YouTube may show films and TV programmes – but at a price

YouTube is hoping to widen its catalogue from dogs on skateboards and Michael Jackson tributes by showing blockbuster movies and hit television programmes. The only problem is viewers may well have to pay to see them.

Google, which bought the video sharing website for $1.6bn in 2005, is still looking for ways to make the service profitable and, despite several landmark deals with broadcasters this year, is making overtures to bring more premium content onto the site.

So far television and film producers are loath to hand over their most valuable programming as they don't see the advertising-supported model as bringing in big enough revenues.

Senior Google executives have now admitted that they have been in talks with broadcasters around the world and are prepared to countenance bringing in different business models.

David Eun, Google's vice-president of content partnerships, said this week: "We're making some interesting bets on long-form content; not all content is accessible to us with the advertising model."

Dan Cryan, analyst at Screen Digest, said: "This would be a significant departure for YouTube. This might well be an effort to play nice with the content owners because outside the UK they have very little premium material."

Several broadcasters have already put their back catalogues on YouTube but some see such a move as direct competition to revenues generated by video on demand and DVD sales.

The move would bring YouTube more directly into competition with catch up sites such as Hulu, the US-only site which shows full-length programmes including The Daily Show and Family Guy, and is rumoured to be coming to the UK. Many individual broadcasters also have their own online catch-up services, including BBC's iPlayer and ITV Player.

"This is a bid by YouTube to maintain relevance in the growing pressure from Hulu and other online providers as well as with the march of internet-connected TV," Mr Cryan said.

Google has held talks with film studios about the potential for "renting" films via the site, as several studios already have agreements with Apple's iTunes and Amazon, but so far nothing has been agreed.

Google does not report YouTube's numbers separately but Enders Analysis predicted the group would generate between $300m and $400m this year. It is understood not to have made a profit since being taken over but could be on course to break even next year. Yet it is understood that YouTube is not set to unveil a subscription model any time soon and, even if it does, it will probably first be rolled out in the US and restricted to that region. Mr Eun was still backing the free model with support from advertising.

"If we just continued to focus on our advertising model that would be enough opportunity to create meaningful revenue," he told Reuters, adding: "The biggest opportunity today is advertising and we've just begun to scratch the surface."

YouTube has signed landmark deals with broadcasters in the UK this year, with Channel 4 the first to provide its full-length shows, including Peep Show, for free. The partnership, signed in October, was followed by a similar deal with Five.

A source close to the group said that the company had taken calls from interested broadcasters around the world in the wake of the announcements. Although it has emerged that Sky, which charges a subscription for its television services, would not provide full-length programming to YouTube under the current arrangements.

Hits of the year: YouTube reveals UK's most-watched clips of 2009

1. Evian Roller Babies

Some mothers, as they say, do 'ave 'em: roller-skating babies who dance to hip-hop, that is. It is very cute. Well, more than 13 million viewers couldn't be wrong, could they now? The short sequence was created at Pinewood Studios. The bottled water company previously ran an advertising campaign which featured babies performing underwater ballet. Viewers are encouraged to "live young". There is no guidance, however, on whether that includes forcing your infant offspring to roller-skate.

2. Extreme Sheep-led Art

While shepherds watched their flocks by night, all seated on the ground, one of them said "let's make sheep-art" and LEDs shone around. A group of shepherds, perhaps with rather too much time on their hands, took to the hills of Wales armed with a herd of sheep, some sheepdogs and huge numbers of LEDs and filmed themselves herding the animals to create vast pictures of fireworks and The Mona Lisa, among others.

3. YouTube Street Fighter

The series of interactive videos allows players to play a Street Fighter-like game. Viewers are invited to click on buttons to perform "moves", played out on pre-recorded videos to try to knock out their opponents. Among the comments left by YouTube users is: "Have any of you ever been outside?" Still, it has been viewed six million times, so who's laughing now, eh?

4. Damien Walters Showreel

The Derby free-runner posted a video of himself "playing around with some new moves for 2009". The film of Walters jumping off buildings and, bizarrely, managing to strip down to his underwear while performing a series of flips and turns, has been viewed more than five million times thus far.

5. Simon's Cat 'Fly Guy'

Part of a series of animated shorts. Simon's hungry cat darts around the living room chasing a fly while his owner sleeps soundly – blissfully ignorant of the damage being caused to his house as his cat knocks over cups and lamps and rips the furniture to pieces. When the the hungry feline finally catches up with the fly, it shoves it in Simon's mouth in an attempt to wake him up and finally get something to eat. So far, the video has attracted just short of 4.7 million views.

Kevin Rawlinson