Posts Tagged ‘Internet Statistics from Bizak’

Types of Internet Startups & Websites

The current breakdown of the types of internet startups listed on

Types of Internet Startups & Websites


Monetizing YouTube

June 4, 2008 10 comments

YouTube LogoEarly this week YouTube’s Head of Monetization quits the company to work at a smaller company that presumable might be easier to monetize. Since Google Inc. (NASDAQ:GOOG) purchased YouTube for $1.65 Billion in October 2006 the issue of monetizing video content has been a major issue for the company. Even though YouTube has yet to become a cash cow for Google it has become an online phenomenon and traffic powerhouse. According to YouTube has captured a 50.4% market share of the online video market. That equates to a market share increase of 2.4% from March 2008 and 12.3% when compared to April 2007.

In terms of market share Google blows away the competition with the closest competitors being Yahoo and Fox Interactive Media which each have less than 10% of the market according to However even with 64 million monthly visitors (source YouTube is having trouble converting these videos (and eyeballs) into dollar signs. The much smaller video site seems to be doing a much better job monetizing their content with revenue estimates of $25 million on less than 1% of the market.

YouTube Revenue Valuation Based on Zero Costs

YouTube Revenue Valuation Based on Zero Costs

Bear Stearns estimates that 2008 revenues for YouTube will be $90 million, of which $22 million comes from InVideo advertisements. Using the Bizak Business Valuation Calculator (right) we can get a rough estimate of YouTube’s revenue valuation and EPV (Earnings per Visitor), which is the amount of money earned from each visitor to the site.

If you divide the yearly revenues by 12 you get a rough monthly revenue estimate of $7.5 million. We then enter these numbers into the calculator. At this point we’re assuming YouTube has zero costs but in actuality we know this to be false. We’ll factor in the enormous bandwidth costs of video hosting in the next section.

Based on the Bizak calculations YouTube has an EPV of $0.12 and a Bizak Estimate (business valuation estimate based on revenues) of $360 Million. This valuation is obviously a lot less than the $1.65 Billion Google paid for YouTube, however YouTube is a premium brand that must be (and was) factored into the purchase price.

YouTube Revenue Valuation Including Costs

YouTube Revenue Valuation Including CostsBack in July 2006 it was estimated that YouTube’s bandwidth costs were $1 million per month, which was based on 12.9 million visitors per month. Today (according to YouTube receives 64 million monthly visitors which is 3.5 times the amount it saw in 2006. If you estimate YouTube’s monthly costs on my very unscientific method that would mean their bandwidth costs them $3.5 million dollars every month.

Entering these calculations into the business valuation calculator gives you some major changes to the estimates. First off YouTube’s EPV has been cut in half to just $0.06 per visitor. This means that YouTube earns just six cents for ever visitor who goes to the site – this number is very low. The Bizak Estimate has also dipped to $318,000,000 compared to the $360,000,000 above and $1.65 Billion purchase price.

Hulu Estimated Revenues, Costs & Earnings Estimates

If you remember makes $25 Million in revenues per year on just 821,899 monthly visitors, according to If you compute these estimates (without costs) into the Bizak Calculator you get an EPV of $2.53 and a Bizak Estimate of $99,999,984. This EPV (excluding costs) is comparable to YouTube’s $0.12 EPV. Lets factor in costs since they too host video which is costly. We’ll error on the high end and estimate that it costs Hulu $1 Million a month ($12 Million/Year) to host their videos. Even with these costs Hulu does a better job monetizing their platform with an EPV of $1.32 compared to YouTube’s $0.06 EPV.

CPV – Costs per Visitor

The YouTube calculation (after costs) has monthly earnings of $4 Million and a CPV (costs per visitor) of $0.06. For ever visitor to the site YouTube spends 6 cents in the form of server costs rather than advertising. With Hulu their CPV is much higher at $1.21 with earnings of over $1 million per month. (Both of these estimates are based on costs estimates which could be higher or lower than actual costs.)

Forbes YouTube Revenue Estimates

Forbes YouTube Revenue Estimates

The calculations above are based on the Bear Stearns revenue estimate of $90 million. Forbes estimates that YouTube will bring in $200 million in revenues for 2008. Plugging those estimates into the business calculator we get an EPV of $0.21 and a Bizak Estimate of $758,000,016 – considerable better than the $0.06 EPV and $318 million valuation (on $90 million revenues) but lower than the $1.65 billion purchase price.

YouTube EPV of $0.50 = $1.65 Billion Purchase Price

Based on all the estimates outlined above (and they are estimates) YouTube needs to earn fifty cents for every 64 million people who visit the site monthly in order to have a $1.65 billion valuation. An EPV of $0.50 equates to monthly revenues of $35,300,000 ($423,600,000 yearly revenues) which then give them a valuation (according to the Bizak business valuation calculator) equal to their purchase price.

YouTube EPV of $0.50 = $1.65 Purchase Price

Monetizing YouTube

YouTube currently generates about a quarter ($22 million) of its revenues from InVideo Advertisements. The remainder of their sales come from front page ads ($175,000/day) and branded YouTube channels which go for $200,000 each. If YouTube was only concerned about dollars they could easily expand their InVideo Ads, however this would definitely hurt their market share. Clearly Google and YouTube are treading lightly.

The InVideo Ads are very unobtrusive but I find them ineffective. I go to YouTube to watch videos, not to click on text ads. Text ads are for YouTube is for videos. I have no problem watching advertisements as long as they are in video format.

The other 75% of YouTube’s revenues come from corporate partnerships and advertising from deep pocket companies. This is definitely essential for revenues, however I feel YouTube is shutting out the small business owners and individuals who would pay for better placement of their videos. Adwords didn’t generate billions for Google by focusing only on big business. Rather Google Adwords allows anyone with a website to place a text ad on their site. Why can’t I do the same with my videos?

We’re all familiar with the right hand column of Google that’s reserved for sponsored advertisements. Google is about textual content and so are these ads – they fit. Since I go to YouTube for video why can’t I bid my video to be placed along this familiar right hand column? Except this time on YouTube and instead of small text ads it’s a small picture of my video. As a small business owner who relies on internet traffic I would be more than willing to pay extra to have my video be seen by more people. Users would still have the option to upload videos for free but now they would also have the option to pay for additional exposure.

If only 5% of the 46 million monthly visitors opt to use this service then that equates to over 2 million people per month. If they average a monthly advertising budget of just $50 then that’s an additional $100 million+ per month. That’s a lot more than the big boys are currently generating for YouTube.

Revenue Sources

May 28, 2008 1 comment

Of the websites submitted to Bizak 39% of them rely on Google Adsense to pay the bills – none use Microsoft Search Advertising or Yahoo Search Marketing.

E-commerce sites (products sales) are the second most popular revenue models representing 14% of the total.  In house advertising affiliate marketing and service/consulting fees each represent 12% of the revenue models submitted to Bizak.  Subscription models make up 11% of the revenue models.

Top Revenue Sources on

  1. 39% – Google Adsense
  2. 14% – Product Sales
  3. 12% – In-House Advertising
  4. 12% – Affiliate Marketing
  5. 12% – Service/Consulting Fees
  6. 11% – Subscriptions
  7. 0%  – Microsoft Search Advertising
  8. 0%  – Yahoo Search Marketing

Date:  May 28, 2008

Social Networks

To no surprise social networks are very popular on Bizak and currently make up 18% of all business types submitted.  Include business networks and that number becomes 24% for all networking sites.

Of the social networks currently on Bizak (excluding those beyond the standard deviation) their monthly averages are the following:

Monthly Benchmarks for Social Networks

  • Visitors 128,830
  • Revenues $11,707.69
  • RPV $0.23
  • Costs $5,139.62
  • CPV $0.21
  • Earnings $6,568.08
  • EPV $0.01
  • Bizak Estimate $500,293.85

Content sites are the most popular business types on Bizak making up 21% of all websites.  The most interesting comparison between content sites and social networks comes in the costs field.  Content sites have a CPV (Costs per Visitor) of just $0.05 compared to the $0.21 for social networks.  RPVs (Revenues per Visitors) are significanly lower for content sites ($0.07 vs. $0.23) but due to lower costs earnings are relatively equal with an EPV of $0.02.


Types of Internet Businesses

Bizak gives entrepreneurs the ability to sort their projects according to the type of internet business they manage. These types include: blogs, bookmarks, collaboration, consulting services, content, e-commerce, e-learning, hosted services, lead generation, management, mapping, messaging, mobile, networking-business, networking-social, photo sharing, search, video and wiki.

Of the types of internet businesses listed above content sites are currently the most popular on Bizak at 24% of total. Social networking sites come in second place at 20%, followed by blogs at 10% and business networking at 8%. Source:

Internet Statistics from Bizak

Bizak is still in beta collecting enough data to make the comparative analysis statistically relevant. It’s been a great week and we hope to have the benchmarks and comparisons open after another strong week (spread the word) of data accumulation.

So far there has been some interesting numbers. Of those who have contributed projects/websites to Bizak 43.75% of them use Google Adsense as their primary revenue source. In comparison none (0%) use Yahoo Search Marketing or Microsoft Search Advertising. 16.66% use in house advertising, 12.5% rely on product sales for revenues, 8.33% affiliate marketing, 8.33% service or consulting fees and 8.33% rely on a subscription model.

These numbers are interesting but probably not all that surprising. If you look around the majority of sites appear to use Google Adsense to cover costs. I would imagine these numbers will fluctuate over time (so contribute to Bizak), however, my guess is that Adsense will remain on top with at least a third of websites using it.

As for the main analysis from Bizak it’s probably still to early to be statistically significant however here are the averages (so far) for submitted projects. (Please note this includes all types of sites – once enough data is collected then these numbers can be sorted by Industry, Business Type and Revenue Source)

As of May 4, 2008 the total monthly averages for the following are:

  • Monthly Visitors 169,881
  • Monthly Revenues $16,808.62
  • Revenues per Visitor (RPV) $0.42
  • Monthly Costs $12,656.66
  • Costs per Visitor (CPV) $2.08
  • Monthly Earnings $4,151.96
  • Earnings per Visitor (EPV) -$1.66
  • Bizak Estimate $654,933.64

These numbers will fluctuate dramatically over time since the survey pool is still statistically low. Once Bizak launches their comparative analysis tools, startups and investors will be able to make these stats more relevant to their interests and business. For example, the costs estimates on many of the sites who sell products are very high since they are heavily invested in marketing costs.

SOURCE: Please feel free to source and use any of the statistics mentioned above. However, if used please source Bizak and link to – Thank you!

If you wish to publish updates to these numbers please contact Bizak for the latest statistics.

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