The video-sharing site YouTube is hoping its attempt to woo Hollywood studios will go better this time.
Sources close to the discussions with studios say that YouTube executives have raised the notion of a service that would charge $3.95 to rent a movie, the same rate Apple’s iTunes Store charges for new movie rentals and similar to video-on-demand prices. If reached, the deal would put Google’s YouTube in direct competition not just with Apple but also with online movie rental services from Netflix and Amazon.com. It would also, for the first time, allow YouTube to begin charging consumers for its content. However, the sources said talks are at a very early stage, could take three months or more to come to fruition, and that details are far from set in stone.
YouTube is by far the most popular video site, though much of the material is either clips or snippets provided by studios and other companies for marketing purposes, or videos contributed by amateurs. YouTube’s traffic, however, represents a huge audience ready for movies and other professionally produced video — Google sites, chiefly YouTube, drew nearly 121 million viewers in July, according to ComScore.
For the past year or so, Google has pressed to come up with ways to make money on YouTube, which is believed to be losing money, though how much remains a matter of great debate. It has come out with a series of new ad formats. But so far, even Google CEO Eric Schmidt has conceded that the site hasn’t lived up to its revenue hopes. Schmidt said in April that YouTube would try micropayments and other subscription models.
Strong Objections from Paramount
YouTube’s Hollywood efforts apparently began with talks involving Warner Bros., which led to an agreement to allow more clips from TV shows Warner produces, such as Gossip Girl…