Google CEO Eric Schmidt is on the corporate relations warpath in New York this week in an attempt to assure its traditional media company partners that YouTube, the company's $1.65 billion
acquisition, will not turn into a content competitor. Schmidt, fresh from a meeting in Los Angeles with Rupert Murdoch and other News Corp. executives, arrived in New York Thursday to meet with top
executives from Time Warner, Viacom, CBS and other big content companies. In an interview with the
Financial Times, Schmidt reiterated that the YouTube purchase was all about expanding Google's
ability to distribute ads across the Web. "We are not in the content business, and partnerships really show the application of our advertising network to the content and media abilities of our
partners," he said. "We want those partners to put their media content into this emergent [system]." He added that video is "one of the most important new media types on the Internet." News Corp.,
which last year bought the social network MySpace, has become one of Google's most important partners, after the companies agreed to a search deal guaranteeing $900 million in payments to the media
giant over a number of years. But the YouTube acquisition would also make News Corp. a Google competitor, since MySpace is also a big player in the online video market. According to yesterday's
Wall Street Journal, at one point MySpace considered banning YouTube videos from its Web site after YouTube made it clear that it wasn't interested in a News Corp. acquisition.
Read the whole story at Financial Times »
