Business Ideas
January 09, 2021
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Founding and initial growth (2005–2006)
From left to right: Chad Hurley, Steve Chen and Jawed Karim, the founders of YouTube
From left to right: Chad Hurley, Steve Chen and Jawed Karim, the founders of YouTube
YouTube was founded by Steve Chen, Chad Hurley, and Jawed Karim, who were all early employees of PayPal.[12] Hurley had studied design at Indiana University of Pennsylvania, and Chen and Karim studied computer science together at the University of Illinois at Urbana–Champaign.[13]
Karim said the inspiration for YouTube first came from Janet Jackson's role in 2004 Super Bowl incident when her breast was exposed during her performance, and later from the 2004 Indian Ocean tsunami. Karim could not easily find video clips of either event online, which led to the idea of a video sharing site.[14] Hurley and Chen said that the original idea for YouTube was a video version of an online dating service, and had been influenced by the website Hot or Not.[15][16] They created posts on Craigslist asking attractive women to upload videos of themselves to YouTube in exchange for a $100 reward.[17] Difficulty in finding enough dating videos led to a change of plans, with the site's founders deciding to accept uploads of any type of video.[18]
According to a story that has often been repeated in the media, Hurley and Chen developed the idea for YouTube during the early months of 2005, after they had experienced difficulty sharing videos that had been shot at a dinner party at Chen's apartment in San Francisco. Karim did not attend the party and denied that it had occurred, but Chen commented that the idea that YouTube was founded after a dinner party "was probably very strengthened by marketing ideas around creating a story that was very digestible".[15]
The YouTube logo was used from its launch until 2011. Another version of this logo without their "Broadcast Yourself" slogan was used until 2015.
YouTube began as a venture capital–funded technology startup, primarily from an $11.5 million investment by Sequoia Capital and an $8 million investment from Artis Capital Management between November 2005 and April 2006.[19][20] YouTube's early headquarters were situated above a pizzeria and Japanese restaurant in San Mateo, California.[21] The domain name www.youtube.com was activated on February 14, 2005, and the website was developed over the subsequent months.[22] The first YouTube video, titled Me at the zoo, shows co-founder Jawed Karim at the San Diego Zoo.[23] The video was uploaded on April 23, 2005, and can still be viewed on the site.[24] YouTube offered the public a beta test of the site in May 2005. The first video to reach one million views was a Nike advertisement featuring Ronaldinho in November 2005.[25][26] Following a $3.5 million investment from Sequoia Capital in November, the site launched officially on December 15, 2005, by which time the site was receiving 8 million views a day.[27][28]
At the time of the official launch, YouTube did not have much market recognition. It was not the first video-sharing site on the Internet, as Vimeo was launched in November 2004, though that site remained a side project of its developers from CollegeHumor at the time and did not grow much either.[29] The week of YouTube's launch, NBC-Universal's Saturday Night Live ran a skit "Lazy Sunday" by The Lonely Island. Besides helping to bolster ratings and long-term viewership for Saturday Night Live, "Lazy Sunday"'s status as an early viral video helped established YouTube as an important website.[30] Unofficial uploads of the skit to YouTube drew in more than five million collective views by February 2006 before they were removed at request of NBC-Universal about two months later, raising questions of copyright related to viral content.[31] Despite eventually being taken down, these duplicate uploads of the skit helped popularize YouTube's reach and led to the upload of further third-party content.[32][33] The site grew rapidly and, in July 2006, the company announced that more than 65,000 new videos were being uploaded every day, and that the site was receiving 100 million video views per day.[34]
The choice of the name www.youtube.com led to problems for a similarly named website, www.utube.com. The site's owner, Universal Tube & Rollform Equipment, filed a lawsuit against YouTube in November 2006 after being regularly overloaded by people looking for YouTube. Universal Tube has since changed the name of its website to www.utubeonline.com.[35][36]
Acquisition by Google (2006–2013)
On October 9, 2006, Google announced that it had acquired YouTube for $1.65 billion in Google stock.[37][38] The deal was finalized on November 13, 2006.[39][40] Google's acquisition launched new newfound interest in video-sharing sites; IAC, which now owned Vimeo after acquiring CollegeHumor, used its asset to develop a competing site to YouTube, focusing on supporting the content creator to distinguish itself from YouTube.[29]
YouTube's headquarters in San Bruno, California
In March 2010, YouTube began free streaming of certain content, including 60 cricket matches of the Indian Premier League. According to YouTube, this was the first worldwide free online broadcast of a major sporting event.[41] On March 31, 2010, the YouTube website launched a new design, with the aim of simplifying the interface and increasing the time users spend on the site.[42] In May 2010, YouTube videos were watched more than two billion times per day.[43][44][45] This increased to three billion in May 2011,[46][47][48] and four billion in January 2012.[49][50] In February 2017, one billion hours of YouTube were watched every day.[51][52][53]
According to data published by market research company comScore, YouTube is the dominant provider of online video in the United States, with a market share of around 43% and more than 14 billion views of videos in May 2010.[54]
In October 2010, Hurley announced that he would be stepping down as chief executive officer of YouTube to take an advisory role, and that Salar Kamangar would take over as head of the company.[55] In April 2011, James Zern, a YouTube software engineer, revealed that 30% of videos accounted for 99% of views on the site.[56] In November 2011, the Google+ social networking site was integrated directly with YouTube and the Chrome web browser, allowing YouTube videos to be viewed from within the Google+ interface.[57]
In May 2011, 48 hours of new videos were uploaded to the site every minute,[49] which increased to 60 hours every minute in January 2012,[49] 100 hours every minute in May 2013,[58][59] 300 hours every minute in November 2014,[60] and 400 hours every minute in February 2017.[61] As of January 2012, the site had 800 million unique users a month.[62] It has been claimed, by The Daily Telegraph in 2008, that in 2007, YouTube consumed as much bandwidth as the entire Internet in 2000.[63] According to third-party web analytics providers, Alexa and SimilarWeb, YouTube is the second-most visited website in the world, as of December 2016; SimilarWeb also lists YouTube as the top TV and video website globally, attracting more than 15 billion visitors per month.[6][64][65] In October 2006, YouTube moved to a new office in San Bruno, California.[66]
YouTube logo from 2015 until 2017
In December 2011, YouTube launched a new version of the site interface, with the video channels displayed in a central column on the home page, similar to the news feeds of social networking sites.[67] At the same time, a new version of the YouTube logo was introduced with a darker shade of red, the first change in design since October 2006.[68]
In early March 2013, YouTube finalized the transition for all channels to the previously[when?] optional "One Channel Layout," which removed many customization options and custom background images for consistency, and split up the channel information to different tabs (Home/Feed, Videos Playlists, Discussion, About) rather than one unified page.[69]
New revenue streams (2013–ongoing)
In May 2013, YouTube launched a pilot program for content providers to offer premium, subscription-based channels within the platform.[70][71] In February 2014, Susan Wojcicki was appointed CEO of YouTube.[72] In November 2014, YouTube announced a subscription service known as "Music Key," which bundled ad-free streaming of music content on YouTube with the existing Google Play Music service.[73]
In February 2015, YouTube released a secondary mobile app known as YouTube Kids. The app is designed to provide an experience optimized for children. It features a simplified user interface, curated selections of channels featuring age-appropriate content, and parental control features.[74] Later on August 26, 2015, YouTube launched YouTube Gaming—a video gaming-oriented vertical and app for videos and live streaming, intended to compete with the Amazon.com-owned Twitch.[75]
In October 2015, YouTube announced YouTube Red (now YouTube Premium), a new premium service that would offer ad-free access to all content on the platform (succeeding the Music Key service released the previous year), premium original series, and films produced by YouTube personalities, as well as background playback of content on mobile devices. YouTube also released YouTube Music, a third app oriented towards streaming and discovering the music content hosted on the YouTube platform.[76][77][78]
In January 2016, YouTube expanded its headquarters in San Bruno by purchasing an office park for $215 million. The complex has 51,468 square metres (554,000 square feet) of space and can house up to 2,800 employees.[79]
YouTube logo since 2017.
On August 29, 2017, YouTube officially launched the "polymer" redesign of its user interfaces based on Material Design language as its default, as well a redesigned logo that is built around the service's play button emblem.[80]
On April 3, 2018, a shooting took place at YouTube's headquarters in San Bruno, California.[81]
On May 17, 2018, YouTube announced the re-branding of YouTube Red as YouTube Premium (accompanied by a major expansion of the service into Canada and 13 European markets), as well as the upcoming launch of a separate YouTube Music subscription.[82]
In September 2018, YouTube began to phase out the separate YouTube Gaming website and app and introduced a new Gaming portal within the main service. YouTube staff argued that the separate platform was causing confusion and that the integration would allow the features developed for the service (including game-based portals and enhanced discoverability of gaming-related videos and live streaming) to reach a broader audience through the main YouTube website.[83]
In July 2019, It was announced that YouTube will discontinue support for Nintendo 3DS systems on September 3, 2019. However, owners of New Nintendo 3DS, or New Nintendo 3DS XL, can still access YouTube on the Internet browser.[84]
In November 2019, it was announced that YouTube was gradually phasing out the classic version of its Creator Studio across all users by the spring of 2020.[85] As of August 2020, the classic studio is no longer available.[86]
During the COVID-19 pandemic, when most of the world was under stay-at-home orders, usage of services such as YouTube grew greatly. In response to EU officials requesting that such services reduce bandwidth as to make sure medical entities had sufficient bandwidth to share information, YouTube along with Netflix stated they would reduce streaming quality for at least thirty days as to cut bandwidth use of their services by 25% to comply with the EU's request.[87] YouTube later announced that they will continue with this move worldwide, "We continue to work closely with governments and network operators around the globe to do our part to minimize stress on the system during this unprecedented situation".[88]
Watching videos
