Another Indian-American CEO of Silicon Valley take office, can he save YouTube, which is in danger?

Focus

• 1 Recently, YouTube CEO Susan Wojcicki announced her resignation and chief product officer Neil Mohan will take over. As one of the most influential video platforms in the world, whether YouTube can continue to maintain its position has also reached a critical period.
• 2 The newly appointed CE0 Neil Mohan is "regarded as a treasure" by major Silicon Valley companies. Neil Mohan has contributed significantly to YouTube's revenue growth, introducing a new advertising revenue growth model.
• 3 However, Youtube is currently facing significant growth difficulties, still lagging behind Instagram's short video form Reels in terms of daily views.

Google's personnel changes, YouTube 9 years CEO left

In February, Susan Wojcicki, who had been YouTube's CEO for nine years, announced her impending resignation and Chief Product Officer Neal Mohan would take over as YouTube's fourth CEO. Despite the attention her resignation has attracted compared to her return to Disney's Bob Iger and Netflix's Reed Hastings, YouTube's personnel changes have not caused a huge stir in the media world. But as one of the world's most influential video platforms, whether YouTube can maintain its position has reached a "critical period" - as Google's main growth engine, YouTube has been declining revenue for two consecutive quarters, facing many questions from the industry and investors.

Foreign media rated the departing Susan Wojjcicki as "a symbolic figure for Google and Silicon Valley as a whole." She has contributed greatly to the development of Google. Among the many tech giants, she is a rare female leader. Susan joined Google in 1999 to oversee the design and construction of Google's advertising and analytics products, and as a veteran of Google for nearly 25 years, she played a key role in the development of Google's core business search and advertising, and helped Google become the king of digital advertising.

Susanki was involved in Google's original "viral marketing initiative," helped create Google's long-standing logo, launched the first Google Doodle, helped develop and launch Google Image Search, and led Google's first video and book searches. In 2006, she advocated for a $1.65 billion acquisition of YouTube. During her tenure, she led YouTube's rapid expansion to become the world's largest video platform. It was also under her leadership that YouTube became an integral part of the entertainment sector, such as DIY manuals, recipes, babysitters, jukeboxes, yoga instructors, news channels and timelines... Combining all of this content into one, it has 2.6 billion monthly active users and a simple but effective revenue-sharing model that millions of creators rely on to keep popping up their work. YouTube Shorts, on average, also has an average of 50 billion views per day.

(Photo: Mohan's tweet *Note: The original tweet is in English)

"Susan understood the importance of content creators on YouTube from the start," said Bogliari, CEO and co-founder of The Influencer Marketing Factory. In recent years, however, YouTube has come under pressure amid intense competition from major social platforms, and it has been trying to compete with it through its short-form video platform, Shorts. With new initiatives across YouTube this year, such as those to share ad revenue with Shorts creators, Susan's departure ushered in a new era for YouTube.

The Indian CEO who was appointed in danger, Google once retained a genius with $100 million

For many casual users, the new CEO--- Neal Mohan, is an unfamiliar name. In fact, he has always been regarded as a treasure by the major factories in Silicon Valley. Just five years after joining Google, he became the soul of the huge revenue growth for YouTube — and when Twitter tried to poach it, Google spared it to keep it with stock options worth up to $100 million.

Google's phenomenal growth over the past decade means that the stock held by Mohan, the new CEO of You Tube, is worth more today. For example, according to a 2019 CNBC report, the $1,000 invested in Google in 2009 was worth $4,800 in 2019, an increase of 400%. So, based on the current value of his 2011 stock alone, Mohan's wealth can be imagined. Some media commented on him: Neil Mohan is a person who knows how to "follow the rules". On public appearances, he almost always wears a blazer - black or blue. In workplace chats, he is known for his academic approach – thinking exploratorily, keenly considering problems.

Neil Mohan was born in India in 1975, and then immigrated to the United States with his family, is a typical Indian-Silicon Valley struggler, following Microsoft's Satya Nadella, Alphabet's Sundar Pichai, and IBM, Adobe, Palo Alto Networks, VMWare, Vimeo, Mohan became another Indian-American CEO of Silicon Valley. Mohan studied electrical engineering at Stanford as an undergraduate. "I've always been interested in tech, even before college," he said in a 2022 interview with Graylock. Mohan began his career as a "management consultant". He began his career working with technology companies to find ways to bring this new technology, the Internet, to Fortune 500 companies. He quickly realized he wanted to be a part of these startups. After a brief stint at Accenture, he joined Net Gravity in 1997, which was acquired later that year by advertising startup DoubleClick (also known as DFP). In 2003, Mohan returned to Stanford for an MBA, and at a time when DoubleClick was facing solvency problems, Mohan was asked by DoubleClick's CEO to rejoin the company as soon as possible after completing the MBA program.

After returning to the company, Mohan once again proved himself and helped rewrite the company's fortunes, which was acquired by Google for $3.1 billion in 2007, and Mohan was the main promoter of the deal. Advertising insiders who have worked with Mr. Mohan say the executive is steady, competent and determined. Rob Norman, former global chief digital officer at ad-buying giant GroupM, said: "Although he was always polite and well-behaved, I don't remember him giving in the slightest concession at work."

Google's advertising hero, YouTube's "product godfather"

After joining Google in 2008, Mohan worked on the convergence of media and technology, taking on the role of senior vice president of display and video advertising, setting a new roadmap for the company's advertising model in the digital age at the time, and Mohan quickly proved his strength. He is responsible for advertising products on a range of programmatic ad platform products such as YouTube, Google Display Network, AdSense, AdMob and DoubleClick. During this time, Mohan established ways to earn revenue from Google ads from video impressions and clicks — he found the right monetization solution for everyone, from media partners to advertisers, that not only cemented Google's position in the advertising business, but also drove the rise of the entire online media industry. Subsequently, Google AdSense was one of the most successful advertising platforms in the world, and it can be said that Mohan played a key role in this.

The strategy was built thanks to Mohan's planning during his time at DoubleClick, which launched tools to connect advertisers for publishers, and at one point was the largest online advertising service in the United States. After the acquisition, the advertising client technology Google Ads launched by the original DFP team (a paid network promotion method that uses Google keyword ads or Google's global content alliance network to promote websites) is very popular in the industry, and Google itself has the largest advertising resources, such as YouTube and search engines, which quickly helped Google become a "giant" in the field of digital advertising. At the same time, Google is the most important inventory provider in the entire market, except for advertisers (Advertisers), Google currently plays the role of all the remaining links in the advertising provider chain, and can obtain corresponding service revenue in each link.

By 2011, Google's total display advertising revenue reached $5 billion and continued to grow rapidly for many years. Mohan also showed Google the know-how to expand its advertising business with the right acquisitions. During his tenure, he led Google's acquisitions of Admeld, Teracent, and Invite Media—all of which gave Google unique tools that benefited its advertising business. By 2015, when Mohan came to YouTube to lead the product, he was already an experienced and well-respected Google executive. Mohan has since gone on to play a key role in some of the company's top products. He is behind YouTube TV, YouTube Shorts, YouTube Premium and YouTube Music. "At its most fundamental level, my job is mainly about two big aspects: I am responsible for all our products, such as the YouTube experience on mobile phones, desktops, laptops and large living room screens; There are also YouTube products used by creators including YouTubers, musicians, artists and traditional media companies. Mohan once described his work in an interview.

Television is especially important to YouTube's development. YouTube carved out its niche in the online video platform space early on, but that positioning also limited it from profiting from digital advertising. Long before streaming TV became popular, Mohan looked at how YouTube could expand into the field, and future trends have confirmed that TV has played a pivotal role in YouTube's development.

Dave Morgan, CEO of Simulmedia, a TV ad tech company, has said he was impressed by his discussion with Mohan about "how YouTube fits into the future of television." "He's been following the digital evolution of the TV industry," Morgan said, "and he's been following this for a long time, and a lot of people and senior leaders at Google tend to look at the problem from an internal perspective: 'How do I integrate with TV?'" How can this new form be maintained and built? But in contrast, in his conversations with him, Mohan is more concerned about the changes in the market and its direction. ”

Under Mohan's leadership, YouTube's creator economy has boomed, and its successful monetization model has changed the traditional way content creation platforms monetize — as of 2019, YouTube has 2 billion users and watches 1 billion hours of video per day. In 2020, YouTube advertising revenue was about $19.77 billion. According to Insider Intelligence, 143 million U.S. viewers will watch YouTube on connected TVs this year, up 5% from 2022. Last year, YouTube cemented its position in the linear TV space, with traditional broadcasters like NBC and Disney trying to lure brands into investing heavily in reserving ad space for their shows. "

The video giant's growth woes

However, it cannot be ignored that both YouTube and Google are facing great growth difficulties. In January 2022, the U.S. Department of Justice, together with eight states, including New York and California, jointly launched an antitrust lawsuit against Google, accusing it of illegally monopolizing the digital advertising market and requiring it to spin off its advertising technology business. Coupled with the intensification of industry competition, Apple's IDFA policy and other adverse factors, the pressure on YouTube's advertising business is also increasing. Data show that in the third quarter of last year, YouTube's advertising business achieved revenue of $7.1 billion, down 2% year-on-year, and the decline in revenue in this quarter further expanded to 7.8%, becoming the hardest hit area of Google's advertising business.

In terms of market competition, Google said on a recent earnings call that YouTube Shorts (YouTube short video format) has been viewed more than 50 billion times a day. The company previously reported 30 billion daily views as part of its Q1 2022 earnings. While these increases are impressive, Shorts' data lags far behind the rest of the short video social media on the market. Meta, for example, said in October that Reels (Instagram's newest form of short video) received 140 billion views a day on both social networks. TikTok made a similar attempt in 2021 to make its app available on multiple large-screen platforms, including Amazon Fire TV, Android TV, and select LG and Samsung smart TVs. By last year, YouTube said 1.5 billion users logged in to watch Shorts every month. But by comparison, Instagram has more than 2 billion users.

In the fourth quarter of 2022, YouTube's revenue was $7.96 billion, down 8% from $8.63 billion last year. In November 2022, the company said that YouTube Music and Premium had more than 80 million subscribers worldwide. But it doesn't specify how much subscriptions contribute to YouTube's revenue. In general, in the competition with major social giants, YouTube is still facing a lot of pressure and danger.

In February, YouTube launched a new program to share ad revenue with Shorts creators. This may motivate more creators to produce original content for the platform. Last November, the video platform also began testing Shorts' shopping and affiliate marketing features. On the earnings call, Philip Schindler, Google's chief commercial officer, said the company is "pleased with our continued progress toward commercializing Shorts." Now that the video industry is accelerating change, can Mohan, the "godfather of YouTube advertising" who has risen to CEO, create the company's growth miracle as before? Let's wait and see.

Compiled by Pranav Dixit et al., Silicon Valley cover & RockFlow