Diller: 'Final convergence' in about 3 years
EmptyNEW YORK -- Barry Diller's IAC/InterActiveCorp expects to invest "a couple hundred million dollars" in online content in the next few years, the media mogul said Wednesday.
IAC, which owns Match.com, CitySearch, Ask.com, HSN and Ticketmaster, purchased CollegeHumor.com in August and will launch 23/6, a satirical news site, in the coming months.
Speaking at the Media Summit, sponsored by McGraw-Hill and produced by Digital Hollywood, Diller said that 23/6 is just one of a "ton" of ideas that will be rolling out in the next few years with "a couple hundred million dollars" in capital behind them.
Diller, who used to run Paramount Pictures and is credited with creating Fox Broadcasting Co., said media is in the midst of a "radical revolution" and that all content will be in digital form before long. He envisions a "final convergence" in about three years, in which a "big data pipeline" will shoot content to various home and office screens.
However, Diller said he does not see the much-hyped user-generated-content movement leading this revolution. He argued that there are very few people capable of creating compelling entertainment that will be appreciated by a mass audience.
"As time goes on, professional product is going to be where this develops," he said. "It will not be the long tail, but it will be the short tail that will generate huge audiences."
Speaking at a later panel, Todd Herman, GM of media experiences at MSN Entertainment, disagreed with Diller's assessment of user-generated media and pointed to the "absolute time suck" of the estimated 120 billion minutes of such content on the Web. "It is going to eat out of the pie," he said. "It will change the range of tastes."
At the same panel, Greg Foster, vp corporate development at Turner Broadcasting, said the answer lies somewhere in the middle of these two characterizations. For now, branding and programming is lost in the "ocean" of user-generated content. "A best of the worst will emerge that will create brands and command compensation," he said.
Speaking about the recent news that Viacom Inc. has demanded that Google-owned YouTube take down video clips from its networks, Diller said the company made the right choice. He expects a "domino effect" and that media companies will not let YouTube make all their content available on the site.
Diller also mentioned that he doesn't see great value to social-networking sites like News Corp.-owned MySpace. He said IAC passed on the chance to purchase the firm, which he likened to the "mall," because it didn't see a way to generate advertising revenue from the site.
"It's a great promotional vehicle, but it's not in evidence how vibrant an ad medium it is," said Diller, who then admitted that he doesn't have all the answers. "Who knows? Ask again tomorrow."