We’ve seen a lot of press on YouTube Red in the online media (Forbes.com is no exception) and the governing roundup seems to be one of concern: how, exactly, will YouTube get people to pay for something previously considered free? And how, if they do so, will the average YouTube generator—not the sponsored channel with the deal, but the person just putting up a project—get paid?
These are questions consumers and competitors absolutely need to ask themselves, and questions we deserve answers to.
However, what interests me is the question of this decision’s evolution: Why did YouTube seek to do this, and why now? Or, to put it another way: who forced YouTube’s hand into this new modus operandi?
The service has been compared to the subscription models of Hulu and
According to my sources, it’s Apple’s platforms which have necessitated the paying subscription model we’ve come to patronize, not by offering one of their own (they’re relatively late to the party with Apple Music), but by shaping the medium through which paid subscriptions are more frequently utilized: the app-based ecosystem, as viewed on mobile, tablet, and Apple TV, and more.
In fact, as Variety hinted, Apple TV might have as much of a hand in this change as any other platform the company has offered: yes, early iterations of Apple TV weren’t great, and there are obvious problems with the fourth generation. Still, the ethos behind the system is one that everyone has had to take note of—one that seems to be leveraging the marketplace as a whole:
Apple has flouted the idea that the UX behind the basic TV watching experience was inherently broken and needed to change, indeed, that the user experience behind many entertainment practices could be streamlined and enjoyed in a better way. In conjunction with the app-based ecosystem of the iPhone, an immediate hit, many companies took note to operate within this model.
Take a look at the landscape today, and you'll see that PC internet usage is down, while mobile viewership (and consequently, app-based activity—an arms race which Apple arguably started) is on the rise.
I was directed, in my conversations, to consider YouTube not in a vacuum, but in respect to their parent company,
This change, people have told me, indicates two things: that Google’s apparatus has strayed away from their purported plan of aggregating information; and that the way Google has made their money to date is, according to my sources, no longer in a growth stage—it’s in a sustained stage, and in fact, in a stage of decline. Ads have supported Google’s search for a long time. However, the number of people using search engines is in shrinking, signaling, again, a change to how things are done on the web these days.
Even after the launch of many Google services intended to drive us towards their search engine (Google Now comes to mind), the usage has leveled off. This means, in turn, the their ad revenue will not grow.
However, what hasn’t leveled off is so called “Freemium” model: paying for content directly from an app in piecemeal stages, or paying for the app on a subscription plan, which offers you the ability to access all of their content.
So what does this have to do with Apple? I invite you to look up who coined the term “app” in the first place—a shorthand with which we’re all now familiar . In the opinion of many of my sources, Apple’s platform pushed everyone into the new model we see today: the proprietary company delivering its content to you through its app but via the ecosystem Apple envisioned.
In short, Apple has proven they are juggernauts for clients and developers alike; if you’re not displayed on the Apple ecosystem, you’re simply not relevant.
And of course, other companies have competed, down the line, to provide their own ecosystems to house apps. But it all boils down to who started the trend, who pushed the model into fruition.
The model, it seems, is only growing. YouTube’s parents, understanding the shift in the marketplace, are attempting to get ahead of the change while they can - while they’re still making money off the old model. It’s not a bad move, though it does have its one decidedly visible drawback: Hulu and Netflix sell you product that, before their onset, nobody imagined could ever be free (streaming search engines like "alluc" having assumed the mantle of piracy long ago). YouTube’s content, on the other hand, has always been viewed as gratis. This might be a difficult pill to swallow. Then again, thanks to YouTube’s large database of music and music videos, it might make previous giants like Spotify irrelevant. Only time will tell on that front.
