Can YouTube thread the needle for OTT skinny bundle services?
YouTube Inc. officials certainly seem to think they can. At an event in Los Angeles Tuesday afternoon, they unveiled their long-awaited plans to launch a 40-channel OTT streaming video bundle, known as YouTube TV, for $35 a month sometime this spring. They also boasted about how well the new service is designed for the "YouTube generation" of millennials and other younger consumers who want to watch live TV and online video services on any device of their choosing wherever they may be whenever they want.
The new YouTube TV offering, which will launch first in major markets throughout the US, does have a number of key things in its favor. First, it won't require subscribers to sign a contract for a certain term, so subscriptions can be cancelled any time.
Second, the new skinny bundle package will include all four major US broadcast networks -- ABC, CBS, Fox and NBC -- as well as dozens of major cable networks, including Bravo, the Disney Channel, E!, Fox News, FX, MSNBC, Sprout and USA Network. It will also include such major cable sports players as ESPN, Fox Sports Network and Comcast SportsNet and offer access to content from the YouTube Red premium service.
Third, YouTube TV will offer unlimited cloud DVR recording. Subscribers will be able to store shows and movies for up to nine months and will be able to download those recordings to a wide range of devices, including connected TVs, tablets, smartphones and streaming video adapters.
Finally, YouTube TV will offer its "members" up to six accounts, each with its own unique recommendations and personal DVR with no storage limits. Each member will be able to watch up to three concurrent streams at a time.
But that doesn't mean YouTube TV will necessarily be a slam-dunk success. For one thing, while its programming lineup is impressive for a 40-channel package, the offering will still lack many popular cable channels. CNN, AMC Networks, Discovery Communications, TBS, TNT, A&E Networks and HBO head the list of major TV programmers still missing in action.
For another, YouTube TV faces an increasingly crowded field of skinny bundle rivals, including AT&T Inc. (NYSE: T)'s DirecTV Now, Dish Network LLC (Nasdaq: DISH)'s Sling TV and Sony PlayStation Vue. Still to come are a planned bundled service from Hulu LLC and an-oft rumored offering from Apple Inc. (Nasdaq: AAPL). So it's not like YouTube has the whole market of millennials and broadband-only households to itself. (See OTT Went Big in 2016, Aims Higher in 2017.)
The big question is how much of a difference YouTube's brand name will make. Will millennials and other online video fans flock to YouTube TV because they've already spent years tuning in to YouTube for their favorite videos? Or will they turn elsewhere because of better pricing, packaging or programming?
It's hard to say right now. But I'm betting on YouTube because of its commanding position in the online video market, unless they find a way to screw things up.
— Alan Breznick, Cable/Video Practice Leader, Light Reading