Guessing game: How much money is YouTube losing!

[Newsbot]

SAN FRANCISCO – Internet video leader YouTube Inc.'s losses have been overblown by some analysts, but corporate parent Google Inc. doesn't mind the misperception, according to a study being released Wednesday.

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Technology consultants at RampRate Inc. project YouTube's operating losses this year at $174.2 million — far below the $470.6 million estimated by Credit Suisse analysts Spencer Wang and Kenneth Sena in an April research report that became a hot topic on Wall Street and the Internet.

The dueling forecasts are the latest twist in a guessing game that has intrigued investors since Google bought YouTube for $1.76 billion in late 2006.

Although YouTube has become an even more popular diversion since the Google deal, it still hasn't proven it can make money.

Google has acknowledged YouTube isn't profitable, but has refused to provide any specifics, leaving it to outsiders to figure out.

And the number crunching usually leads to inaccurate conclusions, according to Google's chief financial officer, Patrick Pichette.

"Most people build outside views of what it costs us to do things, and often they exaggerate," Pichette said in an interview with the Canadian magazine Maclean's shortly after Credit Suisse released its YouTube report.

But Google has little incentive to set the record straight about YouTube's actual losses, according to RampRate, which specializes in managing technology costs.

RampRate reasons the perception of large losses at YouTube helps Google negotiate more favorable contracts with movie, TV and music studios licensing their video. What's more, copyright owners also are less likely to go to court in pursuit of unpaid royalties and damages if they believe YouTube is a big money loser, according to RampRate's thesis.

"Google is no doubt thrilled to let YouTube be known as a financial folly," RampRate's report said.

Wait a second. I can't watch a single video without a goddamned ad covering half the screen, and this fucker is losing money? What, did they hire fucking Dell Rusk as their business manager?