For many viewers, YouTube is TV now. What that means for Hollywood
Netflix rightly gets a lot of the attention for winning the streaming wars, but that obscures the dominance of what is the leading online entertainment player for many viewers: YouTube.
The platform, which just turned 20 years old, has for some time been the most-watched streamer on U.S. TV screens, according to Nielsen.
YouTube, which the vast majority of people watch for free, accounted for 10.8% of television viewing in January, again besting Netflix, Disney's streaming suite and Amazon's Prime Video in terms of engagement.
As much of the streaming landscape has settled along established battle lines, YouTube is still growing fast.
Streaming hours on YouTube, including the YouTube TV live television service, increased 27% in 2024, making it 'by far the largest contributor to overall streaming growth' in the U.S., according to MoffettNathanson. Meanwhile, viewing hours for the top tier of subscription streaming services (Netflix, Amazon, Hulu and Disney+) rose just 8%.
All that viewing has translated into ad dollars for parent company Google. YouTube's quarterly advertising revenue hit a record of nearly $10.5 billion, up 14% from the same period a year earlier, the company said this month. It was the first time YouTube's ad sales surpassed $10 billion in a single quarter.
The larger point has to do with how customers view YouTube and advertising-supported streaming more broadly.
For many, YouTube isn't competing with traditional television; it is television.
Once best known for cat videos and quirky short-form comedy sketches, YouTube evolved over the years to encompass sports, dramas, three-hour video podcasts and shows for preschoolers, including the ubiquitous 'CoComelon' and 'Ms. Rachel.' It's how people catch up with the stuff they used to watch in real time, like the presidential debates and 'Saturday Night Live.' It's the 'everything store' of video. (My colleague Wendy Lee wrote a comprehensive piece about this last year.)
In a recent blog post, YouTube Chief Executive Neal Mohan said that TV screens are now the primary way people watch the service, surpassing mobile devices.
Netflix and other subscription-based streaming services are starting to look a little more like YouTube. 'Ms. Rachel' is now a top-10 show on Netflix. Having noticed the success of creators such as Alex Cooper of 'Call Her Daddy,' Netflix reportedly is looking at video podcasts as a potential growth area. Music service Spotify also is taking steps to boost its video podcasting business.
With around 8 million YouTube TV subscribers, the company is the fourth largest multichannel video distributor in the country, behind Charter's Spectrum, Comcast Xfinity and DirecTV. But being the new TV brings some of the old TV's headaches.
Over the weekend, YouTube and Paramount Global resolved a carriage dispute that would have resulted in a blackout of channels including CBS Sports, BET, Comedy Central, Nickelodeon, TV Land and Los Angeles broadcast stations KCBS-TV Channel 2 and KCAL-TV Channel 9. Terms of the deal were not disclosed.
Paramount wanted higher fees for its programming and to preserve carriage of its networks. As the sides haggled, YouTube said it wanted to avoid having to pass cost increases on to its customers. In general, pay-TV distributors want programmers to give them more flexibility to offer smaller, more targeted packages of channels, rather than the old-school, one-size-fits-all bundle.
YouTube TV recently raised its subscription price 14% to $83 a month, up from $73, provoking ire from cord-cutters who had signed up hoping to save money by circumventing the cable companies. The costs of operating YouTube TV increased after it took over the NFL's 'Sunday Ticket' subscription offering in 2023 from DirecTV.
A Paramount spokesperson on Saturday said the new pact 'features an expanded streaming relationship, with the ongoing inclusion of Paramount+ With Showtime and BET+ among YouTube Primetime Channels and providing Google the right to make Paramount+ available to qualifying YouTube TV customers.'
'We look forward to extending our long-standing partnership and giving audiences greater access to their favorite programming,' the spokesperson said.
YouTube, in a blog post, said the deal 'will enable more user choice in the future' but did not give specifics. 'To our subscribers, we appreciate your patience while we negotiated on your behalf,' the company said.
Carriage disputes are nothing new, but they have increased in frequency, as my colleague Meg James has reported. And YouTube is no stranger to them. In 2021, a contract fight between YouTube TV and the Walt Disney Co. resulted in a brief blackout of ESPN and other channels.
YouTube's power comes from its ability to offer a massive range of content, mostly for free, including the deep well of do-it-yourself material that made it popular in the first place. Audience behavior surveys suggest that this is still an advantage, as young people including members of Gen Z prefer user-generated content over Hollywood productions. The low cost and the constant barrage of new material are surely factors.
On this front, YouTube faces some real competition in the form of TikTok, which took viral video and personalized recommendations to a new level. YouTube launched its own TikTok rival, YouTube Shorts, several years ago.
Artificial intelligence is sure to enable an explosion in user-generated videos, with tech platforms racing to harness the trend, in what will likely be the next streaming war.
As the traditional Hollywood distribution model reels from future shock, there are some who predict that the next generation of independent, punk-rock film artists will find success on YouTube and other freewheeling platforms. Experimental filmmakers need their own outlets at a time when the established players are increasingly risk-averse.
If YouTube is a proxy for the convergence of tech and entertainment, the future is both similar to TV and quite different at the same time.
Leonard Cohen's estate sues onetime attorneys for malpractice, citing fraud and forgery. In 2022, Cohen's children successfully sued to remove Robert Kory, the late singer's manager, as trustee of Cohen's estate. Now the 'Hallelujah' singer's estate is suing the law firm that handled the trust.
L.A.'s classical KUSC will merge programming with San Francisco sister station. Starting this summer, KUSC and the Bay Area's KDFC will combine their radio programming and on-air staffs. Cost-cutting is not to blame, leadership says.
FCC launches effort to 'root out' DEI programs, beginning with Comcast. The agency's chairman, Brendan Carr, is concerned that diversity, equity and inclusion programs at Comcast and NBCUniversal fostered discrimination, which is forbidden under FCC rules and federal laws.
Hollywood writers say AI is ripping off their work. They want studios to sue. Several film and TV writers say they are horrified their scripts are being used by tech companies to train AI models without writers' permission. They are pressuring studios to take legal action.
ICYMI:
$100 million
Disney and Marvel's 'Captain America: Brave New World' launched with a better-than-expected $100 million in the U.S. and Canada over the four-day Presidents Day holiday weekend, despite poor reviews from critics. It generated $92 million internationally, for a global debut of $192 million.
It's a high-stakes film for the Marvel Cinematic Universe, an attempt to hand off one of the franchise's most beloved monikers to Anthony Mackie's longtime character Sam Wilson (a transfer that happened at the end of 2019's 'Avengers: Endgame' and was reckoned with in the Disney+ show 'The Falcon and the Winter Soldier').
As that last sentence demonstrates, the MCU has become increasingly confusing over the years, and much less consistent commercially and creatively after the box-office achievement of 'Endgame.'
But the solid, if not stellar, opening for 'Brave New World' suggests there was pent-up demand for Kevin Feige, et al.'s, money-making machine after the studio put out just one movie last year: the highly successful 'Deadpool & Wolverine.' That movie was less a continuation of the series and more a takedown from within of Disney's unwieldy superhero apparatus.
Watch out for how well 'Brave New World' holds up next week, which will depend on how positive or negative the word-of-mouth chatter is. A 'B-' grade from CinemaScore (quite low for an MCU release) is not a great sign, but we'll see.
The latest weekly local on-location production data from FilmLA.
Read: Inside the Murdochs' succession drama (New York Times); James Murdoch on mind games, sibling rivalry and the war for the family media empire (the Atlantic).
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