YouTube may make original content free, cut most new programming
posted Friday Nov 30, 2018 by Scott Ertz
YouTube is always trying new ideas to monetize the platform. That is because video streaming is an expensive process, and making it profitable can be incredibly difficult. A couple of years ago, the brand tried something new: YouTube Red, a paid version of the platform that removed ads and gave access to original programming. This service was replaced by YouTube Premium earlier this year but additional changes may be coming to the service over the next year.
According to the Hollywood Reporter, YouTube may make original content free on the platform, with ads supporting the cost of production. This decision is likely being made for a number of reasons. The most likely is that not enough consumers are signing up for YouTube Premium to be able to pay for the content. By allowing everyone to watch the content, they expand their overall viewership and generate some new revenue off of ad sales, which is really the platform's bread and butter.
In addition to making content freely available, it is said that YouTube is considering cutting back on the amount of original content they produce. For the most part, the experiment with original content from YouTube has been a bust, as many of their contracts have been with existing YouTube creators who lock some of their content behind Premium. Since Red was announced, however, Patreon has come in and taken a lot of the wind out of the service's sails.
In response to the drop in interest for locked content, YouTube has added a number of actual series, but it might have been too little, too late. The value of Premium has dropped because those who might have paid for a subscription to see bonus material from their favorite YouTubers have moved to Patreon. That limits how much exposure these series have now behind their paywall. Expanded viewership will mean more potential revenue, assuming that these originals are worth watching.
There is no timeline for the change, as no decision has been made internally, according to the report.