YouTube Red, oddly enough, is in the red.
YouTube Red launched late last year with big plans. The company wanted to provide a solid alternative for other services like Hulu and Netflix. After all, a company as big as YouTube launching their own paid video service, with growing total monthly viewers, what could go wrong?
Top sources told The Verge that Red has only scored 1.5 million paid subscribers at the end of the summer. Another 1 million users signed up, but just on a trial basis. This shows that people are accustomed to watching video content for free, and aren’t willing to pay up — just yet. This also underscores people’s interest in YouTube Music, which launched last November, and requires a Red subscription.
Another contributing factor with low paid subscriptions is that Red has launched in only four countries so far: the United States, Mexico, Australia, and New Zealand. Red outpaces the growth of similar services, like CBS All Access and Sling TV. The company says that Red paid subscriptions are also the heaviest video users. The company also stated that people with Red subscriptions watch 75% more YouTube on their TV than non-subscribers.
According to The Verge, Tidal grew faster in its first year. The music streaming service now owned by Jay Z scored 2.1 million subscribers against Red’s 1.5 million. Though, the service did roll out in more countries, an error that is costing Red.
YouTube doesn’t appear fazed by the low numbers. In a statement to the website, the company stated,
“We’re pleased with momentum behind…Red and we’re seeing healthy growth of members each month. While we don’t release or comment on speculative numbers, we’re seeing strong engagement of the service in the four countries we’ve launched, leading us to invest in more originals series and movies for 2017 and increased marketing of YouTube Music.”
We covered Red’s launch last year. According to the New York Times, company executives threatened to eliminate content from major media companies who did not support Red.