YouTube is reportedly ready to compete with cable TV providers by offering a paid subscription bundle of streaming TV channels as soon as next year.
Bloomberg News reported Wednesday that YouTube, a division of Alphabet Inc.’s GOOG, +0.82% GOOGL, +0.47% Google business, has been working on the project since 2012 and has recently been in licensing talks with major TV content providers such as Comcast Corp’s CMCSA, +0.26% NBC Universal, Viacom Inc. VIA, +0.27% , CBS Corp. CBS, +1.66% and 21st Century Fox Inc. FOX, +0.81% , although it has not yet secured a deal with any of them.
YouTube reportedly hopes to offer so-called “skinny bundles” of programming in 2017 at less than $35 a month, and would include the four major broadcast channels along with a selection of popular cable channels. Bloomberg said additional themed bundles — such as sports and kids programming — may be offered separately.
Securing streaming rights with the top media companies is critical in order to offer a competitive product. Apple Inc.’s AAPL, -0.41% long-rumored TV plan was reportedly put on the back burner earlier this year after it failed to reach such a deal with CBS, the No. 1 broadcast channel in the U.S.
YouTube’s service, which would be called Unplugged, would add an additional revenue stream to the company, likely much more so than its current Red subscription service. And the à la carte method of programming would likely appeal to many so-called “cord-cutters” as a cheaper alternative to cable packages.
YouTube Unplugged would join a growing field offering streaming TV bundles. Earlier this week, Hulu was reported to be planning a subscription service offering broadcast and cable TV channels that it hopes to launch by early 2017. Dish Network Inc’s DISH, -4.24% Sling TV already offers a similar service for $20 a month, though it lacks channels from Walt Disney Co. DISN, +0.05% — such as ESPN and ABC — NBC Universal and CBS.
Source: MarketWatch
