Expect more YouTube deals
Media execs accept promo potentialGoogle's $1.65 billion acquisition of YouTube will spark a flurry of deals among mainstream media companies and turbocharge the market for Internet video, top industry executives said Wednesday at separate conferences on digital media.
AOL Media Networks president Mike Kelly praised the Google-YouTube deal while speaking at the OgilvyOne Digital Summit. He predicted a "parade of deals" between media companies and YouTube during the next six months.
"You can't ignore the audience-building potential of YouTube," Kelly said.
Beth Comstock, president of digital media and market development at NBC Universal, detailed how NBC Uni has grown to embrace YouTube during the past year, using it to promote NBC's Emmy-winning comedy "The Office" and adding viral videos to the site. She said she sees a bright future for video on the Internet and predicted that it would be a "$9 billion marketplace" by 2010.
YouTube co-founder Chad Hurley praised NBC's approach to the site.
"They realize the power of what we're providing," he said. "It's a way to tap into a new audience."
Hurley said YouTube will continue to look for ways to monetize content on the site, and he emphasized the importance of his product in the new-media landscape. "It's a way to leverage the power of millions to control what you created," he said.
During a separate event on the convergence of the Internet and marketing — called Media Convergence Forum: The Marketer's Dilemma, organized by the Economist magazine — Martin Sorrell, CEO of advertising giant WPP Group, said that what keeps him up at night are "China and the Internet," adding that "the first is easier" to figure out right now.
On the Web front, Sorrell said that for the longest time he wasn't sure whether Google was a friend or foe.
"I christened them a 'frienemy,' " he said, explaining that the Internet search giant firm seems to be a partner and a competitor.
Google has been moving in on WPP's turf, Sorrell explained. For example, it already is offering or promising research and other services that WPP provides. And it recently acquired dMarc, which sells broadcast advertising inventory online.
Sorrell stressed that WPP must further expand its role in Web advertising and other nontraditional services to boost revenue from such businesses and remain on the cutting edge.
Asked about Google's acquisition of YouTube, Sorrell said the money spent on it was "petty cash" for Google and the transaction was "a brilliant deal because it shut out the competition."
In his appearance at the Economist gathering, Fox Interactive Media president Ross Levinsohn said that MySpace, his News Corp. unit's social-networking destination, has about 80 million registered users and 125 million profiles. He also said MySpace is careful to offer only relevant content and to "not force News Corp. content" on users.