This one is a stretch. But back in the day, Bertelsmann - an old media establishment - decided to invest in Napster - the cool new kid in town that all the kids were raving about - and in the end, that was not a wise move.
Last year, YouTube was the new kid in town, and there were many comparisons to Napster. Ultimately Google, an old, new media outfit, bought YouTube - the new, new cool kid in town - and many asked if it was a wise move. From a purely financial engineering move, yes, it was a no-brainer: an all-stock deal, taking out a potential thorn down the road, avoiding a MySpace-$900M move and avoiding YouTube to fall into the hands of you know who.
But now Viacom, CBS, NBC and company are all coming down hard on YouTube and Google. Today we see via PaidContent that this is making YouTube chase smaller content deals, while Viacom sees a rise in their own traffic since they asked YouTube to remove 100,000 clips.
While many people in LaLa land questioned Viacom’s decision, the simple fact is that Google/YouTube are not being fair in the debate. I’ve written about this before.
Google is finding out that indexing and profiting off text-based content is very different than tackling video content. I am seeing some things in the marketplace that show just how much video can be a killer app (hate that term). More on that to come. I would love to disclose more but I am working on an interesting, potentially landscape shaping deal. Or at least, I wish…
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