In YouTube Deal, Channel 4 to Sell Ads in Its Own and Third Party Content

YouTube has announced a significant content partnership with major U.K. broadcaster Channel 4. The deal grants users access to full length, ad-supported and on-demand programming via the Google-owned site. Channel 4 will become the first broadcaster worldwide to offer a significant portion of its content through YouTube, with around 3,000 hours of original programming available at any given time.

The three-year deal will open up a plethora of premium online video inventory, which Channel 4 sales teams will package and sell direct to agencies and advertisers — sharing a portion of that revenue with YouTube. Details of that revenue split have not been disclosed, but some suggest Google offered basement rates in order to secure a big name broadcaster and tempt others to come on board. YouTube said it looks forward to similar agreements with other content providers in the future.

Channel 4’s deal is non-exclusive, leaving it free to distribute content through rival streaming sites if it sees fit. Hulu, for example, has been preparing an entry into the U.K. market after finding success with long-form ad-funded content in the U.S. Channel 4 also will continue operating its ad-supported video site, 4oD, which features recent TV shows one week after they’ve aired. The YouTube partnership is likely to dramatically increase the reach of its content, however.

Errol Baran, head of future and digital advertising at Channel 4, told ClickZ News that YouTube inventory will consist of the pre-rolls and mid-breaks currently available via its 4oD offering. Advertisers will be “encouraged” to buy across both platforms, but are free to buy into either separately if they wish.

Baran declined to indicate how much revenue would actually be shared with YouTube, but YouTube will continue to monetize non-video inventory. Erol said the decision regarding how closely YouTube sales staff work with Channel 4 in the creation of custom packages would “be up to YouTube.”

Google says it also plans to leverage the experience of Channel 4’s sales team by allowing it to sell ads around some third party content for the first time, further extending the inventory and reach of Channel 4’s sales operations. Baran described this as a “longer-term” plan, but said the experience of Channel 4’s teams would likely benefit third-parties. “We’ve worked very hard for over two years with 4oD, and have knowledge and experience of an online video platform, as well as relationships and understandings with agencies,” he said.

Though Baran refused to explicitly confirm his company was in talks with other potential distribution partners, he emphasized the non-exclusive nature of the YouTube deal, and signaled that there were other appealing players in the market.

Some Channel 4 content will appear on YouTube in the coming months, but the full range will be available in early 2010. The broadcaster’s most popular programming includes shows such as “Skins,” “Hollyoaks,” “The Inbetweeners,” and “Peep Show.”