Future digital video destinations will be asking a pressing question: "Is it worth 10% of your advertising revenues to get more distribution?"The owners of Hulu.com
-- NBC Universal and News Corp. -- don't need the future
to make that call. They don't think it is worth it. They believe their strong marketplace position is reason enough.
Because Hulu.com has been a wild success
for partners NBC Universal and News Corp., it doesn't need outside destination deals to further its
video footprint. Especially deals with would-be competitors.
In this case, CBS Corp.'s TV.com
-- the Internet destination that came to the company in conjunction with its CNET acquisition. As a part of its agreement with TV.com, Hulu has decided to pull its content off TV.com
, giving TV.com less network-type TV content
to work with, not to mention the 10% of advertising revenues that digital video syndicators typically receive.
This has been a point of differentiation for digital content: Do
you offer up content links to related digital destinations, which, in theory, makes your site more valuable, more of a video portal? A number of sites already do this. Or, do you restrict your content
to a few players?
All this is in line with how the two parties currently feel about video on the Internet. CBS's head of digital, Quincy Smith, believes that syndicating content whenever
possible is best. NBC/News Corp.'s Hulu has a different tack: to be more selective, mostly to big areas AOL, Yahoo and MSN.
On the surface, this would seemingly punish CBS. But this was
expected. The deal with TV.com was made before CBS acquired CNET. CBS declined to be a part of the Hulu destination.
TV.com actually has more unique visitors than Hulu. But Hulu is
way ahead of TV.com in unique video views, something advertisers closely monitor.
Who has the better plan? This drama hasn't ended