19 October 2010

NBC Universal Drops Ad Partnership with Google

LA Times

The media titan stops turning over excess commercial time from some of its cable channels to the Internet giant to sell.

Google Inc.'s ambitions to broaden its advertising reach beyond the Internet have been dealt a blow by the loss of its marquee media partner — NBC Universal.

NBC said Wednesday that it had stopped providing unsold commercial time from several of its cable channels to Google. Two years ago, Google's efforts to ramp up its television ad sales brokerage system received a substantial boost when NBC Universal became the first major TV programmer to sign on. NBC had been contributing time from its Syfy, Oxygen, MSNBC, Sleuth and Chiller channels.

"We're not currently contributing inventory into the Google marketplace, but we continue to work with Google on multiple projects involving advanced advertising," NBC Universal spokeswoman Liz Fischer said in a statement.

A few months ago, NBC determined that, while the Google service helped fill advertising space on small channels that were not included in Nielsen Co. ratings surveys, it was less effective for more established networks, according to a person familiar with the company's decision. NBC Universal never included its most popular channels — the NBC network, USA and Bravo — in the initiative.

Analysts said that the end of the partnership between the media and Internet giants underscores Google's struggles to get a toehold in advertising sales of traditional media.

"Any marginal benefit that NBC might have seen was not sufficient to outweigh the much larger benefit of maintaining a relationship with their advertisers," said Greg Sterling, an Internet analyst and the founder of Sterling Market Intelligence.

Media companies continue to evaluate whether Google is friend or foe.

"Google's point of view is that they bring more to the table than they take way — whether it be more eyeballs or more revenue. But not everybody sees it that way," Sterling said. "Google has become this force sitting between companies like NBC and their customers. These media companies want to have a direct relationship with their readers, TV viewers and advertisers."

In a statement, Mountain View, Calif.-based Google said it was continuing to work with NBC Universal and its properties. It said that financial news channel " CNBC is an important partner in the launch of Google TV and we are working together on research studies."

Google still counts satellite television providers DirecTV and Dish Network among its partners, along with the Bloomberg, Outdoor, CBS College Sports and Hallmark channels and two Santa Monica cable channels: Ovation and the Tennis channel.

"Google has found it much more challenging than anticipated to sell a TV ad opportunity to big marketers, even those they have delighted and formed relationships with online," said Jacquie Corbelli, chief executive of Brightline TV, a competing advertising agency that specializes in on-demand and interactive TV advertising. "TV, unlike the Web, continues to be — and will be for the foreseeable future — a highly fragmented marketplace of many platforms, with little resemblance to the Web from a pure advertising standpoint."

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