YouTube Inc. is the latest big video provider that's looking to plunge deeper into the OTT space with a live TV skinny bundle. As first reported by Bloomberg, YouTube is now developing a subscription service, Unplugged, that would offer customers a bundle of broadcast and cable channels streamed over the Internet.
YouTube declined to comment on the report.
A unit of Alphabet Inc. 's main Google Internet business, YouTube is apparently pursuing a premium video subscription service to complement the world's largest ad-supported video website. YouTube already launched its first subscription service, Red, last fall. Unplugged would offer more premium content, combining programming from broadcasters, cable channels and other major media companies.
But it's not yet clear which media players will participate in the proposed service. While YouTube executives have reportedly discussed their plans for Unplugged with most major media companies, including Comcast Corp. (Nasdaq: CMCSA, CMCSK)’s NBCUniversal LLC , Viacom Inc. (NYSE: VIA), 21st Century Fox and CBS Corp. (NYSE: CBS), they have not yet secured any programming rights, sources told Bloomberg.
YouTube officials, who have been working on some kind of online TV package for at least four years, also haven't decided on the exact business model for Unplugged yet. Under one scenario, Unplugged would offer a skinny TV bundle with the four US broadcast networks and some popular cable channels for less than $35 a month. Under another scenario, YouTube would offer a bundle of less popular networks as well as smaller packages of channels organized around themes, charging one fee for the main bundle and extra, smaller monthly fees for the theme-based groups.
This YouTube news follows reports that Hulu LLC , another big online video player, is planning to launch its own subscription online video service in early 2017 that would compete with linear services from traditional pay-TV operators. The new Hulu offering, which was confirmed by the company earlier today, is targeting a monthly price of about $40. (See Hulu Eyes Cable-Like Bundle – Report.)
— Alan Breznick, Cable/Video Practice Leader, Light Reading