The Online Video Implications of Microsoft-Viacom Deal

Microsoft & Viacom announced a wide-ranging agreement this morning that’s valued at about $500 million. It’s essentially a way to thwart Google’s growing influence in the online video and advertising markets. Here are the online video implications: (We will follow up with more details later.)

• Viacom will provide Microsoft with content for distribution by Microsoft on properties such as MSN.com and Xbox 360. Much of it is already distributed to Xbox 360 users through Xbox LIVE Marketplace and this deal adds popular content from BET Networks.
• Microsoft will serve graphical and video ads on Viacom properties.
• They will develop a new, co-branded site that will feature exclusive content from at least four MTV Networks and BET Networks events, such as the MTV Video Music Awards and BET Awards, and will share certain advertising revenue generated by the site.