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> The system is so inefficient that it finances almost the complete operation of Alphabet/Google.

Since Youtube is wildly unprofitable, Alphabet/Google has to be funneling in money generated from other sources. Thus, Youtube is funded by ads, just mostly not from the ads on Youtube.

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It was mentioned in a private email that the only reason YouTube exists is that Google's servers happens to have a lot of free disk space in the days before SSDs.

YouTube was a separate company acquired by Google in 2006: https://en.wikipedia.org/wiki/History_of_YouTube

Yep, I mean YouTube existing within Google obviously.

Is the limiting factor for youtube really disk space? I would imagine it is bandwidth.

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