YouTube could become a true cable killer next year

Traditional TV has reason to worry

YouTube may significantly step up its streaming game as soon as next year, overthrowing traditional TV in the process.

Google's video arm is reportedly working on a subscription service that would offer a bundle of cable TV channels streamed online, according to Bloomberg.

It even has a name: Unplugged.

This new 'Tube venture is said to be a major priority for the video site as it looks to bolster ad revenue with subscriptions and contend with Sling TV and Hulu, among others. It already has a money maker in YouTube Red, which offers an ad-free experience for a price, though more premium, cable-generated content would live on Unplugged.

YouTube has reportedly had such an online cable service brewing since 2012, yet now the pedal is on the metal to get it up and running.

Cable clusterf***

YouTube has reportedly already laid the technical groundwork for Unplugged, and it's now dealing with the Achilles heel of similar rumored services from the likes of Amazon and Apple: striking deals with cable companies.

To that end, it's tinkering with different types of bundles with varying levels of plausibility and appeal to content gate keepers.

One is a so-called skinny bundle that would roll together four US networks (think NBC and CBS, for example) with a selection of popular cable channels, similar to Sling TV. It would give users access to channels they presumably watch the most without the fat of those they don't yet still have to pay for with traditional cable.

An issue here, though, is price. Bloomberg notes that cable firms typically charge new providers more for use of their channels than long-standing bastions of the industry. YouTube's interest, obviously, is in keeping Unplugged's price down - as low as $35/month, the report says - so it may not be able to serve up the channels it wants and offer a reasonable rate to users.

Another option is to latch together smaller, less-watched channels and put them into themed categories, such as comedy and lifestyle.

Like add-on packages already seen in TV land, YouTube would charge subscribers one rate for the primary bundle and an extra fee for these themed channel clusters.

If YouTube can sell packages of second-fiddle channels, it could convince cable companies to put their top audience draws (Big Bang Theory!) on Unplugged, too.

As seen on YouTube

Clearly, many questions remain, not least whether YouTube can strike a deal with any cable company, let alone several of them, to piece together a new service.

One plus YouTube has going for it is the sheer number of people who use it. Networks can make all the good shows they want, but they're losing viewers to cheaper internet-based services, like YouTube.

We also can't ignore the question of whether Unplugged will be enticing enough to lure customers accustomed to watching videos for free online and living with whatever their cable fees are away from the traditional set up.

If it was the only service on the market to offer scaled-back, cheaper online streaming, then perhaps we'd be more convinced, but it's not. Whatever Unplugged looks like, it's got to be good and it's got to be cheap to compete.

Despite the uphill climb it's facing, YouTube seems keen to not just be in on, but leading the action. We'll unfortunately just have to wait until next year to see what it has on tap.

Top image credit: TARIK KIZILKAYA/iStock

ABOUT THE AUTHOR

News Editor (US)

As the US News Editor, Michelle (Twitter, Google+) keeps her eye on all things tech with particular interest on phones, tablets and finding out who the people are behind the devices. Any phone that can survive a regular (accidental) drop has her vote for best handset. Michelle previously worked covering local news in the Bay Area and has been with TechRadar since July 2012.