Reports have surfaced that YouTube may soon be adding full-length movies from current DVD releases to the site, but customers are actually going to have to pay to watch these new videos.

Up until recently, YouTube was known as the site where people uploaded videos of their pets, children, themselves and everything else you can possibly imagine.  It has also been well-known for being a source of free entertainment, but all of that may change soon as Google, the parent company of YouTube, is in talks with major Hollywood studios to bring newly released movies to the service.

According to The Wall Street Journal (registration required), YouTube has been in negotiations with Lions Gate Entertainment Corp., Sony Corp., Metro-Goldwyn-Mayer Inc. and Warner Bros. about streaming recently released DVDs on the Google-owned site.  The plan calls for movies to be available on YouTube the same day they are released to DVD and Blu-ray, but instead of the normal free format, the majority of them would be presented under a new rental format.

Users of the site would be able to rent the films, for how long isn’t stated, and watch them on their computers.  Some films would also be presented under a revenue sharing format supported by advertising, the current method most videos are shown on the site.

The purpose of this new plan is two-fold as YouTube wants to take on the likes of Netflix, while the movie studios are looking for ways to generate new revenue as DVD sales have been on the decline for the past few years.

The new service was due to launch as a beta test for 10,000 Google employees this month, but it has been delayed due to the continuing negotiations with the studios over the finer details of the arrangement.  Once it is finally approved, the selected employees are scheduled to test the new service for three months prior to it being made available to the general YouTube community.  There is currently no time frame in place that indicates when all of this will begin to happen, but it seems like it should be fairly soon.

YouTube is the undisputed king of the online video sites, but it has been doing quite a bit as of late to make sure it doesn’t allow the likes of Hulu to catch up with it.  While Hulu has been streaming full-length films since the day it opened, they are not current releases, this move by YouTube would be a definite boon to keeping the site on top of the online video space.

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Entry was posted on Thursday, September 3rd, 2009 at 2:33 pm under YouTube.

Read more entries by Sean P. Aune.
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