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What I really mean is i don't get how these smaller but still popular video/tube sites make money. They host their own videos not embedded ones. How do they afford the bandwidth? if bandwidth is 0.18 cents per GB(don't know if that is expensive), 18$ per 100GB, each video an avarage size of 50mb, 2000 video views = 18$? how do you make more than 18 on 2000 views?

How do you make money with a smaller video site?

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Very few smallish video sites are turning a profit and, arguably, very few of the large ones would exist if it weren't for their corporate backing to absorb costs associated with scaling along the way.

I would argue though that the niche sites that have a strong core audience have a better chance to target advertising in a way that converts (i.e. if you had a video site full of videos of babies doing cute things you could safely assume advertising for baby products would make more money per view than if you put the same ads on, say, vimeo).

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Many sites that host videos more than make up for their bandwidth costs with other upsells (private videos, subscription fees, affiliate links, etc)-- porn sites being a solid example of what I'm talking about.

Also note that bandwidth costs drop dramatically when you are using it in bulk-- I don't have any solid figures for you right now (sorry) but I can tell you it falls off fast. For example, a site may be paying 18c per GB up to a point, then after they hit a milestone in consumption it drops to 10c, then 3c.

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Here's the update in 2020: The mistake here is the assumption that bandwidth is 0.18c/GB, even if it's much less now on many platforms lets ignore this.

There are server hosts all over the world which offer unlimited bandwidth on dedicated servers such as servers.com. Additionally cloud providers such as DigitalOcean provide 1TB of free data per droplet you host with them, put your dev environment and some other side projects in there and you can quickly enjoy 5TB+ of free bandwidth including CDN.

If you really want to operate a video based platform and grow it without correlation to your billing the answer is as simple as purchasing your own rack mount or leasing a dedicated. The key to this, in the event that the site becomes popular enough to demand an infrastructure upgrade, is to prepare your framework and build from the ground up with the ability to migrate expeditiously, think kubernetes and the like.

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There is one good way.

  1. Create a small video site.
  2. Get enough users.
  3. Sell site for nice sum of money or get strategic investor with money.