YouTube advertising revenues predicted to grow by 20% this year

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Source YouTube

Despite growing competition within digital video, it seems that YouTube has nothing to fear. The video streaming platform continues to perform strongly and remains an evidently important player in Google Alphabet’s portfolio judging by the company’s latest earnings call.

Last Thursday, Alphabet presented its fourth quarter revenue, which was up 22% in 2016. The main drivers for this growth included YouTube, mobile search as well as programmatic.

Now, eMarketer has presented estimates suggesting that the streaming platform had 180.1m US users last year. Given the saturation of the market, growth levels are going to be fairly low this year at just 3.2%.

However, the research firm adds that almost 85% of digital video viewers are YouTube viewers.

When it comes to OTT usage, YouTube approaches saturation at 95%.

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Source eMarketer

YouTube advertising revenues increased 30% in 2016 according to eMarketer predictions.

The growth is largely due to new advertising features such as search data layers for improved targeting. Advertising revenue in 2017 is predicted to grow 20%.

In addition, Google is planning to roll out a subscription-based streaming service in the UK this year. Dubbed YouTube Red, the Netflix competitor is currently available in the US, Australia, New Zealand, Mexico and South Korea and enables subscribers to view videos without adverts.

In addition, the company is currently testing a new messaging service in Canada. iOS and Android mobile device owners can now share videos in private conversations through the YouTube app instead of circumventing to additional social platforms.

Google CEO Sundar Pichai is optimistic:

“You’ll see us invest more – more (availability in) countries, more original content. We are seeing traction with the rate of sign-ups for YouTube Red, but we’re not disclosing specific numbers.”