YouTube Mulls Allowing Original Content Partners to Charge for Subscriptions

Robert Kyncl

Three years ago, Abu Dhabi put on the first-ever Abu Dhabi Media Summit. Now held in October, it is back for its third edition with the likes of WME's Ari Emanuel, YouTube content guru Robert Kyncl, Bill Gates and former MTV and Viacom boss Tom Freston.

Robert Kyncl, global head of content at the Google-owned video site, tells the Abu Dhabi Media Summit that a majority of channels would likely remain ad-supported.

ABU DHABI - YouTube is looking at giving its original content channel partners the option to charge users for subscriptions, Robert Kyncl, global head of content at the Google-owned online video site said here Wednesday at the Abu Dhabi Media Summit.

If the site does go ahead with this approach, "the majority will be ad-supported, and there will be some that will be paid," he predicted.

He later told THR that there are no set plans though and that it was too early to say when such subscriptions could be offered or at what prices.

Industry observers have previously wondered if and when YouTube could offer the subscription option as a potential revenue stream besides advertising.

Kyncl said YouTube's goal for now continues to be "taking the friction out" of the ad process to maximize ad revenue for the site and its partners. Promising advertisers that they only pay when ads are actually viewed draws higher ad rates and benefits all sides, he said.

YouTube typically sells ads against the channels and keeps all revenue up until it recoups its original investment. After that, YouTube and the content partner split ad revenue roughly 50:50.

Kyncl also said that when offering content in a branded and popular context, it draws higher ad rates. For example, he said videos of dogs on skateboards may draw minimal costs per thousand advertisers of $2 or less, but that goes up to $20 when the dogs on skateboard appear on a branded Tony Hawk channel.

Earlier this week, YouTube added more than 60 new original content channels to its lineup, including some from international content partners. The news took the company's original programming push to a more global audience.

In a session entitled “The War for the Living Room: The Internet Takes on Television," Kyncl also predicted that mobile usage by YouTube users will continue to rise. About 50 percent of consumption in parts of the Arabic-speaking world already happens on mobiles, he said.

Asked about the increasing usage of mobile devices during TV viewing, known in the industry as the rise of the "second screen," he quipped that for him, television rather than iPads or smartphones are the second screen.

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