Google Goes to Hollywood – Produces More In-House Video Content

In July, we posed the question: Is Google heading down the Yahoo! path? As Google continues its forays into content production — something that that some argue runs contrary to its goal of indexing the world’s information because it puts it in competition with web publishers — we’re left to wonder if the Mountain View-based company is losing focus of its core search and advertising businesses.

“Google built itself to be the 33rd biggest company in the world (by market value) — the 10th largest in the US — based almost exclusively on one thing: its dominance of the online advertising market, specifically the search advertising market,” we wrote in July [note: recent market volatility may have changed those market cap standings]. “But recent forays in areas outside of search and into content production and even areas notoriously difficult to monetize have has made me begin to wonder if Google is heading down the ‘kitchen sink’ path that has been so disastrous for Yahoo!”

One of the most ambitious of Google’s content production projects is the original online cartoon show Cavalcade of Comedy. The cartoon shorts, created by Family Guy’s Seth MacFarlane, are distributed over the Google Content Network (the AdSense network) and carry a corporate sponsorship — Burger King for the first ten episodes.

So far, GCN has supposedly driven a large amount of traffic to YouTube, where the segments have become instant hits. 115,000 people have signed up for the related YouTube channel, and the most viewed episode has over 6 million views. It drew 14 million streams in its first 3 weeks.

As a follow-up to “Cavalcade,” Google soft-launched POPTUB last month. POPTUB is a celebrity gossip video blog distributed on YouTube, and produced by Embassy Row, the production company run by Michael Davies, the creator of “Who Wants to Be a Millionaire,” and Pepsi (notice the Pepsi logo stealthily hidden in the POPTUB logo). POPTUB hasn’t garnered much attention so far, but Google will begin delivering via their GCN ad network in the near future, which will expand its reach to a few hundred thousand new web sites.

“For Seth [MacFarlane], it’s about launching episodes on a weekly basis,” said Alexandra Levy, director of branded entertainment at Google, explained to Reuters. “With ‘POPTUB,’ we’re creating an organic destination on YouTube meant to live there for a longer period.”

But, is this a path that Google should be heading down?

In the case of some of their other forays into content production and publishing (such as Lively and Knol), the answer for me is a resounding, “No!” But for their video production, the answer is a tentative, “yes.”

YouTube is feeling the pressure from professional content video sites, like Hulu and CollegeHumor, and has begun taking steps to compete in that area, such as posting full-length television shows. As time-shifting television content and consuming it on smaller screens (web, mobile phone, etc.) becomes more common, users are more likely to demand commercial content, and Google needs to find a way to offer it.

As Greg Sterling of Search Engine Land correctly pointed out last week, it was on the back of illegally uploaded commercial content that YouTube first rose to its current position of online video dominance. It seems likely that many online video watchers will begin to tire of the amateur hour stuff (notwithstanding the occasional “History of Dance” viral hit), and demand more professionally produced content. YouTube will be placed at a competitive disadvantage going forward if it isn’t able to provide access to the commercial, full length content that users desire.

Creating original web content is cheap for Google, and it allows them to keep users craving that sort of thing from jumping ship. The GCN is a amazing distribution channel for Google, and it gives them a built in monetization channel as well. Further, Google is supposedly being very selective about what sort of content it will pursue.

That said, YouTube’s first foray into original content production — the political video blog CitizenTube — appears to have been largely forgotten. So we’ll have to wait-and-see if POPTUB fares any better.

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