YouTube is attempting to build upon its popularity by offering full length features on a rental basis. The company has been in talks with several movie studios about potential ways to make this possible. Their biggest hurdle is attempting to get users to pay for premium content when free content is readily available on sites like Hulu and Crackle.com.
YouTube has been in contact with YouTube is talking to Lions Gate Entertainment, Metro-Goldwyn-Mayer, Sony, and Warner Bros. about releasing movies the same day that the DVD becomes available and charging a set fee for instant online viewing. The studios hope this type of venture could possibly help bring in revenue since DVD sales are down.
If YouTube does decide to start offering movie rentals, they face stiff competition from sites like iTunes, Netflix, and Amazon.com. The talks are still in the early stages, so no pricing information has been indicated or an expected date when this service could become available.
Read: [Wall Street Journal]
Although there will be a service available because in its essence YouTube is user content changing its bussiness model would do huge damage to its brand and drive customers away, insted they should create a new service/company that they can advertise for free to all their members plus monitor what is posted to there service and remove duplicate/pyrate content.
if youtube really wants to pursue this they should amp up what they are going to offer because as said in the article they are facing tough competition from the already established movie rentals services online.