Google is tightening the belt in an effort to make back the $1.65 billion it spent in November 2006 for YouTube.
The company’s revenue strategy is to have commercial ads as part of the search, based on categories that users choose. Advertisers will offer contextual ads that will appear based on a certain order, according to their bidding amount.
It is yet unclear how YouTube’s millions of viewers will react to the addition of ads to the website.
This step is taking place while the advertising world is being affected by the recent economic downturn. Many companies have cut down their advertising budgets due to declining revenues.
Google’s stock itself has fallen below $300 for the first time in 3 years to $291. This is significantly lower than the company’s peak price of $718 in early 2008.
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