MTV, Google deal makes video AdSense

Google has enlisted Viacom's MTV Networks in an ambitious expansion of the Internet giant's advertising network and video portal, the companies said Sunday.

The deal calls for Google to begin testing at the end of the month the insertion of video into Google's targeted advertising system, AdSense, from hit Viacom-owned series like Nickelodeon's "SpongeBob SquarePants."

If the arrangement works, Google could allow any number of content companies to utilize the service, splitting ad revenue between them as well as the Web sites chosen to carry the clips, which are 2-4 minutes in length.

The Google-Viacom alliance represents a reaction to the unfolding sea change in video content distribution, which is rapidly transitioning online as broadband connections become more pervasive and new players like YouTube are becoming destination sites.

It also represents an evolution for AdSense, which relies primarily on text and images in its ubiquitous system, which reaped $2.7 billion in revenue last year for Google.

MTV Networks will allow Google to experiment with clips from three of its shows, including "SpongeBob," "Laguna Beach: The Real O.C." and "The MTV Video Music Awards." The clips essentially will promote those shows and be embedded with mini-ads as well that MTV Networks will sell to third parties.

In addition, the deal will put a wide range of full-length episodes of MTV Networks content on Google's video portal for $1.99 each, including Comedy Central's "South Park" and MTV's "Jackass." MTV Networks has a similar arrangement with Apple's iTunes.

Reuters/Hollywood Reporter