Google Inc. recently fronted $100 million in order to have original video content produced for dozens of new YouTube channels. The technology giant is finalizing agreements with media companies such as News Corp.’s ShineReveille, which produces “Ugly Betty” and “The Office,” and Warner Brothers as well as retired professional skater Tony Hawk. In addition, many other content producing agreements are expected, including with IAC’s Electus, the producer of VH1’s “Mob Wives,” and RTL Group’s FremantleMedia Lrd., which produces “The X Factor.”
With the offer of cash advances on the table, over 150 potential content producers were invited to pitch their services to YouTube. The video giant is fronting anywhere from hundreds of thousands of dollars to millions of dollars to each content partner in exchange for the monthly production of several hours of content.
According to the Wall Street Journal, unnamed sources revealed that the new channels are expected to launch next year. Google hopes to recoup the $100 spent to produce the content through advertising revenue, which will be shared with content producers.
Although they would not specifically comment on the WSJ’s report about the video giant’s content generation agreements and new channels, a YouTube representative noted:
“We’re always talking to content creators and curators of all kinds about building audiences on YouTube. The more engaging, high quality content they bring to the site, the more content there is for YouTube users to enjoy.”
Since acquiring YouTube in 2006 for $1.6 billion, Google has been seeking innovative ways to monetize the popular video site. YouTube’s new channels will compete against streaming services such as NetFlix and Dish Network that allow people to watch online video streaming on their home TVs as well as tablet and smart phone services such as the Amazon Kindle Fire that allow people to view shows and movies on their mobile device.