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YouTube Reported Launching $1.99 Subscription Channels
YouTube Reported Launching $1.99 Subscription Channels

By Adam Dickter
May 6, 2013 2:24PM

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If it offers pay subscription channels, YouTube is surely looking at the success of Netflix, Hulu Plus and Amazon Prime in selling subscriptions for streaming content. And the advent of Internet set-top boxes made by Apple, Intel, Roku and others show that top companies are banking on increased interest in Web content.
 


If you get tired of looking at cat videos, or just want to view more professionally made ones, you may soon be able to log on to some premium content on YouTube. But there will be a price tag.

The video sharing giant, which was founded by Chad Hurley, Steve Chen, and Jawed Karim in 2005 and bought by Google the following year, is about to launch a system of premium channels for which users would pay a relatively small fee of $1.99 per month for access, according to a published report.

The London-based Financial Times said the move has been in the works for months and would provide more shared revenue between Google and content creators.

'Another Vehicle'

The move was not confirmed by YouTube, but the service told the Financial Times it is "looking into creating a subscription platform that could bring even more great content to YouTube for our users to enjoy and provide our creators with another vehicle to generate revenue from their content, beyond the rental and ad-supported models we offer."

It's the latest step in revenue enhancement for the social media giants we have come to know and love and enjoy over the last decade such as Facebook, Twitter and YouTube. All three are still free to users, but since going public in February 2012, Facebook has moved beyond simple advertising to sponsored posts, recommended pages and more.

Twitter, which subsisted for years on venture capital start-up costs, began selling promoted tweets in 2011.

Just as newspapers and magazines initially gave away all their content on Web sites at the dawn of the Internet, and now seek ways to gain income through some forms of "pay walls," social media seem to be looking for bigger payoffs, too.

In the case of YouTube, Google is surely looking at the success of Netflix, Hulu Plus and Amazon Prime in selling subscriptions for streaming content. And the advent of Internet set-top boxes made by Apple, Intel, Roku and others show that top companies are banking on increased interest in Web content, while Netflix and Amazon are now developing original shows.

The Evolution Is Here

"I don't see this as social media maturation so much as an evolution in paid video content models," said Rebecca Lieb, a digital advertising and media analyst at the Altimeter Group.

"Google hasn't yet said they're doing this, but [they] are looking at models for subscriptions, which makes sense. Paid video streaming is a growing market -- Netflix, Hulu and Amazon demonstrate users are willing to pay for quality content -- as distinct from user-generated cat videos."

Lieb told us that as more people "cut the cord" from cable or broadcast TV, "many are turning to digital channels for programming, and proposed cost models for online programming are much lower than monthly cable or satellite fees."
 

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