They've a/b tested inserting ads into the video stream before. If most people acted like I did, then YouTube would have seen them come back once every week or two and leaving as soon as one of those ads came up.

Right now it seems like most content providers are actually experiencing competition as it's extremely easy to jump to the provider with the least onerous ads, while torrents create a floor in terms of how annoying your ads/drm can be before people pirate

I'm pretty sure it would also be more expensive in terms of CPU and potentially disk.

The cost of concatenating two mp4† files is essentially zero. IIRC you can even `cat foo.mp4 bar.mp4 > baz.mp4` and it's supposed to still be valid mp4 (there may be same-codec restrictions, but even resolution can change).

The output of cat isn't valid MP4. The CPU cost of concatenating is small though, it can be done on the fly. Even easier for MP4 streaming (DASH).

The cost is not in the CPU, or the processing or the resources. The cost is in the people who leave.

They are doing it already, if I block googlevideo.com, the videos don't play.