20 years of YouTube: 8 key innovations that have helped the video platform achieve its success

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YouTube's rise to dominance

When YouTube was first launched in 2005, its impact on the media landscape was minimal, even going unnoticed in The Guardian’s coverage of TV’s Digital Revolution at the Edinburgh TV Festival.

However, two decades later, YouTube has transformed into a massive competitor to traditional TV, with its growth reshaping the media industry.

Today, YouTube uploads as many new videos every five minutes as the 2,400 hours BBC Studios produces in an entire year.

Popular creators like Mr Beast, a 26-year-old YouTube star, earned $85m in 2024 from a range of content, from live gaming streams to philanthropic acts like providing free cataract surgeries.

A business juggernaut

YouTube is now valued at $455bn, a staggering 275 times return on the $1.65bn Google paid for it in 2006.

If Google were to use YouTube’s current value, it could buy British broadcaster ITV approximately 127 times.

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Revenue and user base

With $36.1bn in gross revenue in 2024, YouTube’s financial power rivals that of Netflix, yet it does so without the expense of creating original content since most videos are uploaded for free by users.

The platform boasts 2.7 billion monthly active users, roughly 40% of the global population outside China, and serves as one of the largest music streaming sites and the second largest social network, following Facebook.

It has also created a vast, eclectic content library, from viral hits like Baby Shark Dance to educational videos on topics like septic tank repairs and quantum physics.

It has revolutionised children’s programming, with Wired magazine noting that the future of this genre may not lie in television at all.

Challenges

Despite its success, YouTube faces challenges, such as being labelled a conduit for disinformation by fact-checkers.

Nonetheless, its influence on global media and entertainment continues to grow.

So how did all that happen? Eight key innovations have helped YouTube achieve its success.

1. How new creativity is paid for

Traditional broadcast and print uses either the risk-on, fixed cost of hiring an office full of staff producers and writers, or the variable but risky approach of one-off commissioning from freelancers.

Either way, the channel goes out of pocket, and if the content fails to score with viewers, it loses money.

YouTube did away with all that, flipping the risk profile entirely to the creator, and not paying upfront at all.

It doesn’t have to deal with the key talent going out clubbing all night and being late to the set, not to mention other boring aspects of production like insurance, cash flow or contracts.

2. The revenue model of media

YouTube innovated by dividing any earnings with the creator, via an advertising income split of roughly 50% (the exact amount varies in practice).

This incentivises creators to study the science of engagement since it makes them more money. 

Mr Beast has a team employed just to optimise the thumbnails for his videos.

3. Advertising

Alongside parent company Google/Alphabet, and especially with the introduction (March 2007) of YouTube Analytics and other technologies, the site adrenalised programmatic video advertising, where ad space around a particular viewer is digitally auctioned off to the highest buyer, in real-time.

That means when you land on a high-rating Beyoncé video and see a pre-roll ad for Grammarly, the advertiser algorithmically likes the look of your profile, so bids money to show you the ad.

When that system works, it is ultra-efficient, the key reason why the broad, demographics-based broadcast TV advertising market is so challenged.

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4. Who makes content

About 50 million people now think they are professional creators, many of them on YouTube.

Influencers have used the site to build businesses without mediation from (usually white and male) executives in legacy media.

This has driven, at its best, a major move towards the democratisation and globalisation of content production. 

Brazil and Kenya both have huge, eponymous YouTube creator economies, giving global distribution to diverse voices that realistically would be disintermediated in the 20th-century media ecology.

5. The way we tell stories

Traditional TV ads and films start slow and build to a climax. Not so YouTube videos – and even more, YouTube Shorts – which prioritise a big emotive hit in the first few seconds for engagement, and regular further hits to keep people there.

Mr Beast’s leaked internal notes describe how to do sequential escalation, meaning moving to more elaborate or extreme details as a video goes on: “An example of a one thru three-minute tactic we would use is crazy progression,” he says, reflecting his deep homework. “I spent basically five years of my life studying virality on YouTube.”

6. Copyright

Back in 2015, if someone stole your intellectual property – say, old episodes of Mr Bean - and re-broadcast it on their own channel, you would call a media lawyer and sue.

Now there is a better option – Content ID – to take the money instead.

Through digital rights monetisation (DRM), owners can algorithmically discover their own content and claim the ad revenue, a material new income stream for producers.

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7. Video technicalities

Most technical innovations in video production have found their way to the mainstream via YouTube, such as 360-degree, 4k, VR (virtual reality) and other tech acronyms.

And now YouTube has started to integrate generative AI into its programme-producing suite for creators, with tight integration of Google’s Veo tools.

These will offer, according to CEO Neal Mohan, “billions of people around the world access to AI”.

This is another competitive threat to traditional producers because bedroom creators can now make their own visual effects-heavy fan-fiction episodes of Star Wars.

8. News

YouTube became a rabbit hole of disinformation, misinformation and conspiracy, via a reinforcement-learning algorithm that prioritises view time but not editorial accuracy.

Covid conspiracy fans got to see “5G health risk” or “chemtrail” videos because the algorithm knew they might like them too.

How can the big, legacy media brands respond? Simple. By meeting the audience where the viewers are, and putting their content on YouTube.

The BBC has 14.7 million YouTube subscribers. ITV is exploiting its catalogue to put old episodes of Thunderbirds on there.

Meanwhile, in February 2025, Channel 4 also announced success in reaching young viewers via YouTube. Full episode views were “up 169% year-on-year, surpassing 110 million organic views in the UK”.

This article is republished from The Conversation under a Creative Commons license. Read the original article here.