YouTube, the world’s largest video-sharing platform, has just turned 20. Founded in February 2005 by former PayPal employees Chad Hurley, Steve Chen, and Jawed Karim, it has disrupted the media landscape and become a major competitor to traditional TV.
With over 2.7 billion monthly active users, YouTube is now worth $455 billion, a staggering 275 times return on its initial investment of $1.65 billion by Google in 2006. The platform’s success can be attributed to several key innovations that have helped it achieve this milestone.
Firstly, YouTube flipped the traditional risk profile for creators, allowing them to keep all the revenue from their content without upfront costs or fixed budgets. This has enabled creators like Mr. Beast, who earned $85 million in 2024, to produce high-quality content without worrying about the business side of things.
Secondly, YouTube introduced an advertising model that gives creators a significant share of the revenue, incentivizing them to create engaging content. The platform’s use of programmatic video advertising has also made it ultra-efficient, allowing advertisers to target specific audiences and demographics.
Thirdly, YouTube democratized content production by giving anyone with a smartphone and internet connection the opportunity to become a creator. This has led to the emergence of global YouTube creator economies, with Brazil and Kenya being notable examples.
Fourthly, YouTube’s algorithm prioritizes engagement over editorial accuracy, leading to concerns about disinformation and misinformation on the platform. However, this also allows creators like Mr. Beast to build massive audiences by producing content that resonates with viewers.
Lastly, YouTube has integrated generative AI into its platform, offering creators new tools to produce high-quality visual effects-heavy content. This has opened up new possibilities for bedroom creators to make their own fan-fiction episodes of popular shows like Star Wars.
As YouTube continues to evolve, legacy media brands are taking notice and responding by putting their content on the platform. The BBC has 14.7 million YouTube subscribers, while ITV is exploiting its catalogue to reach younger audiences. Channel 4’s success in reaching young viewers via YouTube demonstrates the platform’s potential for reaching new audiences.
In conclusion, YouTube’s success can be attributed to a combination of innovative business models, democratization of content production, and technological advancements. As the platform continues to grow and evolve, it will be interesting to see how legacy media brands adapt to its changing landscape.
Source: https://theconversation.com/youtube-at-20-how-it-transformed-viewing-in-eight-steps-250083