The latest rumors coming out of The Wrap suggest that YouTube's new movie rental service (one of the worst-kept secrets of the web) is being held up by two or three Hollywood studios that have yet to ink a deal with the video giant. The studios in question are Fox, Paramount, & Disney. Their reasons for not wanting to partner with YouTube? Piracy.
It's easy to just assume that revenue is the culprit in deals like this--that studios might be concerned about getting their fair share. Release dates is another obvious possible roadblock, since Hollywood has wrestled with rental services over street dates for years. But apparently... neither of those are the sticking point. Instead, it's all about piracy.
But it's not "piracy concerns" in the traditional sense. By that I mean... it's not that the studios are afraid that people will pirate their films straight off of YouTube. It actually has more to do with what the studios view as complacency on YouTube's part.
From The Wrap's article:
"Executives at the hold-out studios have a common reason for doing so -- they believe that YouTube and its parent, Google, have not taken adequate steps to stop supporting piracy sites. Their senior executives have told the internet behemoth that it needs to stop supporting pirate sites by linking them in searches and advertising on them, according to an individual with knowledge of the discussion."
Surely the "linking them in searches" part pertains to YouTube's parent company, Google, right? Because to my knowledge, YouTube searches only return YouTube pages. And the advertising bit... I think is also about Google, whose display network surely places ads on sites related to piracy.
Reading between the lines, then, it sounds to me like the studios are trying to use YouTube's desire to build its own rental service as leverage to get Google to do something Hollywood has wanted for years: removing piracy URLs from its index and banning piracy-connected sites from being part of the Adsense and Adwords programs. At least... that's what it sounds like to me.
And I'm not sure how far Google's willing to go with that one, because taking sites out of the index is a slippery slope.
In truth, the studios might have more leverage if they just attacked the pirated movie content that already lives on YouTube. As The Next Web pointed out earlier this week, there are gobs of illegally pirated movies available--in full--on the site. In prepping their article, TNW found several complete films on YouTube, including Toy Story 3, Tron Legacy, Finding Nemo, Alice in Wonderland, and more. Of course, since TNW published their piece, all the examples they listed have since been pulled by YouTube. But their implied point was that maybe YouTube's Content ID and other copyright-defending methods aren't working as well as we thought.
And if I'm a Hollywood studio, I might be more worried about that kind of thing than anything else. After all, why would someone pay to rent my movie on YouTube when they can watch it for free on YouTube? People who consume pirated video content have already shown that, while they're willing to pay for content in the right circumstances, they're almost always going to go the "free" route if one exists. And we haven't even talked about how easy it is to rip videos from YouTube, which might make this rental store a new source for pirates to find and steal movies.
But this new rental service will happen, I'm convinced, and YouTube will eventually line up all or most of the studios as partners. Why? Because there's too much dang potential in YouTube... potential eyeballs, potential rental revenue, long-term potential for selling digital copies of films. The studios may be paranoid, but they're not dumb. Sooner or later they'll work out some kind of deal, because they want a slice of those 2 billion video views YouTube is serving up every day.
Oh, and if they don't... then YouTube will eventually just start making their own movies and tv shows, and cut the studios out of the loop altogether.