With competitors big and small looking to carve away pieces of YouTube's audience, the Google-owned (NASDAQ: GOOG) service may be taking a new tack: matching Hollywood producers with its top-tier video talent, and investing directly in original programming which results from those unions.
YouTube wouldn't comment to Variety or Reuters (which broke the story) on the report, saying only that it is "always exploring various content and marketing ideas" for its users. But sources told Reuters that the website may offer between $1 million and $3 million, and perhaps marketing funds, to producers for a series of programs.
The rise of multichannel networks (MCNs) on YouTube has created a whole new market for media companies, which have been eyeing properties like Vevo for some time. Maker Studios and AwesomenessTV are the Cinderella stories of the MCN phenomenon so far, picked up by Disney and Dreamworks, respectively, for hundreds of millions of dollars.
But other MCNs and individual channels don't do so well and are buried in the mass of videos proliferating across YouTube's website. For some, it's driven a move off of YouTube (or in many cases, in addition to YouTube) to sites like Vimeo, which allows for high-definition video uploads and this year created a $10 million fund to invest in new talent.
And a new OTT platform, iLOOK TV, launched last month, giving creators a different way to promote their channels. iLOOK's platform creates a mobile app for a YouTube content creator and adds it to a program guide that viewers can access through the creator's app. Content owners can also syndicate their videos to other iLOOK-based accounts or can purchase ad space on the service.
Developments like this may be driving YouTube's rumored talks with producers--with top-notch content and better deals being one way to keep both its viewers and its top-shelf creators happy. "The YouTube outreach effort may be a response to projects undertaken by creators that are being distributed through non-YouTube channels," Todd Spangler wrote in the Variety article, noting that a comedy film developed by three YouTube personalities was distributed through other channels, selling on iTunes and via VHX.
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