YouTube makes premium video play, opening up mobile advertising opportunities
As YouTube expands its focus to include premium video, mobile is likely to play a key role in how the content is consumed and in attracting big brand advertisers.
Digital content is increasingly being consumed via smartphones and tablets. With its new paid channels offering, YouTube is looking to be a bigger player in premium video while also giving content creators more choice in how they monetize content through a combination of subscriptions and ads.
“As long as YouTube has been around, it’s been a video-snacking juggernaut for consumers,” said Eugene Youn, vice president of business development at Rhythm NewMedia, Mountain View, CA. “With its investments in premium channels, YouTube is now becoming a lean back media powerhouse as well, which makes it super relevant to big brand advertising.
“Mobile should play a huge role in YouTube’s strategy,” he said. “Especially now that YouTube has a standalone app on iOS, they have a great chance to be a major player in premium mobile video.
“They must build their strategy around this. We’ve already heard from our own publishers that mobile video usage is quickly surpassing online on their sites, and we know this to be true for YouTube as well.”
YouTube last week launched a pilot program offering subscription-based channels enabling mobile, desktop and TV users to watch content from a variety of providers with fees starting at $0.99 per month and each offering a 14-day free trial. There are 53 channels at launch, including Ultimate Fighting Championship, which is offering classic fights.
The strategy addresses how content is being consumed across multiple screens.
For example, once someone has paid for a subscription to a particular YouTube channel, they will be able to watch that channel anywhere regardless of whether they are viewing from a desktop computer, tablet, smartphone or connected TV.
“Since users nearly always have their mobile devices on them, the role of mobile in this strategy will be significant,” said Nikao Yang, senior vice president of new business development and marketing at AdColony, Los Angeles.
“The challenge for YouTube working with paid channels in mobile, or rather the challenge for their content creators, is finding the sweet spot for offering paywalled – subscription – content and ad supported content,” he said.
YouTube could eventually incorporate a combination of advertising and paid subscriptions that work hand-in-hand, similar to value-exchange advertising, per Mr. Yang…
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