody was watching youtube on a mobile device and ads weren't yet shown before videos. Google had just purchased youtube and I'm sure Apple paid them a nice fee to have it on the iPhone. We all know what happened in those 5 years and the bad blood there is between Apple and Google now, so Apple didn't renew.

 

This will keep h.264 content coming for iOS.

 

No Flash, no WebM but still got YouTube on iPhones.

 

Does Google want to throw away this revenue with their little games?

 

iOS users happy, Apple happy, 3rd party developers happy, that's how to manage an ecosystem.

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post #34 of 52
Quote:
Originally Posted by DroidFTW View Post

To those that are posting that they're upset at Apple for removing the native YouTube app, know that they likely would have been forced to by Google eventually.  Google did that to Microsoft and the Windows Phone YouTube app that MS had made (which also bypassed ads).  I'm sure that was a factor in the tripling of mobile ad sales as well (though obviously not as huge as traffic from iDevices).

 

Google also removed ad blockers from Play, strange I don't recall much of an outcry over this violation of users rights.

 

Remember when Apple removed a fart App and it was like the end of the world?

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post #35 of 52
Quote:
Originally Posted by hill60 View Post

 

Google also removed ad blockers from Play, strange I don't recall much of an outcry over this violation of users rights.

 

Remember when Apple removed a fart App and it was like the end of the world?

 


The backlash for removing ad blockers from the Play Store was non-existent because they were free (so no lost revenue to the devs) and side loading apps on Android is a trivial process.  That fact is amplified considering ad blockers only work on rooted phones and anyone capable of rooting their phone is capable of finding and installing an ad blocker outside of the Play Store.  I think there was more head scratching at the futility then anything.

 

Apple removed a fart app from there store?  lol

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post #36 of 52
Quote:
Originally Posted by DroidFTW View Post

 


The backlash for removing ad blockers from the Play Store was non-existent because they were free (so no lost revenue to the devs) and side loading apps on Android is a trivial process.  That fact is amplified considering ad blockers only work on rooted phones and anyone capable of rooting their phone is capable of finding and installing an ad blocker outside of the Play Store.  I think there was more head scratching at the futility then anything.

 

Apple removed a fart app from there store?  lol

 

Yep, there was such an outcry they had to put them back.

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post #37 of 52
Guess its time to remove the YouTube app and put video tube back on my iPhone.
post #38 of 52
Quote:
Originally Posted by dasanman69 View Post

A good amount of youtube videos are viewed on a mobile device and seeing as how there's no iTunes for Android I doubt they'd make a video app for it either.

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Quote:
Originally Posted by Robin Huber View Post

Quote:
Originally Posted by dasanman69 View Post

And how well did Safari work out?

It's the only browser I use.

Me too, also at work, running it on Windows. Even though it's unsupported now, it's still better than IE. It can open any website, unlike IE, and does it faster as well (IE10 & Safari 5 on a W7 box).
Quote:
Originally Posted by Crosslad View Post

Guess its time to remove the YouTube app and put video tube back on my iPhone.

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post #39 of 52
I do not know the nature of the negotiations on YouTube, but like maps I suspect Google wanted more access to people's information including location than Apple was willing to allow. So YouTube like Maps was no longer a pre-installed app. Like Maps Apple certainly did not ban YouTube, but other apps e.g., Vimeo, are not parity.

Now if you want to grant YouTube access to location data or personal information it's in your control when asked by YouTube.

More interesting data would be to know what per cent income does Google earn from iOS vs Android and what percent vs popular of iOS devices have YouTube. This data would expose an entirely different set of data on business strategy progress by Google. I suspect 70% of Google mobile ad revenue comes fom the 50% of iOS devices with YouTube. My guesstimates paint an interesting picture, but I don't know the real facts.
post #40 of 52
@rob53 Apple has no reason to "fight" Google because Apple did not lose any revenues from this case. Instead, Apple has indirect benefit because the new YouTube app is more functional than the previous native app and that makes user happy -> less reason to switch to other platforms.
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