Eric Schmidt, CEO of Google, told a Bear Stearns conference crowd in Florida Tuesday, that he thinks there will be enough bandwidth for video over the Internet.
In a briefing for financial analysts, Schmidt said the company was going to spend the money to be able to provide quality entertainment over the Internet, saying it had already heavied up on data storage and fiber thanks to fire sales after the Internet bubble burst. But he also said there were some unanswered questions about an Internet that has empowered so much user-generated content.
Schmidt asked what would happen when the next billion people come on line? What happens when everyone decides to do user-generated content? "I don't think the debate has occurred, and it needs to."
Commenting on YouTube, which Google bought, Schmidt said there was a video explosion last spring. He said Google bought YouTube for the traffic, "the community," and opportunity to monetize that.
"There is a large ad opportunity to be built in user-generated video," he said. Google struck two recent deals with the NBA and BBC, he said, and conversations continue with major media players.
Schmidt said those conversations include pointing out to the companies that people are going to copy their protected content, but that that person is a fan and somebody the media wants to know. Google can convert that content into a licensed copy, he said, and help monetize it.
As a potential targeted ad market, we prioritize TV and radio pretty highly, he said.
He said that today, when you turn on the TV, the ads are not targeted. Ads for baby products sent to homes without babies, for instance. The next generation of digital set-top boxes, by contrast, will be addressable Internet devices, he pointed out, and present a huge opportunity for targeted advertising.