YouTube to launch subscription plan for some channels
A screenshot of YouTube's home page.(Photo: YouTube)
Google is planning a subscription service for some high-quality YouTube channels to raise revenue from sources beyond advertising and to help spur more professional video production.
The move, which could be announced as early as this week, would require viewers to pay about $2 or more per month, with about 50 channels participating initially, according to the Financial Times, which first reported about the company's plans.
"We're looking into creating a subscription platform that could bring even more great content to YouTube for our users to enjoy and provide our partners with another vehicle to generate revenue from their content, beyond the rental and ad-supported models we offer," YouTube says in a statement.
YouTube has previously expressed its desire to start charging viewers for content, in keeping with Netflix, Hulu and other subscription-based video-streaming services. That would open up a potentially lucrative new source of revenue beyond advertising. And video makers say they've been approached in recent weeks by YouTube with its subscription plans.
While YouTube is largely known for homemade videos, the content displayed in the channels belonging to professional producers and large media organizations has become increasingly sophisticated.
Starting in January last year, YouTube also has been spending $100 million to fund production firms to create more channels and content that would keep viewers on its site longer.
YouTube's pricing plans — and the quality of video content they can help create — will dictate whether the new service will be successful, says Dan Rayburn, an analyst at StreamingMedia.com.
"It's content just created for the Web, and it has lower cost of content creation," he says, referring to videos on popular YouTube channels. "It's still expensive, but it's still not professionally produced broadcast TV shows."
The video providers that now have a business model of charging a small monthly fee generally have specialty content that appeals to a niche group of fans, such as Major League Baseball.
"What does YouTube have in its content arsenal that it can package together?" Rayburn asked. "A comedy package? Do they roll out a financial package about stocks? It might be a niche like that that can do well (and) has concentrated audience."