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YouTube kicks off 'click to buy'

October 08, 2008|Jessica Guynn

Ever watched a video on YouTube and wanted to buy the song? YouTube is counting on it. The world's most popular video-sharing site is hoping to make money from its huge audience by installing buttons under YouTube videos so that the ability to buy the music and video games featured in the video clip is just one click away.

The "click to buy" buttons, which began appearing in the United States on Tuesday, connect viewers to the product page on or Apple Inc.'s iTunes store.

To start, YouTube, which will receive a commission for each sale, is selling songs from two major labels -- EMI Music and Universal Music Group -- and video games from Electronic Arts Inc. Eventually it wants to expand to sales of other products such as movies, television shows and concert tickets.

"This is the first step in a viable e-commerce platform," said Bakari Brock, business affairs counsel at YouTube.

It's another effort by the video-sharing site to figure out how to profit from its popularity. So far, YouTube has mainly focused on advertising as a source of income, including text ads that run along the bottom of videos as they play, contests sponsored by advertisers and home-page video ads. But it has begun to experiment with new ways to take advantage of the site, which attracts nearly 100 million people a month in the U.S.

Google Inc. bought YouTube two years ago for $1.65 billion. Google Chief Executive Eric Schmidt has pledged to investors that YouTube will make money once it hits on the right formula. Last month he said Google was being patient.

"We are where we should be," he said. Yet revenue this year is expected to be only about $200 million.

-- Jessica Guynn

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