WSJ: Studios Discussing Movie Rental Streams with YouTube2 Sep, 2009 By: Erik Gruenwedel
Hollywood studios Sony Pictures, Lionsgate and Warner Bros. are reportedly in negotiations with YouTube to offer rental downloads on new release movies, according to a report in The Wall Street Journal.
The social video behemoth owned by Google would join Apple iTunes, Amazon and Netflix in offering digital movie files on a rental basis starting from $3.99 per title.
The move comes as studios, grappling with declining sales of new-release DVD movies, explore alternative distribution strategies that include offering new releases to $1-per-day rental kiosks and cable video-on-demand (VOD) the same day as the standard-DVD and Blu-ray Disc releases.
A YouTube spokesman remained coy, telling the Journal the Web-based video portal continued working to expand upon “its great relationships with movie studios and on the selection and types of videos we offer our community.”
YouTube, which reportedly already has ad-revenue deals in place with select studios, would take another step ingratiating itself to studios.
YouTube in 2007 was sued by Viacom (owner of Paramount Pictures, MTV and Nickelodeon) for $1.1 billion, the latter alleging that more than 150,000 unauthorized clips of copyrighted programming had been available on the site.
The Journal reported that Google would test service on about 10,000 employees beginning sometime shortly, citing sources familiar with the negotiations.
Representatives from Sony Pictures, Lionsgate and Warner were not immediately available for comment.