Google in Content Deal With Media Companies
By LOUISE STORY
Google built an empire delivering advertisements across the Internet, and now it plans to distribute content from media companies just as aggressively.
Google is working with Dow Jones & Company, Condé Nast, Sony BMG Music Entertainment and other large content companies to syndicate their video content on other Web sites. The videos appear inside Google ad boxes on sites that are relevant to the content of the videos, and advertisements run during or after the content. Google shared the ad revenue with the video provider and with the sites that show the videos.
There are already video ad networks that make similar deals, and NBC Universal is attempting something similar. But the Google experiment could be more widespread since the company already has a vast reach on the Internet.
“Once upon a time, if you had some video content that you wanted to distribute, you could do it on three television stations in the days of the networks, then 100 in the days of cable,” said Kim Malone, director of online sales and operations for Google AdSense. “Now, thanks to this program, you can do it on literally millions of channels on the Internet.”
On the financial news site StreetInsider.com, for example, videos from The Wall Street Journal, a Dow Jones property, are running within ads on the site. In one, Emily Friedlander, a Wall Street Journal reporter, narrates a video feature on the TKTS booth in Times Square; Sam Schechner of The Journal speaks about marriage in TV shows; and Jonathan Welsh visits a motorcycle show.
After the three videos, a commercial from Pantene Pro-V, a hair conditioner, appears. In that case, Google shares the ad revenue with StreetInsider.com and Dow Jones.
The videos and the accompanying ads can also be found on articles on YoungMoney.com, AdVersus.com and SeatGuru.com, among other sites. A ski resort show created by LX.TV, a broadband network, is being shown with ads on skiing blogs.
The ads are part of Google’s larger initiative to gain traction with consumer goods companies who spend billions on brand advertising. Founded as a text-based search company, Google’s early advertisers were smaller companies and advertisers who bought ads to generate direct sales rather than to build brand recognition.
Large brand advertisers still spend the bulk of their money on television advertising, but Google sees potential for them to spend more online through the use of video ads.
But Google’s broad plan to bundle media content with ads depends on participation from media companies. On the one hand, Google’s network will bring more visibility of their content across the Internet, where attention is fragmented online between thousands of sites. On the other hand, media companies like to be a destination in their own right, so that they can sell ads on their sites.
“We want people to come directly to our site, but that’s part of why we’re doing this,” said Sarah Chubb, president of CondéNet, the digital arm of Condé Nast. “To see if we can find people that we haven’t found in other ways.”
Media companies also want to keep control over their relationships with advertisers. Google sells ads in its network for Condé Nast videos, but in a similar content-ad test with MTV Networks last fall, MTV sold the ads (sharing the revenue with Google).
Adam Cahan, executive vice president of strategy and business development for MTV Networks, said that his networks want to make sure that when their content is distributed on the Web, that it links to their sites.
“In the same way that Harry Potter book sales grow from a Harry Potter movie, you would not give the movie away to support the book sales,” Mr. Cahan said. “There is a balance between promotion and consumption that is up to the original content producer to manage.”
