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Google Inc. has reached an agreement with CBS Corp. to carry the broadcast network on its soon-to-be-launched web TV service, people familiar with the matter said.

The new service, which will be housed on Google's YouTube platform, is likely to debut in early 2017. Google is also near an accord to distribute channels owned by 21st Century Fox and is in advanced talks with Walt Disney Co. as well, the people said. . (21st Century Fox and News Corp, which owns The Wall Street Journal, share common ownership.)

The service, dubbed Unplugged, aims to be a low-cost option targeting consumers who either have resisted subscribing to traditional pay-TV or cut the cord due to rising costs.

Google is looking to offer a "skinny" bundle of live TV channels with a price in the range of $25 to $40 a month, according to media executives who have heard the pitch.

The new offering is likely to be separate from YouTube Red, the ad-free subscription offering the company launched last year. A curated portion of YouTube Red videos will be included as part of the skinny TV bundle, one of the people familiar with the matter said.

Google will enter a crowded field of so-called "over-the-top" web video services. Last May, Hulu, the online video platform owned by Disney, Fox, Comcast Corp. and Time Warner Inc., said it plans to launch a cable-style online service in the first quarter of 2017. It, too, hopes to carry the major broadcast network and select cable channels at a price in the $40-per-month range.

Last year, Dish Network Corp. launched SlingTV, its so-called skinny bundle service. Sony Corp.'s PlayStation Vue, a more high-end option, also launched last year.

Apple Inc. has explored putting together its own discounted online TV bundle, but ran into issues securing media rights on the terms it desired.

A YouTube spokesman declined to comment. The initiative is being overseen by YouTube content partnership executives Kelly Merriman and Heather Moosnick, the people familiar with the matter said.

To offer low-cost online TV service, new entrants must try to secure rights to the most-desired networks while leaving out many other channels in the typical cable TV lineup. That can be difficult, since large media companies negotiate package deals for carriage of their groups of channels.

Securing rights to carry major broadcast outlets has been a particular challenge, in part because it requires the buy-in of both the networks that make programming and the TV stations that distribute it. Earlier this week, YouTube executives met in New York with several large local television station owners as well to discuss the service.

For years, Google has danced around the idea of getting premium content for YouTube, in part to get its hands on the high ad rates that television commands. But the company has faced skepticism from big media companies because of their perception that YouTube wasn't aggressive enough tackling piracy on its site.

Beside CBS, other channels from CBS Corp. that will be part of the YouTube offering include Pop and CBS Sports Network. 21st Century Fox channels include Fox Broadcasting, Fox News, FX, Fox Sports and National Geographic Channel, the people familiar with the matter say, while Disney-owned channels that could be part of the service include ABC, ESPN, Disney Channel and Freeform.

For media companies such as CBS, the emergence of new platforms is seen as a key new revenue stream and a hedge against consumers dropping traditional pay-TV services. In talks with investors, CBS has said it would seek a rate for its content on such services that is between the roughly $2 per-subscriber, per-month entrenched distributors pay and the $5.99 a month it charges for "All Access," the subscription online service it sells directly to consumers.

One sticking point that has emerged in YouTube's discussions with some programmers is that YouTube is pushing for rights to overlay data on network feeds—for instance, fantasy or sports stats on top of ESPN's channel feed, or tweets alongside a show, people familiar with the talks say. TV networks are very protective of their live feeds. One worry about overlaying a Twitter feed next to a show, for example, is that trolls can overtake a conversation and turn things ugly easily—insulting an anchor.

Media companies are also wary that YouTube will bundle their premium content alongside Web-native videos and YouTube stars, which they perceive as lower value content.

Write to Joe Flint at joe.flint@wsj.com and Shalini Ramachandran at shalini.ramachandran@wsj.com

(END) Dow Jones Newswires

October 19, 2016 15:45 ET (19:45 GMT)

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