Viacom Keys in on Comedy to Monetize Internet Video

Ad-Friendly Content on iFilm, Atom Could Help Sites Challenge YouTube

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NEW YORK ( -- Viacom is getting serious about its online-video strategy -- by betting heavily on comedy.
As comedy content continues to prove popular on video sites, it's becoming clearer how iFilms and Atom Films fit into Viacom's online-video strategy.
As comedy content continues to prove popular on video sites, it's becoming clearer how iFilms and Atom Films fit into Viacom's online-video strategy.

When Atom Films relaunches today, it will be a playground for aspiring video producers hoping for the next big Comedy Central or Spike TV hit. When iFilm relaunched a month ago as a more accessible, more open video portal, it was loaded with clips of "The Daily Show's" Jon Stewart and his Comedy Central cohorts.

Strategy comes into focus
Indeed, as comedy content continues to prove popular on video sites, the two Viacom-owned video companies (iFilm was acquired more than a year ago; Atom over the summer) have been brought under Doug Herzog, president of Comedy Central/Spike/TV Land, and it's becoming clearer how they fit into Viacom's online-video strategy. Atom Films will concentrate on short-form independently produced content and be an incubator for MTV Networks, and iFilm is emerging as a broad-based video portal and a home for professionally produced MTV Networks content.

Both sites, Viacom executives like to boast, already make money on advertising. With professionally produced content to place advertisers against, Viacom has an advantage over YouTube and Google video, which have struggled with guaranteeing advertisers they will be kept away from questionable content.

Don't discount the timing of the two relaunches. While Viacom has been criticized in the press for a lagging online strategy, its content, such as the popular clips of Comedy Central's "Daily Show," has contributed to the growth of sites such as YouTube. A month ago Viacom's corporate office asked YouTube to remove some copyrighted content from a variety of Viacom cable networks, including Comedy Central and MTV.

Some content still on YouTube
Some of that content still shows up on YouTube, albeit in smaller portions. One executive close to Viacom said it's hard for the company to know what kind of a deal it should or shouldn't strike with YouTube until it makes a go of it on its own -- and makes its most popular content as accessible and distributable as possible.

"IFilm's not starting from scratch, and there's no reason they wouldn't or shouldn't make a play for it," said Jason Klein, president and co-CEO of Special Ops Media, a Manhattan-based digital-marketing company that has run campaigns on several video-sharing and social-media sites. The problem, he said, is if the content isn't exclusive, it's going to be hard to get people to come to iFilm. After all, he said, "Joe Blow doesn't care if he watches it on YouTube or iFilm, and if he's already on YouTube looking at 10 other videos, then why go back to iFilm?"

Blair Harrison, iFilm's CEO, said the company has had several iterations since it launched in 1999. After watching other video portals pop up, "we realized our audience wanted not just a place to find user-generated and viral content but also some of the best professionally produced content." He said they also made sure the new iFilm was "a Web 2.0 design -- light, lean, fast," to reflect what people have come to expect from a video site. It supports RSS and allows people to embed videos on other sites. Scott Roesch, general manager of Atom Films, said its relationship at MTV Networks "supercharges our value proposition to the creator. ... It gives us direct access to networks."

Copy CBS's model
Of course, stealing share from a behemoth like YouTube won't be easy. Some executives think Viacom should strike a promotional deal similar to the one CBS has with YouTube. (CBS, for its part, credits YouTube with helping lift ratings for "The Late Late Show With Craig Ferguson" and "The Late Show With David Letterman.") Hitwise data from November show YouTube's share of web traffic continues to increase. In the past month, it's grown 18%; iFilm is up 35% and Atom Films 606%. Of course, YouTube's share of traffic for the week ending Nov. 25 is still 44 times greater than Atom Films' and 40 times greater than iFilm's.

Mr. Harrison is undaunted: "There's always someone new, and there's always someone bigger and more popular. But ... we're in this for the long haul, and we're owned by a company that has huge resources."
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