In 2014, when YouTube made the decision to develop a product akin to cable TV, one of the main objectives was simply to improve relations with Hollywood. After battling Viacom for seven years over massive copyright infringement, YouTube CEO Susan Wojcicki sought a method to collaborate with networks and studios rather than compete with them. With the wide assignment of “figure out what YouTube might be able to do with the larger media companies, with a focus around television,” she hired Christian Oestlien, who is currently YouTube’s VP of product management.
Seven years later, the business’ live cable streaming package, YouTube TV, is still popular. Although not quite the same as having 5 million subscribers, the business today said that 5 million individuals are actively using YouTube TV, either for a fee or as a trial.
Even if the number of cable customers in the US has decreased over time, reaching a total of 46.2 million in the first quarter of this year, it has gained 2 million subscribers since mid-2020. The largest US cable provider, Comcast, reported 17.6 million subscribers in the first quarter of this year, a decrease of nearly two million from the prior year.
The internet-cable options, meanwhile, have been unequally distributed. With over 4.1 million members, Hulu with Live TV is expanding nicely, whereas Fubo, Sling, and a few other services have largely struggled to gain traction. Overall, YouTube TV is a modest but significant player in the TV business with five million users.
Of course, none of these figures even come close to the 220-million-plus Netflix customers or the 130 million or so Disney Plus users. And given how quickly on-demand streaming is growing, it’s natural to question how long YouTube TV’s “cable but better” strategy will actually hold true. Well, a while, responds Oestlien. Although live television may be on its way out, it will take some time. Additionally, there is still money to be gained because, despite its problems, Oestlien notes that “TV, for all of its flaws, is still a really lucrative business to our partners.”
In reality, sports continue to be the most profitable thing happening in the TV business and are so profitable that they prevent YouTube TV from becoming a totally streaming service. The majority of the top sports programming is still included in the bundle, especially with local broadcast channels and regional networks, according to Oestlien. These are still the primary factors that lead individuals to subscribe to YouTube TV or any of its rivals. It is similar to the cable bundle but has a better app, larger DVR storage, and an anytime cancellation policy. In essence, it is a sports bundle with a few additional highly appealing networks added to fill it out and make it something the whole family can enjoy.
Okay, but won’t streaming still be used for sports eventually? Disney is becoming more and more invested in ESPN’s digital future, while leagues like the NFL and MLB are already starting to sell rights to companies like Amazon and Apple. This trend appears to be continuing. Although Oestlien concurs, he adds that it might make YouTube TV even more beneficial.
He says that starting the game has grown much more difficult as more leagues join streaming services or even create their own. also pricey. You simply need to consider the price plan that would need to be used there, according to Oestlien. You arrive at a point when a bundle actually makes a lot of sense to make that all work. Additionally, he is betting that leagues and networks alike won’t turn down a corporation with significant pockets looking to get in on the action as those rights get more expensive. Over the years, YouTube has experienced its fair share of carriage disputes, but the networks appear to need YouTube TV just as much as the platform does.
The actual wager made by YouTube TV is that the bundle won’t go the way of cable. A generation of unbundling has passed, dividing content from a single source into numerous ones. This has reduced the cost of the services and increased the amount of excellent content, but it has also made discovery more difficult and account management more challenging, and it’s not always obvious how much money you’re actually saving. Oestlien and YouTube believe that a better bundle has to be created rather than the bundle being permanently broken.
Oestlien even imagines a scenario in which YouTube TV re-bundles the streaming services, reuniting Peacock and Paramount Plus the way CBS and NBC formerly did in the TV Guide. That presently sounds like a pipe dream because streaming firms are desperately trying to retain users inside their own content universes rather than cooperating. Because they would want users to open the Netflix app rather than just search for something on Justwatch, Netflix and other companies have even fought inclusion in universal search tools. However, when these services become more prevalent, many of them would have a motivation to search for a business with excellent distribution and significant financial resources.
By the way, YouTube is not the only business taking this route. HBO, for example, is apparently about to return to Amazon Channels after earlier leaving the service and losing 5 million customers in the process. Both Apple and Amazon have had success allowing people to subscribe to HBO, Starz, and other services through their own platforms. Additionally, the YouTube TV app already allows you to subscribe to HBO Max and view all of its programming. But so far, the majority of services have chosen not to participate in these all-encompassing platforms.
The bundle is essential to YouTube in general as well as YouTube TV. If the current streaming trends continue long enough, YouTube’s entire business model could be put in jeopardy. What if HBO Max was the only place to watch John Oliver’s most recent epic rant and Carpool Karaoke was only available on Peacock? What if Spotify and Apple Music were the only places to see music videos? Of course, YouTube has a tonne of original material, but TikTok, Instagram, and other platforms are eager to change that as well.
The success of the platform is in large part due to YouTube’s position as the largest provider of other people’s video on the internet; however, a push for more control and streaming may change this in the future.
That may be the reason why after speaking with Oestlien, You had the sense that YouTube TV is still mostly used as a diplomatic tool with content creators.
Oestlien also manages YouTube’s linked TV division, which entails helping to broker deals to get various TV shows into the main YouTube platform. He appears unconcerned about content loss. He says that there are 2 billion users globally. Therefore, You believe that YouTube can be a terrific partner there whether content is provided in a bundle or where over time we explore various ways of releasing it. He claims that even in sports, YouTube is entering into agreements to use league content in many different areas across the network in addition to streaming games on YouTube TV.
YouTube TV feels like a hit and a hedge after five years. However, if the future of TV is ever going to be drastically different, it’s still a long way off. The amount of money used to maintain the status quo, particularly in sports, is excessive. Though “Cable but better” may not always be the ideal TV strategy, it’s currently doing very well.
- Google Drive is launching a new web “Home” page by default - November 29, 2023
- Amazon Unveils Latest AI Chip in Strengthened Partnership with Nvidia - November 29, 2023
- American Airlines Collaborates with Startup to Decrease Carbon Dioxide through Underground Storage of Plant-Based Bricks - November 29, 2023