Business | Technology
Media giants now embrace video-sharing
Hollywood used to fume when fans uploaded video clips to the internet to share with their friends. Now it's looking to cash in on them.
- Los Angeles Times-Washington Post News Service
- Published: 23:20 November 7, 2008
- Image Credit: Bloomberg News
- The MTV store, located below the MTV studios, in New York. MTV Networks and other media giants have started to embrace the consumer-led digital revolution.
San Francisco: Hollywood used to fume when fans uploaded video clips to the internet to share with their friends. Now it's looking to cash in on them.
For several years, television networks and movie studios dispatched legions of lawyers and sophisticated technology to stamp out piracy while showcasing their content on their own websites.
Viacom Inc., owner of Paramount Pictures and MTV Networks, filed a $1-billion (Dh3.67 billion) copyright infringement lawsuit against Google Inc.'s YouTube, the Web's most popular video-sharing service.
But MTV Networks and other media giants have started to embrace the consumer-led digital revolution. The Viacom unit plans to pair advertising with clips from "The Daily Show with Jon Stewart," "Punk'd" and other shows that MySpace users upload to the social network site - whether they have permission or not.
MTV plans to pull it off through a deal, scheduled to be announced on Monday, with MySpace and Auditude, a Silicon Valley start-up that is providing the advertising technology.
The strategy is similar to that of YouTube, which late last year launched a system that identifies video clips and then offers copyright holders a choice between removing the material or letting YouTube place ads on it in exchange for a piece of the revenue.
Analysts say tensions between new media and old have eased. Both are looking to profit from how today's generation consumes and interacts with online video.
If the strategy works on MySpace, where millions of videos are streamed every month and where watching premium content is one of the most popular activities, other networks will follow suit, predicts Forrester Research analyst James McQuivey.
"This is a sign that we are finally ready to do this," McQuivey said. "Two years ago the solution was, 'Let's sue YouTube and block this.' It really hasn't worked. Now the solution is, 'Let's create a system where content can derive some benefit.'"
No copyright cop
MySpace is enthusiastic about the concept rolled out by Auditude. MySpace does not have to play copyright cop, controlling what consumers can and can't watch on its site. Instead, it receives a split of the advertising revenue. MTV Networks gets to target ads to fans of its shows and direct them to its shows and merchandise.
And consumers can share some of the content they want without having it blocked or removed, said Jeff Berman, MySpace's president of sales and marketing.
"This is a game changer," Berman said. "This takes us from a world of 'no' to a world of 'yes,' where the audience gets to curate content, express and share it as they choose, while copyright holders are not only respected, they get to make money."
Auditude Chief Executive Adam Cahan, a former executive of both Google and MTV Networks, said he joined the company a year ago when it was still based in Los Angeles because he was intrigued by the prospect of helping media companies reach their fans across the web. He already has signed Warner Bros.
He says Auditude can identify virtually any professional video uploaded across the internet because it has indexed more than 1 billion minutes of professional content, including 250 million videos and four years worth of television from 100 channels. Then content owners can decide if they want to run ads with the content.
"What we saw was a problem, and we tried to bring a solution to it and make it into an opportunity," Cahan said.
A number of companies, including Santa Clara, California-based Vobile Inc., whose technology is used by some major Hollywood studios, are also working on ways to help companies make money from their copyrighted content.
"Everybody is moving in that direction," Vobile Chief Executive Yangbin Wang said.
But, says Vance Ikezoye, chief executive of Los Gatos, California-based Audible Magic, "it's a tough problem to solve." He said video providers were starting to experiment more.
"The first stage was clearly more focused on how do I protect my content as a copyright holder and how do I keep from being sued as a site publisher," Ikezoye said. "The stage we are entering now is much more about openness to try new business models to try to monetise the content."
Mika Salmi, MTV Networks' president of global digital media, said he welcomes all potential solutions to what has been a vexing problem. "We are looking for consumer-friendly, copyright-friendly solutions that fit everyone's needs," he said.
Gartner media analyst Mike McGuire says Salmi's attitude is typical of media companies nowadays. "They realise the web is not their enemy, that it is a place where they can find other ways to monetise their content," McGuire said.
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