In an effort to widen Youtube’s main advertising revenue stream Google is set to launch paid channel subscriptions this week. The move puts them on a direct collision course with Netflix, Hulu, and Amazon streaming video services.
At the start the channels available will mainly be occupied by higher end producers. When the model proves itself it will most likely become available to all publishers.
If the subscription option catches on, it could herald a huge change for the online video industry, which has subsisted almost entirely on advertising revenue. It could give producers of Web video series a second source of revenue, analogous in some ways to the flexible pay walls that some newspapers and magazines have adopted. It could also put more pressure on the cable television industry, which is fighting off fresh competition from the Web.
Youtube’s plans to expand their revenue streams should turn out to be a positive for publishers and advertisers alike. It’ll be interesting to see how this plays out on the publisher side. Will there be new revenue share models? let’s hope so.
And let’s not ignore the potential for new advertising opportunities as well. When the subscription model proves itself the advertising angles will soon follow.
So what do you think? Is this the final nail in the coffin for old school TV? Are you excited about the potential opportunities with this new model? Let us know in the comments below.