News Corp., NBC Universal in Major Broadband Video Initiative

News Corp. and NBC Universal have announced plans to launch a broadband video Web site--which has not yet been officially named (note: the partners are referring to it as "NewCo")--which they claim will be "the largest Internet video distribution network ever assembled." According to the companies, the site, which will debut this summer, will feature thousands of hours of full-length programming, movies and clips from at least a dozen networks and two major film studios (programming on offer will include full episodes of and clips from such shows as "Heroes," "24," "House," "My Name Is Earl,"  "Saturday Night Live," "Friday Night Lights," "The Riches," "30 Rock," "The Simpsons," "The Tonight Show," "Prison Break," "Are You Smarter than a 5th Grader" and "Top Chef," as well as programs from NBC's and News Corp.'s libraries). Its initial distribution partners will be AOL, MSN, MySpace and Yahoo!. The latters' users--which, according to News Corp. and NBC Universal, represent 96% of the monthly US unique users on the Internet--will have unlimited access to the site's content: each distribution partner will offer the site's content in an embedded player that will be customized in accordance with the look-and-feel of the partner's own Web site.

A number of charter advertisers have already been signed up for the new site, including Cadbury Schweppes, Cisco, Esurance, Intel and General Motors. Advertising on the site will be managed by AOL-owned Advertising.com. "This is a game changer for Internet video," News Corp president and COO, Peter Chernin, said in a prepared statement. "We'll have access to just about the entire US Internet audience at launch. And for the first time, consumers will get what they want--professionally produced video delivered on the sites where they live. We're excited about the potential for this alliance and we're looking forward to working with any content provider or distributor who wants to take advantage of this extraordinary opportunity."

According to NBC Universal and News Corp., the new site's TV programming content will be advertising-supported and free of charge (note: the partners have not said how they plan to price the site's movie offerings, which will include such films as "Borat," "Little Miss Sunshine" and "The Devil Wears Prada," together with bonus materials and movie trailers). The companies say the site will offer video search, and such interactive features as personalized video playlists, mash-ups, and online communities. They also say they plan to seek agreements with additional distribution partners (note: the companies say that other sides in their respective corporate families, including NBC Universal's iVillage and News Corp.'s IGN will also have the opportunity to become distribution partners), and that, once the site is launched, they may consider acquiring content for the site from third parties, as well as producing and licensing original programming for the site.

The site will be operated by a new company that will be located in New York and Los Angeles, and that will have its own advertising sales force. It will be launched by a transitional management team, led by NBC Universal chief digital officer, George Kliavkoff, and comprised of executives from both NBC Universal and News Corp. Each company will devote a significant marketing and promotional budget to the new site's launch, the partners say.

Originally Published: April 16, 2007 in [itvt] Issue 7.26 Part 3

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