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Just An Online Minute... Google, Media Companies Hit Stalemate

When Google announced last October it was purchasing YouTube, it appeared as if the companies were fast on their way to forging alliances with major TV and record companies.

But Google and at least some TV companies appear to have reached an impasse.

Last fall, CBS said it would distribute news, sports and clips from prime-time shows like "Survivor" on a CBS-branded YouTube channel, while Sony BMG and Warner Music were going to distribute ad-supported music videos on Google. NBC had several months earlier come out with its own plan to harness YouTube to promote TV programs.

But today's Wall Street Journal reports that Google-CBS talks faltered when the companies couldn't agree to terms for distribution of shows like "CSI," even though Google reportedly promised CBS more than $500 million in ad revenue. The Journal also reports that NBC's general counsel dashed off a letter to Google griping about copyright infringement on YouTube.

These signs of trouble come several weeks after Viacom took a dispute with Google to a new pitch, ordering the company to remove 100,000 clips from YouTube.

Earlier this week, Viacom said it was going to distribute on upcoming YouTube rival Joost, founded by the same people who created peer-to-peer company Kazaa -- which itself was a longstanding bane to media companies.

Of course, whether Joost will be able to keep pirated video off its site remains to be seen, since the service hasn't even launched yet. In fact, Viacom's decision to support Joost seems at least as much a rebuke to Google as a vote of confidence for the Kazaa creators.

Viacom and other media companies seem to believe that Google, with all its technological innovation -- and cash -- could prevent copyright infringement if it really wanted to. Or at least that it could compensate the companies for their clips.

Meantime, it's hard to see whom this impasse is helping. Consider, just two months ago, after CBS placed more than 300 clips on YouTube, the TV network unveiled a study showing that ratings had increased. The company said "The Late Show with David Letterman" drew 200,000 new viewers, a 5% increase, after CBS placed clips of the show on YouTube, while "The Late Late Show with Craig Ferguson" increased its viewership by 100,000, or 7%.

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