YouTube seals deals with major studios to compete with iTunes

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Google-owned YouTube plans to expand the premium on-demand video rental services offered through its website.

Earlier this week, Google and YouTube reportedly closed deals with Sony Pictures Entertainment, Warner Brothers, Universal and Lionsgate to offer filmed content from these studios as streaming rentals -- including access to new releases the same day as competing movie-on-demand services. YouTube's new service is expected to compete with market leaders in the online video rental market: Apple and Amazon.

In an effort to generate revenue with professionally produced content, YouTube began offering premium video rentals on its website about a year ago, starting with a limited number of films from the Sundance Film Festival, Weinstein Co. and MGM. But the Google subsidiary has struggled to transform its 130 million monthly users into a sizable audience for its paid and ad-supported feature films. This week's licensing agreements that expand YouTube's library of rental titles may help more customers see value in paying the website for access to Hollywood films and make it a more competitive rival to Apple's iTunes and Amazon's Instant Video services.

Google isn't the only big brand making big moves in the streaming video business. According to The Hollywood Reporter, both DirecTV and Dish Network are exploring subscription streaming service businesses to challenge Netflix and iTunes. Meanwhile, cable television provider Comcast is trying to negotiate deals to offer premium video-on-demand options that would allow cable subscribers to enjoy new movies only 6–8 weeks after their theatrical release dates.