YouTube is launching an online streaming video store and is in talks with entertainment companies to engage their participation. Internally referred to as a “channel store,” it could reportedly be open for business as early as this fall. Currently, subscribers who pay $64.99-a-month for the YouTube TV package of cable channels can add services such as HBO Max. The new marketplace would let consumers add streaming services a la carte via the main YouTube app. YouTube, a division of Alphabet-owned Google, will be competing with platforms including Amazon, Apple and Roku, which all have hubs that sell streaming video services.

The ability to purchase multiple program services through a single app is generally viewed as a convenience for consumers. While the companies that host streaming hubs typically get a cut of revenue from purchases within their portals, YouTube is said to be in discussion about splitting subscription revenue with at least some of its potential streaming partners. Terms may vary depending on the deal cut, according to The Wall Street Journal.

“This is now maybe the single most popular idea in the streaming business,” suggests The Verge. “Tech companies, particularly those who have tried to make their own original content and seen how hard (and expensive!) it is to do so, are deciding they’re better off handling everything but the shows and movies.”

As streaming video services face greater competition and slower U.S. growth, opportunities such as the YouTube offering are another way to gain visibility with potential customers.

WSJ reports that NBCUniversal’s Peacock is among the platforms actively exploring the addition of third-party streaming services to its app. “Walmart is contemplating adding streaming services as a new perk to its membership program,” WSJ says, adding that “Netflix Inc. and other streaming services have agreed to be part of Verizon’s new Plus Play subscription manager, which lets customers sign up for and manage their streaming services through the connectivity company’s interface.”

YouTube is pitching itself as a great environment for a channel store because consumers who already use it to watch free trailers could then easily click onto a subscription plan. The downside for third-party services is less control over customer data, as well as adding a revenue-sharing partner.

Last year, HBO Max was yanked from Amazon Prime Video channels, reportedly because the company no longer wanted to give Amazon direct access to its customers. “At the time, 4.5 million of HBO Max’s 70 million subscribers came from Amazon channels,” WSJ writes, noting that HBO Max’s new owner, Warner Bros. Discovery, is currently negotiating to get the streamer back on Amazon Prime.

Overall, “more streaming services are looking to bundle because it creates a better experience for consumers and they are less likely to cancel subscriptions, said Jeffrey Hirsch, president and chief executive of Starz, which has bundled its streaming offering with Walt Disney Co. in Latin America and Canal+ in France,” WSJ reports.

“A channel store makes perfect sense for YouTube, and it’s been a long time in the works. The Information reported on a similar plan way back in early 2020,” according to The Verge.

Related:
Walmart Strikes Exclusive Streaming Deal to Give Paramount+ to Walmart+ Subscribers, CNBC, 8/15/22