November 15, 2010 | by Andrew Kameka
At today’s Web 2.0 conference, Google CEO Eric Schmidt said that Google TV is an exciting new platform that can bring more money to networks and more content to consumers. However, networks haven’t opened up that content to consumers, so there’s no money to flow to them or Google.
In Schmidt’s view, networks are resisting Google TV because television is a sector that has not seen innovation on a wide scale in a long time. However, he disagrees with the notion that GTV will cannibalize traditional television revenue.
“I think part of the experiement that is being run now with Sony is that people are going to watch even more television,” Schmidt said referring to Sony Internet TV, which runs Google TV software.
“Because [consumers] are going to watch the broadcast television and [web content]…Let’s think about the creative possibilities. The way to get more revenue is to create more revenue sources.”
Well-put Mr. Schmidt, but creativity takes a backseat to bottom lines and profits. Schmidt said that Google is working with networks to encourage them to make content more accessible, but he mentioned data rather than saying whether the company will write checks or share revenue. Schmidt mentioned that “Netflix is a significant source of revenue for content producers because Netflix pays a pretty penny [for streaming rights],” but he did not say that Google is prepared to pay upfront costs related to Google TV.
Schmidt responded to later questions that the next large revenue source for Google is “clearly” in the display advertising space. The four major networks are not yet prepared to adapt a similar mantra related to its online content.