Video Horserace

December 10, 2008

Many Web log wizards are chasing the story about Google’s adding magazine content to its burgeoning commercial database killing service. Old news from my point of view. The GOOG is becoming the go-to service for research with words. In fact, it is game over for Thomson Reuters, Reed Elsevier, Wolters Kluwer, Ebsco, and others in this professional content sector. Management at these companies can whip up Excel models to prove me wrong, but Google has demographics and infrastructure on its side. Besides I describe the trajectory of word-centric content in my forthcoming Google and Publishing study.

The real action is in video. Anyone under the age of 17 can explain what’s happening in information. Words are okay, but the future is the rich media experience where words are amplified by music. Do you have a soundtrack for your life? My neighbors’ kids do. Do you make pix and vids on your mobile phone and use these to perform communication functions for which I need pencil and paper? Check out the demographics, and you don’t need the flailing New York Times to remind you of trouble when reporting that Harcourt will not publish books for a while.

Consider the comScore video results table here. The handicappers look at the data, which are probably generally on track but off the mark in absolute values, and see that Google is at the top of the table. Google appears to have about 40 percent of the online video traffic measured and analyzed by comScore. So 60 percent of the video traffic is “in play”; that is, other companies can enter the video ballgame and have some room to maneuver. Look at the number two player, Fox Interactive Media. If comScore data are reasonably accurate, Fox has a chokehold on four percent of the videos viewed market. One of the largest media companies in the world has captured four percent of the market and lags Google’s YouTube by 36 percent. The rest of the field perform less well., the darling of the old TV kingpins, is in the race. Maybe like a marathon runner getting a marvelous second wind can close the gap between Hulu and Google, but I think I will give Google the advantage for now.

Who cares? The action is text, right?

Wrong, wrong, wrong. could be a major cost sinkhole for Google. If video is expensive for the GOOG, how much of a dent in the bank accounts will video make at outfits like Fox, NBC, and others in the comScore table. Google, for now, seems will to spend to support As the credit mistral whips through old media, a willingness to spend may winnow the companies in the comScore league table.

Demographics and time, therefore, may give Google an advantage. As pundits gnash their teeth over Google’s overt moves into commercial textual information, Google management is implementing tactics designed to bleed rich media companies, thus weakening them.

Just as the book publishers and other print gurus rolled over into a position of submission to Googzilla, the same fate awaits rich media. Google Books’ growth is old news. The real action is in rich media. The comScore table makes clear to me that the GOOG is poised to destablize more 20th century giants with its 21st century business model. Now tell me why I am incorrect. Facts, please. Catcalls make the geese honk.

Stephen Arnold, December 9, 2008


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