YouTube becomes YOURTUBE!

YouTube without the lip synching dudes

Sling Media wants to make it easy to post live TV to the Web. Will it fly? Only if the company gets networks on its side, says Fortune's Stephanie Mehta.

FORTUNE Magazine
By Stephanie Mehta, Fortune senior writer
February 5 2007: 6:17 AM EST


NEW YORK (Fortune) -- "If you've been disrupted, it means your business model is broken."

Jason Hirschhorn, the effusive former MTV executive now running Sling Media's newly formed entertainment group, is explaining why his former colleagues in the traditional media world need to embrace so-called "place shifting" technologies purveyed by his new associates at Sling. (Sling created the Slingbox, a nifty gadget that enables you to transmit live television from your home to a personal computer or cell phone so that you can watch your favorite hometown programming anywhere in the world.)

And don't expect Hirschhorn, who once started a company called Mischief New Media, to sugarcoat his pitch to the likes of CBS's Les Moonves or NBC Universal's Jeff Zucker: Like it or not, he contends, people are going to watch television programming on their computers, cell phones and other devices. Broadcasters and studios need to figure out a way to turn that behavior into a moneymaker. In other words, disrupt your own model before someone else disrupts it for you.

In some ways, he's preaching to a fairly receptive choir. CBS and NBC already place video clips (mostly promotional) on YouTube. ABC, meanwhile, makes entire episodes of some of its programs available on its own Web site, ABC.com.

Viacom tells YouTube to yank videos

But Hirschhorn, 35, is asking these companies and others to go even further. He's launching a new service called Clip+Sling that enables consumers to easily clip portions of any television show and publish them to the Web. (Think YouTube, but without the user-generated clips of dudes lip synching to the Backstreet Boys.) And he's looking for buy-in from the broadcasters.

Hirschhorn is promising TV executives an opportunity to sell advertising when clips are posted on the yet-to-be-launched Sling site. (Sling currently is signing up testers for its beta trials.) Instead of just selling television airtime, a network could also offer marketers a chance to sponsor clips.

Hirschhorn's argument to potential partners is simple: People are going to post portions of your shows to the Web anyway. "Why not monetize what was piracy?" he says, throwing up his hands. "What was once a negative can be a positive."

But Hirschhorn is asking the TV world to take a big leap of faith. He needs media companies essentially to provide air cover for a technology that poses some interesting intellectual property and legal issues. In meetings, Hirschhorn says, he acknowledges those concerns up front: "Your business development people, your lawyers, they're all going to want do a number on me," he tells media honchos. "And they'll be right."

Among the potential worries: How to compensate the artists creating the content that gets clipped, and how to handle content that a network airs, but doesn't own.

Hirschhorn isn't going to be able to strike deals with every single independent television content producer - certainly not before the Clip+Sling functionality becomes available later this year - or every television writer seeking remuneration for a skit that's clipped. And so Hirschhorn is asking the networks to help smooth things over with content producers, to, as he puts it, "go to those constituencies en masse and say, 'We'd like you to not go ballistic until we prove there's a model here.'"

"We're cognizant of people's rights," Hirschhorn adds. "Just give us a beat to figure this out."

TV is dying? Long live TV!

As Hirschhorn talks, one can't help but feel like Clip+Sling is a fun technology in search of a business model. (I'm guessing the engineers at Sling weren't thinking about "monetizing what was piracy" when they dreamt up the service.) That's not necessarily a bad thing. The Google (Charts) founders didn't set out to transform the advertising industry -- they just wanted to build a great search engine.

And his eat-before-you-get-eaten seems to be resonating with media companies. CBS (Charts) (which used to be part of Viacom (Charts), Hirschhorn's former employer) announced last month at the big Consumer Electronics Show in Las Vegas that it will participate in the Clip+Sling beta trial.

"CBS is interested in how new media solutions can help build communities around content," Quincy Smith, president of CBS Interactive, said in announcing the trial. "As we move forward into an increasingly digital and interactive future, that capability will sometimes come from unexpected places, products and services that in the past might have been seen as disruptors, instead of enablers."

Sounds sort of like a sophisticated way of saying, that if you're being disrupted, your business model is broken.