Follow Google Out of the Garden
By Larry Honig -- Broadcasting & Cable, 10/15/2006 8:00:00 PM
Let’s discuss a general problem that I call “clericalism.” It’s the tendency to talk only to people in your club. It leads media-biz managers to misread what the Google/YouTube deal is about.
The stock market likes this deal. Is it dilutive to the tune of $1.6 billion? Nope. Investors, bless their hearts, divined that GOOG was worth about $3.6 billion more three days after the deal was announced than it was before. The market (and I) disagreed with Mark Cuban, who called buyers of YouTube at these prices “morons.”
This merger is for those consumers who don’t make appointments to watch “Must-see TV” and don’t buy an entire CD for one song. They are Skyping each other and downloading Linux and Firefox browsers. Walled gardens, begone!
And yet management often is the last to leave these gardens.
YouTube is the fastest adapter to a whole new video-viewing paradigm: shorts, snippets, low-intensity (or low-production-value, if you prefer) video. In pop-music terms, it’s got more in common with hip-hop or Paul Oakenfold—who samples and embellishes—than with traditional set-piece composers.
It has very little in common with the one-hour network-TV format.
And (gasp!) it’s got the demo. If you’re still married to the old idea that you can tell people what—or how—to watch, you’re in for a bumpy ride.
Google isn’t about transferring wealth from rights-holders to Google, as Microsoft CEO Steve Ballmer told BusinessWeek. Google, the enabler, is merely playing the game of “Go” around less creative media players.
The Google-YouTube deal is just the beginning of this game. Voice search, broadband in cars, and geo-coded information are all white spaces on the map. The next “wowie” deals will be based on the melding of visions at least as much as on patents and other intellectual-property–rights portfolios.
What’s next in the video space? Voice recognition is key. Watch podzinger.com,, blinkx, the open-source Sphinx from Carnegie-Mellon, and the voxforge.net project.
And network programmers? Check out pandora.com.
In other words, be your own cannibal. That’s what your shareholders expect.
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