By Erik Crouch
After purchasing competitor Tudou in August, Youku.com has seen its revenue rise 84% and now posted its first-ever profitable quarter. Forbes predicts that China’s web-video market will value more than $1.2 billion in 2012, with Youku-Tudou leading the pack. Youku and Tudou now have a combined 400 million monthly users, but monetization has not been easy.
Bandwidth is still expensive, and Youku has been trying various forms of advertising to raise revenue: commercials at the beginning of videos, commercials during paused videos, and longer commercials all around. It also features sponsored sections like Youku.com/Scoot for Scoot Airlines and others for companies like Volvo and Samsung. Although known as “The YouTube of China,” that isn’t necessarily a compliment: even with a huge viewer base, and massive revenue, YouTube has consistently struggled to make a profit.