Speaking on CNBC in the US, Schmidt was asked: "Isn't it true that people don't like ads on YouTube?". Schmidt replied; "We have not figured that out yet. You're comparing a 50-year-old mature model that works really well once every four years in the Olympics, versus something that's just starting."
According to US news reports in July, YouTube's ad revenue is likely to total $200m (£101m) this year, well below owner Google's expectations.
Reports in the US say Google plans to significantly cut the number of YouTube clips that it will sell ads against in the future. YouTube wants to sells ads only against content for which it has the right to distribute. At present, it sells ads against just 4% of all clips on YouTube, so as not to violate content owners' copyrights.
Schmidt went on to say that Google would "like to make money out of it [YouTube]. But if we don't, the fact that so many people come to YouTube means they ultimately go to YouTube. I'd be worried if people weren't using YouTube. We know we will benefit."
Asked whether Google would ever sell ads on its homepage, Schmidt dismissed the idea, although conceded that a single deal could net it as much as "some number of billions of dollars".
Asked by the CNBC presenter, "Why not do it?", Schmidt replied; "People wouldn't like it", adding "we're not going to sell it".
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