Thu 4th of February 2010, filed under Social Media
YouTube, the popular video website, has revealed it has generated over £6,300 from the trial of a film rental service.
The scheme, which ran for ten days, gave users the chance to watch five independent films from this year's Sundance Film Festival at a cost of £2.50 per viewing. The New York Times estimated the company generated £6,743 from the 2684 viewings of the films.
Chris Dale, a spokesperson for YouTube, said that the company was happy with the test.
"It definitely exceeded our expectations given all the barriers. The odds are always stacked against independent film makers. This allowed them to reach a bigger audience," he said.
YouTube in 'negotiations' with other studios
It is thought YouTube is currently in negotiations with a number of Hollywood studios in an attempt to secure the rights to screen further films. Writing on popular SEO blog Marketing Pilgrim, Jordan McCollum estimated that YouTube could generate over £245,000 per year if the service was introduced.
"To expand the program with large studios, YouTube will doubtlessly need to share revenue, cutting into their profits," she said.
"YouTube first has been rumoured to be discussing rentals with major studios (or free showings) for months. They already have a number of content deals in place with studios including Disney, MGM, and Lions Gate."
The rental trial is the latest attempt by YouTube to reduce its losses. Last year, it was predicted the company faced a deficit of over £466 million.