YouTube Adds Full-Length CBS Content

Select Cable and Network Shows Will Contain In-stream Ads

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NEW YORK ( -- YouTube is getting its Hulu on. The Google-owned video site has partnered with CBS to air full-length TV shows, starting today.
CBS will sell pre-roll, mid-roll and post-roll ads and YouTube will get a cut of the revenue.
CBS will sell pre-roll, mid-roll and post-roll ads and YouTube will get a cut of the revenue.

For now a select group of old and new shows will appear, including "MacGyver," "Star Trek" and the original "Beverly Hills 90210," the season premieres of Showtime's "Dexter" and "Californication," and current episodes of "The Young and the Restless."

Spurred by rivals' site
Over the past year YouTube has dabbled in full-length TV content with documentary films and premieres for Showtime and HBO shows. Jordan Hoffner, director of content partnerships, said the move was spurred on by the success of those early trials but acknowledged that other sites such as Hulu, a joint venture between NBC Universal and News Corp., and had proved there is a market for this kind of online video.

"This is the first time we're putting on full-length content from a partner on a consistent basis," said Mr. Hoffner. Other partners are likely to join shortly, he said.

The content will be ad-supported by pre-roll, mid-roll and post-roll ads. CBS will sell the ads and YouTube will get a cut of the revenue, although YouTube declined to specify the terms of the revenue-sharing agreement.

CBS's video distribution strategy, including this new one with YouTube, has been one of syndication -- doing deals with many sites but using technology that allows it to serve advertising to those sites. Under the strategy, about half of its web-streaming traffic comes through its distribution partners asopposed to its own site, CBS didn't partner with NBC and Fox on Hulu because it doesn't want to give up 30% of the revenue it would have generated, as per Hulu's required split; CBS instead has done some 80%-20% revenue-share deals with its partners.

Launched new player
YouTube also launched a new player for the longer-form content, called Theater View, which plays video in a higher-quality 16:9 format so it looks less pixelated. "When you go to full screen you can actually kick back and watch it," said Shiva Rajaraman, senior product manager.

Mr. Rajaraman said YouTube is "very much committed" to in-video overlay on short-form video. But, he said, "on this type of content we believe customers accept and the content experience merits in-stream ads."

The video-sharing site dwarfs other video destinations. According to ComScore, Google sites, which primarily include YouTube, accounted for 44.1% of online videos viewed in the U.S. in July, up from 34% in May. The next closest competitor was Fox Interactive, with a share of 3.9. Hulu, which launched in February as almost the anti-YouTube, offering full-length, professionally produced programs from both its parent companies as well as other media companies, had a 1% share.
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