Perhaps Viacom had an ace up its sleeve after all. When the company stormed out of negotiations with Google a few weeks ago and demanded that YouTube remove all its clips, the popular thesis was that the "Big Media YouTube Rival" was a go. It wasn't--and, likely, will never be--but Viacom appears to have found a reasonable Plan B:
Just two weeks after ordering its content to be pulled from YouTube, Viacom Inc. today is expected to announce a broad licensing deal with Joost, a new Internet service that specializes in commercial video content. The anticipated deal, which follows the recent collapse of similar talks between Viacom and YouTube parent Google Inc., involves licensing hundreds of hours of programming from Viacom cable networks such as MTV, Comedy Central and Spike as well as movies made by the company's Paramount studios.The companies declined to disclose financial details. In similar deals in the past, Viacom has received two-thirds of the advertising revenue and other compensation. (WSJ)
YouTube has already won the online video-clip game. It may be, however, that the online video-show game--the place where users can go to find full-length TV shows and other Big Media content--may eventually have a different winner.
According to the WSJ, Joost's strategy is not to run clips but full episodes with high-quality resolution--"real TV online." It is not hard to understand why this, combined with a guaranteed revenue share and a commitment to partners, is appealing to those in the TV business.
What is hard to understand, at least at this point, is why anyone would want to watch "real TV online"--at least when there is a functioning television set nearby. YouTube viewers watch 100 million clips a day in part because the clips are a different entertainment product than a television show, one that is well suited to both the smaller screen and short attention span of the average Internet user (for whom a 30-second television ad seems as long as Dr. Zhivago) Using the internet to distribute TV shows to televisions is one thing, but using it to actually watch those shows on computers is another.
Unless Viacom and other TV companies figure out how to break their shows into clips, and then license those clips exclusively to Joost, deals like today's are probably not much of a threat to YouTube. If Viacom does figure out the clip thing, however, and Joost signs up a bunch of other media companies... Well, then, YouTube might want to hurry up and get its Big Media act together.