MTV Networks in deal to monetize uploaded videos
The company plans to pair ads with clips on MySpace using Auditude's technology.
Reporting from San Francisco — Hollywood used to fume when fans uploaded video clips to the Internet to share with their friends. Now it's looking to cash in on them.
For several years, television networks and movie studios dispatched legions of lawyers and sophisticated technology to stamp out piracy while showcasing their content on their own websites. Viacom Inc., owner of Paramount Pictures and MTV Networks, filed a $1-billion copyright infringement lawsuit against Google Inc.'s YouTube, the Web's most popular video-sharing service.
But MTV Networks' other media giants have started to embrace the consumer-led digital revolution. The Viacom unit plans to pair advertising with clips from "The Daily Show with Jon Stewart," "Punk'd" and other shows that MySpace users upload to the social network site -- whether they have permission or not.
MTV plans to pull it off through a deal, scheduled to be announced today, with MySpace and Auditude, a Silicon Valley start-up that is providing the advertising technology.
The strategy is similar to that of YouTube, which late last year launched a system that identifies video clips and then offers copyright holders a choice between removing the material or letting YouTube place ads on it in exchange for a piece of the revenue.
Analysts say tensions between new media and old have eased. Both are looking to profit from how today's generation consumes and interacts with online video.
If the strategy works on MySpace, where millions of videos are streamed every month and where watching premium content is one of the most popular activities, other networks will follow suit, predicts Forrester Research analyst James McQuivey.
"This is a sign that we are finally ready to do this," McQuivey said. "Two years ago the solution was, 'Let's sue YouTube and block this.' It really hasn't worked. Now the solution is, 'Let's create a system where content can derive some benefit.' "
MySpace is enthusiastic about the concept rolled out by Palo Alto-based Auditude. MySpace doesn't have to play copyright cop, controlling what consumers can and can't watch on its site. Instead, it gets a split of the advertising revenue. MTV Networks gets to target ads to fans of its shows and direct them to its shows and merchandise.
And consumers get to share some of the content they want without having it blocked or removed, said Jeff Berman, MySpace's president of sales and marketing.
