ouTube is reportedly in talks with several major film studios about developing a streaming rental movie program. According to Reuters, the popular video site has held meetings with Lions Gate Entertainment, Sony Pictures and Warner Brothers.
It would be the first time YouTube has charged users to watch videos. Google has charged for movies, but this came through Google Video and the rental offerings ended in 2007. The film rental program would likely focus on newer titles and would mirror other rental programs like those from Apple’s iTunes Store or Amazon’s VOD system.
YouTube has proven to be a successful streamer of HD content, so it’s no surprise that a deal like this is being discussed. YouTube currently leads the world in Net videos, all of which are currently free and supported by advertising. Its current offerings tend to be independent and older studio films, as well as films that are part of the public domain. It offers a wide array of older TV episodes as well.
While the talks are said to be happening under the YouTube name, it’s more likely that the service is approaching studios with an offer to create a new property on the Web that uses the YouTube structure. Currently YouTube is doing just that with its Vevo music video site and at least two of the major record labels – what’s that, the labels might be developing a digital strategy before someone else?
If YouTube uses its main site for the video, it will have a lot of restrictions to add. Not only would the service have to be careful about users linking to content, but it would also have to make sure premium content is not mixed in with free for recommendations, or users will get frustrated at constantly being directed to content they have to pay for.
YouTube would also have to add a DRM to its site – users with the latest version of RealNetwork’s RealPlayer can download YouTube videos in a click or two.
The service will be competing against Apple, Amazon.com, Netflix and other service providers as well as set-top boxes from the cablecos, satcos, Roku, Vudu, TiVo and others. If the talks get serious, expect the studios to give their branded service either better prices or exclusive content.