ABC (DIS) is adding Veoh as a distributor of shows like “Lost” and “Grey’s Anatomy” as well as ESPN programming online, the NYT reports. It’s a curious move for ABC, made more intriguing by the fact that the site is backed by former Disney/ABC chief Michael Eisner.
ABC has been the most parsimonious of the broadcast networks when it comes distributing video. Up until now it has only distributed shows through ABC.com, its broadcast affiliate sites, and AOL (for free, that is – it also sells them via Apple’s iTunes). But that hasn’t hurt ABC when it comes to online viewers. ABC had more views of its videos online (80 million) than any other network in May, according to Niesen Online’s VideoCensus.
So the question is: Why Veoh, and why now? Veoh was recently surpassed by the NBC U – News Corp. joint venture Hulu, according to Nielsen’s VideoCensus, but it remains one of the bigger independent video distributors on the Web not named YouTube. ABC says it has been talking to everyone about distribution, but if distribution was going so well without other partners, why sign up with Veoh (and share revenue) at all?
One possiblity: ABC has decided that it wants to help create an alternative TV aggregator to Hulu. Then again, another ABC exec told the Times that future deals with Hulu and YouTube are possible. (The last time an ABC exec mentioned a possible Hulu deal a Disney spokesperson quickly contacted SAI to tell us none was on the works.)
Another factor: Veoh is permitting ABC to distribute video in its own player, a condition of ABC’s other distribution deals and an impossibility on Hulu, which requires content partners to stream via Hulu’s player. The NYT doesn’t have much in terms of economics, but ABC’s description of the deal–they pay Veoh a fee based on viewers delivered–is the same way ABC digital chief Albert Cheng described the network’s deal with AOL when we spoke to him in March.
Nielsen: People Watching Less YouTube, Less Video, More Hulu
Veoh Investor Michael Eisner: When Do I Get Paid?
ABC-Disney: No Hulu Deal For Us, Thanks
Following Hulu, ABC To Allow Video Sharing Online
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