More details on NBCU-News Corp. video venture

Cory Bergman March 22nd, 2007

News Corp. President and COO Peter Chernin revealed on the call announcing the new NBCU-News Corp. video venture that they are in discussions with Google about distribution. “(We) had a conversation with (Google CEO) Eric Schmidt this morning and they are considering this,” said Chernin. “This is obviously not a YouTube killer…. we’re trying to be as open as possible with distribution.” Chernin also said they’re in conversations with more content companies about joining the new venture. What about affiliates? “Potentially they could be distribution partners,” NBCU CEO Jeff Zucker said. “We’ll be looking at that in coming days.” But currently, no profit sharing for affiliates. “It’s a real positive for the traditional businesses,” Chernin said, pointing out NBCU’s success with The Office in increasing on-air ratings from increased online distribution. “We do not believe this cannibalizes in any way traditional distribution,” Zucker added. Both also said they believe the new venture is a different experience than their current core sites, NBC.com and Fox.com, due in large part from value in aggregation. (The core sites will still stream the same content, and all sites will still stream shows after they air on the networks.) Most of the shows will be available for free, but they do plan to charge for some content. On the advertising front, Chernin has this quote: “On launch, we believe this will be the largest advertising platform on earth.” Zucker said five charter advertisers signed on within four hours, and two more after the announcement this morning. The ad revenue will be split between the venture, copyright holders and the distribution partners. And despite the focus on premium content, Zucker said users will be able to upload video as well.

The best question on the press call came from Bill Briggs of MSNBC.com. “Hi boss,” he said to laughs on the call, and then he asked what NBC and News Corp. plan to do with YouTube before launching the new venture. Zucker said NBCU is continuing discussions with Google-YouTube to ensure pirated content does not exist there. “We look forward to coming to a resolution before this launches.” Stay tuned…