News Corp. and NBC Universal Inc. announced yesterday they are leading a group of media companies building an online video service designed to break the dominance of Google Inc.’s YouTube.

NBC and News Corp. will create a new Web site that features full-length films and television shows, the companies said. Yahoo! Inc., Microsoft Corp.’s MSN and Time Warner Inc.’s AOL, Google’s biggest rivals, will distribute the shows on their sites.

NBC, with a TV network and movie studio, and Rupert Murdoch’s News Corp., owner of the MySpace Web site and Fox television, are seeking to reclaim the users who watch clips of their shows on YouTube, and those who create their own videos. The media companies are up against a site that attracted more than 130 million visitors in January, mainly because of the user-generated clips.

“It really does seem like everyone is taking sides against Google and YouTube,” said Greg Sterling, an analyst at Sterling Market Intelligence in Oakland, Calif.

News Corp. and NBC said they will devote “a significant” marketing and promotional budget to the new site, which will start in the summer.

The venture will have movies such as Borat and television shows such as Fox’s The Simpsons and NBC’s Heroes. Yahoo, owner of the most-visited U.S. Web site, Microsoft’s MSN Internet unit, New York-based Time Warner’s AOL and MySpace will feature videos from the service on their Web sites and promote them.

“We’re willing to sit down and talk to anybody” willing to join the venture, News Corp. chief operating officer Peter Chernin said on a conference call.

Chernin said he talked about the venture with Google chief executive officer Eric Schmidt earlier yesterday.

“Eric Schmidt is considering this,” Chernin said. “Obviously, this is not a YouTube killer.”

The willingness of media rivals to forge a partnership underscores the pressure they feel to rein in the widening use of their shows across the Web. The companies are wrestling with their competing desire to increase the audience for their shows and maintain control over copyright and advertising revenue.

The venture also highlights a split among broadcasters. CBS Corp., which isn’t part of the group, has chosen to partner with YouTube and this month is showing March Madness basketball clips on the site. CBS, chaired by Sumner Redstone, said yesterday it will continue to pursue its own online video initiatives.

Viacom Inc., the New York-based owner of the MTV and VH1 cable-TV networks, sued YouTube last week, claiming $1 billion in damages, for allowing users to post copyrighted material on its site. Viacom said clips of its shows have been watched 1.5 billion times on YouTube.

Time Warner, the world’s largest media company, and News Corp. publicly supported Viacom in its fight to protect copyrighted content, and News Corp. has also forced YouTube to take down clips of some of its shows.

Viacom, which is also chaired by Redstone and isn’t part of the new site, said the venture is a “welcome addition.” Viacom CEO Philippe Dauman has said the company is working on online video initiatives of its own.

Shares of Mountain View, Calif.-based Google, which paid $1.65 billion for YouTube last year, gained $5.49 to $462.04 in Nasdaq Stock Market trading. News Corp.’s Class A shares fell 10 cents to $23.33.

Fairfield, Conn.-based General Electric Co., parent of NBC Universal, rose 33 cents to $35.81.

Advertisers including General Motors Corp., Intel Corp., Cisco Systems Inc. and Cadbury Schweppes PLC have signed on, News Corp. and NBC said in the statement.

The venture will be based in New York and Los Angeles, and George Kliavkoff, NBC Universal’s chief digital officer, will lead a transitional management team, the companies said.

Tim Boyd, an analyst at Caris & Co. in New York, called the new site an “unexpected negative” for Google. He rates Yahoo shares “above average” and Google “buy” and doesn’t own either.

More than 133 million people visited YouTube in January, 14 times more than a year earlier, according to Reston, Va.- based Web-use tracker ComScore Networks Inc.

Meanwhile, activist groups sued Viacom yesterday, claiming the parent of Comedy Central improperly asked YouTube to remove a parody of the cable network’s The Colbert Report.

Viacom responded by saying it had no records of ever making such a request.

Although the video in question contained clips taken from the television show, MoveOn.org Civic Action and Brave New Films LLC argued that their use was protected under “fair use” provisions of copyright law.

With Viacom identified by YouTube as the source of the removal request, they said Viacom should have known the use was legal and thus its complaint to YouTube to have the video blocked amounted to a “misrepresentation” that is subject to damages under the 1998 Digital Millennium Copyright Act.

The challenge, filed in U.S. District Court in San Francisco, came about a week after Viacom filed its own, $1-billion lawsuit against YouTube, claiming that the wildly popular Web site is rife with copyrighted video from Viacom shows, including The Colbert Report.

With Associated Press reports