New York’s blip.tv just whipped YouTube and a cast of thousands of other video-sharing sites in a PC World industry review (By the way, when we say “cast of thousands,” we mean it: any entrepreneur thinking of starting a video company–or, worse, running one–should check out this list). That’s not bad for a company with 10 employees, especially given the competition. PC World’s review here.
This is great news, but we have a question: How will blip.tv ever make money? We don’t mean to rain on the parade, but here’s the picture we’re looking at:
- Google’s YouTube is selling video ads for about a $20 CPM. Blip presumably can’t charge that much more than Google–can it?
- blip.tv shares half of its gross revenue with producers, leaving it with a $10 CPM
- Hosting and serving videos and video ads costs a boatload of money.
- Ad sales people cost a boatload of money
- Google’s AdSense, a similar third-party-content-monetizing service, has awesome scale and very low margins–and it doesn’t pay to host and stream the content. Also AdSense serves ultra-cheap text-based ads, some of which generate a far higher CPM.
- blip.tv, popular though it is, has far less scale than Google.
So, we invite blip.tv to weigh in. Mike Hudack? Dina Kaplan? How are you going to make money?