Ad-supported video continues to gain momentum online. Google has teamed up with Viacom to provide video clips to websites that are part of Google’s AdSense Network. Viacom is the parent company to MTV, VH1, CBS and a number of other premium networks. The deal will be positioned as a revenue generator for Google, Viacom, and AdSense partners. All three will split revenues derived from the tie-in of advertising and content.
It will work like this: publishers (bloggers, big media, etc.) can elect to embed shows such as MTV’s “Laguna Beach” or Nickelodeon’s “SpongeBob Squarepants” on their own web pages in a manner similar to how YouTube supports embedded video (for an example of how this works with YouTube, see this post on Tony Hawk’s Downhill Jam). The clips themselves will contain advertising sold not by Google, but by the networks’ own ad sales teams. Those networks will share a portion of this revenue with Google, which will in turn share a portion of that revenue with the publishers themselves.
The deal is unorthodox, to say the least. While many networks are busy setting up video portals on their own websites, this deal is distinctly decentralized. Why limit video to one or two sites when you can let people spread your product for you in a compact form that has advertising integrated in the package? It’s an aggressive move that we expect will be billed as very user-friendly once it launches later this month.
Could this move give birth to a flurry of “web clip” sites that simply host scores of such embedded video? MTV wouldn’t mind. “The basis of content on the Internet is shifting from text to video. This is the first way to distribute our content widely across the Internet,” Michael Wolf, president of MTV Networks, said in an interview with Reuters. While Mr. Wolf glossed over the existing ways in which MTV content is distributed across the Internet (P2P, YouTube, etc.), this doesn’t mean that copyright infringement isn’t at the top of their concerns. It surely is, but their strategy of making their content widely available in a “monitizable” form shows that they are more focused on building new business models using the ‘net. In the case of MTV, their audience is both young and technically savvy, among the best of all possible audiences to experiment on.
In a related move, participating networks will also be selling ad-free content on Google’s own video store, joining iTunes as an official distribution site.
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