Tucked away amid all of the Viacom vs. YouTube legal storyline is the fact that YouTube makes absolutely nothing from video advertising.  After all, the funniest part about YouTube’s $200M annual revenues is that they would not even be counted in the video advertising category.

Let’s back up:

- Forbes pegs YouTube’s 2008 revenues at $200M.

- However, the vast majority of YouTube’s revenues come from display banners running alongside the videos.  Apart from the odd promotional video that might run on its main page (and thus counted by bean counters as video advertising revenue), YouTube’s percentage from video ads is close to 0%.

- eMarketer pegs US online video advertising revenues for 2008 at $1.35B.

This begs the question, where does that come from?  And who generates those revenues?

Something we’ll look at tomorrow.

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