News Corp., NBC pull together to challenge YouTube
Several media giants are teaming up to challenge Google Inc. and its YouTube video-sharing service, seeking to blunt their incursion into the entertainment business. — News Corp. and NBC Universal plan to announce as soon as today …
Context & Ripple Effects
The partnership formalizes a strategy that had been taking shape since television networks were reported to be discussing a YouTube alternative in December 2006. News Corp.'s own web-video plans were still described as talks two weeks earlier, making the NBC alliance the move from exploration to a named competitive bloc.
The contest is also shaped by copyright pressure surrounding YouTube after Google's acquisition. News Corp. and NBC are not merely seeking online reach; they are trying to give major rights holders a channel with greater control over how entertainment programming is distributed.
First-order effects
- News Corp. and NBC gain a joint vehicle to put their programming behind a direct challenge to Google and YouTube, rather than relying on YouTube as the principal destination for web video.
- YouTube faces a coordinated response from two large media owners whose programming and rights concerns are central to the entertainment-video market.
Second-order effects
- Other television and film companies must weigh whether to align with the News Corp.-NBC effort, distribute through YouTube, or pursue both routes, making control of online distribution a negotiating lever.
- Google has added incentive to address the copyright concerns already attached to YouTube, because licensed programming owners have shown they can organize an alternative outlet.
Third-order effects
- If major media groups keep pooling catalogs and distribution, online video may divide between open user-upload platforms and publisher-controlled services built around licensed entertainment.
- The fight shifts competition from video hosting alone toward rights-holder terms: who controls programming, distribution rules, and the audience relationship.
The trend: Online video is becoming a contest between open platforms built around user uploads and media-owner alliances seeking controlled digital distribution.