Media giants NBC Universal and News Corp. (NYSE: NWS) said on Thursday that they have partnered with leading Internet content providers to create an online video site that is poised to challenge the current video leader, YouTube.

The firms said they will launch what they call the largest Internet video distribution network ever assembled this summer, featuring popular shows such as Saturday Night Live and The Simpsons.

This is a game changer for Internet video, said Peter Chernin, President and Chief Operating Officer of News Corporation. We'll have access to just about the entire U.S. Internet audience at launch.

The site will be free for users, but will include advertising from Cisco Systems Inc. (Nasdaq: CSCO), General Motors Co. (NYSE: GE) and others. AOL, MSN, MySpace and Yahoo! (Nasdaq: YHOO) will be the new site's initial distribution partners, the companies' said in a statement.

Rival YouTube, which was purchased by Google (Nasdaq: GOOG) for $1.6 billion last year, is the current leader in online video, being the origin for 992 million unique video streams in Janurary, according to comScore.

Shares NBC Universal corporate parent General Electric (NYSE: GE), closed up 0.90 percent, or 33 cents to $35.81 on the New York Stock Exchange. News Corp. shares fell slightly, shedding 0.20 percent, or 5 cents to $24.75.

Google shares gained 1.20 percent, or $5.49 to close at $462.04 on the Nasdaq.