NBC, News Corp. Take on YouTube

With Ad-Supported Site for Original, Professional Video

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NEW YORK (AdAge.com) -- In a major kiss-off to Google, two major entertainment giants have partnered with some of Google's biggest competitors to launch an internet-video site full of original, professionally produced content.
Jeff Zucker, president of NBC Universal, and Peter Chernin, president-chief operating officer of News Corp
Jeff Zucker, president of NBC Universal, and Peter Chernin, president-chief operating officer of News Corp

Unlikely partners
It's an unlikely partnership between two strange bedfellows as NBC Universal and News Corp. have partnered to team with Yahoo, MSN and AOL. News Corp.'s MySpace is also a distribution partner. Post-launch, an announcement from the companies stated, sites affiliated with the founding companies, including iVillage (NBC) and IGN (News Corp.), will also have the opportunity to become distribution partners. Notably absent are other entertainment companies such as CBS, Disney/ABC and Viacom.

Charter advertisers on the site include General Motors, Esurance, Intel, Cadbury Schweppes and Cisco. The timing comes on the day that NBC presents a mini-upfront to buyers in Los Angeles.

The announcement of the joint venture, which came streaming into in-boxes this morning from each of the various parties involved, was full of promising language: The announcement said the joint venture has "unprecedented reach," reaching 96% of all internet users.

Free and ad supported
Content includes both full episodes and clips from current shows, including "Heroes," "My Name Is Earl," "Saturday Night Live," "Friday Night Lights," "30 Rock," "The Tonight Show," "Top Chef" (all from NBC Universal), "24," "House," "The Simpsons," "Prison Break," "Are You Smarter than a 5th Grader?" "The Riches" (all News Corp. properties), as well as studio libraries and films such as "Borat," "Little Miss Sunshine," "Devil Wears Prada," "The Bourne Identity" and "Bourne Supremacy." All will be free and ad supported.

Peter Chernin, president and chief operating officer of News Corp., called the venture a "game changer for internet video." He went on to explain that "for the first time, consumers will get what they want -- professionally produced video delivered on the sites where they live."

The tack represents an admission by the major traditional media companies that they can't take on the internet alone -- that the distribution of attention and power in the digital world does not, in fact, mirror their traditional businesses. But there will be challenges. In order for such a venture to work, the networks will be sacrificing on-air promotion of their own independent sites, something that until recently they have appeared remiss to do.

Nets looking to learn
Also notable is the fact that networks have paired with experienced online players, such as three major portals. That move seems to indicate the nets are admitting they have room to learn about how online audiences work.

Permanent management for the independent company, located in New York and Los Angeles, will be announced shortly, but in the meantime, George Kliavkoff, NBCU's chief digital officer, will lead executives from his company and News Corp. as decisions are made about the site. Each company will contribute to a marketing and promotional budget.
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