A different take on the Google/YouTube deal

My partner Chris sent the following around.  Its a more lighthearted way of looking at the Google/YouTube deal…

YouTube is currently “delivering” 100,000,000 videos/day.  I’m by no means a prolific consumer of YouTube content, but I’m going to guess that the average length of a YouTube video is about 1.5 minutes.
That translates into 150,000,000 minutes wasted (or 2,500,000 hours) wasted each and every day watching YouTube videos (it would be interesting to know how many uniques that translates into).
Assuming a 40 hour work week and 50 work weeks per year (2,000 work hours/yr/person), that means that there are 1,250 “man-years” wasted watching YouTube videos–that’s each and every day.  And people say that technology hasn’t boosted productivity…
I didn’t venture past Econ 1, so there may be more accurate ways to quantify the lost productivity, but for simplicity’s sake, let’s use US GDP, which
$41,800 per capita in 2005. I’m sure that YouTube’s viewership is a global one, but I’m also reasonably confident that the majority of viewers are from the US and those that aren’t from the US are much more likely to be from other industrialized nations with per capital GDPs that are similar to the US.
That means that YouTube viewership alone is reducing productivity by over $52 million per day or $19 billion per year.

I guess that makes Google’s purchase price seem like a bargain–after all, how else could you spend $1.6b and cause $19b in lost productivity annually?
  • Randy Levine

    It’s nice to see some logic and sanity applied to this.
    On the other hand, the key is how many people are watching those 100,000,000 videos per day. If it’s 100,000,000 people each wasting 1.5 minutes that they would otherwise waste in some other way then there is no net hit on productivity (relative to what it was). Obviously, it’s more like 10,000,000 people each spending 15 minutes watching something, but then you have to get into when are they watching and what does it displace (work, other diversions, broadcast TV, etc.). Personally, I would be less worried about the impact on overall productivity and more concerned if I were running a traditional media outlet or another big web property (I think most YouTube viewing is displacing other web activity). But those people already know that. Hence Google paying $1.65B.