Too many people confuse Steemit with STEEM. This is a major error which drastically undervalues the potential of this blockchain.
STEEM is the token on the steem blockchain. Steemit.com is an application (the first one) that is really nothing more than an interface to the blockchain. Everything that you post on Steemit.com is on the blockchain. However, Steemit is not the only way to read this data. Busy.org and chainbb are other interfaces which can be used to post in a similar fashion. While each is different in its design, they all access the same information.
This is one of the primary advantages to the blockchain. The ecosystem is the blockchain and what is built upon the top of it. Unlike the traditional model where applications like Google, Facebook, and Amazon are separate from each other, on this network, all are intertwined. It is the blockchain which you are accessing with your account regardless of the interface. That is why the same log in keys work regardless of the app.
The US Stock market is in earnings season so there is banter about the numbers certain companies are going to report. One interesting tidbit that I came across is a new rule that is going to force Facebook and Google to announce what impact, financially, Instagram and YouTube have on the corporate entities. For most companies, this is going to take place this year and many expect FB and Google to follow suit.
Nevertheless, many analysts have taken some shots at what the worth of these entities are.
YouTube is the behemoth on the block. We know this is a gold mine for Google even though we are uncertain of the exact numbers. Nevertheless, the estimates are very impressive.
MKM Partners analyst Rob Sanderson wrote in a note to clients that YouTube revenues are going to reach $26 billion a year by 2019, and said the business should be valued at $150 billion by the time Alphabet reaches a $1 trillion value by market cap, as he has predicted.
$26B in revenues by 2019 (which is next year)? $150B valuation?
That is mind blowing. These are also numbers I am not going to argue with. While I cannot say if they are true or not, the fact remains that we know how important this medium is for Google. One does not have to spend much time on there before realizing that you can go two, maybe three, videos before getting hit up with an ad. Considering all the hours people spend on there, I am sure the advertising is enormous.
As for Instagram, that is a little more challenging to decipher since it is an ad-sales arm for Facebook. As one of the most popular apps of all time, this helps feed advertisers into the Facebook ecosystem. And since mobile is only getting bigger, this means Facebook is aligning itself to where the market is going.
Overall, analysts model $40.22 billion in 2017 revenue for Facebook, of which about $34.44 billion is from mobile ads, according to FactSet. Of that revenue, eMarketer, a market research company, expects Instagram to generate $4.1 billion in 2017 ad sales. In 2018, eMarketer expects that number to grow 93.5% to $7.94 billion.
But Morgan Stanley is much more bullish on Instagram’s 2018 upside, estimating the unit will generate $16 billion of revenue, after a $10 billion haul in 2017.
For full story detailing these projections:
Not as impressive as YouTube but still a pretty big deal. For argument sake, and since I like round numbers, let us use Morgan Stanley's projections. The analyst of YouTube used a multiple of 6 to get valuation from revenues. If we do the same for Instagram, we see this entity is worth almost $100B.
Thus, these two applications combined are worth a projected $250B.
In comparison, the steem blockchain is wroth $1.5B.
When talking about this blockchain, the money factor is thrown out with great regularity. This only makes sense since this network was designed to reward content creators. Obviously, with some of the issues these two companies are creating with censorship and changing the reward pool, this could be attractive to those creating content.
However, is money really what will stimulate users?
Perhaps it could. Yet there is something else that I think is overlooked and that I have not seen mentioned. When you use an app on the steem blockchain, not only do you have the ability to earn some STEEM but you also have NO ADVERTISEMENTS.
How often do you go to watch a YouTube video only to have to sit through a 10 or 15 second commercial? $26B in projected revenue for Google from the YouTube brand; that is a lot of advertisements.
Here is a little secret: D.Tube has no ads. People can watch the content put up there without interruption. As the application keeps improving with each new update, I believe this will be a real force in the video content world.
Advertising or No Advertising? Which do you think people will prefer?
As for the Instagram situation, we are seeing a new app going through ICO by the end of the quarter. Appics announced today that it will host its ICO on March 28th. This is an app, if I am understanding it correctly, that could potentially give Instagram a run for its money. Actually, since Instagram is nothing more than an advertising lead-in for Facebook, I guess it is more accurate to say Appics could take a lot of money from Instagram (Facebook).
Like D.Tube, Appics offers the same incentives to content creators. The major difference is that most anyone with a smartphone becomes a content creator for an app like this. In 2016, there were over 1.5 trillion photos taken, the vast percentage on smartphones. This means the average user takes pictures and shares them with others. Appics looks to target this market.
Therefore, not only does it have the ability to incentivize people, there is NO ADVERTISING.
Again, advertising or no advertising? Which do you think people prefer?
And for those who want to know what will stop either Appics or D.Tube from adding advertisements down the road, why would they? This will only needlessly tarnish their product.
The founders of each of these platforms is looking at the tokens for the value. That is how the revenue streams are created. There is no need to move to the old advertising model. The content/reward system that is inherent in the steem blockchain has a means of offering the applications a revenue stream. At the same time, the people involved in these projects own tokens, which means they profit from the appreciation just like other token holders.
When dealing with this system, advertising revenue is not needed. The system itself creates the revenue for all involved.
So how big can STEEM become?
Just using these two applications, if it can take even 5% from YouTube and Instagram, you are looking at a value of $12.5B. Considering we are less than 1/8 that value now, it puts the price of STEEM at $51.
The question is will millions of people want to send out photos and watch videos without ANY ADVERTISING?
Oh and get paid for doing it too.....let us not totally skip over that part.
Who says "yes"????
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