Seven West Media in deal to spruik hit shows on YouTube

Seven has signed a multi-year deal with YouTube to distribute short-form online videos of hit shows and sports programs.

The video-sharing service and the commercial television network are best of frenemies.

Six months after Google’s YouTube placed its tanks firmly on Seven West Media’s lawns, the video-sharing service and the commercial television network are best of frenemies.

Seven has signed a multi-year deal with YouTube to distribute short-form online videos of hit shows and sports programming, from Home and Away and My Kitchen Rules to the Rio 2016 Summer Olympics.

Chief digital officer Clive Dickens said the agreement ­continued an ongoing strategy of “making content available anywhere, any time, across all ­devices” as Seven follows viewers from the conventional box to new platforms.

The move is significant because it marks a shift in the way the web giant deals with media partners by allowing Seven to take control of advertising sales. For the first time, Seven’s sales team will be able to serve ads and sell YouTube inventory to increase the broadcaster’s share of the booming online video market.

YouTube normally enforces its own commercial terms by ­offering a slice of the advertising take generated by clips, although it does not spell out what the ­proportion is.

“Content owners have been using social video platforms like YouTube for a decade, but ­predominately for promotional purposes or to generate incremental revenues based around high volume and low yield,” Mr Dickens told The ­Australian. “Our unique partnership through YouTube changes that by taking advantage of the high volume and the huge global audience of YouTube in a high-yield environment.”

Mr Dickens said the tie-up ­extended to its Yahoo7 joint­ ­venture, and video content from newspaper and magazines.

For Seven, branded channels on YouTube will create buzz, awareness and, ultimately help drive traffic back to its own sites.

Seven has adopted a more pragmatic approach to working with the big digital insurgents in recent years, offering Facebook users a first look at episodes of The X Factor ahead of the main telecast.

“The fact that any social video network is battling for TV dollars is because TV continues to dominate and will do so for years. That’s no different than another TV network battling for share,” Mr Dickens said.

It comes after Google Australia’s outgoing boss Maile Carnegie annoyed local TV broadcasters in September by claiming YouTube reached more 18-54-year-olds than “any single individual TV channel”. But while YouTube is dominant in online video, the Seven deal is a sign it is facing new challenges from rivals, notably Facebook and Snapchat’s news platform Discover.

The pair are using video to sell more advertising and engage with the people that use their ­services on smartphones.

“It changes the model somewhat for YouTube because they’re increasingly willing to do a select number of premium partnerships,” Mr Dickens said.

Still, YouTube has positioned itself to capitalise on the shift of marketing budgets away from TV. The company does not disclose separate financials for its Australian activities, but it is believed it will collect between $377 million and $484m of advertising revenue in Australia in 2016 or 10 per cent of the local TV ad market ($4.4 billion), according to Morgan Stanley.