YouTube CEO Says Streaming Service Will Hopefully Launch ‘Soon’

29 Oct 2014 | Author: | No comments yet »

Google planning ad-free version of YouTube.

But Susan Wojcicki, a former Google ad executive who was named head of YouTube earlier this year, said a paid-subscription service is being considered as an option for those who don’t want to see ads. “There are going to be cases where people are going to say, ‘I don’t want to see the ads,’” she said at the Code Mobile conference in Half Moon Bay, Calif., late Monday. “That’s actually a pretty interesting model because it’s giving users choice,” she said, according to Reuters. “We’re thinking about how to give users options.” In May 2013, YouTube experimented with a pilot program that allowed individual content creators to charge consumers a subscription fee to access a particular “channel” of videos. Digital companies such as Spotify and Soundcloud already use this sort of model, but it would mark a radical shift for YouTube, which has been ad-funded and free-to-view ever since it was founded. The online streaming world is getting more crowded, with HBO planning its own streaming service and cable giants Shaw and Rogers teaming up to launch Shomi. Photo: Getty Google Inc. ’s YouTube is working on a paid-subscription business model, a big change from the advertising-only approach that turned it into the world’s largest online video website, according to a top executive at the Internet giant.

It sounds as if YouTube’s subscription model will be a variation on Hulu’s, except in lieu of paying for premium content on top of ad-supported content that’s available for free, users will pay to opt-out of viewing ads on the platform. That expanded in October, but as the Journal pointed out, there is currently no option for YouTube users to subscribe to a premium service that eliminates all ads. Wojcicki on Monday described a broader subscription service in which consumers would pay to access an ad-free version of YouTube’s vast collection of videos. There have also been reports of a YouTube Music Key service that would offer audio-only playback and offline access, as well as Google Play Music All Access, for $9.99 a month—similar to offerings from Spotify, Slacker, and Rdio.

Ms Wojcick has been tasked with driving profits and revenues at the online video streaming site, which was acquired by Google in 2006 for $1.65bn and is now thought to be worth more than $40bn. So it was probably just a matter of time before YouTube – the Google-owned video site full of music and video games and cat videos – started to envy a paid subscription model that has worked so well for competitors like Netflix. The initiative follows an earlier scheme to launch a slew of subscription “channels” on YouTube, featuring programmes made by some of the UK’s most respected production companies, including BBC Worldwide and Endemol, the creator of Big Brother. “We rolled out the ability for an individual channel to do a subscription,” Ms Wojcicki said. “We’ve also been thinking about other ways that it might make sense for us. A paid, ad-free subscription version of YouTube, in addition to the existing ad-supported offering, would give users more choice and work well in a world where viewers are increasingly watching videos through apps on mobile devices, Ms. If you look at media over time most of them have both ads and subscriptions.” Meanwhile, Google has also started talking to production companies about supplying content for a number of its own, subscription YouTube channels, according to reports.

The news was part of her response to a question about “over the top” subscriptions, services that end-run the traditional cable model by offering direct subscriptions. An example is the service recently announced by HBO, which said that next year it will start a stand-alone streaming service aimed at “cord cutters,” people who want cable quality shows but refuse to pay several hundred dollars a month for the jumbled mess of cable channels. In essence, the company is making phone calls to potential partners, including anyone from big media companies like Disney to popular individuals with millions of subscribers, to see if they might be interested.

Wojcicki said would be introduced “soon.” Rather than an entirely new paid YouTube, there would be several subscription services based on certain topics – for instance, a subscription service with nothing but video games. The back story to all of this is that while online video sites like YouTube are gobbling up more of people’s time, people still spend vastly less time watching online video than TV. American adults are on pace to spend an average of four and a half hours of their days watching broadcast and cable television this year, compared to about an hour of online video, according to eMarketer. The first is technology and algorithmic improvements, like reducing buffering times and doing a better job of recommending videos for people so they keep clicking on new things.

The first has been to help their “creators” produce higher-quality content by, for example, building studios in cities including Los Angeles, New York and São Paulo.

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