Google Making ‘Strategic Decision’ To Invest More In YouTube

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YouTube may be the undisputed king of free streaming video, bringing in 1.5 billion people each month, but that does not mean it is resting on its laurels.

Executives from parent company Google say they are making a “strategic decision” to invest more cash in YouTube, with CEO Sundar Pichai calling the video platform one of the company’s three big “bets,” alongside cloud computing and hardware, on the company’s quarterly earnings call Thursday.

Where is that investment going? There are a few clues to be had from the call. Google CFO Ruth Porat said that “content acquisition costs, primarily for YouTube,” was one of the factors that contributed to an increase in revenue costs for the company.

YouTube has been spending aggressively on professional content. This week the company announced it would be the exclusive place to watch local games from a new Los Angeles soccer team, in a first of its kind deal. The company has also been beefing up the slate on YouTube Red, its on-demand streaming service, and has been spending significantly to promote YouTube TV, its overt-the-top streaming bundle.

The other big bet from YouTube is international, where the company now has 90 localized versions, across 80 languages. This morning YouTube rolled out its YouTube Go app in 130 countries to try and gain even more marketshare internationally.

YouTube Go is a light version of the regular app, geared toward people who live in places where cellular data is prohibitively expensive or slow, or where bandwidth is limited. The app allows for users to download videos for online viewing, and to share the videos with other nearby users without using any data.

“Historically, YouTube has been very strong on mobile and continues to be strong on mobile,” Pichai said on the call. “It’s doing particularly well in the [developing world] markets. Our growth last year was very strong there, which is why we supported it with investments like YouTube Go.”

Executives from the company also responded to recent changes to the platform, tightening rules about monetization and brand safety in the wake of the Logan Paul controversy.

Pichai noted that the company is now manually reviewing all videos in the Google Preferred ad platform, and is using machine learning to catch more inappropriate content.

“We have provided improved controls for marketers and we are also working with trusted third-party vendors to assist brand suitability,” he added. “It’s a comprehensive approach to make sure all of this works well. And so, while there have been concerns, we are working really hard to address them and respond strongly.”

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