NBCU Fires Off a Video Volley

Sep 18, 2006  •  Post A Comment

NBC Universal took aim at Google last week with an announcement that it is now distributing online video to and from more than 25 partner Web sites as well as those of its NBC network and NBC-affiliated local stations.

The media giant threw its hat into the quickly expanding market for Web video syndication via its National Broadband Co. venture.

The NBBC, as it’s called, lets both Web video providers and Web publishers sign up and then pick and choose from each other the videos they want to offer and the videos they want to carry. That model has the potential to rapidly expand the availability of video across the Internet as sites begin to feed each other with video to grow audiences and advertising. It essentially turns each of the partners in the NBBC into a new army of freelance video producers for each other.

The creation of the NBBC follows on the heels of Google’s landmark deal with MTV Networks last month to syndicate video content from its networks across hundreds of Web sites.

The entrance of both Google and NBC underscores that syndication of Web video is a big new business opportunity for content providers and advertisers both. NBC’s arrival on the scene also indicates that television networks want to get a piece of the distribution dollars and operate both as online video providers and syndicators.

Other news in online video syndication last week came from CBS Corp.-owned CSTV Networks that it had inked a deal with Broadband Enterprises. Under that deal, Broadband Enterprises will distribute college sports clips from CSTV to its network of 1,700 Web site partners, including Lycos.com.

“The dam has broken,” said Matt Wasserlauf, CEO of Broadband Enterprises. “It’s going to be a huge business, and the biggest players are recognizing there are real business models.”

The NBBC was first announced in April as a partnership between NBC and its affiliates, who are co-financing the venture together. NBBC content partners now include NBC Universal and third-party Web sites such as About.com, A&E Network, Break.com, CNET, Forbes.com, The Museum of Television & Radio, Sundance Channel, and Washingtonpost.Newsweek Interactive, among others. NBC Universal is providing video assets from its cable networks Sci Fi, USA, Bravo and CNBC as well its local stations, sports, news and entertainment divisions and iVillage. NBC also brought on board initial advertisers Procter & Gamble and JP Morgan Chase.

“We believe that if you liberate your content you will get it in front of the largest audience possible,” said Mike Steib, general manager of strategic ventures for NBC Universal. “We don’t believe the only solution is launching Web sites and getting people to go there.”

Indeed, as the NBBC rolls out video for partners to share and post in the coming days and weeks, a visitor to Break.com, for instance, could potentially see not only homemade viral videos on the site but also clips from NBC’s “The Office.”

“We have now generated incremental revenue and put our content in front of a broader audience,” Mr. Steib said.

Publishers like the idea too.

“We view this as a way to get our video to [our readers] and to provide more video not done by us to our readers,” said Caroline Little, CEO and publisher for WashingtonPost.Newsweek Interactive, the publisher of Washingtonpost.com and Newsweek.com.

The NBBC partners can select which videos they want on their sites and decide which of the other partners can have access to their video content. NBC sells the ads, though the Web partners can opt to sell them too. NBC then splits the revenue with the content owners and site publishers.

The challenge NBC will face is whether its name recognition, affiliate network and brand advertisers can make up for its lack of a technological engine like Google’s AdSense, the foundation for Google’s online video syndication strategy, said Will Richmond, president of Broadband Directions, a broadband video research firm.

The AdSense network has enabled Google to bring text ads across the far reaches of the Web.

“NBC needs to replicate some of what Google brings to the table with its reach,” he said. “NBC’s challenge will be to sell ads in a scalable, cost-effective way that provides value to advertisers on a par with what Google offers.”

Mr. Steib declined to comment specifically on competing with Google. However, he pointed to NBBC’s benefits as the breadth of content and the flexibility and control the partners have.