Market Insight

Google adds Weinstein films to YouTube

January 14, 2011

Laura Aguilera Laura Aguilera Senior Research Analyst, Service Providers & Platforms

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Google quietly secured film titles from the Weinstein Co. for its YouTube rental service. Twenty Weinstein catalogue titles including Scary Movie 4, Hannibal Rising, and Death Proof are now available for rent on YouTube for $2.99 per film.

Until this point Google's YouTube rental services have been limited to independent films and shorts, due to a lack of copy protection required by studios who want to protect their big budget revenue streams and Google's refusal in negotiations to commit significant dollars up front, in favour of pure ad-revenue shares.
The selection of titles reflects just how much Google is willing to pay for 'premium content' at this stage of its development. For Weinstein, this deal should bring some additional revenue from twenty catalogue titles which otherwise would not have been generated. However, the size of the opportunity presented by YouTube rentals is actually pretty small despite the site's impressive reach. The reality is that, even on sites where audiences are used to paying for traditional, physical media, such as Amazon, unless the paid digital content service is part of a hardware-plus-content ecosystem then the digital service typically struggles to gain any significant traction. For YouTube, where the primary use of the site is free video, the challenges associated with converting the user base to paying customers are likely to be even more pronounced.

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