[HN Gopher] It's time for Alphabet to spin off YouTube?
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It's time for Alphabet to spin off YouTube?
Author : alexcos
Score : 223 points
Date : 2023-02-24 10:58 UTC (12 hours ago)
(HTM) web link (www.economist.com)
(TXT) w3m dump (www.economist.com)
| ARandomerDude wrote:
| > It [YouTube] is an advertising juggernaut to boot.
|
| > Messrs Page and Brin control more than half of Alphabet's
| voting rights, and would not like to be the first titans of tech
| to start selling off the family silver.
|
| Many commenters here have correctly pointed out that the business
| case presented in the article makes approximately zero sense.
| That's because the article is actually an antitrust argument
| disguised as a business analysis.
| linuxftw wrote:
| I'm pretty satisfied with YouTube as a viewer other than Firefox
| on Linux can always decode the ads, but not always the actual
| content (many other sites have this issue as well).
|
| There's so much great content on YT for just about anything.
| Gardening, mechanics, computers, games, sports, you name it. It's
| all there.
|
| Most other platforms are quite vapid. I suppose that's fine for
| the drooling masses, but I'm a quality of quantity person.
| whalesalad wrote:
| judging by the way 9 times out of 10 the callback url for a
| google oauth login is to a youtube domain, i'm going to
| sarcastically assume that this is architecturally impossible
| jonas-w wrote:
| Where does this number come from? Is this just a made up
| number, or is this a real statistic?
| whalesalad wrote:
| in my personal experience this happens to me most of the
| time, but not all the time.
| zpeti wrote:
| This would be the worst time to spin it off. Tiktok is a threat
| but seems slightly subdued, things might take off for YouTube
| again.
|
| On ads ATT has depressed revenue a lot but apples recent updates
| will mean better tracking soon and revenue will recover.
|
| Everything is pointing up for YouTube (and meta), this is the
| worst time for a change in ownedhip structure. You should do that
| at the top not the bottom.
| thewarrior wrote:
| What are these recent ATT updates ? Does Meta also benefit ?
| zpeti wrote:
| They're releasing much more data to advertisers, meaning
| targeting on FB and Meta will considerably improve in the
| next few months. Which will improve performance for everyone.
| dghughes wrote:
| YouTube has become horrible experience practically unwatchable
| unless you pay for the monthly Premium service. And this is
| coming from me a person who grew up watching TV stuffed with ads.
| I can't imagine with young people who never watched TV think of
| bare non-premium YouTube.
|
| Non-premium YouTube is just an ad machine that happens to show
| some video content between ads. It used to be the opposite of
| that.
| crazygringo wrote:
| I don't know what you mean.
|
| If I watch a 9-minute clip, I get 2 ads at the top but can skip
| them after the first 5 seconds of the first ad. And then
| there's often a 15-second unskippable commercial in the middle.
| So about 4% ads. Sometimes there's a single first unskippable
| 15-second ad instead, so about 5% ads. (And the ratio seems
| _roughly_ the same with shorter videos, as they don 't have the
| ad in the middle and sometimes skip the intro ad altogether
| when watched in succession.)
|
| While network TV is 8 minutes of ads in a 30 min slot, or 27%
| ads. So about 5x as much ad time.
|
| If YouTube started implementing _unskippable_ ad segments that
| were _multiple minutes long_ then there would be a comparison.
| But in my experience, YouTube is miles better than network TV
| ever has been in our lifetimes.
| Y_Y wrote:
| That 27% rate would be illegally high in most countries. Not
| to mention the many places which have high-quality public
| broadcasters with few or no ads.
|
| That said network TV isn't necessarily a great comparison.
| For me I'm most likely to compare with YouTube of the past,
| very similar content, but no ads. Or YouTube with adblock or
| third-party android apps.
| crazygringo wrote:
| Well the parent commenter was talking about network TV (and
| basic cable isn't any different) and YouTube is an American
| company.
|
| So that's great if 27% ad time is illegal in some other
| countries, but I guess they either make it up with
| mandatory fees (like in the UK) or have lower budget
| programming.
| pb7 wrote:
| So pay for premium then. It costs a lot of money to run, why do
| you feel entitled to get it for free with nothing monetizing
| it?
| marban wrote:
| Start with spinning off Shorts into a separate tab and I'm happy.
| mattpallissard wrote:
| > I always assumed YouTube's technical foundations were
| significantly subsidized by the mothership, but I have no data to
| base that on
|
| I'd venture to guess that YouTube provided more value than just
| their customer base. I often wonder how much of their tech stack
| made it into the larger Google org.
|
| Example; for the longest time when you'd log into gsuite via a
| SAML IdP you'd notice a youtube url in the login flow.
| hn_go_brrrrr wrote:
| > I often wonder how much of their tech stack made it into the
| larger Google org.
|
| Very little, though that may be changing. Most of YouTube was
| written in Python, which is essentially unknown for a
| production system at Google.
|
| > Example; for the longest time when you'd log into gsuite via
| a SAML IdP you'd notice a youtube url in the login flow.
|
| This was just to set the YouTube "logged in" cookie.
| nickdothutton wrote:
| What percentage can the investment bank handling the spin-out
| expect to skim while simultaneously talking up the share price of
| both Google and the spin-out? (Rubs hands vigorously).
| jl6 wrote:
| I always assumed YouTube's technical foundations were
| significantly subsidized by the mothership, but I have no data to
| base that on other than looking at the $29bn/year revenue figure
| and wondering whether that amount of money would be enough to
| provision the amount of compute, storage and bandwidth that
| YouTube needs, plus all other expenses (including revenue sharing
| with uploaders). Yes, $29bn is a lot of money, but there is a
| _lot_ of YouTube.
| nerdjon wrote:
| This was my first thought as well.
|
| Is YouTube viable as its own company at the scale it operates?
| I have to imagine the infrastructure costs for YouTube would be
| extremely high and would likely cause YouTube to downgrade
| quality or try even harder to put a subscription behind even
| 1080.
|
| Now obviously contacts can be signed and I highly doubt they
| would be paying normal prices in any cloud environment given
| this hypothetical situation. But it wouldn't be the same as it
| would be now.
| chrisfinazzo wrote:
| Yep.
|
| Does YT need Google's backing in order to survive because
| they don't have the resources strictly in-house to build and
| pay for infrastructure?
|
| _Disclaimer: Not an Economist, not even close._
|
| If in the unlikely case they spun it off and another
| competitor emerged, would YT's scale make it hard to compete
| with this new entrant? _Read: Red tape, bureaucracy, etc,
| etc._
|
| Essentially back to where they were as an independent company
| when they didn't have Google to "protect" them...
|
| The inverse case is what usually comes to mind first though:
|
| Would the company wither and die if not for an acquisition?
| Think about Sprint+TMobile. Until the deal, Sprint was in bad
| shape, second to Verizon with outdated tech - in the sense
| that emerging technologies were based more off of an
| evolution of GSM than CDMA.
|
| If TMo doesn't acquire them, Sprint probably goes "poof" and
| their customers flee to the remaining carriers, further
| entrenching their positions.
|
| This seems like it is usually the card European regulators
| tend to play, worrying more about market dynamics and how
| that will affect costs rather than just what people pay for
| service.
| recuter wrote:
| And yet up until a couple years ago at least Netflix served a
| higher percentage of web traffic. Don't know about now, maybe
| that changed.
|
| There is only so many hours in the day and so many eyeballs
| watching, that is your upper bound. Bandwidth like that is not
| available to mere mortals, you would have to colocate with a
| lot of ISPs all over the place. Would take years to setup, not
| really even a question of money.
|
| In the case of Netflix their content library fits inside one
| such colocated server, which can (or pretty soon will) do
| 1tb/s. Hundreds of thousands of streams per box are within
| reach, especially at YouTube potato resolutions.
|
| In the case of Youtube while the long tail is very very long, I
| bet the most popular content of the week would fit into a
| similar sort of server.
|
| So the serving portion at least is an endeavor on the order of
| magnitude of say 1 billion dollars a year.
|
| No idea how to estimate letting anybody upload unlimited
| amounts of video of unlimited length and transcoding it into a
| dozen sizes. I think they did that early on to solidify their
| moat and it seems like a huge waste.
| Aromasin wrote:
| From what I'm aware, a lot of these larger companies basically
| treat other parts of the business the same they would
| customers; very important customers, but customers all the
| same. If YouTube wants more cloud budget, it comes out of their
| budget and goes into revenues of the Cloud business unit. Not
| quite that simplistic of course, but in essence it's meant to
| drive competitiveness. No special privilege's just because
| you're part of the same team. If an external company is paying
| more, for more compute, the business goes to them.
| curiousllama wrote:
| That stuff still comes with special privileges.
|
| E.g., yes they'll "pay" for compute, but they'll do so at
| cost. And they're also allowed to deploy a monitoring widgets
| to other orgs' data centers to find when they're at low
| utilization, and then argue "at cost" is actually near 0,
| because the compute resources were just sitting around
| anyway. And then have the search team agree because YouTube
| promises to build the new data API search has been asking for
| forever.
|
| If you ultimately report earnings on the same P&L, USD is
| just monopoly money you trade around to get things done.
| bpodgursky wrote:
| Yeah I think this is generally true, although YouTube is a
| weird case because there's literally no equivalent customer
| with even a fraction of the compute volume.
| kevincox wrote:
| 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 bad
| thing, they are making use of an otherwise wasted resource,
| effectively lowering the cost for products that need daytime
| capacity to serve humans.
| KMag wrote:
| But separating YouTube and GCP into separate companies would
| presumably cause GCP to expose pricing / scheduling modes
| that would enable more compute to take advantage of regional
| downtimes. I'm sure there's plenty of ML training jobs that
| are just aching for regionally idle compute time.
| BooneJS wrote:
| "In our case, we developed a custom chip to transcode video,
| as well as software to coordinate these chips. And we put it
| all together to form our transcoding special brain - the
| Video (trans)Coding Unit (VCU). We've seen up to 20-33x
| improvements in compute efficiency compared to our previous
| optimized system, which was running software on traditional
| servers."
|
| https://blog.youtube/inside-youtube/new-era-video-
| infrastruc...
| kevincox wrote:
| If I had to guess these are used for urgent video
| transcodes. New uploads to popular channels and on-demand
| transcoding. I suspect that CPUs are still often used for
| background batch encoding. But maybe 20x is enough that the
| power cost of extra CPU usage isn't worth it and they will
| do it all in hardware.
| pradn wrote:
| Why would YouTube not get Borg charge-backs? YouTube does pay
| for the infra it uses. And it's likely much cheaper than it
| would be if it were an independent company with its own data
| centers.
| fisf wrote:
| 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".
| cma wrote:
| Antitrust isn't supposed to tamp down on those kind of
| efficiencies. Google offers the idle time on the market as
| well with spot instances, so they pay an opportunity cost.
| morpheuskafka wrote:
| Actually he is making the counterargument to anti-trust,
| which is that integration increases efficiency and total
| surplus.
| sScTE9qEMCxEk34 wrote:
| 90% of the "efficiency" and "surplus" is the fact that no
| one can effectively compete.
|
| Which is why it's anti-competitive.
| jldugger wrote:
| What OP basically described is use case for cloud computing
| and spot markets. Even if only internally.
|
| While it could be made open, I don't see any regulatory
| reason to. We want companies to reduce waste, and it
| doesn't make sense to require all companies to build public
| facing cloud, and integrate their flagships into it, just
| to open it up to their competitors. It would be like
| telling Apple that its factories reusing scrap aluminum to
| make iPhone cases is an unfair competitive practice.
| detourdog wrote:
| I bet an individual with a static IP could make more money
| self-publishing than using youtube. I see federation and
| countless other things that compete with youtube. Access to
| "free" compute time. Any "free" compute time is likely to
| be transient and nothing to build a business on.
| scarface_74 wrote:
| That's not how anti-trust works.
|
| Are you really saying that no company should be able to
| create a new product based on resources it already has?
|
| Why stop at compute? Why not make it an "anti-trust" case
| that Apple leverages its same operating system and chip
| design across multiple devices? Or Amazon uses its same
| logistics network to deliver more than just books?
| anigbrowl wrote:
| This is big business pretending to be small to distract
| attention from market dominance, and pretending to be
| creative to distract attention from a strategy of
| acquisition rather than origination.
|
| Your argument is valid, but scale matters. Think of a
| game of _Monopoly_ ; you can usually tell who's going to
| win well before the game concludes, and you can guess
| which players will lose well before that.
| scarface_74 wrote:
| And if Google hadn't acquired YouTube it wouldn't exist
| today. It would have either been sued out of existence or
| the infrastructure costs wouldn't be sustainable.
|
| But let's not pretend that the little guy wants to go
| public. If they do, they are naive. Out of all of the
| companies, that YC has invested in, maybe 5 have actually
| gone public. Every startup knows the game is to get
| acquired.
|
| The fact is that some things need scale to succeed.
| OpenAI for instance was never going to be able to afford
| the compute it needed without being subsidized by MS.
| anigbrowl wrote:
| But how did YouTube get founded in the first place, and
| become successful as a video-sharing platform for
| original content? Or how did Google come to exist, when
| the market was dominated by (then-) huge firms like
| Yahoo, Lycos, and Altavista?
|
| Both companies had a first mover advantage by deploying a
| more scale _able_ technical innovation in a somewhat
| stealthy way. OpenAI is subsidized as you say, but
| StabilityAI promptly ate their lunch int he image
| production field and is hoping to do the same with LLMs.
| scarface_74 wrote:
| > But how did YouTube get founded in the first place, and
| become successful as a video-sharing platform for
| original content
|
| A "successful" business makes more than it spends so it
| can be an ongoing concern. Any company can sell a lot of
| dollars for 95 cents. Youtube was never a "successful"
| business with a meaningful revenue stream before being
| acquired by Google.
|
| > Or how did Google come to exist, when the market was
| dominated by (then-) huge firms like Yahoo, Lycos, and
| Altavista?
|
| You realize you're arguing against the need for
| government regulation. This is the market working as it
| should. But Google became a success initially because
| Yahoo used it as their "search engine". Google initially
| offered to be bought up by Yahoo and Yahoo balked at the
| price. Google wasn't trying to go it alone.
| anigbrowl wrote:
| Youtube got acquired before they monetized, but it was
| obvious that they would eventually do something like
| that. Running at a loss to gain market dominance with a
| distinctly different kind of service is not 'selling
| dollars for 95 cents'.
|
| _You realize you 're arguing against the need for
| government regulation._
|
| I'm looking at some gaps in your logic when you assert
| that anyone who ever wants to go public is naive; when
| Excite (not Yahoo) declined Google's $1m buyout ask, they
| were already running as a public service under their own
| brand and had a plan for text ad sales in place.
| Certainly it was worth trying to develop a technology
| product followed by an acquisition before the more
| challenging (but perhaps less interesting) business of
| raising capital directly, but there was a widespread view
| at the time (among both tech and VC people) that their
| product was good enough for them to go all the way.
|
| I'm not trying to debate the need for government
| regulation and don't know why you think this is some sort
| of 'gotcha'.
| sclarisse wrote:
| Eh. Using spare CPU capacity is not really anticompetitive
| behavior. That's just an efficient enterprise. Something
| like Google favoring YouTube in search and suppressing
| their competitors would be actual anticompetitive behavior.
| MichaelZuo wrote:
| But it's not like there will be a free competitor in any
| case? The closest might be peertube but that's nowhere near
| as reliable.
|
| Vimeo is paid. None of the other big companies seem willing
| to subsidize an online video service to the tune of tens of
| billions per annum.
| pwinnski wrote:
| Which, again, makes the anti-trust case stronger. The
| case being: Google leverages one of their businesses
| (providing compute) to build an anti-competitive moat
| around another of their businesses (youtube), and it's so
| effective that they have driven all competitors out of
| the market.
|
| By nearly any standard, Google's control of YouTube
| should be a prime anti-trust target.
| UncleEntity wrote:
| Being a monopoly isn't illegal, abusing your monopoly is.
|
| And how does "providing compute" even matter, YouTube is
| just using google servers like every other google
| service. Not like they're getting something for free
| because they're part of the same company.
| meragrin_ wrote:
| > Google leverages one of their businesses (providing
| compute) to build an anti-competitive moat around another
| of their businesses (youtube),
|
| You speak as if providing compute is their primary
| business. Youtube, existed long before their compute.
| They already had all their own compute. They only got
| into providing compute because they figured they could
| beat AWS with their own infrastructure.
| waboremo wrote:
| Anti-trust wouldn't apply here because there is very little
| stopping someone from creating a video hosting company and
| doing fine. Plenty of alternatives exist as well here,
| Tiktok, Vimeo, Twitch, Patreon all to varying degrees of
| scale.
|
| Where I would try to nail Google/Youtube for with anti-
| trust is the merging of Music and TV/Movies into Youtube as
| well as the reliance of Google ads on Youtube. Both of
| those are incredibly annoying to deal with as a competitor
| and give Google the ability to corner the market on
| multiple fronts. Roku has highlighted this themselves,
| Google leveraging Youtube to make brand deals that other
| competitors cannot.
| himinlomax wrote:
| Anti-trust legislation is not meant to stop economies of
| scale, it's meant to curb monopolistic practices.
| judge2020 wrote:
| 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 well they execute their plan of
| making a good service that gives users what they want
| (fast, instant access to videos that appeal to them) and
| pays out creators enough to where they can make a living,
| or even build a media company (LTT), off of the adsense and
| monetization opportunities YT enables.
| HDThoreaun wrote:
| You don't need to be a monopoly to get anti-trusted. You
| just need to use your market power to stifle competition
| to consumers detriment.
| WastingMyTime89 wrote:
| Preferentially giving YouTube access to ressources is
| indeed an anti-competitive action. That's part of the
| vertical restraint kind.
|
| YT isn't a monopoly however. It might be dominant
| depending of how you define the markets but it does have
| competitors.
| scarface_74 wrote:
| That's not in any sense of the word how anti-trust works.
|
| That's just like saying that car manufacturers can't use
| idle capacity to help start a new line of vehicles just
| because a new car manufacturer couldn't create a new car
| line.
| WastingMyTime89 wrote:
| No, it's not comparable in any ways. Car manufacturers
| sell cars. That's their main business.
|
| Here we have Google using its dominant position in
| another market to prop up another activity through an
| advantage. That's most definitely fall under anti-
| competitive law at least in Europe (I don't care about
| the US. The modern interpretation of American antitrust
| laws is a complete joke).
| scarface_74 wrote:
| Apple's main business was selling computers. Should they
| not have been allowed to branch out to sell phones or
| before that music players? Netflix had a dominant
| business in shipping DVDs to customers. Should they have
| not branched out to streaming?
|
| It's silly to say that companies should never be allowed
| to branch out to other businesses.
| WastingMyTime89 wrote:
| When did Apple ever had a dominant position in the
| computer market? Ah, yes, never, I was scared that you
| may have had a point there for moment.
|
| Care to highlight exactly how Netflix used its dominant
| position in film renting in favour of its streaming
| business?
|
| It would indeed be silly to say companies can't branch
| out. Thankfully no one is so that's fine.
| scarface_74 wrote:
| Netflix very much had a dominant position in DVD rentals
| at its height.
|
| Apple had a dominant position in selling music and in
| music players by 2006. It was the number one music
| retailer in the US. It very much used that to get into
| the phone market and part of its early success in the App
| Store was that it was built on top of iTunes and it
| already had more credit cards on file than any other
| company in the US besides Amazon.
|
| If you're not arguing that a company shouldn't branch
| out, are you arguing that once a company gets a certain
| size, it shouldn't be allowed to invest those profits and
| resources into another industry?
|
| By 2011, Apple was the most valuable company in the US.
| Should it not have been allowed to start selling watches,
| home stereo equipment and AirPods?
| Darrengineer wrote:
| > Netflix very much had a dominant position in DVD
| rentals at its height.
|
| Is this true? My recollection being a netflix DVD
| customer is that brick and mortar rental stores were
| dominant until netflix streaming upended the DVD rental
| dynamic. Would love to see some data on it though!
| scarface_74 wrote:
| There is a long story about how just when it looked like
| the combination of BlockBuster brick and mortar + mail in
| was about to deal the killing blow to Netflix, Carl Icahn
| came in and snatched defeat out of the jaws of victory.
|
| https://hbr.org/2011/04/how-i-did-it-blockbusters-former-
| ceo...
|
| https://www.cnbc.com/2020/09/22/how-netflix-almost-lost-
| the-...
| tshaddox wrote:
| > 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.
| judge2020 wrote:
| > 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.
|
| That's on the user side, though. Like AWS and Azure,
| chances are GCP/Google's internal hardware division bills
| internal teams similarly to external customers
| (especially as Sundar continues to demand cost cuts). Of
| course users themselves can't go and make their own
| website and experience the same economies of scale that
| only big companies can achieve, but if competitors come
| in (like ByteDance) there's nothing stopping them from
| stealing marketshare from YouTube if they invest in some
| colocated servers in key markets.
| rescbr wrote:
| > Like AWS and Azure, chances are GCP/Google's internal
| hardware division bills internal teams similarly to
| external customers (especially as Sundar continues to
| demand cost cuts)
|
| Having worked on such large conglomerates it's closer to
| friends & family discount than from large external
| company discount.
|
| There's also transfer pricing and other accounting ways
| to improve numbers.
|
| This is so widespread that one such company had <company
| color> dollars (internal purchases) and green dollars
| (external customers) pricing.
| scarface_74 wrote:
| That's simple Managerial Accounting 101.
|
| Every major company operates the same way.
|
| When Disney+ "buys" the right to stream the latest Marvel
| movie from Marvel Studios, the company as a whole has to
| back out the revenue so not to count it twice. But still
| show Disney+'s profit.
| lotsofpulp wrote:
| Why would they have to "back out" revenue"? Revenue for
| one department has to be an expense for another if they
| are buying and selling from each other, and that would
| cancel out in the company wide financials.
|
| Disney+ buying from or selling to Marvel would not show
| up as profit or loss for Disney.
| scarface_74 wrote:
| Let's take a simpler example. Apple Retail Stores and
| Apple corporate. For awhile Apple Store profits were
| broken out separately.
|
| Making up numbers:
|
| It costs Apple $800 to make a MacBook. It "sells" the
| MacBook to Apple Retail for $900 wholesale. Apple
| corporate now has revenue of $900 from the Mac it sold.
|
| Apple Retail sells the same Mac to the end user for
| $1000. Apple Retail now has revenue of $1000.
|
| Apple Corporate claims revenue of $900
|
| Apple Retail claims revenue of $1000.
|
| Apple claims a revenue of $1900. But it has to back out
| $900 of revenue so it doesn't double count it.
|
| Apple wants to show that Apple Retail is profitable.
|
| I used Apple instead of Disney in the example because it
| is much simpler to show one item being transferred from
| Apple to Apple retail than it is to show a group of
| movies being transferred to Disney and Disney selling a
| subscription.
| [deleted]
| rottingchris wrote:
| Revenue is independent of expenses. It cancels out when
| you calculate profit.
| scarface_74 wrote:
| I spoke about "revenue" and then I said "profit". I was
| inconsistent. "Profit" would have been cancelled out.
| "Revenue" would have had to be backed out.
| Retric wrote:
| The monopoly practice in this case is subsidizing a
| business with by leveraging a monopoly. Aka YouTube isn't
| paying market prices on unused compute therefore Google
| is leverage its search monopoly to expand into another
| business.
|
| Historically the concern was that railroads might get
| into say coal mining by charging competitors more to move
| coal than they charged themselves.
| giantrobot wrote:
| > Aka YouTube isn't paying market prices on unused
| compute therefore Google is leverage its search monopoly
| to expand into another business.
|
| What in the hell is "market rate" for compute? Google
| bought a zillion CPUs and hard drives and put them in
| data centers that they pay for. There's no "market rate",
| they own the infrastructure. They can do whatever they
| want with the equipment they own. A division using
| another division's spare compute capacity isn't in any
| way an anti-trust violation. What you're saying makes no
| sense at all.
| Retric wrote:
| Google cloud exists... Anyway, monopolies have specific
| legal restrictions on what they can do with their
| infrastructure be that railroads, cables, or data
| centers.
|
| "Amazon EC2 Spot Instances let you take advantage of
| _unused EC2 capacity_ in the AWS cloud. Spot Instances
| are available at up to a 90% discount compared to On-
| Demand prices." https://aws.amazon.com/ec2/spot/
|
| As a monopoly Google could sell the same capacity YouTube
| is using on Google cloud services and YouTube could then
| buy that capacity. If YouTube was treated as any other
| customer it's fine, if YouTube got preferential treatment
| it's not fine.
|
| I doubt anyone is going to take them to court over this
| but it is likely illegal.
| danielrhodes wrote:
| From reading your comments, it appears like you have
| confused having a competitive advantage with anti-
| competitive practices. Just because YouTube has access to
| cheap resources by its parent does not prevent a
| competitor from existing in or entering the market.
| Facebook, Instagram, Tik Tok are doing just fine without
| access to Google's resources. There are other practices
| that Google does which might fit the bill (e.g. ranking
| and prominence in search results, Android, etc.), but
| this isn't one of them.
| Retric wrote:
| Competitive advantage is fine that's kind of the point of
| capitalism. So the problem isn't that YouTube has access
| to cheap compute, that's normally just a basic synergy
| that every MBA loves.
|
| The problem comes from Alphabet having cheap compute left
| over from their search monopoly. In 1982 AT&T was broken
| up because it was using its local monopoly when competing
| in the long distance market. Again for 99% of companies
| it would have been fine, but monopoly = special rules.
| giantrobot wrote:
| So companies can't leverage their own infrastructures
| between divisions? They should have to offer every bit of
| their infrastructure at "market rates"? What's the market
| rate for me shipping boxes using Walmart's trucks? Should
| McDonalds be forced to charge "market rate" rent to
| Subway for counter and kitchen space?
| Retric wrote:
| Monopolies not random companies. Also, what's legal isn't
| particularly relevant only what's enforced as nobody
| actually cares as about what infrastructure YouTube is
| using.
| scarface_74 wrote:
| In that case are you saying it should be illegal for any
| company to leverage its resources to get into a new
| business? Should Netflix not been allowed to leverage
| profits it was making in shipping DVDs to enter
| streaming?
| Retric wrote:
| No, it's not a question of money but of resources. If
| Google offers up their compute at market rates and
| YouTube is treated as any other customer on that compute
| then it's not a problem.
|
| Microsoft for example could have spent unlimited money on
| IE and the justice department wouldn't have cared as long
| as it was treated as a business investment. However,
| leveraging the ability to change windows was seen as
| problematic.
|
| Long term subsidies can also run into issues, but it's
| believed YouTube is inherently profitable.
| scarface_74 wrote:
| Actually, you're kind of making my point. Absolutely
| _nothing_ came of the DOJ case with regards to IE
| bundling.
|
| But that still isn't logical. Are you really going to say
| that a company shouldn't be allowed to use resources to
| create a new product? Should it have been illegal for
| Netflix to use profits from shipping DVDs to later bundle
| video streaming?
|
| Should it also be illegal for companies to "subsidize"
| open source contributors? Should it be illegal for YC and
| other VCs to "subsidize" money losing startups based on
| previous successes?
|
| How long should a company be allowed to spend money on
| money losing products to gain a foothold? Microsoft
| probably lost money on the first 2 generations of the
| Xbox. Should that be illegal? Should Microsoft not be
| allowed to throw billions at ChatGPT?
| Retric wrote:
| Microsoft _lost._ They avoided being broken up, but it's
| absolutely clear they had broken the law. It's not IE
| bundling alone that was at issue but Microsoft making it
| harder to install competitors and limiting access to some
| API's to IE. They where legally required to change this
| and did in fact do so. https://en.wikipedia.org/wiki/Unit
| ed_States_v._Microsoft_Cor...
|
| And the critical thing you don't seem to understand is
| resources aren't the same thing as money. Suppose Intel
| decided to change their CPU design so only their compiler
| would have access to the full instruction set, that's not
| something money can buy. Anyone can bring lots of money
| to the table, only the monopoly can leverage the
| resources associated with that monopoly.
|
| As to spending money, again it's not about gaining a
| foothold because anyone can spend money. The issue is if
| someone is subsidizing a business to maintain their
| monopoly rather than operate a profitable business.
| Google didn't get into fiber because they wanted to
| operate a profitable business they got into fiber to
| defend their websites. They didn't cross the line, but
| you can see how long term subsidies of different business
| could be seen as desirable/problematic.
| scarface_74 wrote:
| Microsoft did not in fact have to change anything about
| _bundling the browser with Windows_.
|
| And just in case you haven't noticed, Intel isn't exactly
| doing great against AMD these days and doesn't even have
| a monopoly on chips with the x86 instruction set.
|
| Do you think its also illegal for the cable companies
| that originally lost money on cable infrastructure and to
| subsidize the cable infrastructure to sell subscription
| content? DirecTV probably wouldn't have made money
| selling satellite internet. But it was able to do it
| cheaply because of its content delivery. Every company
| leverages its resources to have margins of scale.
|
| Even HN can only exist as a free service because it
| leverages the resources it has from the rest of its
| business. No one pays dang to moderate HN. The moderation
| is subsidized.
| Retric wrote:
| I will say it again Microsoft broke the law _and lost._
| The case was more complicated than a simple sound bite
| which is why you're confused.
|
| People get away with breaking the law constantly, you can
| do 57 mph in a 55 every day for 60 years and never get a
| ticket. Shipping Windows with a copy of IE was like doing
| 57, nominally illegal but not something they would have
| gotten in much trouble over. But like a speeder they
| pushed even further and got slapped down over it.
|
| Intel has had an X86 monopoly at various points. Doing
| something when they aren't a monopoly can be legal when
| doing the exact same thing as a monopoly is illegal.
| Whether they currently qualify as a monopoly is
| debatable, but you don't need a 100% market share to be
| considered a monopoly. AMD having a 20% market share is
| right at the edge of where Intel would be considered a
| monopoly but Intel has a great deal of market power.
| scarface_74 wrote:
| This was your original thesis:
|
| > Microsoft for example could have spent unlimited money
| on IE and the justice department wouldn't have cared as
| long as it was treated as a business investment. However,
| leveraging the ability to change windows was seen as
| problematic.
|
| There is no confusion. _Nothing came out of the DOJ case
| with respect to MS bundling IE_.
|
| Intel has never had a monopoly when it came to x86. IBM
| insisted from day one that were two suppliers for x86
| before it even agreed to use the first chip.
| Retric wrote:
| I said "leveraging the ability to change windows" which
| is not limited to bundling.
|
| Making it more difficult to install competitors is
| "leveraging the ability to change windows."
|
| They very much lost in large part because of a video
| shown in court of how difficult to install a competitor.
| They even lied about it by editing their own video which
| skipped steps showing they knew that behavior was
| problematic.
|
| As to Intel's x86 monopoly. Intel paid 1.6 billion in
| response to a monopoly lawsuit, and the EU fined them
| $1.45 billion and ordered it to end its customer rebate
| program. So they where definitely treated like a
| monopoly.
| scarface_74 wrote:
| Did you ever install Navigator back in the day? It was
| not difficult to install another browser.
| barneygale wrote:
| Why are you continuing to argue when you clearly don't
| understand antitrust?
| scarface_74 wrote:
| Well, in that case neither does the justice department
| for the last three decades since none of them have agreed
| with HN lawyers theories...
| saurik wrote:
| You seem to keep ignoring, though, that Microsoft lost
| :/. Like: Microsoft was charged, the case was heard, and
| Microsoft lost. The judge even ruled that Microsoft be
| broke into two companies! So, no: you are just wasting
| everyone's time here by insisting something that is 100%
| absolutely incorrect.
|
| https://corporatefinanceinstitute.com/resources/managemen
| t/m...
|
| FWIW, the reason you might be a bit confused--though I do
| not think this excuses the time you're spending here--is
| that Microsoft did not end up broken into two because
| they appealed that part of the ruling and "won"... but
| that court of appeals actually re-affirmed that
| Microsoft's actions were illegal!
|
| https://www.computerworld.com/article/2582620/appeals-
| court-...
|
| > The appeals court, in its decision, specifically
| rejected Jackson's order that Microsoft be split. "We
| vacate the judgment on remedies, because the trial judge
| engaged in impermissible ex parte contacts by holding
| secret interviews with members of the media and made
| numerous offensive comments about Microsoft officials in
| public statements outside of the courtroom, giving rise
| to an appearance of partiality," the decision said in
| part.
|
| This is essentially akin to someone being convicted of
| something and then appealing the decision to an appeals
| court that decides "OK, the defendant clearly is guilty,
| but the chain of evidence used by the district attorney
| was compromised and so none of it is admissible; thereby,
| you cannot send them to jail, even though we know they
| are guilty".
|
| (edit: Also, there were, in fact, serious ramifications
| on Microsoft for this loss... Bill Gates largely had to
| step down as CEO due to having gotten the courts so mad
| at Microsoft that it was almost broken apart, the IE team
| had a difficult time hiring anyone due to the shame and
| Internet Explorer ended up on life support <- this is
| often blamed in Microsoft "not caring as they were a
| monopoly" but that is far from the truth, and the
| resulting chaos for Microsoft really allowed Apple an
| entrance with Steve Jobs back at the helm to retake a
| large market segment. I did a talk about The Fall of the
| Roman Empire that covered some of these issues, but more
| detail on IE is likely a nonsequitur.)
| https://vimeo.com/310654342
| scarface_74 wrote:
| And this still has no bearings on the original thing
| claimed that Microsoft was found to be anti competitive
| _for bundling IE_. Not bundling IE was never part of the
| consent decree. No one ever said there was going to have
| to be a separate "IE company Inc".
|
| Job first came back to prominence with the iMac, then
| really took off because of the iPod. Microsoft didn't
| fail in the music player market for lack of trying, they
| had multiple failures - first Plays4Sure and then the
| Zune. It was execution failure. The same with the phone.
|
| Microsoft was never able to compete with an integrated
| player like Apple except for the Mac.
| Retric wrote:
| The degree of bundling was part of the decent degree,
| including IE with windows was not.
|
| Aka the use of private Windows API's by IE was explicitly
| banned in the decent decree.
|
| The initial case which MS lost would have resulted in
| splitting the company, on appeal and by the time of the
| new trial (which they also lost) the government changed
| its mind into no longer seeking to break up the company.
| But that was on the government not a legal victory by
| Microsoft.
| scarface_74 wrote:
| According to the Wikipedia summary
|
| > However, the DOJ did not require Microsoft to change
| any of its code nor did it prevent Microsoft from tying
| other software with Windows in the future
| Retric wrote:
| Yes. It wasn't always difficult, but at various points
| there were extra hoops you needed to jump through. Again
| I will point out Microsoft editing a video to skip steps
| they clearly wouldn't have done so if the process was
| reasonable.
|
| They have even swapped peoples browsers with security
| updates before. Though more recent examples like KB
| 3135173 seem like a simple mistake, it's more provocative
| when such things were common.
| scarface_74 wrote:
| There were never any extra hoops. You downloaded Netscape
| and you clicked on install like you did any other
| application.
| Retric wrote:
| Not only is this false it was demonstrated as false in
| court.
|
| "Microsoft later submitted a second inaccurate videotape
| into evidence. The issue was how easy or difficult it was
| for America Online users to download and install Netscape
| Navigator onto a Windows PC. Microsoft's videotape showed
| the process as being quick and easy, resulting in the
| Netscape icon appearing on the user's desktop. The
| government produced its own videotape of the same
| process, revealing that Microsoft's videotape had
| conveniently removed a long and complex part of the
| procedure and that the Netscape icon was not placed on
| the desktop, requiring a user to search for it. _Brad
| Chase, a Microsoft vice president, verified the
| government 's tape and conceded that Microsoft's own tape
| was falsified."_ https://en.wikipedia.org/wiki/United_Sta
| tes_v._Microsoft_Cor....
|
| Also I had forgotten about this bit: "Later, Allchin re-
| ran the demonstration and provided a new videotape, but
| in so doing Microsoft dropped the claim that Windows is
| slowed down when IE is removed."
| dragonwriter wrote:
| > Nothing came out of the DOJ case with respect to MS
| bundling IE.
|
| In the sense that there was ultimately a comparative slap
| on the wrist remedy, in part because of a favorable-to-
| Microsoft change in administration between the findings
| of fact on antitrust violation (in which bundling IE was
| a factor, but far from the sole factor) and the
| imposition of a remedy for those violations, yes, nothing
| much came out of it.
| scarface_74 wrote:
| The original poster was originally focused on bundling.
| If DOJ had said Bill Gates kicked a dog while dressing up
| as clippy it would have meant nothing since there was no
| proposed remedy or anything that came out of the consent
| decree that BG had to stop cosplaying as Clippy and
| kicking dogs.
| JohnFen wrote:
| Right.
|
| And we shouldn't forget that, in the US anyway, it's not
| illegal to be a monopoly. The "antitrust" laws are about
| unfairly leveraging your monopoly position.
| sebzim4500 wrote:
| If they spun out Youtube, then Google could sell access to
| idle data centers. Basically spot instances, or maybe you
| describe some task (with e.g. a docker container) and then
| GCP runs it at some point in the next 24 hours in some
| datacenter.
| RyJones wrote:
| 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.
| tshaddox wrote:
| Is there excess ingress in Google's networks? I might have
| guessed the opposite.
| RyJones wrote:
| If they're ingesting the web as frequently as my Apache
| logs say, I would guess the imbalance is high
| heavenlyblue wrote:
| > It is definitely the case that YouTube gets lots of really
| cheap compute by being part of Google. But that isn't a bad
| thing, they are making use of an otherwise wasted resource,
| effectively lowering the cost for products that need daytime
| capacity to serve humans.
|
| Google could rent this compute capacity to the masses,
| allowing for healthier competition.
| JohnFen wrote:
| > Google could rent this compute capacity to the masses,
| allowing for healthier competition.
|
| They could, but no major corporation wants healthier
| competition. They want no competition whatsoever. So there
| is no reason at all for Google to do this, and every reason
| (from their point of view) not to.
| ghaff wrote:
| Presumably Google could spin out some of those unused
| resources with spot pricing but certainly it's easier with
| their own highly instrumented workloads.
|
| So I'm skeptical that anything is actually "free" and, at a
| minimum, I'm sure has internal transfer pricing that has
| YouTube paying a reasonable value for the resources it uses.
| And I would furthermore assume that Alphabet management is
| satisfied with what YouTube's income statement looks like
| given those transfer payments.
| kevincox wrote:
| For sure. It isn't free, they are just making good use of
| otherwise unused capacity. Much like spot instances can be
| dramatically cheaper they are using the cheapest available
| resources. Plus they are happy with being preempted at any
| time or their work being slowed so they are working with an
| even tighter contract then GCP Spot Instances which have
| minimum runtimes and preemption notices.
|
| It is hard to decide if this is unfair or not. It is true
| that Google doesn't offer this exact ability to external
| customers but most customers wouldn't want this type of
| very unreliable infrastructure. If there was a market
| Google or Amazon would likely offer it (basically a super-
| spot which has less guarantees)
| jelling wrote:
| The commentators point was that YouTube may not be as strong
| of a stand-alone company as the article believes if the COGS
| is inaccurate because YT gets tons of free resources via
| Google.
| jsnell wrote:
| Note that the content isn't free either; more than half of the
| revenue goes to the creators.
| klodolph wrote:
| Think of it less as a subsidy. Instead, think of this--
|
| Team A is running a database and needs to buy disks with a
| certain amount of IO capacity.
|
| Team B is running YouTube and needs to store tons of data.
|
| You add up the IO + storage requirements from team A and the IO
| + storage requirements of team B and you buy disks capable of
| providing that combined amount of IO + storage. The resulting
| cost is much lower than the cost of buying disks for team A and
| disks for team B separately.
| AtNightWeCode wrote:
| Youtube costs close to 2x compared to HBO where I live, just to
| get rid of the ads. Who came up with that business plan? The big
| problem with Youtube right now is the death of history. More and
| more often I seek "Youtube"-content on other sites.
| webdoodle wrote:
| Just in time for the Weaponization hearings. Conveniently...
| londons_explore wrote:
| There are only a few times when a spun off company can be worth
| more than an integrated one...
|
| 1) When the spinoff might have negative value. Eg. has big
| liabilities. But you don't need to make it fully independent to
| gain this benefit - it can be a wholly owned subsidiary.
|
| 2) When the spinoff can't get clients or suppliers due to the
| business of the parent company - eg. the renewable energy
| division of BP might not have much success getting charitable
| funding from green charities.
|
| 3) Where someone else wants to buy the spinoff for more than
| market value for strategic reasons. Eg. to have its patents, or
| to shut down a competing business.
|
| I don't think any of these apply in the case of Youtube.
| PreInternet01 wrote:
| Well, YouTube-the-hosting-business definitely doesn't fit in very
| well with Goo-Alpha-whatever (being, really, an advertising-cum-
| PI-broker), but that's hardly the fault of the owning company.
|
| Fact is: there is _very_ little business sense in an outfit like
| YouTube. You have massive server costs, massive bandwidth costs,
| a fickle audience, a precarious copyright situation, and very
| little margin for recovery.
|
| Yet, YouTube is and remains popular. _Very very_ popular. So, you
| would think there is some room for a play there. And there have
| been sufficient suggestions from various parties on what that
| play should be. Increase advertising. Go full-Spotify. Et cetera,
| ad absurdum.
|
| What YouTube has implemented is a mediocre mix of worst-case
| options: sure, customers can get a subscription, but it does not
| actually offer any advantages. And yes, partners can create
| opportunities, but only if they're a top-10 media company, and
| therefore won't create _anything_ if their life literally
| depended on it. Smaller partners are smothered: Alpha-Goo-tube
| could listen to them, but they don 't and won't.
|
| So, YouTube right now is an entire market-in-itself waiting to be
| disrupted. Spotify did it for audio; who will be the disruptor
| for video, and when, remains to be seen. Given the current market
| conditions, we'll have to wait a year or two, but that YouTube is
| toast is pretty much a given.
| ur-whale wrote:
| https://archive.is/SG4zP
| madrox wrote:
| YouTube's problem isn't competitors. They already have most of
| the eyeballs on the planet. It's that anything new they do is
| going to cannibalize the rest of their revenue streams. Want to
| push people to more clips and create a revenue stream there? They
| need to prove to their creators it won't take revenue away from
| their existing videos. That makes them very careful to roll out
| new things. TikTok, by comparison, had no creators to lose, so
| they can go after new generations of creators or simply be
| another syndication channel.
| stillsleepy wrote:
| [dead]
| WesolyKubeczek wrote:
| I'm afraid Youtube will just die. As far as I know, it's still
| not profitable on its own.
| swframe2 wrote:
| With AI tech getting dramatically better quickly, we need to wait
| wrt restructuring the dominant players.
|
| Basically, all the major players in the tech space are going to
| make major transformations to their internal services over the
| next 5 years. YouTube as you know it today is not going to be
| here 5 years from now.
| osigurdson wrote:
| 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.
| JohnFen wrote:
| > Users are forced to watch at least 5 seconds of ads before
| watching any content.
|
| Not all users. I pay Google in order to not have to watch those
| ads, and they aren't served to me.
| devmunchies wrote:
| Same. Which is a tough spot for YouTube. The user's with the
| most disposable income and possibly niche targets for high
| value products are inaccessible.
|
| I only pay $9-10 per month, whereas there are some companies
| who would pay way more for me (eng leadership/founder) to
| learn about their product. It would be very expensive CAC
| (cust. acquisition cost) but maybe worth it for a some niche
| products.
|
| Maybe Google needs a way to "recommend" reviews for products
| in the video recommendations so that businesses can pay for
| placement (like Google Ads).
| JohnFen wrote:
| > Maybe Google needs a way to "recommend" reviews
|
| I would say "please don't give them any ideas", but I
| already ignore YouTube recommendations anyway, so that
| wouldn't actually bother me.
|
| However, if YouTube found a sneaky way to get ads in front
| of me regardless of my premium membership, that would
| eliminate the entire value of the premium membership. And,
| for me, it would reduce the value of YouTube enough to get
| me to finally ditch YouTube once and for all.
|
| Which might not be a bad thing, really.
| devmunchies wrote:
| I don't mind ads, what I'm paying for is time. I don't
| like ads where I have to wait for them to end.
| loloquwowndueo wrote:
| 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.
| kgwxd wrote:
| Sponsors are the way ads should work. Ads aren't the problem,
| tracking is.
| wintermutestwin wrote:
| 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...
| JohnFen wrote:
| > I'd gladly pay for ad-free YT
|
| Then why don't you? That's been an option for years.
| wintermutestwin wrote:
| >The problem is that google is already stealing my data.
|
| My data is worth much more to me than the cost of a YT
| sub.
| JohnFen wrote:
| But, as you said, google is already stealing your data
| anyway. Would paying a bit of money every month really
| make that any worse?
|
| But aside from that, it's totally possible to minimize
| your exposure and still pay for Premium. What I do is
| have a Google account that is only used for YouTube, paid
| for through a prepaid debit card, and I only watch
| YouTube on a single tablet that is not used for any other
| purpose.
|
| It's not perfect protection, but it's also not terrible.
| wintermutestwin wrote:
| If I give data thieving Google money, I am sending the
| message that I am OK with their data theft (regardless of
| going through ridiculous hoops to keep them from stealing
| it).
| JohnFen wrote:
| Yeah, I'm with you there.
|
| YouTube is the last Google service (outside of Android)
| that I still use. I'll be ditching it as soon as some
| other service comes reasonably close to being able to
| replace it for me. That hasn't happened yet, but the day
| is coming closer.
| osigurdson wrote:
| I don't bother with that stuff. I just wish the ads were more
| relevant.
| goku12 wrote:
| It could be argued that the worst thing that happened to ads
| are targeted ads. The targeting part manages to insert
| irrelevant ads at the most inappropriate times, even after
| invading users' activity across the web. Even simple non-
| tracking ads like a word from the sponsor are sometimes
| relevant and manages to avoid invasive breaks.
| JohnFen wrote:
| Ignoring the issue that targeted advertising requires
| surveillance, my biggest problem with it is that it removes
| the only useful thing about ads:
|
| You used to be able to tell pretty quickly what demographic
| any given content was made for by noticing what ads were
| running with it. Targeted advertising removes that signal.
| favourable wrote:
| > Cue uBlock origin
|
| uBo doesn't work everywhere. I do have it installed on
| Firefox for Android though.
| [deleted]
| sgtnoodle wrote:
| 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.
| boulos wrote:
| Ahh, you mean the original Squatty Potty ads:
|
| https://m.youtube.com/watch?v=YbYWhdLO43Q
|
| It's definitely bizarre. I assume they were going for
| memorable, but your report sounds like it failed at the
| basic goal: remembering the product.
| causi wrote:
| You, my friend, need to install SponsorBlock.
| pier25 wrote:
| And so the creators don't get paid when you watch their
| content.
|
| I pay for YouTube Premium. Creators get paid and I don't
| watch ads. We have a family plan so this applies to the whole
| family.
|
| We spend way more time watching YouTube than Netflix but pay
| for both.
| j-bos wrote:
| Echoing this, a YT premium subscription feels like a proper
| transaction.
| JohnFen wrote:
| > And so the creators don't get paid when you watch their
| content.
|
| Let's be honest here -- creators aren't really getting paid
| any meaningful amount of money from those ads anymore.
| Those days are long gone. That's why all YouTubers who care
| about revenue do their own ads as part of their own
| content, and/or use things like Patreon.
|
| There's only one reason why YouTubers even bother to allow
| YouTube to "monetize" them -- if they don't, YouTube won't
| recommend them to other viewers.
|
| I also pay for Premium, though.
| Panzer04 wrote:
| This is untrue afaik. Even big channels with big self-
| sponsorship (eg Linus Tech Tips) still make (pulling out
| of thin air here) something like 20-30%+ of their revenue
| from native google ads.
| JohnFen wrote:
| As I understand it, the big channels do make decent money
| from their cut of Google's ads. But the vast majority of
| YouTubers aren't big. I think it's a percentage game.
| peoplefromibiza wrote:
| > And so the creators don't get paid when you watch their
| content.
|
| They could ask the users to pay for the content they
| produce and measure how many microseconds would pass before
| they switch to someone else's videos.
|
| It's an option.
|
| I don't want to watch ads, I skip sponsored sections, I
| feel no guilt about it, if they can't monetize enough and
| have to shutdown operations, I can survive without that
| content.
|
| What would you say if I was dancing in the middle of the
| streets asking for money and blaming people who don't give
| any because "I am not being paid for the show I've put up,
| you ingrates!"?
|
| Nobody asked or forced content creators to upload their
| content on YT.
| PixelForg wrote:
| Your analogy is only correct if you watch content that's
| recommended to you, but many of us actively watch
| YouTubers we have subscribed to, in that case it makes
| sense for the creators to get paid then. Edit - Edited
| the comment a bit
| JohnFen wrote:
| 95% of what I watch on YouTube is from YouTubers I
| actively subscribe to. I rarely use YouTube's
| recommendations (in no small part because YouTube is bad
| at recommendations for me).
|
| I'm very happy to support the ones I follow who are doing
| it for a living. For most, I consider their cut of my
| Premium fee to be sufficient. For some, I go beyond by
| giving them money through Patreon and the like, or buying
| their swag.
| peoplefromibiza wrote:
| of course it is fair to be paid, they should be paid
| regardless by YouTube though, not by me watching the ADS.
|
| If I block the ads, YouTube should pay them nonetheless.
|
| Because I chose to block the ADS, not the content
| creator.
|
| But it's not my responsibility to watch the ADS or the
| sponsored content.
|
| The content has been uploaded as "public & free" and I
| watch it for free.
| titaniumtown wrote:
| Youtube ad revenue is a very small part of income made from
| creating Youtube videos. Most people who makes videos take
| up sponsorships which are way more lucrative.
| ahtihn wrote:
| I don't really care that creators don't get paid. Youtube
| was better when no one was getting paid.
| edgyquant wrote:
| Nearly all of them shill some product in there video. They
| get paid.
| judge2020 wrote:
| Even with sponsors, adsense is always an incredible
| driver of revenue[0,1] especially as more and more people
| (especially in the US) have an iPhone which prevents any
| ad blockers within the YouTube app.
|
| And YouTube Premium views pay out a lot more per view
| than any ad-supported view[2,3].
|
| 0: https://twitter.com/linusgsebastian/status/16094682622
| 194032...
|
| 1: https://twitter.com/LinusTech/status/14869187844010885
| 15?s=2...
|
| 2: https://twitter.com/LinusTech/status/14869356903151124
| 55?s=2...
|
| 3: https://twitter.com/hankgreen/status/15131774907300618
| 29?s=2...
| Tepix wrote:
| Do you want to encourage this behaviour versus those who
| merely rely on what YouTube pays them?
| 998244353 wrote:
| If I had to choose between seeing the ads by YouTube and
| seeing the creator's own ad, I'd choose the second.
|
| I don't really know why. But if I turn off ad blocking,
| YouTube's own ads are way more obnoxious and intrusive.
| Maybe it's because every advertiser has figured out they
| need to cram as much shit into a 5-second segment? Or
| maybe it is because seeing an ad at the very beginning is
| much more psychologically disruptive (or if the YT ad is
| in the middle, it is usually inserted without any regard
| to the video, even breaking up sentences).
| Waterluvian wrote:
| You can't filter out google ads because you don't know which
| are ads beyond the handful they label as such.
|
| Google filters and shapes the results so much now that I'm
| inclined to say it's all essentially advertising. That is,
| Google is giving you want it wants you to see in what order,
| and lately filters out anything that isn't helpful for Google.
| opdahl wrote:
| Your point is certainly valid, but I have a slightly different
| perspective on the matter. Google Search Ads hold a certain
| magic that is unparalleled in the digital marketing world.
| Unlike video ads, which can be intrusive and irrelevant to a
| viewer's current needs, Google Search Ads are precisely
| targeted to solve the exact problem or question a user is
| currently facing. I've personally experimented with YouTube ads
| and discovered that while they can be useful for building brand
| awareness, they don't always lead to direct website traffic. As
| my company grows, I've realized that spending money on
| platforms like TikTok or Facebook simply doesn't make sense, as
| we can't yet promote our products in high enough volumes to
| truly stick in a user's memory. However, with Google Search
| Ads, we're able to reach potential customers at the exact
| moment when our product can be of service, leading to higher
| click-through rates and ultimately, a higher conversion rate
| than we could ever achieve with video ads.
| taco_emoji wrote:
| As a consumer, this is 90% of the reason I avoid Youtube as
| much as possible.
|
| EDIT: Also just because people are forced to watch 5 seconds of
| an ad doesn't mean it's got any measurable positive effect (for
| the advertiser) whatsoever.
| sebzim4500 wrote:
| Because youtube ads respond almost instantly to changing the
| settings, you can normally get a pretty good idea of whether
| you are getting any return.
| osigurdson wrote:
| I think if the ads are relevant it is a really good system.
| I'm only annoyed when ads are not relevant. Unfortunately the
| ads are irrelevant 90% of the time. These days they are
| sometimes not even in the right language - not sure what is
| up with that.
| osigurdson wrote:
| If you have any idea what Monday.com or Asana is then YouTube
| is probably working.
| HDThoreaun wrote:
| You can thank the MTA for knowing that monday.com exists
| VLM wrote:
| I was unimpressed by the arguments in the article.
|
| Focus implies that Alphabet cannot avoid being over controlling
| (why? Any evidence other than idle speculation?) whereas devotion
| to increasing quarterly shareholder value would somehow be hands
| off (LOL has the author ever worked for a megacorporation?), or
| eventually being bought out by a (probably overcontrolling)
| competitor (Disney? Netflix?) would by some miracle be less
| overcontrolling than Alphabet currently is. With a side dish of
| the assumption that Youtube would be better off with less control
| and oversight. Why is that?
|
| The second argument is also weak. The claim is there are two ways
| to being ad sales in-house at Youtube (they... aren't already?)
| one is paying financial market middlemen billions to do a
| corporate split such that there will only (temporarily?) be in
| house sales dept, the other option is a cheap, probably money
| saving, departmental re-org. "We can save money by making a giant
| pile of cash and lighting it on fire". Naah, not taking the bait,
| doesn't sound profitable.
|
| The third argument is the author is some kind of insider and our
| toothless and ineffective unelected regulators hate google more
| than they hate facebook (solely because he claims it to be the
| case), so splitting from google would reduce government
| regulation. I mean, we're just making stuff up at this point,
| aren't we?
|
| The forth, unnumbered, argument is a restatement of the first
| argument, that Alphabet is inherently and uncontrollably
| hypercontrolling so "freeing" Alphabet from hypercontrolling
| responsibilities WRT youtube would allow better micromanagement
| of various AI projects. Now wait a minute, the first argument was
| Alphabet's theoretical control issues are "bad" therefore YT
| should leave, why is the forth argument that toxic management is
| somehow good when its applied to new AI divisions? I have a
| better idea, if the author repeatedly restates that Alphabet
| management is incompetent and detrimental to everything it
| touches, why let it ruin AI along with ruining Youtube, why not
| push to implement better leadership at Alphabet so all the orgs
| underneath Alphabet would benefit? I'm just saying if the
| repeated theme of the article is Alphabet is a "rats deserting
| the sinking ship" argument, well... why not fix the ship so its
| not sinking instead of coming up with elaborate and expensive
| evacuation processes? If Alphabet management is toxic therefore
| YT should leave to avoid it, then a couple paragraphs later
| claiming Alphabet management is toxic therefore they need to
| manage AI even harder, doesn't make sense.
| crazygringo wrote:
| 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 rest of Alphabet. It 's
| not like YouTube and Maps reinforce each other the way Docs and
| Slides do.
|
| But the biggest argument for keeping them together is that there
| are large economies of scale, mainly regarding datacenters and
| edge nodes and all of the like, and that for this reason alone
| YouTube is an essentially perfect part of Alphabet's portfolio.
| lumb63 wrote:
| Not saying I disagree with you, but couldn't the "economies of
| scale" argument be used to justify e.g. all cloud providers
| forming a monopoly, all hardware manufacturers doing the same,
| etc.? The only reason all tech companies shouldn't aspire to
| monopoly status is to avoid regulators stepping in; they should
| aim as close as possible.
| notatoad wrote:
| the main reason that all cloud providers don't form a
| monopoly is because they can't afford it. if google could buy
| microsoft or vice versa they totally would. of course they
| _want_ the monopoly, but that doesn 't mean they can have it.
| conductr wrote:
| 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.
| H8crilA wrote:
| 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).
| conductr wrote:
| Yes, I'm sure that's so but not quite sure of how that
| implies anticompetitiveness.
|
| If a YT competitor built a search feature that they thought
| was so good they spun up a search engine product, does that
| make them anticompetitive?
|
| Every competitor has to implement their own solutions to
| these problems. Or, don't? Search isn't a barrier to entry.
| You could launch a video service without a search feature.
| If you can leverage something from your existing assets,
| that's not anticompetitive. It's like a lawn mowing service
| starting a Christmas light hanging service because they
| already possess the truck and most of the tools and labor
| resources. It's the definition of being competitive. They
| may be able to offer lower prices to consumers because they
| get to use their assets during middle of winter when grass
| isn't growing.
|
| Or, and this is key to the bundled conglomerate argument,
| offer a service that wouldn't otherwise be feasible
| (because the cost would be higher than what customers would
| pay.) In this case, bundling of the service is a net
| positive to consumers.
| alldayeveryday wrote:
| [dead]
| CydeWeys wrote:
| The two companies would likely have more total value separate
| than together. The stock market doesn't price conglomerates
| correctly.
| crazygringo wrote:
| Citation needed. When companies are split, sometimes they
| gain value and sometimes they lose it. There's no hard and
| fast rule, and I'm not aware of evidence of systematic
| downwards mispricing of conglomerates.
| Barrin92 wrote:
| >When companies are split, sometimes they gain value and
| sometimes they lose it
|
| Evidence suggests that spinoffs produce quite significant
| gains in shareholder value, here is one such study[1]. This
| isn't really that surprising as large conglomerates are
| slow, have managerial issues and are difficult to price and
| generally hold their best performers down.
|
| [1]https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1875
| 857
| mijamo wrote:
| It is the
| https://en.m.wikipedia.org/wiki/Conglomerate_discount
|
| It is not mispricing, but it is a discount. Big companies,
| even very healthy ones, often split to satisfy their
| investors based on this phenomenon.
|
| It hasn't really played much in tech though which might be
| why you haven't heard of it, but is very very well known in
| industrial companies.
| hackernewds wrote:
| YouTube Premium is a large part of Google One. Which also
| includes Google Photos, Google Fi, Google Drive etc benefits.
| luckydata wrote:
| this is very wrong. You can coordinate a campaign where you
| have video ads on youtube for let's say a new burger from
| McDonalds and then the same ads in Maps. Youtube is brand
| awareness, Maps is to bring customers to physical locations.
| There's TONS of synergy.
| causi wrote:
| Why has a question mark been added to the article title?
| gerash wrote:
| As if Google or other tech companies don't already have non-stop
| re-orgs, now Economist's armchair executives are proposing even
| more re-orgs so all the poor army of engineers spend their next
| year on _migrations_.
| luckydata wrote:
| This would be an absurd move. Youtube is a property that relies
| on Google's ad infrastructure AND commercial relationship with
| advertisers to make sense. You split it and it becomes instantly
| less appealing cause you're dealing with another network so you
| can't coordinate campaigns as well as you can in the current
| system.
|
| It's complete nonsense and shows the person writing has no idea
| how that particular business works.
| buggythebug wrote:
| Stopping calling them Alphabet. These tech companies are worse
| than rappers when it comes to name changes. It's Google.
| ydnaclementine wrote:
| It's time for Android to spin off google too. Their new "Did you
| know google made a PHONE?" commercial feels like terrible
| marketing. They should market it something like: "Android,
| powered by Google", and take advantage of the view that google is
| at least seen as a modern bell labs (by normals at least), so
| people can get the feeling that smart people are working on
| android. Otherwise I don't think anyone really knows android and
| google are the same (present company excluded).
| throwaway472919 wrote:
| Was a bit surprised it got past the lawyers re:antitrust, it's
| very heavy on "You already use EVERYTHING Google"
| scarface_74 wrote:
| Yes and next anti-trust should break up Microsoft for
| bundling office and break up the cable companies for bundling
| cable channels. We should also get rid of BigFastFood because
| McDonalds bundles hamburgers, fries and a drink...
| nindalf wrote:
| 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".
| Aperocky wrote:
| > I wish I could invest in YouTube without investing in the
| rest of it
|
| That's assuming YouTube needs any investment.
| luckylion wrote:
| > 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.
|
| You mean like they haven't for the past 5 years?
|
| I have no opinion on splitting them up besides "why?", but
| "Youtube wouldn't innovate on their product any more" is a
| weird position: Youtube hasn't innovated since it was created,
| they've only copied from other products (streaming, shorts,
| music, superchats, channel members), and did so in a mediocre
| way that's just disappointing.
| jimnotgym wrote:
| I have no idea about the utility of divesting YouTube but on
| this point...
|
| >YouTube clearly shares a lot of infrastructure with the rest
| of Google, especially datacenters and ads.
|
| I don't see this as a particularly thorny problem. Normally in
| a divestiture. Newcorp would just sign a 5 year infrastructure
| deal with Alphabet, and a 5 year deal for it's ad space. That
| is plenty of time to resolve any lingering issues.
|
| I wouldn't be surprised to see Alphabet divest some business,
| however I think it is unlikely to be for tech reasons. It is
| more likely to be financial engineering, as growth stalls and
| share prices need protecting.
| danpalmer wrote:
| The problem is there's no clear split. Some infra is owned
| and developed by YouTube teams, some by Google teams, and
| it's hard to figure out the balance and usage and so on.
|
| I'm some case you might have a service used by a Google
| product, operated as a platform by a YouTube team, that uses
| Google Cloud services, and runs on Google infrastructure. And
| the SREs may be "paid for" with YouTube budgets. Who pays
| who? And how much?
|
| It's not as clean as, say, treating these things all like
| cloud services provided by an infrastructure provider.
| duxup wrote:
| This reminds me of what I see happen in sports sometimes.
|
| Fans decide it is time to trade Player X. Next move is to find
| someone to replace them ... they then describe someone just
| like Player X.
|
| A YouTube and Google split would setup a situation where they
| both seem to be a pretty good fit for each other.
| noizejoy wrote:
| In sports, you need to replace players, because they age out
| of their prime.
|
| It might be interesting to apply similar thinking to
| technology.
| tehlike wrote:
| Spin off doesn't always imply spinning of infra or codebase.
|
| They could license each other their infra and libraries.
| valley_guy_12 wrote:
| Just as a point of interest, AIUI the names "Schumpeter" and
| "Babbage" are "house names", not the real names of the people
| who write the columns. Any given column might be written by
| anyone, and it would still use the same house name.
|
| Shumpeter and Babbage are the last names of famous people in
| fields related to the columns topics.
| kqr2 wrote:
| https://en.wikipedia.org/wiki/Robert_X._Cringely is another
| interesting example, however in this case, Mark Stephens
| actually took over the pseudonym after he left InfoWorld:
|
| _After a financial disagreement in 1995, Stephens was
| dismissed from InfoWorld and was promptly sued by IDG to
| prevent him from continuing to use the Cringely trademark. A
| settlement was reached out of court that allowed him to use
| the name, so long as he did not contribute to competing
| technology magazines_
| dageshi wrote:
| I think more fundamentally, youtube is far less vulnerable to
| the chatgpt garbagisation of the web. SEO crap is already bad,
| it will likely get much worse.
|
| Youtube has actual good content from creators whose opinions I
| trust. Google would be moronic to give that up, they've spent
| long enough building it.
| dfinninger wrote:
| Well, not really. I follow a few channels that tell
| interesting true stories over some photos of and around the
| event. Over the past year or so a few of them have started
| supplementing with AI, but others have just gone all in.
| Posts are much more frequent, but the music is AI generated,
| the pictures are all AI, and the script in an AI expansion of
| a Wikipedia article. Someone still has to edit it together
| (for now), but all the content is AI-based. I've been
| unsubscribing since the quality just isn't there anymore.
|
| Now, this isn't a problem for the majority of my YouTube
| consumption, but I'm still seeing it creep in.
| smm11 wrote:
| The internet as we know it is already there, AI talking to
| AI. The luddites who want the mid-90s environment back were
| right.
| jeffwask wrote:
| > the chatgpt garbagisation of the web
|
| Eh... it's already started on YouTube. There's a whole new
| genre of movie content that has chatgpt summarize the movie
| while they play 15 minutes of clips. It's higher effort
| garbagisation because someone needs to at least do some low
| effort video editing.
| echelon wrote:
| Full video automation is not going to take long. I'm
| working on systems to automate 100% of video workflows (in
| a good way).
|
| We recently launched a 24/7 news channel:
|
| https://fakeyou.com/news
| mustacheemperor wrote:
| I just tried to check out your 24/7 news channel and it
| is currently a twitch stream of a windows desktop
| wallpaper.
| mustacheemperor wrote:
| Working now! Pretty dang cool, too.
| ramphastidae wrote:
| Doesn't seem to be working?
| EForEndeavour wrote:
| What do you mean "in a good way"? How do you control
| whether someone using your video workflow automation uses
| it for good (whatever that is) or not?
| echelon wrote:
| How does Adobe assure this? Or any tool maker?
|
| Email has problems, yet the good and productive uses
| vastly outweigh the bad actors. The vast majority of
| systems humans use have benefit, otherwise they would be
| unwound by governments (eg. crypto).
|
| People want to be creative more than they want to be
| destructive. The destroyers will be moderated, just as
| they are in every system.
|
| I want a world where every kid can make their own Star
| Wars or Princess Mononoke and create more than Scorsese's
| entire career within a single year.
| 91bananas wrote:
| Most of the rest of us don't.
| echelon wrote:
| "ought to be enough for anybody"
|
| If things stay the same as ever, this life will have been
| boring. I'm not cut out for another twenty years of
| smartphone incrementalism.
|
| Fuck the status quo. I don't live for "same". Everything
| in the world as it exists isn't enough.
|
| The future could be the most exciting thing if we dream
| and build it.
| [deleted]
| barneygale wrote:
| Have you considered a career in subsistence farming?
| You're likely to be less damaging to the world.
| echelon wrote:
| I'm a filmmaker and love the arts more than you'll know.
| You're being incredibly sour, and I guarantee you that
| acting the way you do toward other humans (and yourself)
| subtracts way more from the universe.
|
| I feel sorry for you.
| maxbond wrote:
| People who don't like your view of the future aren't
| "antiprogress" or "pro status quo," while you are
| imagining a little kid enabled to be creative and making
| lots of great stuff, others are imagining being inundated
| with targeted ads featuring their loved ones (and
| inevitably hurting people by showing them recently
| deceased loved ones, like when Facebook used to say, "you
| haven't spoken to this person in a while, why don't you
| send your dead friend a message?"), movies that go
| nowhere and mean nothing but are barely engaging enough
| that people watch them (AI is great at discovering
| solutions that satisfy the objective function while
| undermining the objective, eg, creating content that
| keeps you engaged but is devoid of substance), and
| deepfake misinformation masquerading as news.
|
| You're imagining inventing a car and feeling the wind in
| your hair on the open road, others are imagining being
| stuck in traffic and cities becoming more and more
| dominated by parking lots. You're criticizing them for a
| lack of vision, but that's not correct; they're peering
| into the same future, and seeing something different.
|
| That doesn't make them "antiprogress," they're critics
| with concerns that would be worth engaging with instead
| of dismissing. If you care about this project and you
| want to make the best version of it - ask them why they
| think that way instead of responding to the version of
| their concerns which is in your head, and then give some
| thought to how you could address it.
|
| (I'm ambivalent leaning towards skeptical, so not much
| much of a dog in the race, trying to bridge a
| miscommunication.)
| hyperdimension wrote:
| I like your analysis. I think you could generalize it to
| any (even more-hotly) debated topic. People can hear the
| same thing and imagine two (or more) very different
| things by virtue of life experience, upbringing, morals,
| or any number of factors that make us unique.
|
| I don't think that's a bad thing. It's a good perspective
| to keep in mind when disagreeing with someone though.
| qwytw wrote:
| Your future sounds pretty dystopian and very lonely
| though....
| echelon wrote:
| I imagine factory workers and butter churners said the
| same.
|
| You know what really sucks? How labor intensive and
| capital intensive filmmaking is. How hard it is to make
| it into the field. How almost impossible it is to lead a
| production.
|
| Think about all of the great ideas that wither on the
| vine because the Hollywood studio system only has so much
| capital and can only back so many projects.
|
| Think about how many months and years go into a single
| film, and how few of them succeed.
|
| Think about the opportunity cost of learning a creative
| skill - locking you out of all the other skills you could
| use to build your vision.
|
| When the cost structures drop, people will be more
| creative and more cooperative. The long tail will be all
| of us.
| dragonwriter wrote:
| > Think about all of the great ideas that wither on the
| vine because the Hollywood studio system only has so much
| capital and can only back so many projects.
|
| Very few; great ideas mostly happen outside of the
| Hollywood studio system, which is largely about expensive
| packaging of low-risk ideas, not great ones.
| echelon wrote:
| > Very few
|
| Allow me to point to the thousands of creatives trying to
| cut it that cannot break in. I've met perhaps over a
| hundred of them personally. I, myself, am one of these
| people.
|
| > which is largely about expensive packaging of low-risk
| ideas, not great ones.
|
| The market serves different segments and there's a lot of
| intelligence built around vehicles of all types, shapes,
| and sizes. I don't think Hollywood is stupid at all. I
| think it's simply a small local optima when we're about
| to jump the peak to a new Mt. Everest.
| dragonwriter wrote:
| > Allow me to point to the thousands of creatives trying
| to cut it that cannot break in.
|
| I'm not saying great ideas don't fail to get realized.
|
| I'm saying that the Hollywood systen is actively hostile
| to great ideas, so that the _reason_ greay ideas fail to
| get realized is not the limited resources within the
| Hollywood system, which is more inclined to crush great
| ideas than to realize them with whatever resources it
| has.
|
| (Limited money _outside_ the Hollywood system might be a
| problem, though.)
|
| > I don't think Hollywood is stupid at all.
|
| I didn't say anything about its intelligence, merely its
| function, it is _far_ from stupid.
| ryandrake wrote:
| I like this vision of the future of entertainment,
| honestly.
|
| I like Star Trek the Next Generation... a lot! It was on
| when I was a teenager, and I like it because it's
| nostalgic and actually a pretty wholesome show compared
| to a lot of the shit that gets produced today. I'd love
| to see more than the existing 7 seasons, but they'll
| never make any more of them. It would be incredible if I
| could just ask my PC "Generate a new Star Trek TNG
| episode with the original actors and a believable, good
| story". I could watch a new one every week forever if I
| wanted! At the speed technology is moving, I expect we
| might see that in my lifetime.
|
| We all saw the cheesy "infinite Seinfeld generator" a few
| weeks ago. That's v0.1. The technology will inevitably
| get better--in fact the only thing that could torpedo a
| realistic "infinite nostalgic TV show generator" are the
| copyright goons trying to hold it back.
| jeffwask wrote:
| > I want a world where every kid can make their own Star
| Wars or Princess Mononoke and create more than Scorsese's
| entire career within a single year.
|
| Rad goal. Good luck as someone who consumes more YouTube
| than mainstream content. I'm all for unlocking the
| potential of creators.
| [deleted]
| JohnFen wrote:
| That's all well and good, but the question still stands
| -- what do you mean by "in a good way"? What
| differentiates a "good way" from a "bad way"?
| xboxnolifes wrote:
| Full video automation has been done for years. There is
| one infamous channel that automatically scrapes stack
| overflow posts and makes video versions of the questions.
| echelon wrote:
| Yeah, well, now we need to make it good.
|
| I want to put mocap and editing into this. Humans can
| tweak high level knobs, then dive into specifics.
| xhkkffbf wrote:
| Ah, I've been seeing more and more videos that were clearly
| tossed together by some algorithm using a synthetic voice.
| The text may even be largely written by an AI and then
| proofed by a human. They use the same clips again and again,
| almost in rotation.
|
| I think they're slowly going to drown out the good producers.
| JohnFen wrote:
| Those synthetic voices drive me insane. Nothing makes me
| stop watching a video faster.
| arcticfox wrote:
| The TikTok woman voice is so grating it's oddly
| fascinating. It might be the most annoying voice I've
| ever heard but yet...
|
| edit: TIL it's a real person and she (can) sound exactly
| like the TTS version... I'm cracking up listening to her.
| Thank goodness it's something she can turn on and off.
| rchaud wrote:
| YouTube was the home of AI-generated cartoon videos for kids.
| Remember the whole uproar about "Elsagate"? That was more
| than 5 years ago!
|
| When you say "SEO crap", you mean text search. But the world
| is much bigger than text search today, lots of people use YT
| as a search engine. Because of that, the "Front Page" of
| Youtube looks like dumpster fire of the worst clickbait you
| can imagine.
| JohnFen wrote:
| I don't mean to put words in his mouth, but when he said
| "SEO crap", I think he meant "scummy marketing crap", not
| SEO specifically.
| dageshi wrote:
| Yeah basically. If people are watching AI stuff for
| entertainment, I don't really care or particularly think
| it's a problem. My issue is the impossibility of finding
| good information on any kind of paid products or services
| on the web.
|
| Youtube genuinely does a better job on that and I think
| it'll be quite a bit harder for AI generated video to
| game it, if nothing else the sub count on the channel and
| the comment section (or its status as disabled) will be
| indicators.
| make3 wrote:
| I feel like one of the only ways Youtube can be profitable is
| by having integration and being a first class citizen Google
| cloud's infrastructure & tech.
| cm277 wrote:
| Well, let's start with the idea of "I wish I could invest in
| YouTube without investing in the rest of it". Why not? YouTube
| is a more focused brand, with a world-beating product that's
| already active in multiple high-growth verticals
| (entertainment, shorts/vertical video, education, conspiracy
| theories). As the article says it can compete against both
| Netflix and TikTok (and probably Udemy, etc.). Aren't these
| high-growth areas worth investing in? aren't they _more_ high-
| growth than whatever Google is doing this week? (I don 't know,
| streaming video games to a watch and a new chat application
| probably).
|
| And if you are investing in these areas and this is your only
| business isn't this "focus" all of a sudden important? (so you
| can actually compete in these businesses and potentially grow
| the business more?).
|
| I for one like the idea --as well as I think Google needs to be
| broken up ten years ago. YouTube has scale, a good brand and
| would probably gain by being _less_ Googley --i.e. iterative
| and consumer-focused. Not just YouTube, but the internet would
| be better off with a more focused YouTube (that also has less
| of your personal data as a bonus).
| ketzo wrote:
| You're not _wrong_ to say it, but describing conspiracy
| theories as a "high-growth vertical" kinda makes my stomach
| hurt
| jfengel wrote:
| Is Alphabet lacking cash? Unless a spun-off YouTube were to
| issue more stock, they don't really care what investors would
| like.
|
| If Alphabet needs money for YouTube investment they can issue
| more Alphabet stock, and investors can take that deal or not.
| But I doubt that Alphabet's challenges involve cash flow.
|
| It might well be better for the world if Alphabet weren't a
| conglomerate. But it seems unlikely that it's better for
| them.
| jpadkins wrote:
| Alphabet cash on hand for 2022 was $113.762B, a 18.54%
| decline from 2021.
| insane_dreamer wrote:
| _Only_ $113B? Ouch.
|
| /s
| cmeacham98 wrote:
| > Well, let's start with the idea of "I wish I could invest
| in YouTube without investing in the rest of it". Why not?
|
| The preceding parts of the comment literally explain why not.
| ok_dad wrote:
| "Because it's hard" is no answer.
| bloodyplonker22 wrote:
| Additionally, it's not quite right when the author compares
| YouTube to TikTok as direct competitors. I have used YouTube to
| learn an insanely great amount of new things which range from
| programming to car and home repairs. You cannot do this on
| TikTok.
| heisenbit wrote:
| > They would need to fork it and staff all of these teams
|
| I think the worst would be having to split the customer base.
| Their sales costs would increase a lot and they would loose
| pricing power. On the social networking front turn a leader
| into a me-too. This article confuses what these businesses seem
| on the surface (search+video) and what they really are (selling
| ads, keeping track of customer identities to do the same).
| madrox wrote:
| I'm reminded by calls for Apple to buy Nintendo. It focuses on
| a very specific upside while ignoring or hand-waving away all
| the challenges that would likely kill what makes these
| companies work.
| sircastor wrote:
| I see the same kind of thing for Apple to buy Disney. In the
| abstract, the money and some shared goals make sense, but the
| reality would be a very challenging struggle to combine two
| ideologically different companies.
| theknocker wrote:
| [dead]
| pclmulqdq wrote:
| 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 way.
| Spinning off the loser (Facebook), and the non-social networking
| product (WhatsApp) would let Instagram grow wings against TikTok.
|
| Google: Search, YouTube, ads, and technical infrastructure
| (cloud) can all easily be separated, and Search and YouTube could
| likely command an even bigger premium by treating other ad
| networks as first-class citizens. Google ads could get a lot more
| business too when they are not tied to other products (those
| products might compete with yours, driving you away from Google
| ads).
| chiefalchemist wrote:
| Last I read, which was a couple of years ago, after Google
| search, YouTube is the next most searched "search engine". It
| serves ads. Is it really, from Google's POV that different than
| it's core business?
|
| That aside, as we know now, Google wasted it's time with Plus.
| Instead it should have fleshed out YT's social aspects. While
| that's easy to say in retrospect, it's still not a bad idea if
| Google wanted to "social media" product.
| nubinetwork wrote:
| > Also spin off the media company, comprising Audible and prime
| video
|
| And twitch.
| walthamstow wrote:
| MGM too? Or are they owned by Amazon in a different way?
| swarnie wrote:
| ? Meta: Meta has always run 3 separate products either way.
| Spinning off the loser (Facebook), and the non-social
| networking product (WhatsApp) would let Instagram grow wings
| against TikTok.
|
| Three products which share data. I don't care what the law
| says, or what they tell a select/congress committee, nothing
| will convince me otherwise.
| paganel wrote:
| Not combatting the merits of those break-ups, of which I agree,
| just wanted to point out that WhatsApp is a social media
| product at this point, because all the relevant social group
| interactions have moved there from Facebook the website/the
| app.
| the_af wrote:
| What do you mean?
|
| Just as anecdote, I don't have whatsapp groups for my fb
| groups. My whatsapp and fb worlds are entirely disconnected.
| People in groups from fb often promote Discord (which I don't
| like: real time chatting with strangers feels odd to me).
|
| Facebook is aggressively promoting its own chat for groups,
| spamming it violently and so I'm forced to unsubscribe/ignore
| lots of chat groups now. Do people really need yet another
| chat platform?
| paganel wrote:
| > ust as anecdote, I don't have whatsapp groups for my fb
| groups
|
| Exactly that, that the personal updates for close friends
| and family that we used to post on FB are now posted on
| several dedicated WhatsApp groups. Yes, that means that
| that former highschool colleague who you'd met once in the
| last 20 years won't get to see them, but it's still social.
|
| > Facebook is aggressively promoting its own chat for
| groups,
|
| Could be, but the WhatsApp interface when it comes to group
| chats is way nicer and more intuitive (especially when it
| comes to sharing photos).
| rvz wrote:
| and Microsoft.
| AlchemistCamp wrote:
| Amazon doesn't have close to a monopoly with AWS, Prime Video
| or even its ecommerce.
|
| What possible anti-trust rationale would there be to forcibly
| break up the company?
| [deleted]
| rcme wrote:
| I used to support breaking up Meta, Google, and Amazon. Their
| market positions are pretty dominant, but not unassailable.
| Facebook barely avoided Snap eating their lunch with stories
| and now looks to be in a losing position against TikTok. Google
| vs. LLMs will be interesting to see play out. Amazon... is
| still in a very strong position.
| capitalsigma wrote:
| It's unclear to me how making these divisions dramatically
| increase their infrastructure costs (by either pulling them in-
| house or paying a premium to the original parent company) will
| "help them compete"
| pclmulqdq wrote:
| Are you sure that they will dramatically increase
| infrastructure costs? Large companies get amazing deals from
| clouds, and this is no exception to that rule. Their
| infrastructure costs might actually decrease because the
| clouds will have to compete for their business.
| jasode wrote:
| _> Are you sure that they will dramatically increase
| infrastructure costs? [...] Their infrastructure costs
| might actually decrease because the clouds will have to
| compete for their business._
|
| Maybe theoretically possible but I have doubts.
|
| As Youtube's founding was February 2005, they now have _18
| years_ (i.e. _exabytes_ ) of videos stored on Google's
| datacenters. Exporting all that to a competitor like AWS
| (even with mass Snowmobile transfer service) probably
| wouldn't make financial sense.
|
| I worked on a corporate spin-out from a petroleum company
| and there was months of back & forth negotiation for "IT
| infrastructure services pricing" from the ex-parent
| company. The new spin out company was definitely not
| getting a deal from the ex-parent company and switching to
| other datacenter competitors wasn't realistic because the
| ex-parent already had all the data and the existing IT
| staff expertise to run-&-maintain the spin-off's
| proprietary systems. (E.g. think Lotus Notes custom
| programming workflows).
|
| Google could realistically raise their infrastructure
| prices to an independent Youtube spinoff but that higher
| cost is still less than switching to Azure or AWS.
| Scarblac wrote:
| It will help _their competitors_ compete, which would
| presumably be the point of antitrust action.
| giancarlostoro wrote:
| > Meta: Meta has always run 3 separate products either way.
| Spinning off the loser (Facebook), and the non-social
| networking product (WhatsApp)
|
| You don't think of it as a social networking product, but it is
| used as such. I consider Discord social media, and WhatsApp is
| honestly a text only Discord competitor in the grand scheme of
| things, all the group chats are reminiscent of Discord servers,
| but for people who dont care about all that Discord has to
| offer, even if they never heard of Discord. I would absolutely
| include chat platforms under social media.
| JohnFen wrote:
| I've never thought of WhatsApp as a social networking
| product. For me, it's just an SMS replacement necessary to
| talk to my friends outside of the US.
|
| Not saying my perspective is correct, but I think of a
| "social networking" product as one where I'm talking to
| groups of people. That's not how I use WhatsApp. That's
| always 1-on-1 conversations with people I know in the real
| world.
| giancarlostoro wrote:
| For some people it is all the social media they get. People
| share memes, and pictures, and live updates.
| cptskippy wrote:
| Why wasn't Microsoft included in this list? They have more
| overlap with Amazon and Google then Meta does.
| jxf wrote:
| Facebook is practically a utility company at this point. The
| number of businesses whose only online presence is
| Facebook/Instagram is significant.
| kevinmchugh wrote:
| If I was an antitrust regulator worried about Disney's
| dominance, I would just make them sell star wars and/or avatar
| so they don't own three sci-fi mega franchises. I'd also
| consider Pixar and Hulu. Why do things to Amazon in service of
| sapping Disney's power?
| psychlops wrote:
| Globalization is at odds with national level anti-trust. The
| past has shown that international companies supported by their
| governments would eat away at the smaller US companies.
| pclmulqdq wrote:
| I think this is the big reason that the US hasn't taken
| action against these companies. They view them as strategic,
| and want to keep a very friendly relationship.
| msabalau wrote:
| In this case, treating the "US" as if "they" have a
| consistent, considered view that drives all their actions
| seems a little odd and vaguely conspiratorial. After all,
| it has been well reported that US politicians on both sides
| of the aisle are looking to put investigative scrutiny on
| big tech in the year ahead. And US regulators were broadly
| underutilizing antitrust tools across the board in the
| past, not just for big tech. That also seems to be
| changing.
|
| Sure, the US pursues strategies related industrial policy
| and national security. The CHIPS act or the Inflation
| Reduction Act are examples.
|
| But you don't need a "big reason" why to explain why US
| companies like these tech firms have been underregulated.
| It isn't isn't some mystery, it is just (unfortunately)
| normal. If US firms are grossly underregulated and under-
| punished for simple stuff like wage theft, you don't need
| to invoke strategy to explain why big tech has gotten away
| with anticompetitive stuff in the past.
| kryptiskt wrote:
| Privacy will be impossible as long as platform owners are in
| the ad business so the most important thing for me is to
| separate Android and Chrome from Google's ad business. For the
| same reason Apple and Microsoft should be forced to choose
| between being in the phone/computer or ad business.
|
| I don't care too much about Facebook, no doubt they are capable
| of failing on their own.
| JustLurking2022 wrote:
| You should read up about DMA coming out of the EU. Privacy is
| possible even in a conglomerate.
| Dalewyn wrote:
| I wouldn't even mind ads in Windows, objectively speaking, if
| Microsoft were to just give it out for free (as in no
| activation required).
|
| What sucks about Microsoft and ads right now is they sell you
| a product and then also drown you in ads. Either I pay cold
| hard cash or they give me ads, but not both; they shouldn't
| get to double dip.
| adrr wrote:
| Hitting companies with antitrust when consumers have is a
| terrible idea. Antitrust laws were made to prevent monopolies
| giving consumers choice and preventing them from getting
| screwed.
|
| Amazon is e-commerce, i have multiple choices to shop on web.
| Amazon has even benefited the consumer by forcing retailers
| speed up shipping. For cloud hosting, there are alternatives to
| AWS. There's healthy competition in both fields.
|
| Meta the consumer is the advertiser. They are the ones spending
| the money. For advertising, there are different channel and
| mediums. You could buy billboard ads, tv/radio ads, direct mail
| etc. Competition is very healthy.
|
| Google the same thing. The consumer are advertisers. Thats the
| market.
|
| Lets compare major anti-trust actions. Standard oil was the
| pretty much the sole source of oil in the US. Consumers had no
| choice. ATT another major antitrust case where there was just
| one telecom company in the US. Kodak where they were controlled
| all the film market.
| geoduck14 wrote:
| None of these are reasons for an antitrust case
| kyrra wrote:
| Google side: from maybe a business idea, you could have it
| work. But from a technical perspective, it would be near
| impossible without years of engineering effort. Google has a
| ton of core internal infra that is shared between all the
| business units at Google. The only reason this is feasible is
| that the cost of running it is shared between the units.
|
| (Googler opinions are my own).
| drdec wrote:
| Sounds like the internal infrastructure should also be spun
| off into it's own company with the other baby Googles as
| customers!
|
| (sarcasm, in case Poe's Law has you down)
| zeckalpha wrote:
| Call it a discontinued tier of GCP that only has a handful of
| customers, and things could more or less stay the same.
| hnbad wrote:
| The fun thing about antitrust is that this is entirely
| Google's problem.
| londons_explore wrote:
| Op is suggesting this breakup might increase shareholder
| value. Ie. It would be worth doing even without a
| government regulator forcing it.
|
| If true, then their internal engineering limitations
| directly impact how viable the idea is.
| mbesto wrote:
| > The only reason this is feasible
|
| I assume by feasible you mean profitable. Which means there
| is a pricing mismatch then.
| jeffbee wrote:
| Yeah I'd love to know how this "spinoff" would work. YouTube
| is an arms-length independent company but Google happens to
| have deployed dedicated, co-designed accelerators around the
| world to support their use case?
| pclmulqdq wrote:
| AWS sells video accelerator machines. GCP could sell access
| to Argos.
| actuator wrote:
| IMO Apple should be the biggest target for antitrust right now
| looking at what they do on their platforms.
| lancesells wrote:
| > Spinning off the loser (Facebook) I'm not a Facebook user but
| it's not a loser.
|
| - 2.9B Monthly Users in 2022 - 5.3B People with Internet Access
| - 55% of the world uses Facebook.
|
| It seems both Instagram and Whatsapp have about ~2B monthly
| users. And sure, these numbers are juiced but none are losers.
| WaitWaitWha wrote:
| The online retail portion of amazon.com would not survive such
| a split [0].
|
| [0]: Most recent Amazon.com, Inc. 10-K
| https://d18rn0p25nwr6d.cloudfront.net/CIK-0001018724/d2fde7e...
| lm28469 wrote:
| > Also spin off the media company, comprising Audible and prime
| video,
|
| Prime video is what they use to get a foot in the door, then
| they know you'll want to extract as much value as you can from
| your prime membership, and that's done by buying shit from
| amazon
| sofixa wrote:
| > 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-
| subsidising and reuse of stuff that makes them profitable.
| Prime video without AWS' cache isn't a great competitor to
| Disney; YouTube on it's own will have a ruinous infrastructure
| bill that is subsidised by Google now; WhatsApp doesn't make
| money so can only survive on someone else's dime, etc. etc.
| Same goes for traditional conglomerates - of course GE were
| stronger before they split up into three. What will GE
| Aerospace do next time there's an air travel downturn like a
| pandemic? Crash and burn unless it has enough reserves, because
| it won't have the benefit of being propped up by different
| businesses that aren't impacted (like say GE HealthCare).
| Bombardier today are in a much worse spot, focusing only on a
| minuscule and volatile niche (private jets), but at least in
| their case it wasn't their choice, Boeing bankrupted them with
| protectionist tricks.
|
| The real reasons to split them up would be to improve
| competition and the choice of consumers, not because "idiot
| investors think 'value' will go up".
| conductr wrote:
| 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.
| jefftk wrote:
| _> 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?_
|
| One example: some parts of a business need a positive
| consumer reputation and others don't. When you connect these
| under the same company you may end up with two business units
| that are each less valuable than if they were free to take
| the approach that best suited their business.
|
| For example, an ad company that didn't care much what
| consumers thought about it would use fingerprinting to
| personalize ads and it's prevalent in the industry, but
| Google committed to not doing this. Why? My guess is that a
| big part was reputation: having an ads division that's
| tracking users with no opt out is inconsistent with the
| company-wide policies Google needs to be competitive in
| consumer markets.
|
| In this case I think the effects are positive, in that the
| display ads division is closer to what consumers would want
| than if it were independent, but I think it's pretty likely
| that spinning DoubleClick back out would increase overall
| profits.
|
| (I used to work at Google, and here I'm speculating about
| decisions made several levels above me that I wasn't a part
| of.)
| SilverBirch wrote:
| It's pretty wild that your example of a good conglomerate is
| GE considering GE's a perfect of example of why conglomerates
| don't work. Gee I sure wish I could invest in that great GE
| Aerospace division, too bad if I do the jokers over at GE
| Capital are going to snort half of it and place the rest on
| black. GE was the notorious exception to conglomerates being
| terrible right up until it also turned into a massive shit
| show.
| runako wrote:
| These hypothetical splits show the perils of having outsiders
| (including regulators) make decisions like these. Just some
| quick notes:
|
| > You don't need the retail arm any more [...] spin off the
| media company, comprising Audible and prime video, to make a
| Disney competitor
|
| The whole point of the conglomerate model they use (following
| Costco) is that the membership fee grants consumers access to a
| bevy of services. The services may not work a la carte.
| Further, spinning Amazon media to become one of the weakest
| Disney competitors doesn't obviously enhance competition or
| consumer welfare in media.
|
| > Spinning off the loser (Facebook), and the non-social
| networking product (WhatsApp) would let Instagram grow wings
| against TikTok.
|
| The "loser" (Facebook) generates most of the revenue and profit
| at Meta.
|
| The Google analysis arrives at a viable conclusion (the ads
| business could be run as a utility), for the wrong reasons.
| (For ex: Search/YT would not get a bigger premium by treating
| as first-class other, weaker, ad networks. The near-monopoly is
| what drives pricing power and is frequently a reason cited for
| forcing a hypothetical breakup.)
|
| Anyway, this stuff is not obvious or easy, even assuming people
| can agree on goals (which is difficult).
| vidarh wrote:
| > The services may not work a la carte
|
| They don't need to. Prime could still offer Prime Video /
| Music as a membership perk. But if the media services are
| independent, maybe it'd turn out offering one or more of the
| others, or letting customer pick and choose, would end up
| making more financial sense (FireTV can already be used to
| subscribe to competing services _in addition_ )
|
| I'm not saying it's necessarily a good idea - I don't have an
| opinion on that - but the bundling of services does not
| depend on them being part of the same company.
| runako wrote:
| This misses the point. A breakup would put Prime Video /
| Music (are those two even allowed to be in the same
| company? Why? Who decides?) on the same footing as Hulu or
| Spotify. This would create independent third-tier players
| in both markets.
|
| The consumer would likely end up paying more (because Prime
| Video / Music can't be run at zero or negative margins as
| part of a bundle; ditto for other media options like
| Spotify). Further, I'm not sure what goal would be served
| by doing all of this and increasing costs to the consumer.
| vidarh wrote:
| Splitting it out as a separate service would not
| inherently stop Amazon from paying exactly the same
| amount towards Prime Video as it does today, and would
| allow the new company to seek additional customers
| unwilling to pay for the full bundle, so it's not at all
| a given that prices wouldn't go _down_.
|
| But even assuming that'd not be the case, anti-trust law
| is in large part aimed at ensuring _competitors_ have
| fair access to the markets, not minimising costs to
| consumers. It 's presumed that over time the former will
| ensure the latter and/or improve service, but it's really
| a separate issue.
|
| That said, I don't see a compelling anti-trust case for
| going after Prime Video anyway - there's plenty of
| competition in that space.
|
| However, there _is_ also another possible cost reduction
| in forcing _unbundling_ as well for those customers who
| don 't want Prime Video, but want the other benefits. Not
| at all convinced it'd be worth it. That's not the part of
| Amazon that's a competitive issue.
| madeofpalk wrote:
| > The services may not work a la carte
|
| If the service cannot compete on it's own merits, and is
| being propped up by an unrelated business, how competetive is
| it actually?
| rtsil wrote:
| 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.
| orra wrote:
| 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.
| runako wrote:
| Their largest competitor is Walmart. Walmart's bundle
| includes video, fuel discounts, from-store delivery,
| long-haul delivery. Further, the Walmart.com e-commerce
| site is subsidized by the Walmart bricks & mortar
| operation.
|
| Businesses are allowed to do more than one thing. I'm not
| sure when it became popular to try to strip down
| businesses to a single SKU each, and it's not obvious to
| me that consumers (or anyone) benefits from pursuit of
| that goal.
| conductr wrote:
| 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.
| tshaddox wrote:
| I'm a long time paid subscriber to both Amazon Prime and
| Costco, and I can't say I've ever thought of the services
| as particularly similar. Maybe that's because I rarely use
| Costco to buy things online (I've only ordered a few
| online-only items and one travel package), which is the
| primary way I use Prime.
|
| Prime certainly feels more like a bundle of unrelated
| things, with the streaming service, and cloud
| music/photos/ebooks/etc. stuff no one uses, and whatever
| Twitch benefits they have now. I guess Costco might
| actually have some stuff like that, but I'm not aware of
| anything other than warehouse access, some online shipping
| benefits, and the travel/car/"Next" shopping.
| ghaff wrote:
| No one uses Kindle ebooks?
|
| People may not read books as much as they used to and
| many still read physical books but lots of people use
| ebooks.
| tshaddox wrote:
| I meant "Prime Reading": https://www.amazon.com/kindle-
| dbs/fd/prime-pr
|
| But I could be wrong about it being rarely used.
| ghaff wrote:
| I had forgotten about Prime Reading. It looks a lot like
| the free digital services a lot of libraries have--not
| really a whole lot of quality content.
| runako wrote:
| > 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.
| mulletbum wrote:
| 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.
| runevault wrote:
| Frankly among the not-tech-first companies Disney is the
| one that should most be targeted. The fact they were
| allowed to buy LucasFilms and Fox media (minus Fox News
| and Fox Sports because they already own ABC and ESPN) was
| so stupid. The year before those purchases the collected
| movies of those 3 were most of the top movies at the box
| office.
| danaris wrote:
| 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.
| runako wrote:
| This is such a great point.
|
| Disney makes a lot of money in theme parks etc.; Walmart
| makes something like $42B annually in healthcare; Costco
| sells cars & travel packages; Kroger sells gas (petrol);
| Apple (also a competitor) makes most of its money selling
| phones.
|
| Why leave all those businesses intact and target Amazon?
| ericmay wrote:
| So Google should have to charge money for Chrome?
| CydeWeys wrote:
| Also the most obvious split would be AWS and then
| everything else. What does AWS have to do with Prime?
| judge2020 wrote:
| AWS is only apart of Amazon for shareholder purposes.
| Even internally, word is that AWS bills all of Amazon's
| internal businesses similarly to how they bill external
| customers, so it's not like Amazon is getting super
| discounted/free hosting out of keeping them under the
| same unit.
| mkmk3 wrote:
| I'm poorly informed regarding breakups of this kind, and
| I don't have the experience/research to assess the infra
| costs of a streaming service like Prime video. Assuming
| the hosting costs are a significant portion of their
| expenditure, what would it look like in a breakup, what
| kind of deal would they be able to get from the newly
| spun off AWS?
| runako wrote:
| > Assuming the hosting costs are a significant portion of
| their expenditure
|
| I would consider this unlikely, for reasonable
| definitions of "significant." Costs to license IP and
| develop content are likely the dominant term in expenses.
|
| > what kind of deal would they be able to get from the
| newly spun off AWS?
|
| The same as everyone else, or it was a re-org and not a
| breakup.
| CydeWeys wrote:
| There are lots of video streaming services that don't
| operate the bulk of their own infrastructure. They would
| simply become a customer of GCP, AWS, Azure, whatever.
| jimbokun wrote:
| It's not so much being propped up, as at achieving better
| efficiencies. Leveraging the larger organizations compute
| resources and ads technology makes Youtube more valuable
| than a stand alone company would be, for example.
| dahfizz wrote:
| Who decides what is unrelated or not?
|
| Amazon's whole retail business started by selling paper
| books. Extending that to kindle and audio books doesn't
| seem so outrageously "unrelated". Its more of an ecosystem
| which has legitimate benefits to the consumer. And once you
| have audio books, music and video doesn't seem like a huge
| stretch.... etc etc.
|
| Apple is the obvious example of this. Do you think every
| single service apple offers should be broken into a
| separate company? Apple pay, apple music, icloud all seem
| to be "unrelated" but the consumer legitimately benefits
| from these things being bundled into a cohesive ecosystem.
|
| Breaking these things into individual companies which has
| to be profitable based on just their one product would lead
| to higher prices and worse user experience, IMO.
|
| For non-consumer facing products, the case is clearer. AWS
| / GCP could be split out nicely. The ad networks of meta
| and google could be independent without hurting the
| consumer at all.
| AtNightWeCode wrote:
| Fix the font.
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