Later this year, Google may start offering pay-per-view movies through the online video site YouTube. This will include new releases, possibly offered at $5 per movie. YouTube already offers some older titles for a rental fee of $0.99 to $4, but its catalog is limited. Google is currently talking to several movie studios, including Lions Gate, Sony, MGM, and Warner Bros. about including their titles in the YouTube catalog. New titles may be offered the same day they are released on DVD.

It is also speculated that this service will be integrated with the next Google TV. According to Google’s senior product manager, Rishi Chandra, the purpose of Google TV is to “bring the entire Web to the TV…take the best of what’s on TV these days and the best of what’s on the Web and combine them.”

Google TV will give the television the browsing capabilities of the web. This will benefit both viewers and advertisers. Viewers can browse the TV to more easily find the shows and channels they want to watch. And advertisers can include links in their commercials to take the interested viewer to the company’s website, allowing for more effective Internet marketing.

It is speculated that both the pay-per-view service and Google TV will launch at the same time. They can be integrated in the way that those with the Google TV service can watch pay-per-view movies on YouTube directly through their televisions. This will provide a more comfortable viewing experience than sitting at a computer desk or watching a movie on a small laptop screen.

With the decline of video stores like Blockbuster, streaming movies over the Internet is where the future of video rentals lies. After all, you don’t have to leave your house to watch the movies, there are no late fees, and you don’t have to worry about getting a DVD that is scratched and won’t play or constantly skips. Netflix, iTunes and Hulu already offer such services. Will Google offer a worthy competitor? Or will this service fail like many of Google’s other recent efforts, like Google Buzz or Google Wave?

Google is counting on the popularity of YouTube to make its pay-per-view service a success. YouTube is currently one of the most popular sites on the web, with approximately 100 million visitors each month and an excellent Alexa rating of 3 worldwide. This high traffic website already has a large audience that will be aware of this new service when it launches.

However, part of YouTube’s popularity may be the ability to watch a large number of short videos for free. Many people visit YouTube to catch the latest viral video, catch that funny commercial they constantly hear about (Old Spice Guy?), or watch music videos from their favorite artist when they have a little time to kill. Will YouTube’s audience be enticed to visit the site to pay to watch full-length movies? Or is the plethora of user-generated content and short videos the main draw?

Another factor that could hinder success is that Google may be a little late to the party. Netflix has already rolled out an instant viewing service that allows members to watch movies instantly over the Internet and video game consoles like the Nintendo Wii. Other services like Hulu, iTunes, and Amazon Video on Demand are also gaining popularity as sites for watching movies and TV shows. Will YouTube’s already huge audience be enough to propel Google’s pay-per-view service over its competitors? What will Google offer that its competitors don’t?

It is obvious that Google is trying very hard to stay on top of the search engine and internet realm. The web giant already has plans for a social network said to possibly rival Facebook, which will prove to be a daunting task. However, Google is willing to take on the challenge of starting its own online social networking site and has already acquired companies involved in social networking services. Only the future will tell if Google will stay on top or eventually crash.