CBS want to create video portal

CBS (NYSE:CBS) has watched the success of Google's (NASDAQ:GOOG) YouTube and Hulu.com, a creation of NBCU and wants in on the action.

According to the FT, to create its portal, "CBS has added content from partners including Sony, Endemol, Metro-Goldwyn-Mayor and PBS, to TV.com, the site it acquired in the $1.8bn takeover last year of CNET Networks, the technology web site operator."

Jack Welch used to say that it was not worth being in a business unless you can have the No.1 or No.2 spot. CBS may disagree to its own peril.

The broadcast company may feel that people are willing to go to any number of site to view video. That is probably not true. According to comScore, CBS is not in the top ten video sites visited by consumers. Most of the other big media companies are on the list. That means CBS would have to jump over a number of its competitors to be viable in the online video business. Those competitors are not likely to sit on the sidelines and allow another party into sector.

CBS has been one of the least successful media companies over that last year, especially based on it stock price. That may be because it has been slow to create an Internet strategy. Now it is adopting the position that "if we build it, they will come." It doesn't work that way.

Douglas A. McIntyre is an editor at 247wallst.com.