YouTube advertisement boycott may cost Google 750 million dollar
New York, March 28: In each day more and more companies are pulling their advertising from Google’s YouTube video platform over company’s inability to ensure advertisements won’t appear next to hateful and offensive content.
According to the Wall Street Journal reports YouTube videos centered around racist, homophobic, and anti-Semitic views are still scooping up ads from brands like Coca-Cola, Amazon.com, and Microsoft.
This led to mass advertising boycotts in the Britain and now in the United States, prompting Google to promise companies it would solve the issue and implement better tools and moderation practices.
The boycott of video-hosting platform YouTube by advertisers could cost its parent company Google approximately $750 million (Rs 4880 Crores) in revenue, a media report says.
Major consumer brands, including Johnson & Johnson, PepsiCo and McDonald`s have pulled out their ads from the platform on past weeks, as they are protesting the placement of their advertisements which were appearing next to offensive contents, including videos posted by terrorism-affiliated groups.
The controversy still continues, although Google promised that it was taking steps to deal with the problem, and has led at least one firm to downgrade the search giant`s share price, Fortune reported on Monday.
If Google addresses the issue quickly, the boycott could cost its video service dearly, says analysts at brokerage firm Nomura Instinet.
The firm said that the video platform YouTube could see its annual revenues — which are estimated to be $10.2 billion (Rs 6638 thousand Crores) for this year — a cut by as much as 7.5 percent due to the controversy. This is combined with the costs of fixing the problem.
“Advertisement buyers are likely to demand greater direct control over advertising placement, which could take time and resources to implement,” Nomura Instinet was quoted as saying.
The YouTube ad controversy first arose in the UK, where a number of prominent brands and the British government itself withdrew their advertisements after it was discovered that many advertisements appeared along with the videos from terrorist organizations and other offensive content.
The Internet giant Google was even summoned to address the parliament about what it planned to do about the problem.