YouTube tripled its mobile ad sales thanks to the removal of its client from iOS 6

When Apple removed the YouTube app from iOS 6, it turned into a big break for Google. According to YouTube's vice president of sales Lucas Watson, over the last 6 months mobile ad sales for the streaming video site tripled to $350 million. The YouTube client on the Apple iPhone, which had been available on the iconic smartphone since its launch in 2007, was completely free of ads. With its new YouTube app available in the Apple App Store, Google has been able to sell mobile advertisements bringing in ad revenue to an application that originally had none. Watson said, "The commercial business has exploded. It’s a huge part of our business, and we know that’s where it’s headed." According to EMarketer, U.S. mobile video-ad sales are forecast to rise to $2.69 billion by 2017, a ten-fold increase from 2012.

Wedge Partners Corp. analyst Martin Pyykkonen says that his work shows that You Tube accounts for 10% of Google's revenue. Additionally, YouTube's mobile ad sales are believed to be 25% of YouTube's total mobile advertising. That would work out to the aforementioned $350 million in mobile ad revenue for YouTube over the last half-year. 250 million of YouTube's 1 billion viewers now access the site from a mobile device and more than half the smartphone users in the U.S. visited YouTube in March. According to Nielsen, 70 million Americans visited YouTube using a smartphone that month, up 42% from a year ago.

And more money should soon be rolling into Google's coffers now that it has come to an agreement with Microsoft over the development of an official YouTube app for the platform.


source: Bloomberg