Now here is something you don’t see every day:

“We made a big mistake,” Mayer, who oversees all of Google’s search products, said Tuesday. “You can’t come out and launch a product like Google Video and say ‘CSI’ and ‘Survivor’ are there if they’re not on the home page.”

The video service has “fallen far short” of competitors such as Apple Computer Inc.’s iTunes music and video offering, said Allen Weiner, an analyst at Stamford, Conn.-based Gartner Inc. “What Apple has done with the iTunes store sets the bar really high.”

New York Times technology reviewer David Pogue said Jan. 19 that Google’s video store was “appallingly half-baked” and that the site “doesn’t live up to Google’s usual standards of excellence.”

We don’t know which is more shocking: the admission of error or the praise of uber-competitor Apple.

What’s strange really is that Google has a long history of releasing “half-baked” products. For example, Google News which has been in “beta” for over three years has only just now been released as a finished product. Why should the Video product be any different? In the technology world where product cycles are so short and competition is fierce, releasing a half-baked product early is often the difference between first-mover advantage and complete obscurity. Frankly, comparing yourself to Apple is always bad news: Apple has far more experience in pleasing, user-friendly interfaces that nearly any other tech firm around.

One day Google will realize that it cannot be all things to all people. It needs to concentrate on what it does well and leave the eyecandy to others. Unfortunately, Google has decided to take the Mega-Media-Takeover approach using its inflated stock to fuel its way into all sorts of places. In the long run, you cannot outspend Microsoft and you cannot out-design Apple. Google’s genius lies in innovation, rather than taking over traditional media they should concentrate on redefining media on the internet.

Netflix hits pause on movie download plan:

However, due to problems obtaining license agreements with Hollywood studios, the test phase of the service has not been postponed. Hastings said the company would hit the play button on its plans “when the content climate beings to thaw.”

The studios’ reluctance to let Netflix squirt their movies down the wire is no great surprise. Because of its paranoia about unregulated distribution of its content Hollywood is currently about as keen on the internet as it is on thoughtful, foreign language dramas featuring real, unaugmented people. Perhaps Netflix would have more success if it courted Bollywood instead of Hollywood.

It seems funny how far apart Silicon Valley and Hollywood can be. They are only a little over 300 miles apart in sunny California but they might as well be on opposite sides of the planet. The software geeks are stumbling over themselves to create new video distribution sites too numerous to mention while the studio execs struggle to find new ways to restrict digital distribution.

The only solution is the California Republic civil war. North vs. South. We’ve got front row seats.

John Battelle’s Searchblog is an excellent resource for anyone who wants to know more about Google:

The ability to sell video is great, but not news. We’ve known that was coming. What is really interesting is the pricing leverage: Google is splitting revenues 70/30 - that’s 70 to the content producer. Also very important is that the producers of content are the ones who set the price - again, totally different from traditional models. Thirdly, Google is doing its own DRM. That’s very interesting, and probably best left as the subject of another post. Producers can decide to not use DRM, as Charlie Rose did, Feiken told me.

This is a major step toward entirely new models of content distribution, and if I were Comcast, DirecTV, the telcos, or frankly anyone in the traditional video business, I’d be a bit concerned. It gives content producers far more power to connect directly to audiences, and the leverage will only increase - in five years, it won’t be 70/30, it’ll more likely by 80/20.

John goes on to predict that the studios will be among the first to sign up for Google’s new service but we’re not so convinced. Firstly, the studios have already spent gobs of money building and promoting their own online movie distribution services. Their future is certainly in jeopardy but will the studios have the stomach to kill their own children right away?

Secondly, iTunes gives studios much more control over display, ranking and other promotions. If you have learned anything about the big content producers like the studios and networks from this site it is that they love micromanaging control over their product. The wild west of Google Video may be fine for indie producers but definitely not the studio’s style.

Introducing Digital Rights Management (DRM) definitely puts Google into direct competition with Apple and Microsoft. This should shape up to be an interesting race. See John’s post for links to other Google Video competitors.

The New York Times isn’t exactly renowned for its technology coverage, so you can safely assume that by the time they cover anything that it is a pretty safe bet:

In the battle for the living room, cable, satellite, and increasingly, phone companies are trying to defend their turf by offering more choice through an array of content in video-on-demand programs.

But fending off the Internet’s openness will be a struggle, one that the online companies themselves lost years ago.

At the onset of the dot-com era, large online service companies like AOL, Compuserve and MSN tried to lock customers into electronic walled gardens of digital information. But it quickly became apparent that no single company could compete with the vast variety of information and entertainment sources provided on the Web.

The same phenomenon may well overtake traditional TV providers. Potentially, IPTV could replace the 100- or 500-channel world of the cable and satellite companies with millions of hybrid combinations that increasingly blend video, text from the Web, and even video-game-style interactivity.

We’re not usually Markoff fans over here but we found this analogy to be uncharacteristically apt. [via BoingBoing]

Google isn’t happy with letting Apple be the only player in TV downloads:

Google will announce its plans to allow consumers to buy television shows or other videos that can be downloaded onto their computers at the Consumer Electronics Show in Las Vegas on Friday.

Citing people familiar with the matter, the Wall Street Journal said Google is likely to unveil partnerships related to the new service with CBS Corp. and the National Basketball Association.

CES is starting up this weekend and this is just the first of what we expect to be many interesting announcements.

EMarketer has a cute little piece based on some Forrester Research data:

Aside from ads integrated into games themselves, marketers would be wise to advertise on related Web sites. Young consumers spend more hours per week on the Net than adults, and Forrester found that much of this time is spent on sites related to gadgets and games — almost 80% visit games sites, almost 50% visit movie sites and over one-third visit music sites.

To be fair the data still shows that TV has a large influence. The trend over time however shows that the younger the audience gets the less TV is watched. Younger people spend more time away from the TV and much more on the internet, videogames, mp3 players, etc. [via Wonderland]

A cute WSJ piece on the death of TV:

Audiences are splintering off in dozens of directions, watching TV shows on iPods, watching movies on videogame players and listening to radio on the Internet. All these activities cut out the usual forms of sponsorship and take place when and where consumers—not media executives—choose.

The upshot is that any advertiser with an urgent message needs to start planning now to reach consumers in new and unexpected ways. Some already have.

Unfortunately, their list of newfangled advertising techniques amount to nothing more than product placement and integration, the same thing we’ve been harping on for a while now. No new surprises here other than the WSJ repeating what you already know.

The good news is they have finally found a way for tightwad studios to support upgrading to digital projection in theaters:

The digital projection guidelines, published in July by a consortium of Hollywood studios called the Digital Cinema Initiatives, say every five-minute chunk of video must contain a 35-bit “forensic marker” specifying the date, time and location at which the movie is shown. The guidelines don’t say how to get that information into the movie, but they require it to be “visually transparent to the critical viewer” and “inaudible in critical listening” tests.

The bad news is that the studios will never be able to justify the upgrades once they discover that steganography won’t stem the flood of piracy.

Let’s hope they upgrade all our theaters before they notice.