The Unwarranted Hysteria Over YouTube Red

Last week, Google pulled the tarp off a project they’ve been working on since last year; one intended to not only keep content creators from jumping-ship to places like Vessel, but also, hopefully, to finally see some profitability off a site with over a billion viewers.

YouTube Red is Google’s first attempt at a subscription model for the video site, similar to the those offered by Spotify, Hulu, and countless other streaming services. For $9.99 per month (or $12.99 on iOS devices), YouTube Red subscribers will have access to all YouTube videos ad-free, with some offline playback functionality; in addition to forthcoming “YouTube Red Originals” & YouTube Music app and Google Play Music. 

Per expectations, a service as popular as YouTube introducing a subscription model has caused a wave of confusion, anger, and, yes, even a comparison to The Godfather

Some of this hysteria has come from the fact that Google is forcing content owners to agree to be included in YouTube Red—those that do not will be (or already have) forced to remove content entirely or have it set to private. This is because YouTube wants to provide a consistent experience across both subscription and ad-supported viewers. Imagine how few would be interested in YouTube Red if subscribers couldn’t access ad-supported content any longer—it would essentially render the subscription less valuable than sitting through a few ads.

In the case of ESPN and select few content creators (Google says 99% of whom have already agreed to Red), they were forced to pull YouTube content due to conflicts with other existing relationships preventing them from profiting off subscription fees for content. Disney, ESPN’s parent company, originally held-off signing an agreement with Google over YouTube Red (reportedly, they felt they were entitled to more of a cut); but, the company has since agreed to Google’s terms.

Sure, there are some kinks in Google’s plan—which, I can imagine, will be worked through over time—but, do fans of YouTube’s content actually have anything to fear with the introduction of Red?

Not particularly.

ESPN’s conflicts aside (note: ESPN videos are still available on their own website), with 99% of content creators on-board with YouTube Red, all the subscription service means is that you can either shell-out $10/month to watch Grumpy Cat’s videos ad-free—or, you can just skip the mostly-TrueView advertising like you’ve done in the past. Sure, Google’s longterm plans include original content (a whopping 10 or so vids thus far); which means, at some point, a measly 99.5% of YouTube’s videos will still be available for free.

For content creators, not much will change. Google is paying out a reported 55% of ad revenues currently to YouTube “stars”—and continues to plan to do so under YouTube Red.

Advertisers shouldn’t expect to see much of a decrease in impressions—at least for a very, very long time (though, interestingly enough, this may be one of the reasons Google pulled YouTube inventory off AdX back in August). Though the desire for ad-free, offline amateur videos may be greater than my skeptical personality will allow me to admit, I can’t imagine any significant percentage of YouTube’s billion viewers will be signing up for Red anytime soon.

So, for now, let’s everyone relax—and see where this goes. For those interested, YouTube Red will be available to US users only (at first) on October 28th. Google is offering a one-month trial membership for the ad-free service.

One Pingback/Trackback

banner