Internet Streaming Services Like YouTube TV Trying Hard To Become Profitable

The transition from conservative cable TV to streaming channels is already underway, but it is being said that these mergers of media will eventually raise the cost of the new services and would make it difficult to generate revenues and boost profits. Advertisements are seen as a resort to achieve these targets and make the services more profitable.

Internet streaming services like Youtube TV and Sling are working hard on boosting revenues to make their working modules profitable. According to the sources, the networks are being paid by Youtube TV a monthly fee of $49 per subscriber for the basic package. For this, the companies charge a fee of $40 per month.

Network Deals:

Also, deals with the networks are only getting expensive and would increase by 7% year on year for the programming costs for the Internet TV services. Earlier this year, the prices were increased from $35 to $40 by Youtube TV already for it’s the cheapest offering, and this has helped to some extent to compensate for the expenses.  The remaining difference is expected to be made up of their advertising revenues, however, they have not been able to make the same work yet. The high prices are said to be due to cost structures of legacy and some existing deals which continues to keep the cable channel prices high.

As a resort to boost revenues, Google has turned towards advertising which is its traditional style. As per the estimates made from an industry executive, the advertising revenues that are generated can be as high as $8 a month for every user, and it’s also said that Youtube TV is expecting this figure to double up gradually. About 2 minutes of ad space is being able to be sold by the seller for every one hour on the cable network that it carries. This would eventually cover the losses they incur in programming and certain other expenses.

Google has reportedly said that they are amazed to see how Youtube TV has grown in the past six months. It’s a huge achievement to gain half a million subscriptions in just about 6 months, and are confident to see the numbers growing.

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