Last month at my Disruptors Roundtable in Los Angeles, the anger and distrust between YouTube and the media industry was palpable in the room. Two execs from YouTube and News Corp. got into a heated debate about who is bypassing whom in the world of digital video.
YouTube's vice president of content partnerships Jordan Hoffner charged that networks like Fox and NBC are bypassing their affiliates whenever they put their TV shows on their Websites. Mike Lang, the executive vice president of Fox Networks, retorted that every time an unauthorized video is put on YouTube that's bypassing the networks. To which, Hoffner shot back: "Send a letter." (As in a takedown letter).
Watch the CNNMoney video from the event, which just went up. What I love about this exchange is that it is so much more candid than what you'd get from the YouTube bosses. (Full transcript after the break)
¶--JORDAN HOFFNER, Vice PRESIDENT OF CONTENT PARTNERSHIPS, YOUTUBE--
REAL DISRUPTION I THINK IS THE WAY THAT THE ECONOMICS ARE STRUCTURED. SO IN THE PAST IT WAS GET PAID IN ADVANCE AND THEN PRODUCE SHOWS.
NOW IT’S PROVE IT THAT YOUR SHOW IS GOING TO BE SUCCESSFUL AND YOU WILL GET A SHARE OF THE REVENUE. ...
¶--MIKE LANG, EXECUTIVE VICE PRESIDENT, STRATEGY AND BUSINESS DEVELOPMENT, FOX NETWORKS--
WHO’S AGREED TO THAT DEAL YET?
... EVERYBODY ELSE, AS IS YOURS ... SO THAT IS THE THING.
IT IS PROVE IT AND IT STARTED NOT ONLY IN ONLINE VIDEO, BUT I THINK WITH OUR FRIENDS AT FOX AND ABC I THINK THIS IS PROBABLY THE LAST YEAR OF NETWORK UPFRONTS. MAYBE IT’S ONE MORE YEAR.
¶--ERICK SCHONFELD, EDITOR-AT-LARGE, BUSINESS 2.0--
ARE YOU SEEING THAT AT FOX, ARE YOU GOING TO GET RID OF THE UPFRONTS?
NOT THAT HE KNOWS OF.
WE MIGHT BE THE ONLY ONE LEFT, BUT I DONT' THINK THAT IS ON THE RADAR - OF A LOT OF TRADITIONAL MEDIA COMPANIES//I AM TELLING YOU RIGHT NOW THE IDEA THAT THERE IS GOING TO BE PIRATED FILMS AND TELEVISION CONTENT ON SITES THAT OTHER PEOPLE ARE MAKING MONEY OFF OF AND WE'RE JUST GOING TO . . . MEDIA COS ARE GOING TO SIT BACK AND LET THAT HAPPEN IS A MISNOMER
WE’VE GOT THIS INCREDIBLE COMMUNITY THAT CONTRIBUTES NOT ONLY VIDEO - BUT THEIR TIME - THERE IS ONLY A CERTAIN AMOUNT OF TIME THAT PEOPLE HAVE TO PRODUCE STUFF AND THAT IS WHAT WE HAVE MORE THAN ANYTHING ELSE.
¶--SAUL BERMAN, ENTERTAINMENT AND MEDIA GLOBAL STRATEGY LEADER, IBM--
BUT IF YOU ARE A CONTENT OWNER YOU DONT WANT AN INTERMEDIARY
LIKE BLOCKBUSTER IN THE PHYSICAL SPACE, ITUNES OR APPLE
MEDIA COMPANIES ACT THE SAME WAY WE DO
SO WHO GETS THE VALUE?
THEY ARE CUTTING THEIR AFFILIATES OUT OF THE DEALS ..
I MEAN, THE LOCAL BROADCASTERS ARE LIKE ‘WELL, WHAT DO I DO HERE?”
EXCUSE ME WHO IS? WHO IS? MOST OF THE NETWORKS, JUST SO YOU KNOW, AGAIN, FOR PEOPLE WHO ARE IN THE MEDIA INDUSTRY, MOST OF THE MEDIA COMPANIES HAVE EMBRACED THEIR AFFILIATES ...
BUT WHEN YOU ACTUALLY TAKE THE OFFICE AND PUT IT ON NBC.COM RIGHT AFTER IT CLEARS HAWAII, YOU ARE BASICALLY BYPASSING THE AFFILIATE
NO, WHEN YOU GO TO YOUR AFFILIATE AND DO AN AGREEMENT WITH THEM—I CAN'T SPEAK FOR NBC AT THIS MEETING—AND THEY GIVE APPROVAL TO DO THAT, THAT IS NOT BYPASSING. WHEN YOU GO TAKE THAT CONTENT AND LET A USER PUT IT ON YOUR SITE, SOME CLIP OR A FULL EPISODE AND YOU GET NO MONETIZATION OUT OF IT, THAT IS BYPASSING THE MEDIA COMPANY
SEND A LETTER -