YouTube is reportedly investigating licensing TV and film content for its new streaming subscription service, Red.
Providing premium content would make YouTube's $9.99 over-the-top (OTT) video service directly competitive with the streaming services from Netflix Inc. (Nasdaq: NFLX), Hulu LLC , Amazon.com Inc. (Nasdaq: AMZN) Prime, Comcast Corp. (Nasdaq: CMCSA, CMCSK) Watchable and Verizon Communications Inc. (NYSE: VZ) Go90. (See Operators Blunder in Online Video Era).
They're all positioned as alternatives to the VoD services of traditional pay-TV service providers -- some competitively, some complementary. One interesting difference is that YouTube appears to have more immediate international potential.
Red's current value is built on providing YouTube content without ads, considered a boon mostly for people who line up music videos as "radio" playlists. YouTube does already host some long-form content, including a hodgepodge of films (e.g., Death Race 2000, The Flim-Flam Man, The Girl With the Pearl Earring) and TV shows (e.g., Space 1999, Married With Children), but the company has no corporate control over most of it.
— Brian Santo, Senior Editor, Components, T&M, Light Reading