Google's YouTube is reportedly in negotiations with movie studios to offer pay-per-view videos by the end of the year. The move could make a lot of waves given YouTube's reach.
The Financial Times reports:
Google has been pitching to the studios on the international appeal of a streaming, on-demand movie service pegged to the world’s most popular search engine and YouTube, according to several people with knowledge of the situation.
The key concept in the FT report is that YouTube is looking at something on a global scale. The ramifications are huge. To wit:
Such a pay-per-view deal is likely to put YouTube on the profitable side for good. Google's YouTube, which is embedded on many phones, would have an instant pay-per-view smartphone play. The YouTube pay-per-view effort would be aimed squarely at Web rivals such as Hulu and Apple's iTunes as well as Netflix and the cable industry.
And YouTube has more reach and eyeballs to really drive pay-per-view usage.
Simply put, Google's YouTube effort is going to shake up Web video. The biggest encroachment---at least initially---will be on Apple's iTunes business. Will you rent a movie from iTunes or YouTube? It remains to be seen whether YouTube will have the library to battle Netflix, but Google will reportedly get releases as they go to DVD. Long-term, the cable industry may be in YouTube's aim, but one thing at a time.