Making money on mobile: the YouTube perspective

It’s no secret that more and more content is being consumed on mobile devices. While this has been a source of stress for some web publishers like Facebook (s fb), YouTube (s goog) appears to be doing just fine at monetizing phones, tablets, Xbox consoles and more.

Shiva Rajaraman, YouTube’s director of product management, joined our video reporter Janko Roettgers at GigaOM’s Mobilize conference to explain the company’s view of mobile.

Screens are everywhere, Pages are dead

According to Rajaraman, 25 percent of YouTube videos are being watched on mobile devices and the number is accelerating rapidly. In some markets, like Korea, that figure is already at 50 percent. Rajaraman attributes this rise to everything from larger screen sizes, more 3G and 4G networks, and consumers turning to tablets over desktops for info and entertainment.

For content makers, this means that creating a video channel page in a “classically desktop” design is folly. Pages with links, browser bars and other desktop architecture just doesn’t belong in a video environment, says Rararaman.

“Pages are dead,” he says. “It’s all about fluidity and a full screen model.. like TV.”

This means that YouTube’s partners have had to adjust to how their content is presented — and where it appears. While the site once let video makers publish to discrete devices, now their only choice for syndication is monetized or non-monetized platforms. The reason for this is that YouTube wanted to put a stop to the “odd experience” where a video shared from a desktop can’t be seen on a mobile device. Rajaraman said the channels must be everywhere in the same way that your friends are always there on a social network no matter which platform you use.

But what about monetization?

Unlike display ads, which have proved a rocky fit on smaller screens, video ads have made a smoother transition. Rajaraman says that YouTube’s plan is to continue scaling its skippable pre-roll ads across all devices where people watch them as part of a fluid package of content.

He also noted that while the format of online video resembles TV, the advertising environment is much less restriced. Ad makers are not constrained by artificial 15 or 30 second windows and that the possibilities for execution are much broader. Rajaraman observes, for instance, that advertisers trying to induce a call to action (like asking a viewer to go to a web page) can try to reach the target with one big splash rather than using conventional TVs tactic of bombarding the target with the same ad.

Audience members asked if the video ecosystem is threatened by phone carriers’ increasingly strict limits on data usage. Rajaraman said that YouTube was looking for ways to “uncap” people but that the company for now is not disclosing how much content is consumed on Wi-Fi versus on phone networks.

He also suggested that YouTube was in the process of developing something analogous to Apple Airplay for Android.

On the broader picture of how consumers will interact with video content in the future, Rajaraman said that TV will be used for display and mobile devices for discovery.

Check out the rest of our Mobilize 2012 coverage here, and the live stream can be found here.