[Round 2] Viacom v. Video Sharing Sites

Corner 1: Viacom

Viacom, the media conglomerate behind numerous cable properties (including MTV, VH1 and Comedy Central), has certainly enjoyed tons of success in the last few years. Its cable programming can often generate more buzz (positive or negative *cough* Jersey Shore *cough*) that keeps it very competitive in a crowded space.

The media group has done very well over the air, but it’s had a slight history with the online video world. In 2007, it memorably sued Google for $1b related to copyright claims on video clips that it owns posted to the site by its users. It started a landslide of the “takedown” variety and kicked off a small broadcast giant vs. little video site battle ever since. Remember, this was early in the days of YouTube (within it’s first 18 months) and right after Google picked it up, and Viacom’s shot was among the first on the copyright questions around it. Court battle to come, and the bigger question (i.e., is it YouTube’s responsiblity to monitor and act to censor its users instead of waiting for a company to request removal) still has yet to be answered.

Since then, Viacom has developed online video technology that allows clips to easily be watched on its own properties, including dedicated micropages for The Daily Show and The Colbert Report. That way, video content was still available, but in an “owned” way and against which the company was able to self-serve display and interstitial ads. However, there were limitations on the full dispersion of clips and it kept all of its shows pretty far away from YouTube.

Corner 2: Hulu

Since launching in 2007, Hulu has had an incredible amount of exposure thanks to housing hundreds of episodes and full movies that are owned by major media groups. It has been very corporation friendly as it builds in ad-structures, limitations on the duration content is available and a single, central point for measuring viewiership. Even though it was initially a joint venture between NBCU and Fox, it has grown to include other partners, including Viacom. Most notable among Viacom’s contributing properties is Comedy Central, building a very popular fan base (at the time of this, The Daily Show is the third highest-watched program on Hulu).

The Situation

Yesterday, in a post to Hulu’s blog from its SVP, Content & Distribution, Andy Forssell, the facts were laid out that Viacom would be pulling its Comedy Central content from the service. The network’s content, which had been on the service for nearly two full years, was incredibly popular among the fan-base, as previously noted, but they weren’t seeing the revenue come in from the venture that it was hoping. As Forssell commented in his post:

In the past 21 months, we’ve had very strong results for both Hulu and Comedy Central, in terms of the views and revenue we’ve generated, thanks to a couple of key trends. First, more and more of our viewers have voted with their time by making these shows a regular part of their day. And second, we’ve driven steadily increasing revenue per view as advertisers voted with their budgets to take advantage of innovative ad formats and very strong advertising effectiveness. After a series of discussions with the team at Comedy Central, though, we ultimately were unable to secure the rights to extend these shows for a much longer period of time.

This isn’t to say that the shows will not be available online – the video player at The Daily Show’s site is one I actually use quite often myself. However, they will be leaving a site that has become the second highest place for video watchers online – with a shade over 1 billion views in the month of December.

The Judge’s Ruling

Just to carry that last point through into my verdict: Viacom has prevented its content from appearing on the number one video sharing site and now has pulled its content from the number two video sharing site. In the era of “go where the eyeballs are,” this is a backwards walk. The microsites that support its programming will continue to get views from fans like me (I’ve been a loyal Jon Stewart guy for what feels like forever – I even own the Indecision 2004 DVD). I will continue to watch, promise, online and broadcast.

But the audience they may be missing is the other millions who traverse these sites who maybe *aren’t* overly plugged into the mockery of cable news. Walls are great for keeping content in and owned – but they also have the function that they prevent anyone new from getting in. This method will help Viacom efficiently capitalize on the audience it has – but they may have just put a pair of blinders on when it comes to the people they need to get that audience to grow.