You Tube Opponent Vessel Launched Its Paid Subscription Service

YouTube rival  platform Vessel launched its paid subscription Vesselservice, offering programming at least three days before other websites in a bid to reshape an industry dominated by free content on Google’s YouTube.

Online video platform Vessel launched its paid subscription service, offering programming at least three days before other websites in a bid to reshape an industry dominated by free content on Google’s YouTube.

Vessel, which costs viewers $3 a month, was founded by former Hulu CEO Jason Kilar and CTO Richard Tom. They aim to create an early window for a selection of web video, similar to the way movies are released in theaters before they arrive on cable TV or the Internet.

“Early access is very valuable,” Kilar said in an interview. “There are a lot of consumers who would love to see something early.”

More than 130 creators will provide early access to content on Vessel. After the exclusive period ends, videos can go to YouTube, Vimeo, Vevo or other free, ad-supported sites, and are free on Vessel.

YouTube stars such as Ingrid Nilsen, Rhett & Link and Shane Dawson are among creators whose videos will make their debut on Vessel. Other programming comes from online networks such as food-oriented Tastemade and celebrities such as Alec Baldwin.

Video creators on Vessel keep 70% of ad revenue, compared with 55% that is typical on YouTube, plus 60% of Vessel subscription revenue. With those incentives, the new service will be an easier sell to creators than offering viewers who are used to watching videos for free, said Brett Sappington, director of research at Parks Associates.

“Vessel must rely on content creators’ popularity and self-marketing to entice their loyal viewers into paying a monthly fee,” he said.

A YouTube spokeswoman said the platform’s creators are pulling in higher revenue, boosted last year by a program called Google Preferred for advertising on the most popular channels. Year-over-year revenue rose 70% for the top 100 channels after Google Preferred launched, she said. Vessel, which raised $77 million in V-C funds, also includes free videos with ads.

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