YouTube Launching Paid Subscriptions

YouTube Launching Paid Subscriptions

YouTube is set to launch a paid subscription model for its specialist video channels as early as this week. This strategic move has been in development for months, and aims to help channels finance a wider range of content such as television shows and films, and will serve as another source of revenue. The service will included up to 50 YouTube channels and subscriptions to each channel will start as low as $1.99. A YouTube spokesperson told Mashable, “We’re looking into creating a subscription platform that could bring even more great content to YouTube for our users to enjoy and provide our creators with another vehicle to generate revenue from their content, beyond the rental and ad-supported models we offer. There are a lot of content creators that think they would benefit from subscriptions, so we’re looking at that.”

As a consumer and marketer, I think YouTube offering paid subscriptions is a big deal. YouTube is known for its free content and paid subscriptions can benefit content creators but I don’t know if the platform will succeed as a paid model. I could see backlash similar to what Netflix received when they raised their prices. Consumers are used to the video content being free even though content creators want more revenue from the videos they post. This model would have to be right to compete with the likes of Netflix and Hulu. They have to carve out a niche market with paid content that users will actually subscribe to. I could actually see this working for instructional videos such as workout videos.

So this makes me wonder how marketers could use this paid content model to their benefit. This offers a new avenue for creating brand channels on YouTube. The only problem would be creating content that people would want to pay for. This is going to make breaking through the clutter on YouTube even more difficult. Another problem with this model could be viral videos. With the new model it might be harder to create buzz and videos won’t have the natural tendency to spread through WOM marketing. If users are turned off by the cost model and don’t frequent YouTube like they did in the past, it will be harder to take advantage of the viral aspect of the site.

What effect do you think the paid subscription model will have on consumers and marketers?

I look forward to hearing your thoughts.

-Britney

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4 thoughts on “YouTube Launching Paid Subscriptions

  1. Hey Britney. Great post. This trend will continue as distributors, filmmakers and exhibitors will have to adjust its business mode to the new digital world. You will no longer see releases exclusively for cinema theaters. Instead there will be multiplatform releases, with a high priority on digital subscription services, movies created for mobile devices and with online marketing strategies. YouTube will follow this trend: SocialCinema http://emergingmediainimc.wordpress.com/2013/05/12/socinema/

  2. Thank you! You bring a great point about the fact as consumers we will no longer see releases exclusively for cinema theaters. There will definitely be multiplatform releases as people are leaning more towards digital subscription services. This provides another medium for filmmakers and distributors to release their content. With that being said what do think is the future of the cinema theater business? Do you think that we will see a change in the future or will people still appreciate the nostalgic feeling of going to the movies?

  3. It all depends of what the subscription will provide. For example, I would LOVE to pay just for a TV subscription to Duck Dynasty and its various series seasons on Netflix or YouTube, BUT this is currently not an option. YouTube must heed caution because consumers now-a-days don’t like to be pushed into a corner and they can quickly turn a campaign or new service method into a viral nightmare.

    • Hi Lova,

      Thanks for your comment. I agree that it all depends on the subscription YouTube will provide. They have the opportunity to provide a niche market with certain content that is unique to YouTube. The company just really has to evaluate their pricing plan and make sure they don’t alienate users. You bring up a great point about pushing consumers into a corner because there could definitely be some serious backlash from users who enjoy their free content.

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