YouTube announced their premium service YouTube Red – for $10 a month

 

 

Read the announcement from YouTube here: http://youtube-global.blogspot.com/2015/10/red.html

YouTube Red Features:

• An ad-free experience while signed in
• Save videos to watch offline
• On Mobile – allows videos to play in the background behind other apps
• Access to exclusive content such as new original shows and movies from YouTube’s biggest creators like College Humor and PewDiePie

Your subscription also extends to the recently launched Gaming app (their Twitch.TV competitor) and a brand new YouTube Music app that will be available soon. But wait…there’s more! “And as a special bonus – YouTube Red works with Google Play Music, so subscribe to one and automatically get access to the other.”

“YouTube Music is designed to make discovering, watching and listening to music easier than ever. Any song or artist you choose on YouTube Music will start you on a personal journey through one of the richest music catalogs; just sign in, tap a track you love, and see where your music takes you.”

YouTube Red will be live starting October 28, 2015 and they will be offering a free one month trial at http://www.youtube.com/red.

 

For content creators, some outlets are reporting that “partner” creators content will be hidden from public view on both the ad-supported and ad-free service unless they agree to the YouTube Red revenue share deal (see YouTube Red – an offer creators can’t refuse). According to TechCrunch, YouTube Partner terms changed earlier this year to be paid 55% of revenue, comparatively low with 70% at Spotify and 71.5% on Apple Music. The money will be split up according to watch time.

 

Our team had some thoughts on this:

The price point seems a little high compared to Netflix and Hulu, however it is interesting to see Google enter the Pay Per View arena.  We don’t necessarily see the value being there given the current lack of content offering. Adding the music changes it slightly, but we’ll be sticking to Spotify for now.

It’s interesting that YouTube is going up against Netflix. Does this pave the way for Google TV?

It may be worth it for some people (PewDiePie has almost 40 million fans after all). Since Google Play Music is $10 a month by itself, there may be a built-in audience from the start with the cross promotion. Google’s integration of Songza makes the music side more interesting, as Spotify doesn’t have as many curated playlists for moods, and Songza’s mobile interface is superior.

Maybe the real benefit will be to Mobile users – who wants to pay for data that is taken up by ads?

 

Bottom line: It may be a good deal for some people (and built-in for Google Play Music subscribers), however we will need to wait and see what happens for YouTube Content Creators and Advertisers.