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YouTube Latest Outfit To Launch Web-TV Service; Several Sports Offerings Included

YouTube yesterday "unveiled a web-TV service that will offer a package of over 40 broadcast and cable channels for $35 a month," making parent company Google the "latest entrant in a race to win over millions of consumers who are shifting away from traditional TV," according to Nicas & Ramachandran of the WALL STREET JOURNAL. YouTube TV will "have all the major broadcasters, including ABC, CBS, NBC and Fox, as well as several dozen well-known cable channels, such as ESPN, FX, USA, MSNBC and Fox News." Nicas & Ramachandran note none of the existing web-TV offerings so far "have been runaway successes, with some, such as DirecTV Now, facing technical hiccups and other issues early on." For Google, the new service is an "opportunity to build YouTube into a bigger contributor to its business and put itself once again at the center of changes in commerce and media consumption." The $35-a-month price is "aggressive, given the premium content costs for new entrants into television distribution." MoffettNathanson Senior Research Analyst Michael Nathanson said that Google will "likely be paying about $30 in content costs with its current TV lineup." Nathanson said Google's primary play with YouTube TV is to "break into the in-home and television advertising market" (WALL STREET JOURNAL, 3/1). CNBC's Michelle Castillo noted the subscription covers a "family plan of up to six accounts." There are currently "no plans for international service" (CNBC.com, 2/28). In N.Y., Daisuke Wakabayashi writes YouTube is now "wading into the complex web of broadcast television, which has tripped up other technology companies seeking to break the grip of pay TV providers." YouTube "did not announce a specific start date," and the company said that it "would roll out the service first in markets where it had secured rights from local affiliates." It "did not identify those markets" (N.Y. TIMES, 3/1).

NEW FORTE: Research firm eMarketer Senior Analyst Paul Verna said, "If any of the live TV services ... has the potential to bring television into the digital age and make it relevant for Millennials, this might be the one." In S.F., Wendy Lee notes YouTube TV also will include Fox Sports, NBC Sports and Comcast SportsNet (S.F. CHRONICLE, 3/1). The FINANCIAL TIMES' Hannah Kuchler writes YouTube TV "leans heavily towards sports -- with 10 sports channels including ESPN" (FINANCIAL TIMES, 3/1). In DC, Brian Fung writes the service "comes with a strong array of broadcast network channels," though Viacom "appears to be absent from the lineup." YouTube TV also "lacks some notable cable channels," including CNN, HBO and Cartoon Network. BTIG media analyst Rich Greenfield said, "It's missing a heck of a lot of content that people watch" (WASHINGTON POST, 3/1). The HOLLYWOOD REPORTER's Natalie Jarvey noted the package is missing cable channels from Time Warner, Scripps and Viacom, but it will "include Showtime as an add-on for an additional fee" (HOLLYWOODREPORTER.com, 2/28).

CHALLENGES TO OVERCOME
: RE/CODE's Peter Kafka noted YouTube TV will "sit in a new, standalone app." It is also "supposed to be 'mobile first.'" However, users should be "aware that all of the digital TV services still have gaps in their coverage," usually around NFL games. Deals with local affiliates, or the lack thereof, "may affect your ability to watch your local NFL team play next fall." None of the streaming TV services will "let you watch football on your phone, because those rights, for now, are exclusive to Verizon" (RECODE.net, 2/28). In L.A., Meg James notes Google is "taking direct aim at traditional television operators by designing a service that appeals to younger people who consume much of their entertainment on smartphones and who already spend countless hours watching YouTube videos." YouTube's name recognition and Google's technology and deep pockets could "give its service a competitive advantage" (L.A. TIMES, 3/1). VENTURE BEAT's Ken Yeung wrote, "While it might be simple to think that YouTube is just incorporating content from TV and cable networks, there’s more to this story -- specifically leveraging the online video service’s machine learning and personalized recommendation to surface the right shows you might be interested in" (VENTUREBEAT.com, 2/28). BTIG's Greenfield noted YouTube Red content is included in YouTube TV's subscription, but there is "no YouTube Red sub." There also will be "ad-skipping on all DVR content" (TWITTER.com, 2/28).

TWITTER REAX: YouTuber Philip DeFranco tweeted the service has a "huge upside for creators" that "could bring us to the next level." YouTube TV "could change the whole game." Former Recode editor Dawn Chmielewski‏: "YouTube not offering any hints about which big markets will get TV first. Pardon the pun, but stay tuned." Mobile app company Livefront's Josiah Austin Gulden: "Alphabet getting here first may be the biggest pantsing in Apple history." Marketing agency ZATO's Kirk Williams: "Me then: 'CABLE IS A RIPOFF!' Me now: Youtube TV: $35 Hulu+ (No Ads): $12 Netflix: $10 Amazon Prime TV: fuzzy TOTAL: ~$60 Dang it."

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