User entitlement -- A key to the plan of scaling up and eventually figuring out how to make money is free services for users. The minute you charge people, most walk off, particularly when they've been trained to assume that services should be free. YouTube has clearly told people that they should expect free video streaming, even if it has considered an ad-free paid subscription service. Getting consumers to change their behavior after they've become used to not paying is next to impossible.
The world of YouTube is vastly different from the world of broadcast television. While broadcasters in the United States and abroad are bound by rules, and the threat of punishment for breaking those rules, far fewer such regulations apply to the creators of YouTube content, or to YouTube itself. YouTube’s default position is that no one under 13 is watching videos on its site—because that’s the minimum age allowed under its terms of service. In addition to its main site, however, the company has developed an app called YouTube Kids. Like normal YouTube, it plays videos, but the design and content are specifically made for parents and children. It’s very good. It draws on the expertise of well-established children’s-media companies. Parents can restrict their children’s viewing in a multitude of ways, such as allowing access only to content handpicked by PBS Kids. But here’s the problem: Just a small fraction of YouTube’s 1.9 billion monthly viewers use it. (YouTube Kids is not available in as many countries as normal YouTube is.)
How does a video streaming service with one billion active users per month and $4 billion in revenue not turn a profit? Ask YouTube, which couldn't break free from breaking even in 2014, according to a new report. Sources tell the Wall Street Journal that Google's video unit posted $4 billion in revenue last year, up from $3 billion in 2013, and that while the service accounted for 6 percent of Google's overall sales, it contributed nothing to earnings.
But even in relatively limited doses, these videos can affect young toddlers’ development. If kids watch a lot of fast-paced videos, they come to expect that that is how videos should work, which could make other educational videos less compelling and effective. “If kids get used to all the crazy, distracting, superfluous visual movement, then they may start requiring that to hold their attention,” Johnson says.
YouTube allows users to upload, view, rate, share, add to favorites, report, comment on videos, and subscribe to other users. It offers a wide variety of user-generated and corporate media videos. Available content includes video clips, TV show clips, music videos, short and documentary films, audio recordings, movie trailers, live streams, and other content such as video blogging, short original videos, and educational videos. Most of the content on YouTube is uploaded by individuals, but media corporations including CBS, the BBC, Vevo, and Hulu offer some of their material via YouTube as part of the YouTube partnership program. Unregistered users can only watch videos on the site, while registered users are permitted to upload an unlimited number of videos and add comments to videos. Videos deemed potentially inappropriate are available only to registered users affirming themselves to be at least 18 years old.