I think I predicted this some time back but I can't find that article. That happens quite often to me as I like to prognosticate rather frequently. Anyway, it's been reported that YouTube will open movie and TV video-on-demand for connected TVs by the end of the year. Their first major partner, Philips.
This sort of makes sense as part of Google's continued expansion into the living room. We've already got the larger Google Fiber project taking shape down in Kansas City (or up if you're in the south) and that seems aimed at reshaping the cable/satellite/MSO landscape. Now, they're looking to reshape the streaming premium video-on-demand landscape as well. This time it's testing it out in Europe.
While you can rent movies via YouTube on Google TV, you haven't been able to do so via other TV platforms and even the Google TV rentals have been quite limited. This step, moving away from their own platform and toward another connected TV platform could be the baby step, the toe in the water that ends in them rushing headlong into connected TV and allowing rentals anywhere they've got the license to do so and can find a hardware partner.
It's almost certain to make the other big TV manufacturers, LJ and Samsung, sit up and take notice. It seems to me that having YouTube on board as a major VOD partner is a pretty big selling point, or rather, it could be in, in the near future. Just about every platform under the sun has Amazon, VUDU, Netflix, etc. Almost none have YouTube and depending on how much money Google is willing to invest in licensing of content for rentals, it could see them start to pull new movies away from other outlets.
Plus, YouTube already has a pretty robust advertising angle attached to it meaning that it could begin generating more revenue for them and suddenly open up a massive amount of inventory. I've been predicting that the end of the year will see a major expansion of the connected TV install base and this might be Google believing me and aiming to be there when the dust settles. A report just came out stating that only 29% of U.S. TV buyers are looking at Internet as a major factor in new TV purchasing, but it's also been reporting that 30% of U.S. households already have a connected TV.
It's odd that they decided to start this over in Europe and only in 'select European countries' which smacks of it all being a test market run.
I still think they have the power to turn it around quickly and do a rapid expansion in the U.S. by year end as well. After all, this is Google we're talking about.