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What are YouTube paid channels?

The Internet, and the media, is largely a place that runs on advertising.  Advertising is everywhere.  After all, we are an ad agency!

Ads have been a major, if not the most major, source of revenue for a long time.  And for a long time there have been tiers (or barriers).  Paid content – like SKY in New Zealand, or cable television services like HBO or Showtime in the US – separates almost ad free content from the ads of NBC or CBS (TVNZ and MediaWorks channels in NZ).

For a long time, however, the Internet has relied on advertising.  A large chunk of Google’s revenue is advertising:  AdSense on websites, AdWords in the search engine itself, as well as Maps listings, not mentioning a plethora of others.  Of course, one of the biggest is ads on YouTube’s video content, and for a long time (and still) YouTube content creators have been ‘partnered’ by YouTube due to their popularity:  Google elects to place ads on that user’s videos in exchange for giving a small portion (small comparatively, not objectively) to that user.  In an article that came out a few years ago, some YouTubers were earning over US$100,000 a year.

However, it seems Google has decided to try out another scheme:  paid channels. As Mashable originally reported, the National Geographic last August reached out to YouTube with the idea of making a channel aimed at children, with the site having been unsure that creating another television channel would be sustainable with advertising alone.  YouTube, at that point in time, only had partner channels available.

Fast forward to today and YouTube have now begun to look at the possibility of channels based on the idea of a paid subscription;  an idea that could move beyond the idea of viral popularity and allow content creators to literally create a business around their content rather than relying solely on ad revenue.  This is likely a business model that will dominate the next generation of technology, with services like Netflix, Spottily and Hulu offering a standard level service with ads, and an ad-less better service with subscription.

However, for YouTube, it’s a pilot program which is only in its infancy at the moment. There are concerns like the idea that people go to YouTube for free content only, and that asking for subscription or introducing a paid business model could discourage (possibly heavily so) users from the content.

However, a premium service is often a way to earn money, and the tech industry, as well as the way that we consume media, is changing heavily with the introduction of the Internet.  It will be interesting to see what happens


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