Google looks to shed 'parasite' tag at Edinburgh TV festival - Financial Times (blog)

Eric Schmidt. Image by Getty.

In 2008, Michael Grade, then chief executive of ITV, branded Google a "parasite", along with other internet companies that "live off our content".

Tonight, Eric Schmidt, Google's chairman, will take to the TV industry's most prestigious platform to give the MacTaggart lecture in Edinburgh.

The Edinburgh International TV Festival's annual keynote speech has been on steady rotation between the BBC, ITV and Channel 4 for most of its 35-year history, with the recent exception of News Corp Europe chief James Murdoch's 2009 attack on the BBC.

So the symbolism behind the podium space granted to Google, Facebook and Twitter this year should not be underestimated.

But how much have relations really warmed between Google and the content world in the last three years?

As WPP's Sir Martin Sorrell noted earlier this week, Google still makes medialand nervous.

"There are concerns among broadcasters and content providers on a number of issues," says Ian Maude, head of internet at Enders Analysis. "The bottom line is it's about control… the potential impact on their business models and the commoditisation of their content."

In the UK, YouTube has plenty of shows from Channels 4 and 5, as well as BBC archive hits such as Top Gear. Live events such as Indian Premier League cricket and a U2 concerts have been more successful, says Screen Digest analyst Dan Cryan, because YouTube can gain global online rights and aggregate a much bigger audience than country-specific programming. Mr Schmidt's speech itself is being live-streamed on YouTube.

But British content still matters to British viewers and YouTube still lacks longform content from ITV, in spite of years of on-off negotiations. Nobody is expecting Adam Crozier, ITV's current chief, to leap on stage and shake Mr Schmidt's hand tonight.

What observers are expecting is the latest bout of a charm offensive that has been in progress for many years. Mr Schmidt is likely to stress that Google is not in the content business – a point he's had to repeat many times before – and that, as with the newspaper industry, Google can be a constructive partner, fuelling innovation in the TV world.

In spite of speculation that Google might offer some kind of handout to independent TV production companies, but a voluntary YouTube tax seems unlikely. Google has always resisted the suggestion that it should somehow be responsible for bailing out industries that are not blessed with its double-digit revenue growth.

But in the newspaper world, there have been gambits such as grants for innovation in digital journalism as well as products such as Fast Flip and Living Stories that Google believes can help print's transition to digital.

There are some parallels to this in TV land. YouTube's NextUp programme has given €20,000 in funding, as well as training and promotion, to help professionalise up-and-coming talent using Google's video-sharing site. That was aimed at smaller film-makers but the recent Life in a Day experiment saw YouTube snippets edited together by Last King of Scotland director Kevin MacDonald and produced by Ridley Scott, with the resulting movie polished enough for a cinema release.

Staff changes are also trying to bring the tech giant closer to the media world. Google recently hired Ben McOwen Wilson, former MD of ITV.com, as director of YouTube in the UK and Ireland.

Mr Schmidt's speech might be expected to encompass these more piecemeal measures rather than one big announcement.

Reports this morning suggest that he will announce that Google TV is coming to the UK but the reality is that Google does not yet have very much more to say about its much-hyped assault on the living room.

After its first version flopped, a second iteration is in development, with a redesigned user interface that puts more emphasis on icons and less reliance on horrible qwerty-keyboard remotes.

The FT understands that several hardware partners from Google TV's first release have gone rather cooler on the idea. That's before Google even begins to negotiate content partners – remember that big broadcasters such as NBC, ABC and CBS blocked its set-top box from accessing their online content.

"If we are building up to a refresh of Google TV, that entire process of saying 'We are a friend not a foe' comes more sharply into focus," says Mr Cryan.

In the end, the symbolism that it is Google delivering this year's MacTaggart may be more significant than its contents.

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