Video streaming giant YouTube is reportedly scaling back its original content plans. According to a report from the Hollywood Reporter, the Google-owned service plans to make all future original programming available to users for free with advertising. Google is seeking a bigger audience for shows and movies released on its subscription service, YouTube Premium that had been restricted to paid subscribers.
YouTube Premium launched three years ago, which is available in 29 countries costs about $12 a month in the United States. YouTube has not disclosed the total number of subscribers for the paid offering but reports that uptake for the subscription service has been slow is said to have prompted the shift in strategy. The online video giant is set to scale back the volume of scripted original programming it produces by 2020 and has been informing creative partners about the shift, per multiple sources.
The shift in strategy means that in 2019, YouTube Premium subscribers can no longer expect exclusive access to original programs on the subscription offering. YouTube's paid option will continue to remove ads from originals as well as all other videos, and it comes with music streaming privileges. The company said it will release previously scheduled shows and movies in YouTube Premium, such as the first season of popular action comedy "Cobra Kai," which will remain behind the paywall if only temporarily.
YouTube will make serious budget reductions to its scripted business which has a budget in the hundreds of millions annually, well below the billions spent by Netflix and Amazon. YouTube Originals hasn't produced a hit bigger than the Karate Kid spinoff series 'Cobra Kai', which had a generally well-received first season. But with two billion users across the globe, YouTube has a huge audience for ad-supported content. Shifting focus to embrace that model may increase the number of viewers for each original show and film.
"If you look at our originals over the last few years, our main goal was to drive subscribers to YouTube Premium," YouTube chief business officer Robert Kyncl told The Hollywood Reporter. "But through experimentation, we've also learned that we can make a lot of the projects work incredibly well when we make them available free to users."
The move to make programming free is also aimed at addressing growing international user interest in original programming and advertiser demand to associate with special content. Kyncl added that they have received advertiser interestaboutprojects that were previously ad-free.