Hi there! My name is Janko Roettgers, and this is Lowpass. This week: How Hollywood is responding to YouTube’s mind-blowing viewership numbers.

YouTube owns TV now

This week, Nielsen made it official: Streaming is now officially bigger than cable and broadcast TV combined. It’s a fundamental shift, as streaming’s share of TV viewing time has more than doubled in just four years. And it’s a shift that wouldn’t have happened without YouTube.

The Google-owned video service has been the number one streaming service on US televisions for around two years, according to Nielsen. In May, it accounted for 12.5% of all TV viewing – about as much as its two biggest streaming competitors, Netflix and Disney+, combined. 

In fact, YouTube now clocks more TV viewing time than any legacy media company: Even if you add up Disney’s linear TV networks (ABC, ESPN etc.) and Disney+, the company only accounts for around 10% of all viewing time.

In other words: YouTube owns TV now – and the rest of the media world is playing catch-up, trying to figure out how it can coexist with the streaming juggernaut.

A quarter of all streaming is YouTube

Nowhere was this change more evident than at the StreamTV Show in Denver last week. The conference, which used to be known as the Pay TV Show until a 2019 rebranding, was ostensibly about all kinds of streaming, from FAST channels to AI-powered advertising. But all anyone was really talking about was YouTube, YouTube, YouTube.

That included a keynote from Wurl Americas GM Dave Bernath titled “The YouTube Reckoning,” in which he likened the service to a parasite, eating the industry from the inside. “One in four hours of streaming in the United States today is on YouTube,” Bernath said. “Based on the current growth trend, within two years, that’s going to be one in three hours.” (According to Nielsen, YouTube accounted for close to 28% of all streaming on TVs in May.)

Bernath also had a reality check for all the people still thinking YouTube is just kids watching cat videos: 49% of the videos watched on YouTube are now 11 minutes or longer, and 60% of all TV-based YouTube viewing sessions last half an hour or longer. Also, viewers 55 and over conduct nearly three-quarters of their YouTube viewing on TV. “It is older viewers driving this growth,” Bernath said.

YouTube’s global head of film and TV partnerships Fede Goldenberg brought his own data to further the point that YouTube is the new TV: The service’s audience now watches more than two billion hours of video every single day. In the US, the majority of viewing now happens on TV screens, and 30% of YouTube's creators are now deriving the majority of their revenue from TV-based viewing. Oh, and YouTube is also the number one podcast consumption platform, surpassing both Spotify and Apple.

At the same time, Goldenberg had to admit that YouTube hasn’t actually embraced many of streaming TV’s success stories yet. That’s especially true for FAST, the free, linear streaming channels that have become so ubiquitous on smart TVs in recent years. “We don’t have a FAST product per se with an EPG, and things like that,” he acknowledged.

“The scary thing about [YouTube’s rise on TV] is that they’ve really done it without even trying,” Bernath quipped.

Resistance is futile

So what’s the rest of the industry to do? Bernath had some truly Don Quixote-esque suggestions. Platform operators like Roku, which doesn’t get a single cent from YouTube’s TV advertising revenue, should simply drop YouTube to renegotiate a better deal, similar to retrans fights on TV.  “Maybe it’s because I come from the cable TV business, but this seems obvious to me,” he said.

(It’s worth noting that Roku tried something like this before – and lost.)

In conversations I had at the show, the consensus seemed to be that resistance is futile, and YouTube is here to stay. “It's not like it was even 10 years ago, where you'd graduate from watching YouTube videos to Netflix,” said a senior executive of an ad-supported streaming service. “You're gonna watch YouTube for the rest of your life.”

“YouTube has to be a part of everyone’s video strategy,” that executive added. “I don’t think you can be a media company without having a YouTube strategy.”

An executive of another streaming venture agreed. “For me, it’s: Don’t try to compete against them, work with them,” he told me, while also expressing some hesitation to rely too much on the Google-owned service. 

“The only thing I don’t like about Google: You tend to be one phone call away from going out of business,” he said, likening the company to a black box, unable or unwilling to reveal how its algorithms work. “All of a sudden, there’s a glitch, and your revenue just plummets. [And] if you’re asking: What did we do wrong, they can’t tell you.”

Still, that executive went away from the conference with the intent to distribute more of his company’s content on YouTube, telling me: “If you can’t beat them, join them.”

Learning to speak YouTube’s language

That’s exactly what a growing number of media companies are doing: After previously just using the platform for promotional purposes, big studios are increasingly embracing it as a money maker. Goldenberg pointed to Nickelodeon’s decision to produce an entire show just for YouTube as one such example, calling it “a huge moment in time.”

That’s part of a broader shift that also includes uploading more catalog content to the platform. One example: Warner Bros. Discovery recently uploaded the entire first season of the Friends spin-off Joey to YouTube.

YouTube is “becoming a huge priority” for Hollywood, said former Disney exec Dilip Bala. “If there's one thing these companies understand, it’s that we need to meet these audiences where they're at. And they have now realized, over the last year or two, that YouTube is where it’s at.”

After spending 25 years at Disney, Bala joined Turkey-based video optimization startup Merizgo as its US SVP & GM last September. Merzigo has 500 people working on optimizing the video assets of major content owners for YouTube and Meta. Bala argued that just uploading videos to YouTube and hoping for the best doesn’t cut it.

“It's not enough to just post it. You have to optimize,” he said. “It’s all about basically working the algorithm to reach different audience segments within this 2.7 billion monthly active users.” Such optimization efforts include identifying the characters that resonate with an audience for supercuts, cutting clips to the right length so that they’re eligible for mid-roll ads, and more.

YouTube “is only going to grow,” Bala told me, making efforts to combat or replace it moot. “That ship has sailed.” 

But there is a massive potential upside in that growth story for entertainment companies that are still on the sidelines, he argued: “It’s actually a huge opportunity for [those] content owners in the next few years, because they're not doing a whole lot today.”

What else

YouTube Shorts are being viewed 200 billion times a day. Speaking of mind-blowing: Shorts views grew close to 200% over the past 15 months.

Meta to release smart glasses with Oakley, Prada. Oakley-branded AI glasses are expected to be released on Friday, a Prada collab is reportedly also in the works.

Nintendo sold 3.5 million Switch 2 consoles in four days. This makes the Switch 2 launch the biggest console debut ever.

Disney and NBC are suing Midjourney. The two media companies are alleging that Midjourney’s AI image generator is facilitating copyright infringement.

X has been threatening advertisers with lawsuits. The service formerly known as Twitter has been telling major brands that it will sue them if they don’t resume advertising on its platform, the Wall Street Journal reports.

HBO Max is powering its auto plays with AI. The streaming service will soon use AI to pick “standout” scenes for its autoplay previews.

Netflix eyes Las Vegas for third Netflix House. Previously-announced locations in Dallas and Philadelphia will open at the end of 2025, the streamer said this week.

That’s it

This week, Meta added more federation features to its Twitter clone Threads: If you’re a Threads user, you can now follow people who post to Mastodon and other Fediverse services. The whole integration is still a bit complicated (Fediverse users show up on a separate feed on Threads) and doesn’t always seem to work, but this still seemed like a good time to share some of my favorite Mastodon accounts:

@[email protected] is a curated newsfeed from the fine folks at Flipboard; @[email protected] is exactly what it sounds like; @[email protected] explains the world in very unique ways; @[email protected] shows beauty in decay; @[email protected] is a feed of German TV screenshots; @[email protected] is a blast from the past, and @[email protected] is the Fediverse’s godmother, with a curated feed of retweets to kickstart your Mastodon journey. Oh, and you can also follow me here: @[email protected]

Thanks for reading, have a great weekend!

And many thanks to LinkedIn, iSpot & TVREV for sponsoring this issue of Lowpass.