YouTube is the largest online video content place in the world and when a streaming giant like YouTube decides to release its own TV subscription service, other streaming companies and subscription services are bound to get a decline in their profits – even when those services are being provided by the Cupertino-based smartphone maker.
YouTube’s subscription service a huge threat to traditional TV
YouTube has finally decided to launch its own TV subscription service, which will include the live sports content and the TV shows that people want. After hearing this news, not only the streaming giants like Netflix, Hulu and Amazon Prime will be concerned but the traditional pay TV industry including HBO and CW will be concerned as well.
The much awaited TV service of YouTube will deploy to the major markets in the United States later this spring and will come at a premium price point of $35 a month. The new service will pose a huge threat to other services like Sony’s Vue, Dish Network’s Sling TV, and AT&T’s Di-recTV. The service will first release in the United States, according to reports, however, the search giant will try to get rights to bring the service to other markets across the world soon.
The streaming service will launch its YouTube TV with a collection of only 40 channels including networks from cable and broadcast like CBS, Fox, Disney Channel, FX, Sprout, MSNBC, USA Network, Fox News, ABC, Bravo, NBC and ESPN. In addition to this, the streaming giant will be rolling out a new standalone application with six accounts available per subscription. Also, it will include unlimited cloud DVR storage with no fixed term contract, letting subscribers cancel the subscription any time they want.
Apple very slow in striking content deals
The profit of YouTube TV will be minimal even after monthly fee of $35 because of the carriage costs of the popular networks. However, converting only a fraction of its 1 billion viewers into YouTube subscribers will decrease the share of cable and satellite TV in the TV market. This week, the streaming giant announced that it receives more than 1 billion hours of video views now on a daily basis.
The data by Nielsen suggests that in comparison to YouTube views, the US TV (the entire service) has a viewership of around 1.25 billion hours on a daily basis. Also, reports say that in recent years, this figure of 1.25 billion hours is declining steadily.
Apple, on the other hand, has not been able to take control of the viewing experience and has struggled to start content deals. The tech giant has never been able to compete directly with YouTube, at least not on its own. Tim Cook, the CEO of Apple Inc., said at the earnings conference of the tech giant last month that the iPhone maker is exploring content option for Apple TV, but original content is something that YouTube has no problems with. The streaming giant has already released YouTube Red, its own original content subscription service.
In a statement, the company said, “They (Consumers) don’t want to worry about their DVR filling up. They don’t want to miss a great game or their favorite show because they’re on the go. They tell us they want TV to be more like YouTube.”