YouTube takes steps to becoming self sufficient through paid for content

By Quantum Capital Fund

A common practice in the industrial industry is for a large corporation to embark on a major merger and acquisition campaign to grow the versatility of the company. Although owned by the holding company; these acquisitions are generally managed independently and it is important for them to become self sufficient.

This was the motivation behind YouTube’s announcement that some of its new channels will be offered on a subscription basis.

Technology website cnet.com reports that YouTube could launch its paid subscription service for some of its specialist video channels as early as this week. The a la carte service, which could involve as many as 50 video channels, would allow single channel subscriptions for as little as $1.99 a month, people familiar with the plan tell The Financial Times.

Cnet adds that YouTube declined to comment on a target launch date for the service, reiterating earlier statements on the topic that it had "nothing to announce," but that it was "looking into creating a subscription platform that could bring even more great content to YouTube for our users to enjoy and provide our creators with another vehicle to generate revenue from their content, beyond the rental and ad-supported models we offer."

Achieving this is important as the online video content industry is getting congested with Netflix, Amazon, Hulu and Yahoo, all building capacity of their online content to offer users a unique online viewing experience.

It is important that YouTube moves into this direction and comes up with a funding model which will cater for its significant user base. Although it is new in the paid content arena, YouTube can be regarded as the Facebook of the video world purely on the size and scale of its user base. While market analysis is important, with the size and scale of YouTube’s user base means that any channels that the company producers will find a fan base. The only challenge would be a feasible funding model.