Would ads that don't track users sell?
If we ever want to have a better YouTube alternative, I think the main question is would people be willing to pay a good amount of money for that service. Personally, I find the YouTube model better. Even though it tracks people, it atleast makes videos freely accessible to everyone. Would something like khan academy or OCW even exist without YouTube?.
However, I have observed that as one progress through the social ladder economically, the appetite for a paid but non tracking model grows.
This isn't universal. There are relatively niche sites that people pay to use, or at least have paid tiers. But free is what most people expect. (Look at all the outrage when SmugMug eliminated the 1TB free limit that Yahoo put on Flickr.)