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Mar 2
Viacom Says Move Against YouTube Validated

Responding to some doubters that think they were wrong to have YouTube (GOOG) remove its video clips, Viacom (VIA) says that since they've done it, web traffic to its MTV, Comedy Central and Nickelodeon web sites surged since the action was taken.

“Video streaming traffic on our sites has increased dramatically, an important validation of our strategy,” said Philippe Dauman, president and chief executive of Viacom.

According to Viacom, traffic to MTV.com has grown by over 50 percent and Nickelodeon also had strong growth with a 30 percent increase in web traffic to its site. Comedy Central exploded with over a 90 percent increase in traffic, not surprising with the online propensity for humor; but still significant numbers.

MTV%20Network.jpgNo matter how YouTube spins this, if it continues it's not good news for them as user-generated content has yet to be proven on whether it can generate significant ad revenue ... probably part of what's behind Viacom and others resistance to embracing YouTube.

I'd do the same thing. Nothing has been proven yet in reference to monetizing with the site, and why should companies give away their inventory until something shows that there's a reason to.

All of this is part of a big game being played that nobody really knows how it all will end up. If the numbers of Viacom are accurate, it's a major salvo in not only their negotiations with YouTube, but also their own strategy in focusing more on their own online properties - especially if they continue to grow big.

Viacom seems to be the annointed trial balloon for the major media industry, seeming to be taking over for NBC Universal (GE) which was taking the lead several months ago.

What happens to them, along with their successes and failures, will probably determine the direction the overall big media industry will take.


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