Google CEO on YouTube, Clear Channel, broadcasters

Cory Bergman April 16th, 2007

Google CEO Eric Schmidt sat down with former NBCer John Seigenthaler for a terrific session that just wrapped up here at NAB-RTNDA. Schmidt said YouTube is “very close” to launching “Claim Your Content” (CYC) tools that will identify copyrighted content via audio and video fingerprinting. And he said YouTube is working on a video advertising network that will involve pre-rolls and post-rolls. Lots more in the session including:

- His reaction to Viacom’s $1 billion lawsuit over YouTube
- The Google-Clear Channel radio advertising deal
- NBCU and News Corp’s new video joint venture
- He doesn’t mince words with Microsoft’s antitrust talk over Doubleclick
- His advice for broadcasters and where he would invest money now

Live blog follows below…

The crowd of broadcasters is applauding him warmly as he comes out on stage. (This is the same stage where earlier today the president of NAB only mentioned the internet once in his keynote.)

Seigenthaler asks first about the Clear Channel radio deal.

“(It’s) the defining deal for our radio business,” Schmidt says. “We’re beyond excited about this deal…. It should result in significant more revenue for Clear Channel.”

Seigenthaler: Lots of broadcasters are worried about Google’s inroads in traditional advertising, that it will end up lowering ad pricing, diverting revenue, etc.

“It doesn’t replace radio and television.” He says revenue growth for radio and TV has been relatively flat “and the one way to affect that is to bring in more advertisers…. If our technology can bring more advertisers to the radio, I think it’s a good thing.” Advertisers want efficiency, targetability and measurability. “(They’ll) put money where they get the best conversion.” It’s all about relevancy. “We think that will grow remnant.”

He says the deal was designed not to replace existing sales relationships at Clear Channel. “We’re primarily focused on bringing new advertisers to radio.” People who have Google Adwords campaigns can just click to record a radio spot and put it into circulation.

Seigenthaler: Doubleclick, what’s it mean for Google?

“We jumped at the chance,” Schmidt says. “They by far have the best tools for (display) advertisers.” The combination of Google and Doubleclick will provide many benefits including better integrated ad sales environment, higher targeting, measurability.

Seigenthaler: “Microsoft has raised antitrust issues…”

Schmidt: “Microsoft?”

Crowd laughs.

Seigenthaler: “And questions about privacy…”

Schmidt: “Microsoft?”

More laughs.

Seigenthaler: “They say you’re too big…”

Schmidt: “Microsoft? We didn’t rehearse this. They actually said this?”

Seigenthaler: “Yes.”

Schmidt: “You’re kidding me.” What Microsoft is saying is “clearly false.” When you do the math, Google makes up 1-2% of global advertising dollars spent in a year. Maybe Microsoft’s arguments are well practiced from making them in the past. (Zing!)

What about Viacom’s $1 billion suit over YouTube?

“Nice round number,” Schmidt says.

Crowd laughs.

“There’s a lot of confusion about this…. You’re either in business with (Viacom) or being sued by them…. It’s literally just a business transaction, and everyone is very friendly about it.”

Even more laughs.

“We’re critically dependent on the production of copyrighted content…. so it’s very important we do not violate copyright law.” He goes on to explain the DMCA and how that protects companies who provide the pipes, and he brings up the recent story of how a 16-year-old in Australia passed himself off as a ABC Australia executive and was able to get YouTube to pull a bunch of content under the DMCA. “You just can’t win.”

“We’re in the process of creating tools called CYC or ‘Claim Your Content’” which automatically identify copyrighted content on YouTube. “We’re very close to turning this on. We’re testing it with two or three of our partners.” It will use both audio and video fingerprinting technology.

Seigenthaler: Surprised of the NBCU-News Corp joint venture?

“It’s been labeled as competition, but in fact, it’s a different kind of an animal. It’s primarily targeted to long-form content,” Schmidt says. “YouTube is not television.” He said Al Jazeera just announced it will put all its clips on YouTube. All two or three or four minutes long. YouTube is very social. “Think of it as a platform that’s also a community.”

So is it making money?

“We’re busy building an online video solution that’s similar to radio and Clear Channel that will be possible to monetize video on YouTube,” he said. Pre-rolls, post-rolls, “that sort of thing.”

Seigenthaler asks where broadcasting is headed.

TV and radio are very mature forms, but they’re all getting technology upgrades (HDTV, for example). Those models will get better and better, “they won’t be eclipsed by the YouTubes of the world.”

Schmidt goes on to explain a “new model of content.” Guy watches short clip of a basketball game on his phone, sends it out to five friends with a trash-talking note. It’s very viral. “It’s the seamlessness of that integration” with traditional media “that’s the path.” It works especially well with fans of specific types of content.

Next question: Zell said Google is “stealing” newspaper stories.

“I object to the word stealing. We’ve signed a full licensing agreement with the AP and AFP, and we’re absolutely licensed.” He goes on to explain the new newspaper advertising service. “Feedback is very, very positive.” We want to help provide the funding to keep newspapers going.

Here’s one of those questions that must’ve been ripped from Lost Remote. “Do you believe some people in broadcasting are betting against the internet?”

“I think people who use ligitgation to prevent change are betting against the internet,” Schmidt said. He explains how children are growing up on the internet, so there’s tremendous growth potential. “That’s as big as a land grab as the founders of television in the 30’s and 40’s,” he said. “It’s going to happen. It’s too conveinent, it’s too powerful, it’s too sexy, it’s too easy.”

“It’s much better to place some bets and learn from them (instead of waiting).” The new model will take some experimentation. “In order to innovate as an entrepreunuer, you have to come up with some kind of technology.” He suggests tapping the universities for new talent with fresh new ideas in technology and media.

Question from the audience: If you were a VC, where would you invest your money right now?

“Mobile, mobile and mobile. It’s the DVD of this generation.” Figure out how to get your content on mobile devices.