Are portals passe?
When the CBS network geared up to show the annual NCAA basketball tournament online for the first time in 2003, the television network didn't have the technological know-how to stream games itself. So it partnered with Web giant Yahoo Inc.
This spring, though, CBS went solo and delivered more than 19 million streams of live and archived games.
Viacom Inc.'s CBS isn't alone in bypassing the so-called portals as it moves programming online. In the last month, ABC Television Group and Fox Broadcasting announced plans to make some shows available free on their websites. Cable networks including MTV and Bravo also have "broadband channels" featuring TV and Web-only shows.
Providing e-mail and search services and aggregating news, the portals "built huge audiences on the Web first," said Larry Kramer, president of CBS Digital Media. "Now we're in the process of building huge audiences on the Web around our content."
Analysts say online video distribution is still in its early days. The recent do-it-yourself trend may be a temporary shift as content owners experiment with new business and distribution models. Internet portals, they point out, are still winning deals, as evidenced by CBS' decision in March to create a site with Yahoo to put "60 Minutes" content online. CBS hopes the Web project attracts younger viewers to the show.
But some believe the role of portals -- such as Yahoo, AOL, Google, MSN -- in the growing market for video is less certain than it was only a few months ago.
"I think the portals have been somewhat surprised at the efforts underway of TV content companies to go directly to consumers, and circumvent them as gatekeepers," said Gartner Inc. analyst Allen Weiner. "It probably leaves the people at Google, Yahoo, etc., scratching their head as to where they're going to fit in."
For most of the last year, the portals seemed the obvious choice for video producers seeking sizable online audiences -- the control panel through which computer consumers found clips to watch.
"That's where all the users and the traffic were," said Scott Kessler, Internet stock analyst with Standard & Poor's. "They already had the capabilities to disseminate that content and monetize it."
But now the portals are being squeezed from below and above.
On amateur videos, Google and Yahoo's search engines face heavy competition from popular new sites such as YouTube, Break.com and Veoh Networks, which recently landed $12.5 million from investors, including former Walt Disney Co. chief Michael Eisner.
