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YouTube to fund premium content, signs film deal

Published 28/04/2015, 14:04
© Reuters. A picture illustration shows a YouTube logo reflected in a person's eye, in central Bosnian town of Zenica
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(Reuters) - Google Inc (NASDAQ:GOOGL)'s YouTube will directly invest in new shows to be launched in partnerships with its four top content creators, it said in a blog on Tuesday.

The world's No. 1 online video website also said it entered into an agreement with DreamWorks Animation SKG Inc unit AwesomenessTV to release feature films over the next two years.

The partnerships would help YouTube, which completed 10 years last week, secure higher quality advertising as it transitions from a repository of grainy home videos to a site with more polished content.

YouTube has been trying to lure more premium video advertising to boost margins as overall prices for Google's ads have been declining.

The website, which attracts more than 1 billion unique visitors a month, far surpassing those of Netflix Inc (NASDAQ:NFLX) and Amazon (NASDAQ:AMZN) Inc, did not disclose how much it was investing or how the partnerships would be structured.

The investment marks a significant change for YouTube, which has been backing its content creators by providing production facilities and small amounts of funds for creators to test ideas.

Reuters reported in July last year that YouTube was in discussions with Hollywood and independent producers to fund premium content.

Under the deal with the content creators, YouTube will stream the new season of "Prank vs Prank", a murder mystery reality show featuring online star Joey Graceffa, comedy show "Smosh" and another one by Fine Brothers.

© Reuters. A picture illustration shows a YouTube logo reflected in a person's eye, in central Bosnian town of Zenica

YouTube and AwesomenessTV, a channel aimed at teens and younger adults known as millennials, expect to roll out their first film this fall.

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