YouTube is doomed. That’s the headline for an op-ed penned by Benjamin Wayne, CEO of Fliqz, in Silicon Valley Insider.

It’s not the first time we’ve heard naysayers predict the video sharing site’s imminent demise. But Wayne backs up his prognosis with numbers.

That YouTube is bleeding money is no secret. According to Credit Suisse, the number is $470 million in 2009. The problem is, says Wayne, there is absolutely no way for YouTube to ever earn enough to stop the hurt.

Credit Suisse estimates are based on the following: YouTube will manage to rake in about $240 million in ad revenue in 2009, against operating costs of roughly $711 million, leading to a shortfall of just over $470 million

In order to cover the shortfall, YouTube would have to slot an ad for every one of the 75 billion streams estimated for 2009 by Credit Suisse at a minimum $9.48 CPM for every video impression shown. That’s pretty much impossible – no one’s going to advertise on the toddler screaming “not funny” (despite the fact that my kids love it). CPMs for user-generated content, Wayne claims, can be measured in pennies.

As YouTube hosts more and more user-generated video, costs will only increase. Despite its popularity, can owner Google justify that kind of loss to its shareholders, Wayne asks?

Our guess is yes. Axing UGC would kill YouTube as we know it (though it happened to Napster). But possible solutions include implementing some sort of subscription structure for the site or requiring users to create a paid content in order to upload content. That would discourage individuals but marketers who use YouTube extensively as a viral tool might be willing to take that plunge, Wayne suggests.

Full article is here.