YouTube expands deal with Disney, offers 'hundreds' of titles to rent

YouTube is continuing to spearhead Google's (Nasdaq: GOOG) efforts to become part of the Hollywood establishment, announcing a new partnership with Disney (NYSE: DIS) that will bring more of the studio's content to its site and broaden its growing array of video-on-demand titles.

The company last week said it had signed a deal to license content from Disney, Disney Pixar and DreamWorks Studios for its VOD site, which it launched in May. Titles available to stream initially will include Cars 2, Alice in Wonderland, and Pirates of the Caribbean: On Stranger Tides. On its blog, the company said more content from deeper in the Disney catalog would be added over time. It already is offering "hundreds" of Disney titles, YouTube said on its blog. Disney also will provide behind-the-scene clips and other extras.

Disney and YouTube recently announced plans to collaborate on a YouTube channel that would carry the Disney brand. The deal is small by Hollywood standards, just $10 million to $15 million, initially, but it helps Google get its toe into Tinseltown, brings another big name to YouTube's original content plan it announced last month and gives Disney access to a web audience of more than 800 million-- an audience it so far has been only partially successful in reaching. YouTube said the site currently streams 3.5 billion videos a day.

YouTube plans to create 100 channels of premium content in partnership with entertainers and other subjects. The company in early October also was rumored to be willing to put up $100 million for original content.

YouTube believes its bargain ad rates--they're lower than sites like Hulu, for example--and targeted advertising format can be highly lucrative in the right setting.

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