Keep an eye on this one

Business Week’s Jon Fine is reporting that talks are underway between the networks to create a one-stop site for all their video content to compete with the Google/YouTube juggernaut. At the same time, Google is offering the nets HUGE sums of cash (nine figures) for rights to their content. Here are the key graphs:

Such a sum far exceeds what any single broadcast network can extract from the online world–and drops straight to the bottom line. But taking the dough fortifies an already threatening rival. One executive privy to the discussions says: “The reality is, if they are able to lock in major media [companies] for three years, then by default YouTube is the place to go” for Web video. Such fears may be what’s spurred several major media players to mull assembling a cross-company Web video destination–a YouTube killer of their very own.

“The theory is that if you were to aggregate enough exclusive content in one place, you could actually change viewing patterns,” says an executive familiar with the cross-company talks. Perhaps anticipating my jumping all over the fallacy of “exclusive” in an open online ecosystem, he concedes “it’s really tough,” though not impossible.

I continue to believe that cutting deals with companies like Yahoo to present our local content is penny wise and pound foolish. Better to create a local video portal that includes everybody, but that would take a level of coöperation heretofore impossible in any market. Stay tuned.

Comments

  1. You have to wonder is they will revert back to the traditional money-making machine of advertising, or if this will be the new revolution in broadcast… commercial free.

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