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It’s time for Alphabet to spin off YouTube?

economist.com

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Re: It’s time for Alphabet to spin off YouTube?

#111

Post by sgtnoodle »

loloquwowndueo wrote: post #17
osigurdson wrote: post #14

For me, YouTube is the most effective ad sponsored service by far. Users are forced to watch at least 5 seconds of ads before watching any content. This 5 second window is very focused as there is no time to context switch to anything else. Contrast this with Google search - sure there are some ads at the top but these are easy to mentally filter out.

Cue uBlock origin - I don’t recall the last time I watched an injected ad on YouTube. Of course most content these days is peddling some product, or has a quick word from sponsors - but at least I don’t have to put up with unrelated ads in the middle of a stream.

One time while working at Google, someone sent me an email linking to a video file related to our work. Before I could watch the video, I had to watch an ad of a unicorn pooping and then a man eating it. I was quite repulsed and livid about it.

Re: It’s time for Alphabet to spin off YouTube?

#112

Post by tshaddox »

judge2020 wrote: post #95
fisf wrote: post #68

Earlier quoted context omitted.

You are basically making the case for the anti-trust case here. i.e. it is very hard for another company to compete without "free compute".

No, they're making the case for them being a monopoly. Unless Google is preventing others from purchasing compute or hard drives by buying up all of the supply, they are not performing any anti-competitive actions, which would not make them liable under any anti-trust statutes. I don't think anyone's in doubt YT is a monopoly with how big and widely-used it is. It's just that they continue to survive because of how w…

> Unless Google is preventing others from purchasing compute or hard drives by buying up all of the supply, they are not performing any anti-competitive actions, which would not make them liable under any anti-trust statutes.

Would the massive subsidization of YouTube’s costs not count? There’s nothing physically preventing a competitor from buying storage and compute, but it’s pretty clear that it would be extremely difficult to compete with YouTube if every user has to pay the actual unit costs to upload, convert, and play videos.

Re: It’s time for Alphabet to spin off YouTube?

#113

Post by H8crilA »

conductr wrote: post #103
crazygringo wrote: post #82

I can't agree. Ultimately, the article argues for spinoff because of 1) focus, 2) more subscription experimentation, and 3) regulators. But there's zero evidence YouTube is a distraction, it's already done lots of experimenation with subscriptions, and YouTube seems like the last of regulators' concerns with Alphabet. I do think it's true there isn't a whole lot of strategic synergy between YouTube and Google or the…

The synergy is that google has active advertisers with payment information on file. They can cross sell ads on any vertical to that customer list. A new company would struggle just to get advertisers to sign up and struggle to get the content and struggle to get the views. This is why google bought YouTube to begin with, it’s a vertical for advertising which is their business.

That's on the revenue front and is indeed important. On the product front: some search and generally data processing technologies are similar or even identical in Search an YouTube (YT Search, but definitely not only that).

Re: It’s time for Alphabet to spin off YouTube?

#114

Post by danaris »

mulletbum wrote: post #51
runako wrote: post #41

Earlier quoted context omitted.

> the service cannot compete on it's own merits This is only true if external actors redefine "the service" to be something other than what millions of customers voluntarily purchase (Prime). For example, I subscribe to Prime because I get free/better shipping on goods as well as video. I don't know what % of my subscription fee I would allot to either, but fortunately I don't have to do that.

Not to mention, these other comments are for Disney. However, Disney is propping their business up with lots of other businesses. If you are going to make Amazon less competitive, you can't leave the giant business next to it in a better position. Disney will just buy it then.

Why, in this hypothetical, would the antitrust bodies see Amazon as needing to be broken up or otherwise restricted to improve competition, but not see acquisition by Disney as being something they should block?

That just doesn't seem internally consistent.

Re: It’s time for Alphabet to spin off YouTube?

#115

Post by nindalf »

I respect the Economist’s business columnist (Schumpeter) and tech columnist (Babbage) but this seems to be a case of Schumpeter writing about tech.

Leaving aside HN loving the idea of Big Tech being weakened by becoming Relatively Small Tech, I don’t see how this is in Alphabet’s or YouTube’s interest.

The article assumes that such a divorce would be simple and it would allow YouTube to focus on taking on TikTok. It sounds like the exact opposite to me. YouTube clearly shares a lot of infrastructure with the rest of Google, especially datacenters and ads. Instead of focusing on high leverage activity like improving product, they would spend their time figuring out how to split datacenters, ads products, internal tooling etc. Almost all of their software stack is maintained internally. They would need to fork it and staff all of these teams. All of this is time wasted, work duplication and cost increases.

Most of the rest is questionable claims. Like the claim that a post-divorce YouTube would be able to focus on subscription revenue. You mean like YouTube Premium, a subscription they’ve had for years? They’re not replacing ads with subscription, they need both, so they need to recreate whatever ads infra they were sharing.

The only argument that made any sense was that it would buy goodwill with regulators. This is because regulators also like the idea of Relatively Small Tech.

I feel like this article was started with that Wall St mentality of “I wish I could invest in YouTube without investing in the rest of it” and it somehow tries to justify the rest the divorce.

Really, if I had to think about what YouTube wants to do I’d say they have to beat TikTok at the recommendation game. To do that they need as much data as possible (even if that sounds distasteful to HN), meaning the entire profile that Google has built on each person. In what world does YouTube build better recommendations after voluntarily giving up access to this data?

I’m keen to read an argument that argues this is in the best interests of Alphabet and YouTube. Ideally something that goes into specifics rather than vague notions of “focus”.

Re: It’s time for Alphabet to spin off YouTube?

#116

Post by tshaddox »

RyJones wrote: post #77
kevincox wrote: post #16

Earlier quoted context omitted.

When I worked at Google I definitely noticed that YouTube was great at (ab)using untracked or very cheap resources. They definitely get huge benifits of otherwise idle data centers in sleeping regions. As the regular service traffic died off YouTube would put those idle cores to work transcoding video. It is definitely the case that YouTube gets lots of really cheap compute by being part of Google. But that isn't a b…

YouTube also functions as a network offset, no? Egress from YouTube helps balance ingress from everything, which should lead to cheaper network settlement. I worked in WANOPS at Microsoft in the 90s, so my understanding of billing is literally decades old.

Is there excess ingress in Google’s networks? I might have guessed the opposite.

Re: It’s time for Alphabet to spin off YouTube?

#117

Post by conductr »

orra wrote: post #91
rtsil wrote: post #66

Earlier quoted context omitted.

What if it's not an independent service, merely a perk of the actual service? Where do we draw the line? Should Apple be asked to spin off iCloud because email, photos, documents should all be independent services? Note that neither Prime Video nor iCloud are monopolies, which would bring different considerations into the matter.

Prime Video isn't a monopoly, but Amazon clearly has Significant Market Power when it comes to retail. They're anti-competitively vertically bundling Prime Video along with retail delivery.

Could make a case that local retail is anticompetitive by not incorporating film production cost into a gallon of milk. Or maybe they’re anticompetitive because they have physical stores and do not need to bear the burden of labor/vehicle/fuel to deliver each order. I think it’s a bit absurd to call in the regulators. Retail is hyper competitive and part of that is they all choose these odd little perks/differentiators to entice customer loyalty. It’s a net positive to the consumer.

Re: It’s time for Alphabet to spin off YouTube?

#118

Post by RyJones »

tshaddox wrote: post #116
RyJones wrote: post #77

Earlier quoted context omitted.

YouTube also functions as a network offset, no? Egress from YouTube helps balance ingress from everything, which should lead to cheaper network settlement. I worked in WANOPS at Microsoft in the 90s, so my understanding of billing is literally decades old.

Is there excess ingress in Google’s networks? I might have guessed the opposite.

If they’re ingesting the web as frequently as my Apache logs say, I would guess the imbalance is high

Re: It’s time for Alphabet to spin off YouTube?

#119

Post by wintermutestwin »

loloquwowndueo wrote: post #17
osigurdson wrote: post #14

For me, YouTube is the most effective ad sponsored service by far. Users are forced to watch at least 5 seconds of ads before watching any content. This 5 second window is very focused as there is no time to context switch to anything else. Contrast this with Google search - sure there are some ads at the top but these are easy to mentally filter out.

Cue uBlock origin - I don’t recall the last time I watched an injected ad on YouTube. Of course most content these days is peddling some product, or has a quick word from sponsors - but at least I don’t have to put up with unrelated ads in the middle of a stream.

Cue the people implying that blocking YT's ads is a form of theft.

I'd gladly pay for ad-free YT, mostly to send the message that I will never ever go back to watching ads. The problem is that google is already stealing my data.

Where is the stalker-free option? Of course, I'd never trust google anyway...

Re: It’s time for Alphabet to spin off YouTube?

#120

Post by conductr »

sofixa wrote: post #58
pclmulqdq wrote: post #2

It's time for antitrust to hit Meta, Alphabet, and Amazon. At the very least. Amazon: AWS is one of the most valuable businesses ever created. You don't need the retail arm any more, now that it is enshitting itself. Also spin off the media company, comprising Audible and prime video, to make a Disney competitor. Amazon would absolutely be more valuable broken up. Meta: Meta has always run 3 separate products either…

> Amazon would absolutely be more valuable broken up That is total nonsense, completely irrelevant, and true. Conglomerates being worth less than the sum of all parts is one of the stupidest parts of Wall Street. There is no actual rationale for this besides maybe it being easier to evaluate a company doing only a single thing? Specifically with regards to the examples given - Amazon, Meta, Google - it's the cross-su…

Would customers pay for Amazon services individually if they were unbundled? I’m guessing there would be significant drop off. Prime Video would implode. Subscription revenue wouldn’t be sufficient to fund content and it’s a short life from there.
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