Microsoft (NASDAQ:MSFT). The Associated Press. Two very well-known names in two industries whose fortunes have definitely intersected and have always had a complementary feel -- the Internet and the news. Microsoft and the AP now plan to get together and create an ad-supported, online news network.
The AP will provide news video clips that run about a minute, introduced by ads that run 15-30 seconds. Microsoft will bring the technology, the video player, and the advertising support. The service will go live in the first quarter of 2006. Apparently, it will be free to the AP's approximately 3,500 newspaper and broadcast members.
Of course, it's worthwhile to note that this isn't exactly any new or exclusive development. The AP already sells some video to some other organizations, and the clips that it provides through the deal with Microsoft will be the same content that's sold to non-member organizations.
Whether or not this is going to be a wildly successful partnership in and of itself may not be the point, though. The real point is probably that this is a major step in the Internet revolution -- and with increased use of video over broadband, nobody wants to be left out in the cold.
On Tuesday, it came to light that Motley Fool Stock Advisor pick TiVo (NASDAQ:TIVO) and Internet giant Yahoo! (NASDAQ:YHOO) are teaming up in a step toward the point of convergence between TV and the Internet. There's been no shortage of talk about Apple's (NASDAQ:AAPL) foray into video downloading; it didn't take long for big networks to catch on. And, of course, Google (NASDAQ:GOOG) has dabbled in video search.
There are already plenty of venues where one can get video of news stories on the Internet, and I can't say I think this will be better or worse than any of those. Internet users have many different sources for a variety of types of content these days. And, of course, Microsoft's moves over the near term should be very interesting -- considering Bill Gates' recent comments regarding "the next sea change" taking place on the Internet.
If there's anything that today's news implies, it's that video over the Web and on-demand is reaching mainstream appeal -- at least the companies that matter think it is. Stay tuned for the coming onslaught of similar deals over the next weeks and months.
Despite TiVo's underperformance, David and Tom Gardner's portfolios of picks have outperformed the market by almost 30% and 50%, respectively. To see the entire scorecard of the Gardner brothers' picks from April 2002 until today, take a 30-day free trial by clicking here .
Alyce Lomax does not own shares of any of the companies mentioned.
