Thursday, February 22, 2007

Like Viacom, CBS Rebuffs Google/You Tube

According to this Mediapost story (free registration required), the negotiations between Google and CBS to extend the agreement to show CBS content on YouTube have ended. This happens not long after Viacom had broken off talks regarding a similar agreement.

Boy, wouldn't I like to be a fly on the wall of the corner offices at the media companies as they talk about YouTube. How much of the problem in reaching an agreement stems from CBS's and Viacom's being threatened by a new media upstart? After all, these companies have been around for decades (Viacom: 1971; CBS: 1927), and YouTube launched -- launched, mind you -- in February of 2005, a scant two years ago. If I were an old media company regarding such upstarts, both in terms of the threat they pose and in terms of the audacity of their very existence -- my nose might be a little out of joint, too.

Interesting comment by Larry Gerbrandt, general manager of Nielsen Analytics: "The problem with You Tube is there is no revenue yet ... How is Google going to see a return on the $1.65 billion they paid? They have yet to create a model. On the other hand, once they start to generate significant amounts of revenue, those copyright issues become more significant."

This all prompts a recall of Mark Cuban's famous email regarding the Google acquisition of YouTube in the first place, in which he wrote that anyone who would buy YouTube is a "moron". The delicious irony here, of course, is that Cuban himself cashed out on to the tune of $5 billion. To see just how much Yahoo is benefiting from that deal, just type the URL into your browser and see where it takes you.

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