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  • Yahoo Has Become a Magnet for Video Syndication by Big Media

    Late yesterday NBC Sports and Yahoo announced a content sharing and promotional partnership that further cements Yahoo's role as a video syndication magnet for big media companies. In addition to the new NBC Sports deal, over the past year, other major media partnering with Yahoo include ABC News, CBS Television Distribution, Wenner Media, Clear Channel, CNBC, Fox Digital Entertainment/DirecTV and others, as each has sought to extend its online video presence beyond their own properties and to generate new ad revenues.

    For all of Yahoo's other, well-documented problems, it retains the kind of massive reach that can move the needle for even the largest media companies. Exhibit A of Yahoo's distribution prowess is the ABC News deal, announced in Oct. '11. According to ABC News president Ben Sherwood, one year in, the Yahoo-ABC News collaboration was the top-rated online news network with 85 million unique users, accounting for nearly 50% of all general news videos viewed online. In addition, GoodMorningAmerica.com, which was launched on Yahoo, is the top morning news site, and numerous original web series and live specials were streamed in the past year, together totaling 351 million total minutes viewed.

    Those are the kinds of results that demonstrate Yahoo's position in certain verticals like News, Sports, Entertainment and Finance is as strong as ever. While major media companies have made strides in building out their own online properties, they also seem to recognize that partnering with Yahoo can greatly accelerate their efforts, both for distributing existing video and also for creating new joint online-only programming franchises.

    All of this activity is part of a larger context  of the "Syndicated Video Economy," which I've been talking about for almost 5 years. In the SVE, video content providers shift from solely trying to drive audiences to their own properties, instead emphasizing getting their content into places where large audiences live (e.g. Yahoo). Unlike television's "must-see TV" approach, the web's on-demand, user-controlled dynamic means to truly succeed, content providers need to be willing to give up some programming control in exchange for greater reach.

    These days the syndication model is hotter than ever. According to comScore, in October, 3 of the top 10 trafficked video properties were once again syndication-centric: AOL, NDN and Grab Media. AOL is one of the biggest beneficiaries of syndication so far, seeing its video ad revenues jump from $10 million 2 years ago to a projected $100 million in 2012, largely due to its acquisition of syndicator 5Min in 2010.

    AOL's success demonstrates that syndication is not just about content distribution, but about monetization - simply put, more eyeballs translates into more ad revenue. Supporting this point, just last week, Doug Knopper, Co-CEO of FreeWheel, which powers online video advertising for many of the world's largest media companies, said in an interview that the "syndicated video economy is really kicking in right now," as major video content providers seek broader distribution and monetization for their video.

    While Yahoo is wrestling with a host of strategic issues, one clear bright spot for the company is video, where it has become a partner of choice for major media companies. With the strong tailwind of the syndicated video economy and the proliferation of connected and mobile devices, Yahoo's momentum in video should only increase in 2013.