How a YouTube-Google Breakup Would Shake Hollywood. Are You Ready?
Digital ads, creator dollars and video innovation are potentially all in play as the DOJ continues its assault against the tech monopoly
ESG’s data-driven analysis for paid subscribers appears every other Thursday. He recently covered 7 genres that could replace superheroes, the coming M&A blitz in a second Trump term, the huge hit rate in animation, and made a cautious defense of David Zaslav.
If the biggest antitrust trial of the century happens, but no one covers it, did it happen?
I ask because Google has had not just one, but three of the biggest antitrust trials this century. Yet the amount of news coverage they generated, especially compared with Microsoft’s antitrust trial in the 1990s, seems miniscule given the outsize role Google plays as gatekeeper to much of the internet.
It’s a shame, too, because we’re getting some legitimate insights into the inner workings of a $2 trillion market cap company that is the leader in the digital advertising market, which every entertainment company is now competing with. SEC disclosures and company statements don’t provide this kind of perspective, and in some cases, these details allow me to confirm long-held theories that would have remained speculation otherwise.
For an example of why this matters, consider my look last year for The Ankler at the data of the performance of the shows produced by Reese Witherspoon’s Hello Sunshine or LeBron James’ The SpringHill Company. I couldn’t fathom how Hello Sunshine had been valued at $900 million and SpringHill at $750 million, and indeed the news this week that James’ production shingle lost $30 million last year, on only $100 million in revenue confirmed my orthogonal analysis that it could not live up to the lofty price where investors had marked it up.
So when it comes to Google, these trials have shed light on how much it, as the parent company of subsidiary businesses such as YouTube, powers its success in ways that warp the overall competitive landscape — in this case, for viewers’ time and brands’ advertising budgets. As I wrote back in February, YouTube might actually be the winner of the Streaming Wars, far more than Netflix. A lot of the video platform’s growth can be credited to smart strategic decisions and of course its low price point for consumers (free!).
But the three different antitrust trials also reveal the degree to which Google’s monopoly power also plays a role. If you want to win the Streaming Wars, it helps to have the world’s dominant search engine and digital ad market steering traffic and ad dollars your way.
In light of all the trials, we’re now at the beginning of the process where the government figures out the remedies it’ll demand from Google to address its illegal monopoly. In light of President-Elect Trump’s pick to run the Antitrust Division of the Department of Justice — Gail Slater, a J.D. Vance ally — the pressure on Big Tech looks to continue for the foreseeable future (one of the strange bedfellows situations in modern politics). So it’s time to ask the question that everyone competing against Google should be asking (and that’s everyone in Hollywood): What if YouTube weren’t part of Google?
Before 2024, I wouldn’t have thought such an outcome possible. Now I do. While it’s still not likely, it’s now definitely in the realm of possibilities — and that means we should discuss the ramifications for entertainment.
In this article, you’ll learn:
The big opportunities in the market if this happens, for both streamers and studios
Why Google has been ruled an illegal monopoly
The 3 ways Google favors YouTube that could be ruled antitrust violations
Why traditional Hollywood won’t likely be the big winner if YouTube is split off from Google
The surprising group that would garner more power in a Google-YouTube breakup
The antitrust verdict Hollywood needs to watch for in 2025
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Your article spurred me to ask Chat GPT,
What happens if google is forced to sell youtube and the only people who can afford to buy it are fascists? And it was pretty much what happened to Twitter when Musk bought it. I think the DOJ needs to slow down.
ChatGPT
If Google were compelled to sell YouTube under extraordinary circumstances, and if by some highly improbable turn of events the only potential buyers with sufficient capital turned out to be entities aligned with fascist ideologies, the repercussions would be multifaceted and profound. While this scenario is extremely unlikely due to legal, economic, and geopolitical checks, examining the hypothetical consequences can shed light on the potential fragility and influence of major tech platforms.
1. Immediate Reactions and Regulatory Scrutiny:
2. Reputational Fallout and User Trust Erosion:
3. Advertising and Revenue Implosion:
4. Relaxation or Weaponization of Moderation Policies:
5. Technological Forking and New Competitors:
6. Long-Term Sociopolitical Consequences: Public Discourse and Misinformation:
7. The Platform’s Likely Decline: Loss of Cultural Relevance
Conclusion:
If Google were forced to sell YouTube and the only affordable buyers were fascist entities, the platform’s entire ecosystem would face immediate and radical disruption. Massive user and advertiser desertions, regulatory blockades, and the rise of competing services would likely occur. The brand damage and moral hazards would be so immense that the platform’s new owners would probably never achieve the scale, revenue, or global influence that YouTube currently enjoys. In the long run, the scenario could lead to a profound reshuffling of the online video landscape, with YouTube either collapsing into irrelevance under extremist ownership or prompting significant changes in how societies govern and regulate major digital platforms.
I replied to chat GPT:
This is what happened to Twitter under Musk, so you are right
ChatGPT replied:
Yes, you're absolutely right to draw that comparison. The situation with Twitter under Elon Musk highlights how ownership transitions, particularly when the new owner brings significant ideological or operational changes, can lead to massive disruptions. In the case of Twitter, the shift in management style, policy changes, and public perception led to various consequences like user shifts, altered content moderation practices, advertiser pullbacks, and overall instability regarding the platform’s role in public discourse. It serves as a reminder of how the ownership and governance structures of major social media platforms can have a profound impact on their operation, not just on a technical or business level, but also on societal implications, norms, and trust. The centralization of power in such platforms, especially when monetized with broad public influence, means their management can significantly shape conversations, open doors for certain narratives, and possibly close them for others—depending on the owners' agenda. The changes we saw on Twitter provide a potent example of what could happen when ideological shifts take place in social media, and it’s definitely something to be mindful of as we examine larger platforms and their evolution. That said, the continued discussion about the future of online platforms, democracy, and the role of tech giants is essential, as it affects information dissemination, freedom of speech, and the global exchange of ideas. Would you like to dive more into the evolution of Twitter, Elon Musk's impact, or the role of tech platforms in shaping public discourse? for 4 seconds
It’s certainly true that after Elon Musk acquired Twitter (now rebranded as X), many observers and critics drew parallels to a scenario where a powerful communications platform falls under the influence of ideologies or interests considered extremist or at least highly controversial. While Musk does not identify as a fascist, the shifts in Twitter’s moderation policies, the reinstatement of previously banned accounts (including some spreading hate speech or conspiracy theories), and the noticeable exodus of advertisers, staff, and users all contributed to a perception that the platform’s atmosphere had worsened and become less reliably moderated.
Key Points Reflecting the Parallels:
Content Moderation Changes:
Under Musk, Twitter’s moderation teams were significantly reduced. While not a wholesale embrace of fascist ideology, the platform’s enforcement against hate speech, harassment, and misinformation has at times appeared inconsistent or lax. The changes were perceived as favoring more unregulated speech, which critics argue allowed more extremist or hateful content to surface.
Advertiser Boycotts and Revenue Loss:
Similar to the hypothetical scenario where major advertisers would pull out if a platform were acquired by fascists, many major brands either paused or reduced their ad spending on Twitter after Musk’s takeover. They cited concerns about “brand safety,” as the return of controversial figures and the loosening of moderation standards created a risk of ads appearing next to harmful content. This contributed to a financial downturn, mirroring the hypothetical economic implosion that would occur if extremist ideology were seen to dominate a platform.
User Exodus and Community Fragmentation:
While Twitter still retains a large user base, the sense of trust in the platform’s leadership and long-term direction diminished for some. Many users began exploring alternatives (like Mastodon, Bluesky, Threads, and other emerging platforms) in search of a stable, moderated environment. Though Twitter’s user loss wasn’t as dramatic as the fictional scenario posited, the fragmentation and concern over content quality, harassment, and misinformation align with the predicted user backlash and cultural drift.
Increased Scrutiny by Governments and NGOs:
Governments, civil liberties groups, and NGOs have kept a closer watch on Twitter’s policies post-acquisition. Concerns over hate speech, election misinformation, and harassment have led to more public and regulatory scrutiny, albeit not the extreme global regulatory clampdown one might see if a self-declared fascist regime took control of a platform. Nonetheless, it’s an echo: the fear of extremist influence drives a demand for stricter oversight.
Important Distinctions:
Musk is not overtly aligned with fascism, and the scenario in which “only fascists can afford to buy” a platform like YouTube is far more extreme. The Twitter changes illustrate what happens even when the new owners’ politics are simply viewed as contrarian or less restrictive on speech, rather than explicitly fascist.
The scale of legal and ethical barriers is different. For YouTube, due to its sheer size, regulatory frameworks, and the global pushback from governments, buying it by openly extremist entities would face more front-end resistance. In Twitter’s case, Musk’s takeover passed regulatory muster because it involved a private buyer with no publicly stated extremist agenda.
Conclusion: While Musk’s acquisition of Twitter doesn’t fully map onto the hypothetical scenario of a major platform being acquired by overtly fascist entities, the real-world outcome does show that changes in ownership, ideology, and moderation policies can lead to advertiser flight, user mistrust, content moderation controversies, and increased scrutiny. In that sense, it serves as a partial parallel or a warning: even shifting a platform’s policies away from a known baseline can trigger responses akin to what one might expect if it fell into more extreme and overtly harmful hands.