Why the cofounder of a 250-person video company is 'overjoyed' by YouTube's new cable TV competitor

Burnie Burns, one of pioneers of digital video and the cofounder of 250-person studio Rooster Teeth, is "overjoyed" by YouTube's new $35-a-month cable TV competitor. He thinks it's big for YouTube's top talent.

YouTube TV, which was unveiled on Tuesday, delivers around 40 TV channels to your smart TV, phone, laptop, and so on. It's the latest "skinny bundle" meant to appeal to people who want to dip their toes back into the world of pay TV, or get a premium package for the first time.

But while YouTube TV mostly tries to streamline the traditional TV package, Burns told Business Insider that it's also a big step forward for YouTube's most prominent creators.

YouTube TV will be a totally separate app from YouTube: It will include shows and movies from YouTube Red, the company's $9.99-a-month premium service, which houses YouTube-funded original content from the platform's heavyweights like AwesomenessTV, Lilly Singh, Joey Graceffa, The Fine Brothers, and so on.

That's a big deal, according to Burns, whose company Rooster Teeth has a movie "Lazer Team" on YouTube Red, with a sequel in production.

For Red, YouTube tapped its top talents and gave them the budgets to make premium shows and movies. On YouTube TV, that Red content will live alongside established channels like ESPN, even as "regular" YouTube videos live in a totally different app.

"It goes to show the quality of production," Burns said. It's a vote of confidence from YouTube.

It's also a continued blurring of the line of "what is a TV show," versus a web one, and what that denotes in terms of quality. With Netflix shelling out billions of dollars for original shows, and streaming TV packages like Sling adding digital-first channels such as Cheddar, the difference between linear and digital TV is only getting more complicated. And Burns couldn't be happier because it means more opportunities for companies like Rooster Teeth.

The YouTube Generation

YouTube has said it is targeting young people with YouTube TV.

"This is TV reimagined for the YouTube generation," Christian Oestlien, the director of product management at YouTube, told Bloomberg.

While that might sound like marketing spin, Piper Jaffray's last semi-annual survey of 10,000 US teens showed a whopping 26% of teens watched YouTube every day, putting it over cable TV for the first time (at 25%).

And Burns recalled his own experience on traditional TV, on a recent season of the CBS show "The Amazing Race." He said he actually had to explain to some of Rooster Teeth's younger fans how to watch him on the show. They simply weren't used to watching anything on linear TV.