The announcement from Lloyd Braun that Yahoo! is scaling back on creating originally produced content is unfortunate, however, not that surprising given its history when they walked away from Finance Vision™, the killer IPTV platform of its day. Granted there were differences between then and now (on the technology, content and user side of the equation). Certainly, the costs associated with ramping up a production unit can be huge, perhaps also there were concerns Hollywood might feel threatened.

Mr. Braun went on to say, "I didn't fully appreciate what success in this medium is really going to look like". He said, "This is not about creating one-off hits like in my old business. That is not going to create a sustainable competitive advantage over the long term."

Rocketboom is an interesting example of how original programming can grab market share with a claim of 100,000 views a day. Yahoo! has had some success with their "Kevin Sites in the Hot Zone", a well-produced news site of international hot spots. Yahoo! could create Mow's (perhaps not every week), Mini-Documentaries, or team with established Producers to co-create programming for their different audience segments.

This would also have achieved a short-term objective taking the high ground in IPTV as the first company to stake out the Internet to offer fresh content on a scheduled basis and allow users to be in control of original and customized content delivery, it is hard to be first.

Mr. Braun also said, "Original content is the salt and pepper on the meal. It is certainly not the engine driving this." I guess it is then up to people like MTV, ABC, AOL and Indie producers to cook the meal themselves.

"The Internet is such a niche content environment that the broadcast model does not really work". Mr. Braun said. If this is true, then it will be interesting to see what the established networks see as the future of IPTV and how they create content for it.

Stay Tuned.