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YouTube Lands CBS for Unplugged – Report

Alan Breznick

CBS is going OTT once again, thanks to a reported new deal with YouTube.

CBS Corp. (NYSE: CBS), which already streams its own CBS All Access OTT service directly to subscribers, has apparently become the first major broadcasting network to sign up for a new "skinny" TV service planned by YouTube Inc. , according to The Wall Street Journal . Known as Unplugged, the new OTT subscription service is slated to launch early next year, joining YouTube Red, an ad-free OTT subscription service that YouTube introduced last year. (See YouTube Red Boasts Cable-Like Audiences.)

But CBS likely won't be the last. As the Journal reports, YouTube, a unit of Alphabet Inc. 's main Google Internet business, is also negotiating seriously with 21st Century Fox and Walt Disney Co. (NYSE: DIS) for the carriage rights to their respective TV properties.

YouTube is looking to price the Unplugged bundle of live TV channels between $25 and $40 a month, according to media executives who have heard the pitch, the Journal said. YouTube declined comment on the report.

With the Unplugged launch, YouTube will be venturing into an increasingly congested space in the OTT video market. Its main rivals will likely include Sony Corp. (NYSE: SNE)'s PlayStation Vue, Dish Network LLC (Nasdaq: DISH)'s Sling TV and Hulu LLC -- the online video platform owned by Disney, Fox, Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Time Warner Inc.

YouTube has run into resistance from media companies because of concerns that it doesn't tackle video piracy by viewers on its site aggressively enough. In addition, programmers are reportedly concerned about YouTube's efforts to overlay its own data on network feeds and the potential for the company to bundle premium network content alongside its own web-native videos and stars, which they worry will cheapen their fare. But, with the CBS deal, it looks like YouTube is now overcoming those hurdles.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

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User Rank: Light Sabre
10/30/2016 | 10:41:12 AM
Unplugged But Costly?
I'm a regular viewer of YouTube but not Red and I try to get as much entertainment free as possible even though I have to wade through the ads. Maybe YouTube and CBS might have something as there's lots of folks not like me, who will pay subscription fees to get rid of the advertising. But, it does seem the YouTube is really a competitor to CBS and other like programming and I would suspect the contracts would have to include some specifics to keep CBS's interests in making some profit more likely than not.
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