Updated from Oct. 22.
It's unclear how many of YouTube's millions of users will decide to pay $9.99 per month for an ad-free version of its enormously popular video and music platform. It's likely Google doesn't know either. But when your audience accounts for roughly one-third of all Internet users in the world, even a small slice is likely to generate a handsome business.
"The folks at Google want to put some structure around YouTube, and tap into whatever percentage of their user base is willing to pay for it," said Paul Verna, an analyst at eMarketer in an Oct. 21 phone interview. "When you're dealing with the kind of scale that YouTube has, something as small as 1% or 2% is still going to make a pretty big difference."
As first outlined in a blog post, YouTube Red allows users to play its many videos offline or in the background while surfing to other web sites.
The site will also sync with a forthcoming YouTube Music app that Google promises will "start you on a personal journey through one of the richest music catalogs; just sign in, tap a track you love, and see where your music takes you."
But the big attraction is no advertising. That means no pre-roll or mid-roll banner ads or search ads. None of it. Kind of like watching Netflix. No clutter. That's bound to appeal to some people.
Google's impetus for YouTube Red, of course, is making money off of a gigantic user base that has largely been watching videos and listening to music for free.
When it comes to videos and music, YouTube is the unquestioned leader -- by a mile. YouTube doesn't get specific about the size of its audience, describing its as more than a billion users who watch hundreds of millions of hours each day on the Web site, generating billions of views.
Reaction to the initial announcement was mixed. Comments on a variety of Web sites ranged from those exclaiming that that the price was too high to those proclaiming that they'd gladly pay for a better-curated version of YouTube that will include premium content.