YouTube's Hollywood Investments To Stay Flat By 2020: Report

Google is pausing its Hollywood investment growth meant to generate content for streaming service YouTube Red, Bloomberg reports, citing sources familiar with the move. The Mountain View, California-based tech giant is understood to have halted additional investment efforts in YouTube Red for the next two years, confusing some of its existing partners regarding its long-term strategy. While YouTube didn't directly deny those claims, its Chief Business Officer Robert Kyncl said the company will continue to invest in YouTube Red Originals over the next 12 months. Insiders suggest continuous investments were never in question but their growth was, with Google's subsidiary now supposedly opting to maintain the current level of its financial commitments to the TV show and movie industry at a time when all of its largest rivals are aggressively ramping up their spending in the field.

Sources are saying YouTube will part with several hundred million dollars in its pursuit of new original movies and TV shows over the course of this year. Its flat spending may be indicative of widespread corporate skepticism in regards to the prospects of its streaming business. Originally launched in late 2014 as YouTube Music Key, the on-demand video streaming service was rebranded into YouTube Red a year later. The company is now seeking to merge its video offering with Google Play Music at some point this year but is presently operating a convoluted portfolio of services and appears to be reluctant about committing to original programming any more than it already did. Its digital content platform lineup was recently ennobled with the addition of YouTube TV, a cord-cutting service that offers live TV channels and starts at $40 per month.

Stagnating investment efforts may leave YouTube Red even further behind the likes of Netflix and Amazon Prime Video that it's attempting to rival to a degree. The on-demand service is expected to have a major international expansion later this year, with Google being set to announce new YouTube Originals in the coming weeks, according to recent reports. At a fundamental level, the YouTube brand is still only truly successful in being the world's largest video platform hosting free content monetized through advertising. Facebook is presently trying to rival Google's subsidiary in that respect with its Watch service.

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