When YouTube recently announced its very own live TV service, called YouTube TV, the internet went crazy. With YouTube TV offering live local TV channels, like ABC, CBS and Fox, as well as cable stalwarts like the Disney Channel for only 35 dollars a month while not forcing people into a long-term contract, many were quick to proclaim the end of cable TV. But is that really going to happen?
First, a couple of facts about YouTube TV: the service is said to be released in the next few months, but will only be available in a few selected US cities. According to YouTube executives it will provide users with an unlimited cloud DVR, the possibility to stream simultaneously on three devices with one account, and content from YouTube Red, an ad-free subscription service. Users will be able to create six different user profiles with separate log-ins per account, making the service super family-friendly. YouTube TV won’t be the first service of its kind though and unlike other services like Sling TV or DirecTV it misses major channels, like CNN, Comedy Central and Discovery. Apparently executives are still negotiating with other program providers, trying to offer their clients the best selection of channels.
At first glance traditional cable TV has one huge disadvantage to the service YouTube TV is going to offer: their long-term contracts. While YouTube TV users will be able to cancel their subscription at any given time and can even pause their contract, people are often discouraged by cable packages binding them for long periods of time. Besides, YouTube TV is going to take over cable TV’s only remaining unique selling point: live event shows. After losing its monopoly on high-quality shows to streaming services like Netflix and Amazon Fire TV, cable TV has been heavily relying on customers switching on their TVs when it comes to watching shows like the Oscars, political debates and major sports events. Now that YouTube TV is going to offer nearly all of that, including college and less mainstream sports, executives of other providers are understandably becoming nervous.
Advertising companies are rubbing their hands. YouTube has the best targeting and measurement for ads in the industry and offers the largest market of young viewers. Consequently, Google is able to demand higher ad prices because it has better data on their users than cable TV companies do. With that money YouTube could soon start to create more and better original content and become even more attractive to viewers. All of that sounds like YouTube TV is going to be cable TV’s biggest competitor yet.
But let’s not forget about the critics who were quick to point out that YouTube TV is not offering anything new and has one major flaw: the fact that it is not going to be available everywhere in the US. The TV companies with whom YouTube are currently negotiating will be careful enough to not dig their own economic grave. So let’s wait and see before we declare traditional cable TV dead.