Brandon Katz, a senior entertainment industry strategist at Parrot Analytics, said the move is just another step in YouTube’s ongoing efforts to create a diversified ecosystem with multiple access points and flexible pricing that solves for a variety of consumer needs.
He referenced how YouTube Premium surpassed 100 million subscribers globally last year.
“Company executives likely believe a small portion of that audience and/or a percentage of prospective subscribers will be interested in the premium lite version, adding yet another monetization tool to its ever-growing product suite,” Katz said. “In success, this could also help create a second pool of subscriber-driven revenue with which to pay creators, as ad revenue comprises the bulk of that currently. In failure, this likely isn’t a hugely capital-intensive effort for the company. Why not experiment?”
Katz said that the development comes during a time in which competitors are ramping up their own varied revenue-sharing efforts.
For instance, Netflix is reportedly interested in complementary podcast content and has already been partnering with brands like Nike for lifestyle content. Meanwhile, Spotify is pushing further into video and considering a VIP concert ticket program.
“In this industry, stagnation is unacceptable,” Katz said.