Commentary

YouTube Expands Into More Markets -- Will Price Competition Follow?

This post was previously published in an earlier edition of Video Insider:

In late July YouTube, already the 800-lb. gorilla in video, raised its ambitions even more by offering its YouTube TV streaming service in another 10 U.S. markets. That makes a total of 15 YouTube TV markets.

YouTube said consumers will be able to access live TV from ABC, CBS, FOX, and NBC in all the additional markets except for the Dallas-Fort Worth market which has CBS, FOX, and NBC but has only on-demand prime-time programming from ABC. Those feeds are considered a value-add and differentiator in an already crowded market for streaming video services.

YouTube TV was initially only available in L.A., New York, Philadelphia, Chicago, and the San Francisco Bay area. Now,it's also available in Washington, D.C., Houston, Atlanta, Phoenix, Detroit, Minneapolis-St. Paul, Miami-Ft. Lauderdale, Orlando-Daytona Beach-Melbourne, Charlotte, and Dallas-Fort Worth.

YouTube TV, of course, is competing against services like Sling TV, PlayStation Vue, DirecTV Now, and Hulu’s Live TV service. All offer roughly comparable programming. 

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However,  the company seems to be making an attempt to target younger viewers: those who are already accessing video on YouTube vs. television. Nielsen data indicates that more than half of YouTube TV viewers are 13- to 34-year-olds -- a rather high percentage of a younger audience segment.

Meanwhile, YouTube is touting a lower price compared to cable offerings. For example, YouTube TV is around $35 per month, which is less than half of the average cable subscription.

But that's not a new claim. The other streaming services try to pack as much programming in their packages as possible, too. They also tout the price differential.

YouTube TV's price is comparable to rival services including SlingTV and Hulu Live. It's unclear whether price wars among the streaming services are imminent and if they will make a difference in causing consumers to switch around.

Of course some people already subscribe to more than one service and the cost quickly adds up. Are we headed into price wars for streaming video services, same as the cable TV wars and for mobile data service plans? Wait and see.

1 comment about "YouTube Expands Into More Markets -- Will Price Competition Follow? ".
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  1. Ed Papazian from Media Dynamics, September 12, 2017 at 8:11 a.m.

    What YouTube is actually doing, Tobi, is helping the TV programming "Establishment"---the broadcast TV networks, their stations and owned cable channels ----invade the digital arena and add another revenue stream to their coffers. Also, one wonders whether YouTube, after it pays its content suppliers, makes any profit with this venture or, if that's the end game, how many millions of subscribers will it take for YouTube to be in "the black"?

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