YouTube Could Gross $3.6 Billion This Year

By Megan O'Neill 

YouTube is set to blow its 2011 revenue out of the water this year, according to Citi’s Mark Mahaney.  Mahaney estimates that the video giant is on course to generate over $3.6 billion in gross revenue by the end of 2012.

Back in March of last year, Mahaney predicted that YouTube would gross just under $1.7 million in 2012, finally breaking the billion mark at approximately $1.1 billion net.  YouTube has far exceeded his expectations, and AllThingsD’s Peter Kafka reports that Mahaney has upped his expectations.  Kafka writes, “The video site should generate more than $3.6 billion in gross revenue, says Citi’s Mark Mahaney.  After distributing some of that to partners, Google probably records net revenue of $2.4 billion, he says.”

That $2.4 billion is a lot larger than what Mahaney was predicting last year, but YouTube has gone under a lot of unpredicted changes since his last assessment, from launching a new professionally produced channel lineup to opening their partner program (and revenue sharing) to everyone.

To put Mahaney’s 2012 estimate into perspective, he says that it “is likely 50% greater than Yahoo!’s Display Advertising total and right-in-line with Netflix’s total subscription revenue.  We really doubt whether most investors realize how big/important YouTube has become.”

Well, when the final figures are announced at year’s end it looks like investors may start to realize just how significant YouTube is.  What are your thoughts?  Do you agree with Mahaney’s assessment?

Megan O’Neill is the resident web video enthusiast here at Social Times.  Megan covers everything from the latest viral videos to online video news and tips, and has a passion for bizarre, original and revolutionary content and ideas.