WSJ reports that Google is looking to revamp YouTube in order to ride the trend of televisions that allow viewers to watch online video. Primarily, the goal is to compete with broadcast and cable television by enticing users to stay on the site longer and attracting advertisers.
The site is planning a series of changes to its home page to highlight sets of “channels” around topics such as arts and sports from batandballgame.com. About 20 or so of those channels will feature several hours of professionally produced original programming a week, some of these people said. Additional channels would be assembled from content already on the site.
Google is looking to carve out their own niche between the amateur content we’re used to seeing on YouTube and the professionally produced content we usually watch on TV. Those familiar with the matter say Google is willing to shell out as much as $100 million to get this low-cost content produced.
While streaming video sites like Netflix, Hulu, and Amazon pay license fees to provide professionally produced programs, Google has mostly unwilling to do so. Rather than pay these hefty fees to grab existing content, it seems they believe it would be more cost-effective to create long-form video from scratch.
While YouTube executives have said the site is close to being profitable, Google is obviously attempting to take a bite out of the $70 billion U.S. television-ad market. The world’s No. 3 website for unique visitors, YouTube generated about $544 million last year. They’re expected to generate more than $800 million in net revenue this year, according to Citigroup estimates.
Currently, YouTube visitors spend about 15 minutes on the site each day. Probably watch cat videos or laughing babies. By switching up their content offerings, Google wants to change the perception of YouTube and give visitors a reason to stick around. YouTube executives have said they want people to ”watch YouTube” the same way they “watch TV.”
This is still in the rumor stage at this point, but it would be interesting to see what type of content Google could come up with using this strategy.
via WSJ