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Microsoft Bleeding from the YouTube Wars

It’s scaling back its YouTube-competitive Soapbox web video service
By Maureen O'Gara
Article Rating:
June 19, 2009 12:45 PM EDT
Reads:
 1,776

According to CNET, the new economical Microsoft is scaling back its YouTube-competitive Soapbox web video service, meaning to limit content to categories covered by its online properties like finance and entertainment. It could just as easily give the venture up as a complete loss and shut it down.

Microsoft VP Erik Jorgensen indicated that continuing with the YouTube approach is too costly in this economy.

YouTube, meanwhile, is calculated to be costing Google $174.2 million in operating losses by RampRate, not the $470.6 million Credit Suisse projected a few weeks ago.

They're also divided on what it costs Google to host all the YouTube video: $380 million or $83 million.

RampRate, which used Credit Suisse's $241 million estimate for YouTube revenues this year, suggested that "Google is no doubt thrilled to let YouTube be known as a financial folly." Google paid $1.76 billion for it in late '06.

Published June 19, 2009 – Reads 1,776
Copyright © 2009 SYS-CON Media, Inc. — All Rights Reserved.
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Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025.

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