YouTube Is Pulling Its Own Weight

Google grew its “Google subscriptions, platforms, and devices” revenue from $8.3 billion in the September 2023 quarter to $10.7 billion in the September 2024 quarter, a 28% increase. YouTube is a significant contributor to this revenue line and appeared to generate revenue growth largely without price increases in the September 2024 quarter. Below we analyze three YouTube components: YouTube TV, YouTube Premium and NFL Sunday Ticket.

YouTube TV: YouTube TV launched at $35/month in 2017, moved to $50/month in 2019, moved to $64.99/month in 2020 and moved to $72.99/month in April 2023. It is difficult to say how much pricing power YouTube TV has from here. It is important to note that YouTube TV includes ESPN and local sports. Competition largely comes from “skinny” cable TV packages such as Charter’s skinny TV offering which is offered at $40/month. This offering excludes sports (Sports is the glue that provides revenue lift to content services ). John Malone’s Charter Communications (CHTR) has clearly imputed the value of ESPN & local sports at $33/month as benchmarked against YouTube TV. If YouTube TV is on course to generate revenue of approximately $8 billion in 2024, perhaps the service generated revenue of approximately $2 billion in the September 2024 quarter.