Google Signs Deal With BSkyB To Launch Video Search Facility

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The New York Sun

LONDON — Google Inc. said yesterday that it had signed a deal with the British satellite broadcaster British Sky Broadcasting Group PLC, which it says will provide a test-bed for launching video search services.

The deal is a template for the world’s largest search engine company’s relationships with traditional media companies, according to Google’s chairman and chief executive officer, Eric Schmidt.

“This is a huge deal for us,” Mr. Schmidt said at a press conference in London yesterday. The deal should provide “significant” revenues for both parties over the medium term, he said.

“This is an example of how we can work with media companies,” Mr. Schmidt said, adding that Google planned to “take this deal and go talk to players in other companies.”

Financial terms of the deal weren’t disclosed, although Google and BSkyB will share revenues generated through sponsored searches on BSkyB’s Sky Broadband service. The deal will run for several years, the companies said, but wouldn’t be exclusive.

The agreement allows BSkyB to use search, e-mail, and video-sharing technology, which will be branded Sky, on its broadband sites, and it plans to launch a user-generated video service using Google’s content tools.

It underlines both the growing value of Internet search-based advertising to traditional broadcast companies and Google’s need to develop partnerships with content owners and distributors.

Mr. Schmidt said the launch of a video search facility on BSkyB’s platform would be the first time it would be able to test video search technology it had already developed in a commercial environment. The ability to search for relevant material is considered to be an important next-generation tool that will allow Internet companies to make money from content.

Google, which bought online video networking company YouTube for $1.65 billion earlier this year, said earlier yesterday that developing partnerships with content owners was a key priority.

A number of large broadcast and entertainment companies including the Walt Disney Co. have warned YouTube that they will take a hard line on copyright infringing material on video network sites. Universal Music Group, a unit of Vivendi, has issued legal action against MySpace, a social networking site, which is owned by News Corp., the majority shareholder in British Sky Broadcasting Group PLC with a 39% holding.

The chief executive of BSkyB, James Murdoch, and Mr. Schmidt said the deal was specific to BSkyB and didn’t involved News Corp. The chairman of News Corp., Rupert Murdoch, is also chairman of BSkyB and is the father of James Murdoch.


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