MGM Gives (a Tiny Bit of) Full-Length Video to YouTube

MGM will begin posting TV episodes and full-length movies to YouTube on Monday, the studio told the New York Times. However, the content will be very limited. The initial offering will include the old-school version of American Gladiators, action movies like Bulletproof Monk and The Magnificent Seven, and clips from popular movies such as Legally Blonde (whoo-hoo…).

Other studios that might start putting full-length content on YouTube soon reportedly include Time Warner (s TWX) and Sony (s SNE).

MGM already has a YouTube channel — which says the studio has actually been a member of the site since October 2005. As of Sunday evening, the channel only has three pieces of content, all trailers for the movie Valkyrie posted in the last month or so. Also, for now, the channel allows embeds (many other major media companies disable them). So that’s nice! Update: MGM is actually launching content-specific channels rather than one main brand: “Impact,” for action programming “American Gladiators” for the show itself. According to the official press release, “MGM has plans to launch additional channels on YouTube in the near future.”

The move is part of YouTube’s response to Hulu and had been presaged in a CNET report last week (see our coverage). The reason studios have been so cautious about putting their content on YouTube is that they haven’t felt comfortable with YouTube’s copyright policies and its ability to provide sufficient advertising dollars. The New York Times report did not offer details of the advertising arrangement between MGM and YouTube. Recent additions of full-length CBS shows have included pre- and mid-roll ads, a first on YouTube, which generally prefers less-obtrusive overlays.

Hulu, by the way, also offers MGM content, and has done so ever since it initially came out last year. One of MGM’s largest shareholders, Providence Equity Partners, also ponied up Hulu’s $100 million in outside funding. MGM co-president Jim Packer told the NYT, “We will have some long-form videos up on YouTube, but I don’t think that’s the platform to have 30 or 40 movies up at once. I feel much more comfortable doing that on a site like Hulu.”

As part of the deal, MGM will partake of YouTube’s Video ID copyright protection system and may in some cases elect to leave pirated clips up alongside advertising that provides revenue to MGM.

CNET reports tonight that YouTube has discussed giving studios 70 percent of profits for deals such as MGM’s. It also says that haggling over ad formats has been a major holdup in ongoing negotiations. That most likely means mid-stream versus overlay ads, based on what we know about YouTube’s long-held stance on intrusive advertising.

There’s not a ton of risk for studios to put a little of their back catalog on YouTube, though they’re certainly cutting off the full potential of digital distribution by hoarding the most popular content. And YouTube (as we mentioned last week), needs to do more than “Theater View” to make discovering and watching premium content an easy and enjoyable experience.