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Google (Nasdaq: GOOG ) is finally trying on a multiplex ticket-taker uniform to see how it fits.
The leading search engine's popular YouTube site will offer up five Sundance Film Festival favorites on Friday, but they won't be supported by pre-roll video ads or AdWords text ads overlaid on the bottom of the flicks. Google will charge viewers $5 to stream the indie productions.
The digital rentals will be available through the end of the month. Health and education videos will be available for paid streaming in the coming weeks.
Will YouTube viewers pay? That's the $1.65 billion question. Most of them clearly won't. Even when YouTube has offered up free feature-length events in the past -- from a U2 concert to Ghostbusters -- it's not as if the site's 100 million-plus stateside viewers have turned out in droves. YouTube is the world's most popular video-sharing site by far, but Apple (Nasdaq: AAPL ) , Blockbuster (NYSE: BBI ) , and Amazon.com (Nasdaq: AMZN ) have struggled with digital video, and they're no slouches.
Netflix (Nasdaq: NFLX ) is the only company that has made any kind of traction here, but that's because it includes online streaming at no additional cost for its unlimited DVD subscribers.
YouTube may also be pricing itself out of the market. One of the five films is the critically acclaimed The Cove, but it's available as a digital rental on Amazon.com for only $3.99. YouTube may have better rental success with the newer 2010 Sundance films that haven't been released on DVD, but it's still going to be a steep learning curve for those who aren't used to seeing tollbooths on YouTube.
This brings us to the Trojan horse in all of this. YouTube's announcement advises interested viewers to apply for Google Checkout accounts. In other words, it will probably be the payment platform of choice -- if not the only way to pay for the digital rentals.
Google Checkout hasn't made much of a dent in a market dominated by PayPal, but that is likely because the company's most popular offerings, from Gmail to YouTube to its flagship search engine, are free for most users. If YouTube is able to get even 1% of its domestic users to belly up to its virtual box office, we'll be talking about more than a million Google Checkout accounts. Once the account is set up, it will be that much easier to select it as a checkout option through participating retailers.
Am I suggesting that Google is using indie filmmakers to promote its fledgling transaction platform? I don't know for sure -- but I'm sure there's a smokin' good documentary idea in there somewhere.