SAN BRUNO – Google-owned YouTube, which is seen by 1 billion unique viewers each month, could start charging subscriptions this week for some entertainment and music channels and programming aimed at children.
Report by Mercury News Online
While the majority of YouTube videos will remain free, some YouTube partners want to experiment with new sources of revenue by charging subscriptions that will cost as little as $1.99 per month, according to published reports based on anonymous sources.
A YouTube official told this newspaper that, “We have nothing to announce at this time, but 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’s plans for a subscription model follow efforts by companies such as Netflix, Hulu and Amazon to attract viewers to their video services.
Eventually, even YouTube videos that charge subscription fees likely will carry ads, said David Burch, communications director for TubeMogul, an Emeryville-based video ad buying company.
“YouTube and Google are likely doing this in a strategic way that doesn’t compromise ad sales,” Burch said. “But I bet it ends up being ad-supported (in addition to subscriptions) in a way that’s tastefully done.”
The Financial Times reported that an announcement regarding YouTube subscriptions was expected this week and a subsequent report by The New York Times said press coverage could spur YouTube partners to begin promoting their subscription channels on Thursday.
YouTube now attracts 1 billion unique visitors each month who watch more than 6 billion hours of YouTube videos each month, which represents a 50 percent increase over last year, according to YouTube.
On the company’s blog, YouTube said that in the last 12 months media companies such as Time Warner, The Chernin Group, Bertelsman, Discovery Communications and Comcast each have made “significant investments in companies that create, aggregate or service content for YouTube.”
YouTube partners want to reach “the passionate fan communities of Gen C, an audience that influences more than $500 billion in annual consumer spending,” YouTube said.
While YouTube watchers likely trend younger than customers on Netflix or Hulu, Burch said “YouTube has a broader demographic than most people give them credit for. It’s not just a bunch of teens watching makeup tutorials.”
Some YouTube partners hope to turn current viewers into paying customers while others want to sell archived TV shows, The New York Times reported.
The Times said that “a number” of YouTube’s most popular video providers passed on a subscription trial and instead want to see what happens with other video providers.
But the Financial Times said as many as 50 YouTube channels will begin charging subscriptions of as little as $1.99 per month each.
The Financial Times quoted an unidentified source as saying the subscriptions will allow the channel operators to generate different content, such as TV shows and films.