Google Inc (NASDAQ:GOOG) stock opened higher today, after the Financial Times reported that Google’s YouTube may begin charging viewers for certain video channels as soon as this week. As of this writing, the stock was trading near a 52-week high of $858 per share . The Web search giant has been trying to find ways to monetize its video streaming service since it purchased YouTube in 2006 for a whopping $1.6 billion.
The story at this point is purely speculative, though Google Inc (NASDAQ:GOOG) said it is working on “a subscription platform that could bring even more great content to YouTube,” according to the Financial Times. The alleged starting price for these special subscriptions is said to be around $1.99 a month, and would include up to 50 different channels.
This price point isn’t bad compared to what the competition charges for streaming content. Coinstar, Inc. (NASDAQ:CSTR)‘s Redbox Instant, for example, costs $8 a month for unlimited video streaming. However, the service also includes four DVD credits each month that subscribers can redeem at any Redbox location.
Still, price advantage alone won’t help Google Inc (NASDAQ:GOOG) win the digital streaming wars. That’s because Amazon.com, Inc. (NASDAQ:AMZN), Netflix, Inc. (NASDAQ:NFLX), and Hulu are taking streaming to another level with original content.
Meet the contenders
Original content is key for these companies as they fight for consumer eyeballs. Last month, Amazon Instant Video began streaming 14 pilots free of charge in order to gauge audience tastes. Amazon.com, Inc. (NASDAQ:AMZN) now plans to collect viewer’s votes on which original series it should produce. Meanwhile, Netflix’s House of Cards is stealing the show. Moreover, Netflix CEO Reed Hastings said the show had a positive impact on subscriber growth in the first quarter — a trend that should continue as Netflix, Inc. (NASDAQ:NFLX) rolls out new seasons.
Clearly, original content is king. Yet at this point, it is unclear whether YouTube’s new subscription service will include such content. However, according to a report from CNN, Google Inc (NASDAQ:GOOG) has spent more than $200 million in the last year on advances to dozens of YouTube start-up channels.
Going forward, YouTube will need compelling content if it hopes to continue dominating the streaming market. Although, make no mistake, if the company can successfully monetize its YouTube platform, it would certainly move the needle for Google Inc (NASDAQ:GOOG) stock.
The article Google Stock Heats Up the Video Streaming Wars originally appeared on Fool.com and is written by Tamara Rutter.
Fool contributor Tamara Rutter owns shares of Amazon.com and Netflix. The Motley Fool recommends Amazon.com, Google, and Netflix. The Motley Fool owns shares of Amazon.com, Google Inc (NASDAQ:GOOG), and Netflix.
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