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YouTube eyes subscription-based services for content providers

CEO Salar Kamangar says YouTube could eventually allow content providers to offer subscription-based video.

YouTube's new homepage.
YouTube's new homepage.
Greg Sandoval/CNET

Although advertising has been the most-desired way for YouTube to generate revenue, the company is reportedly considering another way to rake in cash.

Speaking at the D: Dive Into Media conference last night, YouTube CEO Salar Kamangar said his company is considering allowing content providers to create their own, unique subscription-based video service on the site, according to GigaOm, which attended the event in Dana Point, Calif. That said, Kamangar reportedly cautioned that YouTube has yet to decide if it will, in fact, launch such a service and hasn't even gotten to the point of determining how it could be implemented.

Even so, subscription services on YouTube could be a major opportunity for the video site. As Kamangar said during his interview at the conference, YouTube currently has over 800 million active users, giving content providers a huge audience to capitalize on. What's more, YouTube announced last month that its daily video viewership has soared past 4 billion clips, up from 3 billion in May, indicating that its user base is becoming increasingly engaged.

Despite that, YouTube has floated the idea of launching subscription services in the past, but has so far balked at the idea. In fact, nearly three years ago, Google then-CEO Eric Schmidt said subscriptions could eventually be used to supplement advertising revenue on the site.

"With respect to how it'll get monetized, our first priority is on the advertising side. We do expect over time to see micropayments and other forms of subscription models coming as well," Schmidt said during an earnings call in 2009. "We'll be announcing additional things in that area literally very, very soon."

Part of YouTube's success over the years has, of course, been user-generated content. But YouTube has also incorporated professional content, including movies. A few months ago, YouTube also announced an initiative that will see the company spend up to $100 million to create original content for the site. YouTube has signed up actor Rainn Wilson and comic book writer Stan Lee to work on the content.

Last year, YouTube also launched a site redesign, centered on "Channels" that surface content people want. The update also includes social-networking features to help content hit sites like Facebook and Google+ and go viral.

YouTube is changing. And it's not your old-school video site any longer.

(Via GigaOm)