Wednesday, September 20, 2006

Gore Goes to Yahoo as Murdoch Moves from Mainstream and Portals

The online video scene seems to be moving along at the pace that weblogs had set for fomenting online change not so long ago. In addition to recent deals for music videos to appear on YouTube from major music distributors comes word from The Hollywood Reporter that News Corp CEO Rupert Murdoch is now ready to flip his interest in the DirectTV satellite television distribution network back to rival John Malone in exchange for Malone's interest in News Corp. Murdoch is also cooling on the idea of building traditional Web portals as aggregation centers, noting in an AP article "We're not sure the portal model is the way of the future at all,...We think people are going straight to the sites." Whatever doubts one may have had about Murdoch "getting" The New Aggregation as a model for online success have to be put aside at this point. He understands clearly that the future is not in aggregating and distributing mainstream content but in aggregating audiences who are themselves consumers, creators, aggregators and distributors of content in all major media forms.

In the meantime former U.S. Vice President-turned-media-entrepreneur Al Gore seems to have soured on his Current user-generated TV project's Google relationship and is sidling up to Yahoo to have a more mainstream service alongside its user-generated videos, according to a great summary by paidContent.org. The Yahoo! Current Network is to expose Current's online user videos alongside studio-produced content generated specifically for YCN. A post on Current's weblog seems to capture Current's frustration with the Google approach to video: "Here's what I've learned already: once you create a system in which everyone can participate, you need to brace yourself for how ridiculously random the participants are inevitably going to be." In other words, there's something to be said for blending professionally-produced content alongside user-generated content.

Gore's insistence on the lingering power of mainstream television may be valid for a new outlet trying to develop a first-Web-then-TV model, but Murdoch's outlook from the perspective of an established media giant trying to plot out its future seems to be more in focus with where video and other online media types need to go. Traditional broadcast media will be with us for at least one more generation in one form or another but the power shift away from distribution-centric content business models is disintegrating far faster than most experts would have predicted even six months ago. Lonelygirl15 seemed to figure that out easily enough - why hassle trying to get on some TV talent show to promote your acting career when you can start it right away online?

In trying to help users decide who from the democratic field of content producers gets to be seen on a broadcast outlet Current still presumes that those users really need that broadcast outlet to have market impact and importance. Yes, the rabble of user-generated content may not command the revenues at this stage that Current's investors expect, but with brand advertisers rushing in the other direction towards online outlets the money is in chasing publishing-empowered audiences, not distribution channels. Current may yet succeed via its online alliance with Yahoo in creating a solid path to mainstream ad revenues online and via its cable TV channel, but the odds are that the Murdochs of the world will beat Current to the punch via TiVos equipped to feed video from the Web directly to TV tubes. Sorry, Al, the climate's warming faster than you think...
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