NBC and News Corp takes on YouTube - with help from MySpace, AOL, Yahoo and Microsoft

The LA Times announced that NBC and News Corp are teaming up to launch a new video service to compete with YouTube. Mark Cuban thinks it is a great idea. Paul Kedrosky is unimpressed. At first I thought this was a dumb idea...just like when the record labels decided to launch their own music site to crush Napster. But this is different.

NBC and News corp. will use MySpace, AOL, Yahoo, Microsoft, and others to distribute their video. Don't you think MySpace, AOL, Yahoo and Microsoft will do everything possible to make this attractive, build a huge audience, and crush YouTube? NBC, News Corp, Viacom, and others know who their friends are...and they are all too happy to help.

The joint press release says "At launch, full episodes and clips from current hit shows, including Heroes, 24, House, My Name Is Earl, Saturday Night Live, Friday Night Lights, The Riches, 30 Rock, The Simpsons, The Tonight Show, Prison Break, Are You Smarter than a 5th Grader and Top Chef, plus hits from the studios’ vast television libraries, will be available free, on an ad-supported basis, within a rich consumer experience featuring personalized video playlists, mashups, online communities and video search. Plus, the extensive programming lineup will include fan favorite films like Borat, Little Miss Sunshine, Devil Wears Prada, The Bourne Identity and Bourne Supremacy with bonus materials and movie trailers"

In my opinion the Keys To Success are; 

• Distribution partners - MySpace, AOL, Yahoo, Microsoft. Great! Now add Facebook, BrightCove, and any other cool social site that wants to play.
• Content partners - NBC and News Corp own lots of great content. Now add Viacom, Sony, Time Warner, other TV networks, and film producers. The content must be complete. You must be able to find anything to be regarded as a true destination site.
• Have it your way - The video must be available in short clips, "best of" montages, and full length. Just making the same 60 minute, or longer, shows available on the web will not be very interesting. There are much better ways to experience video...like DVR's, Tivo, DVDs, etc.
• Allow User Generated Mashups - YouTube is cool because you can find short clips of the funniest moments of The Comedy Show, or the best clips of a football game, or a crazy compilation of bloopers. Individuals spend hours editing long videos to find just the right clips. The wisdom of the crowds identifies the winners. The TV and film studios need to find a way to leverage the talent of these consumer editors.
• Multiple business models - They will obviously use advertising, but should also consider pay per play, subscriptions, and rentals like Netflix. This could be a huge revenue stream if they get creative with how to monetize it.
• Flexible pricing - All videos are not created equal. Clips are not worth the same price as full length videos. Old catalog TV shows should have a different price than last night's episode of 24.

If the video guys try to take the same content and business models onto the web it will fail miserably. If they try to build a "walled garden" of selected content...very few people will be interested. In short, if they take the same approach that their record label friends did...they will fail.

Be creative. Take risks. Find out what works. - This will be difficult for the TV and film studios. They are incredibly creative people when it comes to content, but very conservative and myopic when it comes to business models. They have made some good choices so far. Time will tell if they really get it and will do what is necessary to beat YouTube.

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Comments

[Abraham Sultan]

Yeah,

All they have to do now is name the damn thing before the "Clown Co." sticks forever.

Abe

[Danial Jameel]

Dear Don Dodge,

Hence the cycle continues....

I find it interesting on how the old vangaurd corporations tend to deal with new challenges. So far I am not intrested in what full episodes etc they are providing but what is present in the DNA of this project that forms a community.

Simply put a web user can switch from many different sites for content and satisfaction (utility as its called in economics). I am a websurfer, I see NBC making a new site with my favourite show, ofcourse i'll go check it out. Joost last week launched a new documentary on "Lions in Africa", ofcourse I will go and check it out too. The Real question is during my journey in this web 2.0 world, which place do I consider home and where I will hang around and contribute towards.

As Mr.Don Dodge states, one of it's keys to success is the partnership with other social portals such as MySpace and especially Facebook (it lacks video implementation). My initial impression is that the foundation of this site is not geared towards creating a virtual community of its own but tieing into various communities already present online. While this may seem like a good proposition in the short and short-medium term, I have some reservations and questions regarding its web 2.0 and hypersocial qualifications.

The questions I would like to know are as follows:

1) What is the purpose of this platform? Are you merely providing content to already present communities (if thats the case, then sites like revver are doing it) or Do you intend to form a community of your own?

2) Is exclusive content the main sweetner for users to view your content and service, or will there be some sort of a hybrid platform connecting communities such as Myspace, Facebook for the very first time (oops! did i just give away a great idea for free :P)

3) Finally Why is playing catchup always the major issue in big corporations and why this obsession to make a Youtube killer?

Innovation starts small(I recommend users listening to Don Dodge's interview on MicroISV). However this race to take out Youtube by so many companies does not seem to be about innovation or community but quite simply money and Big money (the bottom line). If you recall Microsoft tried to launch an Ipod killer "Zune", it did everything Ipod could do and more. Where is Zune now? Where will this Youtube killer be next year? Yes it has the big guys supporting it with exclusive content for a fee and advertising but Applications like Joost are already providing limited TV content for free while users are expected to pay for content on this service. Has anyone torrented any movies lately? Will these users (a significant number by any standards) be convinced on switching sides to paid content which includes advertising? How does providing TV content form a community? Will users be able to publish personal videos and is NBC providing personal videos features and "Recognition" that Youtube is not? These are the questions that I hope NBC and it's partners are asking.

My point is not to say this venture won't succeed. Being a Microsoft fan, I wish all its partnerships the best success. YouTube if anything needs a good wakeup call with competition. It's search engine is losing it's accuracy (try typing "Fox News Canada"), the site is becoming bulky and messy (although messy can be a good thing!). Despite all this Youtube is Youtube and for now a large number of users love it...

P.S I am not a Youtube fan, never was :)

[MS]

Mark of course has been calling out YouTube’s shortcomings from its very launch. Ultimately, the problem with putting faith in NBCU and News Corps’ video sharing service is… putting faith in NBCU and Newcorps.

I can’t tell you how many times I get called out, by technical colleagues working for “tech” companies, on why my own company (full disclosure: Viacom employee) doesn’t have so and so RSS subscription features, or roll out so and so widget application.

It’s the Engineering… dummy!

Read on here... www.sunbulli.com

[Mike]

Hi Don,

So if NBC/Universal/NewsCorp/MySpace succeeeds overwhelmingly, and YouTube is forced out of business ("sorry kids, we *had* to start selling advertising space"), doesn't this become the makings of some sort of (another) media monopoly?

Mike