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The old people network gets it

April 18, 2007

Not sure if everybody has heard about the new web distribution deal announced by CBS, but you can read all about it here.

I for one find this deal quite refreshing. It is simple, broad, and allows CBS to focus on what they are good at. To quote from the article: “We don’t want to be exclusive with anybody, because nobody should expect a content company to be,” CBS Interactive President Quincy Smith told Reuters. “I don’t think the world needs another portal.”

I have never met Quincy Smith, but I like him already. The world really doesn’t need another portal, and frankly, CBS doesn’t need the headache of needing to build a broad web audience. There are new ways of watching broadband content every day. Yesterday it was streaming video on network websites. Today it might be places like YouTube, Blip.tv and MySpace. Tomorrow it might be players like Joost and Democracy. The landscape is shifting fast, so why put a stake in the ground by building a website that may become obsolete soon? Rather, own compelling content, and structure flexible deals that allow you to flow that content out to whoever has the most appropriate audience and functionality.

As an aside, the Internet is doing to content, what it did to voice. It is marginalizing access to content into an application that simply sits on top of a network. The old broadcast, satellite and cable infrastructures will soon no longer be needed to view much of this content, and in such a world, in my opinion, the struggle for value between content and access shifts decidedly towards content. Just as the old copper infrastructure is increasingly being shifted towards simple transport of data packets, so too will these other broadcast infrastructures. (OK. Before we fully hijack this post, back to our regularly scheduled blog.)

This deal is, strategically, very similar to the strategy NBC is taking with NBBC. Although from the outside, it seems superior in its breadth, and in its technology agnostic approach. To be honest, it is not really that strange that old school networks are jumping on this strategy because it is simply the evolution of a strategy they understand well: old school syndication and affiliation. The deal lets CBS focus on its core competencies: finding and developing compelling content, and selling advertising space, rather than worry about managing download infrastructures and managing and growing audience.

Of course, it is never quite so easy, is it. Audiences come to watch content, and content flows to where the audience is. But on the whole, at this point in time, I would rather own content, than own eyeballs.

Incidentally, how long do you reckon before CBS sells off its radio stations to Clear Channel, or a private equity group? I give it no more than 12 months.

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