The live TV service will carry more than 40 channels, including some of the country's biggest networks including ABC, CBS, Fox, NBC and ESPN.

The service will also include a "cloud DVR" that will let users record and store programming.

One analyst told the BBC that YouTube posed a real threat to traditional cable companies.

"YouTube is already an extremely well established video brand, and its apps are virtually everywhere," said Paul Verna of eMarketer.

'For the YouTube generation'

The announcement was made at YouTube's LA-based studio, where it gives free access to the network's biggest stars to create original content.

That material will be part of the package, but the main draw, and the detail most likely to make cable companies nervous, is the inclusion of top channels - including those showing live sport.

"It's live TV designed for the YouTube generation," wrote Christian Oestlien, product management director for YouTube.

"Those who want to watch what they want, when they want, how they want, without commitments."

The service will launch later this spring in its own standalone application on smart TVs as well as mobile devices. One notable drawback, however, will be the absence of major channels such as HBO, CNN and AMC, home of the Walking Dead series.

There were no plans for a similar service outside the US.

Stability challenge

YouTube has also been slow to get involved in the increasingly crowded market. There are already other streaming cable services offering so-called "skinny bundles" of a few main channels at a cheaper cost compared to a traditional cable TV package.

Most notably, DirectTV - owned by AT&T - offers more than 120 channels over the internet, but its cost - $70 per month - is considerably higher.

DirectTV has also come in for fierce criticism over stability. At the beginning of this month, the service went down at perhaps the worst moment imaginable - viewers missed the end of the Super Bowl, and perhaps the most dramatic moment in US sports in recent memory.

Google's vast infrastructure and expertise could give them an edge, predicted eMarketer's Mr Verna.

"YouTube has the technical know how and infrastructure but it's never a given that things will go right. It's not just about delivering the technology at scale.

"It's about the user interface - and that's something YouTube has never been particularly good at."