MSN Europe today announced partnerships with two of the best-known names in entertainment: MTV and Sony BMG. Consumers will be able to stream and share video clips, for free and on-demand, from MTV Network's library of TV programmes.

These include 'Pimp My Ride', 'Punk'd' and 'Cribs', while exclusive clips of shows such as 'South Park' with also be available on what MSN is terming its "social portal".

Sony, meanwhile, seems to be using its tie-up with Microsoft as a means of flagging up its move away from being a mere record company to a music distributor and provider. It is also likely to use the deal as a means of promoting live performances by its artists as it moves into concert sales and promotions.

Both video and audio content housed on and streamed over the MSN portal will be provided for free on an on-demand basis in what is largely an advertising-supported setup. MTV's clips will offer consumers the option to click through to its own site for full-length programmes.

Today's MSN announcement contrasts with the one Apple made three weeks agoin which it announced content distribution deals with the major movie companies in which consumers will be able to either lease full programmes and films or else to buy them outright.

The on-demand streaming deals Microsoft has struck with MTV and Sony BMG will be supported by shared advertising revenue efforts, with MSN aiming to monetise the growth in demand for online video content via targeted but relatively inobtrusive advertising.

According to Jupiter, which undertook research on behalf of Microsoft, online video consumption grew by 80 percent last year and, in the UK alone, 80 percent of the population watch online videos on a monthly basis. More than six million European users regularly watch video via the MSN portal, with a growth rate of more than 60 percent per month.

Describing how the MTV and Sony content will be delivered, MSN's European marketing director for online services, Alex Dale, said: "Users will be able to create their own playlists [from among both commercial and user-generated clips] and effectively create their own channel and share it with buddies online."

MSN is in talks with several other major content providers to extend its online library and described today's deal with MTV and Sony BMG as "its most significant to date".

Explaining the online video advertising model, which all parties at today's announcement acknowledged was at an early stage of maturation, Dale said consumers "won't get a pre-roll advertisement every time they launch a video". Instead, advertising may kick after one or two tracks have been viewed. The aim, he said, was "for a gentler and nicer experience for the user, which is also better for the advertiser".

Both Sony's Geoff Sutton and MTV's Gideon Bierer claimed that the exposure the artists they represent got from exposure to MSN's 132 million-strong audience, as well as the advertising and branding inherent in the project (along with a share of ad revenues) will be sufficient to make it commercially viable for them.

Microsoft has spent the past 18 months conducting research into how and what consumers view online – with some not-so-surprising results. Eighty percent of the six million-strong European user base for MSN watches at least one online video a month, with consumption averaging out at 100 videos viewed a month. This equates to three a day.

Consumers don't enjoy being restricted in what they watch or what they use to access online video content. In another "anyone could have told you as much" statement, MSN revealed that consumers like to view content at leisure on large screens such as TVs and large PC displays as well as 'snacking' on shorter video clips, either on the web or on mobile phones. It termed its research '3 Screens' in reference to its findings about the fact that few of us have just a single PC, TV or mobile phone screen on which to view video content.

The upshot of the research conducted among 18 to 54 year-old males and females is consumers have come to expect to be able to watch what they want when they want to and on the device of their choice. As Marc Bresseel, MSN's consumer and video research manager, termed it: "Time-shifting and device-shifting is now a given. Consumers expect more viewing opportunities, transferability between devices and the ability to share that content."

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