With a new live TV service, YouTube is wagering young people are as hooked on their phones for a full TV meal as they are for video snacks.
YouTube TV launches Wednesday, offering a "skinny bundle" of about 50 live TV networks online for $35 a month, starting in Los Angeles, New York, Chicago, Philadelphia and the San Francisco. The service includes a 30-day free trial, and the company will throw in a free Google Chromecast streaming device, worth $35, after your first payment (i.e. after the second month).
Just don't bank on being able to stream it all through the Roku, Amazon Fire TV or Apple TV you already have.
It adds Google's YouTube to the snowballing market for digital live TV, going up against Dish's Sling TV, Sony's PlayStation Vue and AT&T's DirecTV Now, with Hulu expected to follow suit this spring. That means a lot of options if you're looking to drop your traditional pay-TV subscription. The launch also puts the internet giant in competition with traditional pay-TV providers like Comcast and Charter.
YouTube TV undercuts a comparable plan from Sling TV, as well as Playstation Vue's cheapest plan. Both of those are priced at $40. It's also in line with DirecTV Now's low-end plan (although DirecTV Now has 10 more channels).
To set itself apart, Google's YouTube is focusing on two strengths of its massive free video-clip site: Its popularity with younger viewers and its domination of mobile streaming. Yet the emphasis on watching 60-minute shows or a two-hour basketball game on a phone contradicts how people tend to stream traditional TV programming. Customers who are investing a lot of time in a show prefer the biggest screen available.
Netflix, the biggest subscription video service by members, has previously said that about two-thirds of its streaming goes to TVs. Mobile is a small, but growing amount. Hulu says more than 70 percent of its viewing occurs on the living-room big screen, while mobile and tablet watching is about 17 percent.
YouTube TV direct competitor Sling TV says the majority of its viewing hours happen on televisions."We know that many people want to watch their favorite shows on the biggest screen possible, but also want the option to take their TV with them," Sling TV CEO Roger Lynch said.
But from YouTube's vantage point, millennials -- generally defined as people under the age of 35 -- "love the programming on television but they don't love the experience on television," Kelly Merryman, YouTube's vice president of content partnerships, said in an interview. "How we can reimagine the television experience for the new generation?
For YouTube, the answer was a live TV app designed for phones and other mobile devices, with personalization, search and recommendations.
It also meant offering only one way to watch YouTube TV on an actual TV -- using a Google Chromecast to fling your mobile viewing onto the big screen. (That free Chromecast makes a lot of sense now, right?)
Even with shorter-form video presented like it's live, bigger screens dominate, according to Pluto TV, a free live-TV-like service that strings together digital videos into bespoke channels. Its users, which skew young, will watch for more than an hour per session.
"Because our viewers love to lean back for long periods of time, more than half our viewing occurs on big screens like connected TVs and laptops," CEO Tom Ryan said.
YouTube TV is also available to watch on laptop and desktop computers, which for many young people equates to the biggest screen in the house.
But at launch, YouTube TV doesn't have support for other streaming devices like Roku or Amazon Fire TV, even though those products are more popular than Chromecast. According to the most recent data from researcher Parks Associates, Roku was the most-purchased line of streaming media players in the US, with a 30 percent share. Amazon's devices just beat out Chromecast, with a 22 percent of sales compared with Chromecast's 21 percent. Apple TV followed at 20 percent.
When CNET asked why YouTube TV is emphasizing mobile even though consumer behavior seems to go the other way, YouTube said that more device support was coming.
"We do believe in the living room," Christian Oestlien, YouTube TV's director of product management said. "We'll continue to add more device activations."
In the meantime, YouTube TV will keep hoping that younger viewers can fill up their bellies watching on rectangles six inches long or less.
First published March 5, 1 p.m. ET.
Update, 1:56 p.m.: Adds Pluto TV comment.
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