Mountain View, California — Internet search engine titan Google Inc.’s ambitions to expand its advertising prowess beyond the Internet have been dealt a big blow by the loss of its marquee media partner — NBC Universal, which scrapped a two-year-old alliance with Google that allowed the search engine giant to sell ad space on several NBC cable channels, according to a report.
The alliance between Google and NBCU took off with a promising start in late 2008. But rumors swirling around indicates that NBCU saw little value in deal. The media titan stops turning over excess commercial time from some of its cable channels to the Internet giant to sell.
“We are 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.
One of Google’s biggest victories in terms of television advertising partnerships inked two years ago was viewed as a groundbreaking boost for Google’s efforts to transform the TV business by providing a powerful online platform for ad sales. But now it indicates that would-be advertisers will lose access to a number of high-profile channels.
According to The Los Angeles Times, citing unnamed sources said NBC Universal had concluded that there was little value derived from having an Internet company sell its ads. Although Google TV Ads had helped fill ad space on small channels, it had not worked out so well in regard to more established networks.
Some of the networks covered by the original alliance included Chiller, CNBC, MSNBC, Oxygen, Sleuth, and SyFy (then Sci Fi) channels by way of its Google TV Ads online marketplace. The marketplace lets people get help in creating commercials; choose networks, programs, and time slots for showing the ads; and monitor–through data recorded by set-top boxes–how many households’ TVs are tuned to an ad when it runs.
“Google has become this force sitting between companies like NBC and their customers,” the Times quoted analyst Greg Sterling as saying. “These media companies want to have a direct relationship with their readers, TV viewers, and advertisers.”
In a statement, Mountain View, Calif.-based search engine giant 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 has found it much more challenging than hoped 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.”
Google still considers 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. It will be interesting to watchwhether any other organizations follow NBCU’s lead, or if Google is able to find more partners to participate in its TV Ads program.