YouTube to sign landmark content deal with Channel 4

YouTube and Channel 4 have been in talks for at least the last six months and a contract is expected to be signed imminently. The Telegraph understands that Channel 4 has negotiated the right to sell its own advertising around its content on YouTube and share the revenue with the Google-owned site.

A senior television source close to Channel 4 said: “It was key for Channel 4 to be able to sell the advertising around its own inventory so it could extract maximum value from the deal and retain commercial control over its own property.

“When the Channel 4 content formally appears on YouTube, it will be branded exactly the same way as it is on the Channel 4 website. It will be a fully Channel 4 branded space and look as if someone has picked up 4 on Demand (Channel 4’s online catch up service) and put it on YouTube.”

It is not clear at this stage how the advertising revenue would be split. However, several sources who have had experience in negotiating commercial terms with YouTube, expect the video-sharing site to be taking no less than a 30 per cent cut on each deal and for it to be a multi-year arrangement.

The Channel 4 service on YouTube is expected to offer users a 30-day catch up window, as it already does via 4 on Demand, with the same amount of content.

The partnership will be the first formal arrangement YouTube has agreed with a British broadcaster in which the majority of its content will be shown in full on the video-sharing site.

The Google-owned site has previously signed similar full-length deals in the US and has publicly expressed interest in signing other content deals around the world.

There has been a surge of interest from several video aggregation sites in signing deals with the major UK broadcasters since the Competition Commission blocked Project Kangaroo, the joint video-on-demand venture from the BBC Worldwide, ITV and Channel 4, earlier this year. All three broadcasters are understood to be in negotiations with the likes of YouTube, Hulu – a US based video site and MSN Video – the Microsoft-owned video player.

Channel 4 and YouTube both declined to comment.