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YouTube spending US$100M to compete with broadcast TV

Ian Paul | April 7, 2011
Google's subsidiary is reportedly hoping to launch different "channels" featuring several hours per week of original content.

SAN FRANCISCO, 7 APRIL 2011 - This just might be the year you finally say "Goodbye, cable box" and "Hello, YouTube, Hulu and Netflix," if the latest online rumors are correct. Google's YouTube is reportedly hoping to launch about 20 different "channels," each featuring several hours per week of original content for categories such as sports, arts and entertainment. YouTube channels are simply Web pages built around specific content. The site will reportedly spend as much as $100 million to get its fledgling project off the ground and is in talks with major Hollywood talent agencies to attract content creators to YouTube. The ultimate goal is to get you to watch YouTube the same way you watch TV, according to The Wall Street Journal.
YouTube's original programming should start appearing online this year.

It's unclear how long YouTube's original "Webisodes" might be or how the content will compare to what is on TV. But the new programming initiative is reportedly designed to get you to spend more time watching YouTube than you do right now. Google's network of sites claimed about 141 million online viewers in February, according to metrics firm comScore. Each viewer spent on average a little more than four hours watching content on Google sites, most of which was on YouTube. By comparison, the average American watched more than 150 hours per month of broadcast television during the last three months of 2010 and 145 hours per month between July and September 2010, according to the Nielsen Company.
TV Moves Online

It's not just YouTube that is hoping to challenge, replace or supplement traditional broadcast television. In January, rumors surfaced that Hulu and its backers were thinking of selling live online broadcast TV subscriptions -- Hulu is an independently run company jointly owned by NBCUniversal, News Corp., The Walt Disney Co. and a private equity firm.

Netflix is getting increasingly stronger when it comes to premium streaming content. The service recently signed a deal that will bring the first four seasons of AMC's Mad Men to Netflix streaming in July. The company has also tied up streaming rights to the upcoming fifth and sixth seasons, as well as a potential seventh season (reportedly Mad Men's last), after those seasons finish running on AMC. In addition, Netflix plans to distribute its own original programming. Rumors surfaced in March that Netflix had sewn up the distribution rights for a remake of House of Cards, a British political thriller produced in the 1990s. The company later confirmed it had closed the deal that includes David Fincher, director of The Social Network, as executive producer and starring Kevin Spacey.


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