Google is in negotiations with Hollywood’s top film studios to release a pay-per view video service on YouTube by the end of 2010.
While such negotiations have been ongoing for several months, they have now intensified due to the increasing competition between media and technology companies over the digital distribution of film.
Google has been promoting the huge popularity of online streaming media. YouTube attracts millions of users and while it is best known for its user generated content, Google sees the ability to stream Hollywood movies as being a new breakthrough for the video website.
“Google and YouTube are a global phenomenon with a hell of a lot of eyeballs – more than any cable or satellite service,” says an anonymous executive who spoke to the Financial Times.
“They’ve talked about how many people they could steer to this … it’s a huge number.”
Reportedly, viewers in the US will stream movies for $5 for new titles, which will be available at the same time as the movie goes on sale on DVD and iTunes.
YouTube has already been beta testing film rental previously. It tested it for a small amount of independent films from the Sundance Film Festival.
While it was not a financial success, Google expanded the service to include a larger range of titles, but was still not a real competitor to existing services from iTunes or Amazon Video on Demand.
The negotiations follow rumours that Apple may be unveiling improvements to its TV device, which connects television sets to the internet. They also want to open it up to apps. Due to the massive popularity of YouTube, they could potentially open up a huge new market.