Tech giant Alphabet’s (GOOGL) YouTube has become one of the most powerful entertainment platforms, especially on TV screens. It started out as a website for short, low-budget videos, such as how-to guides or skateboarding clips. However, it’s now the most-watched video platform on televisions in the U.S., according to The Wall Street Journal. As a result, many YouTube creators are producing longer, higher-quality videos for families and groups to watch together. YouTube is also improving its TV app to encourage people to watch longer by adding features like auto-playing the next episode and personalized suggestions.
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These longer videos are more valuable because they can include more ads, which equates to more revenue for both creators and Alphabet. YouTube is also investing in live sports, such as NFL games, and adding tools like “multi-view” so fans can watch several games at once. As a result, YouTube has become a full replacement for traditional TV for many people. But not everyone is happy about this shift. In fact, UK media regulator Ofcom is worried that public service broadcasters (PSBs), like the BBC and Channel 4, could disappear as more people watch YouTube and Netflix (NFLX), according to the Financial Times.
Therefore, Ofcom says that these public channels need more online visibility, and it wants the government to consider laws that would require YouTube to promote PSB content, especially for kids and news. While smart TVs already make sure that PSBs appear on home screens, their online reach is shrinking and accounts for only 9% of views. With most viewers no longer watching regular broadcast TV, Ofcom believes stronger rules and more cooperation are needed to protect UK-made public content.
Is Google Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on GOOGL stock based on 29 Buys and nine Holds assigned in the past three months. Furthermore, the average GOOGL price target of $206.18 per share implies 9% upside potential from current levels.
