PAYG YouTube?

May 23, 2013 10:04 am

Would you be willing to pay for YouTube?


When YouTube said it was running a competition to determine the best video submitted online, it was meant to be a joke for April Fool’s Day.  But when YouTube recently announced it was coming up with a paid subscription plan for some video distributors, they were not joking this time.

Recently YouTube finalized some channels which will now be available for subscription over YouTube.

“Starting today, we’re launching a pilot program for a small group of partners that will offer paid channels on YouTube with subscription fees starting at $0.99 per month.  Every channel has a 14-day free trial, and many offer discounted yearly rates.  For example, Sesame Street will be offering full episodes on their paid channel when it launches.  And UFC fans can see classic fights, like a full version of their first event from UFC’s new channel.  “Once you subscribe from a computer, you’ll be able to watch paid channels on your computer, phone, tablet and TV, and soon you’ll be able to subscribe to them from more devices,” read their statement on the official YouTube blog.

YouTube will have 54 channels available for paid subscription; the list includes a wide variety of channels like the kid-friendly Treehouse Direct and Baby First Plus, music channels like Rap Battle Network and sports channels like PGA Digital Golf Academy, TNA Wrestling Plus and UFC Select.

As expected, there were immediate negative reactions from the public.

“No to paying a YouTube subscription fee.  No to pay-per-view.  We already pay for cable TV and select news-related companies.  Are institutional investors and hedge funds pushing this business model on the tech industry?” said PV of Hudson, Wisconsin.

“Where does it all end?  Increasingly, the Web is the source of virtually everything we do: news, books, magazines, video, music, weather, shopping, banking, socializing, everything.  The days of printed books and physical media are numbered.  DVDs and blu-rays are going the way of VHS tapes.  The new business model wants to stream everything to us, and wants us to pay for it not just once, but over and over again,” said Gemli from Boston.

Others were more understanding of the digital marketing strategy.

“I don’t mind paying for something I’ll use, especially if I can cancel at any time; however, I will not pay for anything that I cannot pay cash for.  Unless Google comes out with credits that come on cards with pre-determined amounts that I can pay cash for, they will not be getting my money,” said CSR Chad of Davenport City in Iowa.

Note: There are now pre-paid cards available

“I think this makes perfect sense.  The traditional TV format is outdated and what YouTube is proposing very attractive.  I’m not opposed to paying especially if I can cancel my cable subscription, and get access to what I really want to watch.  Plus, with original content making its way to streaming (ie. Netflix) it’s only a matter of time before producers and advertisers want in on this new format,” said Chris of Chicago.

Remember that this is still a pilot program and YouTube can cancel it if it goes badly.  But if this catches on, YouTube will have another source of revenue apart from ads.  The online strategy is also seen to put pressure on the cable TV industry which is already under assault from video on demand available in online platforms.


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