Consider that Facebook stores up to 850milj new photos and 8milj videos each months. Imagine the disc farms. The story continues to return revenue. If all those people who uploaded pics and vid’s actually added to the online economy by clicking on ads or better yet actually buying something this conversation would be a mute point. However, many of the users who use social networks and the like can hardly afford a loaf of bread, not to speak of “Sexy lingerie for you and your lover”.

This brings the Utopian vision of world sharing and online equality under some serious skepticism. The couple of milj users who actually DO click and buy cant sustain the rest of the world so now what. Some have answered by excluding ISP’s from specific countries or regions in Africa and India for example. Other alternatives are using simpler displays and lower quality pics and vids for these users to see. MySpace may try something called Profile Lite which would be a simpler layout that would use less bandwidth.

Bandwitdh cost money and not everyone has money so now what…this is going to become tougher question as revenue and usage become closer and closer. At the end of the day it’s all about the bottom line….

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From NYTimes

This intractable contradiction has become a serious drag on the bottom lines of photo-sharing sites, social networks and video distributors like YouTube. It is also threatening the fervent idealism of Internet entrepreneurs, who hoped to unite the world in a single online village but are increasingly finding that the economics of that vision just do not work.

Last year, Veoh, a video-sharing site operated from San Diego, decided to block its service from users in Africa, Asia, Latin America and Eastern Europe, citing the dim prospects of making money and the high cost of delivering video there.

“I believe in free, open communications,” Dmitry Shapiro, the company’s chief executive, said. “But these people are so hungry for this content. They sit and they watch and watch and watch. The problem is they are eating up bandwidth, and it’s very difficult to derive revenue from it.”

Web entrepreneurs like Mr. Shapiro of Veoh, still struggling with his decision to restrict his site from much of the world, might have to find a way to soothe their battered consciences.

“The part of me that wants to change the world says, ‘This is unfair, it shouldn’t be like this,’ ” Mr. Shapiro said. “On the other hand, from the business side of things, serving videos to the entire world is just not supportable at this time.”

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