[Editor’s Note: Original version has been modified on or about February 5, 2007.]
Interesting to see these two legends of business and media fight it out.
When you consider how News Corp’s earnings were more stellar than Viacom’s, it makes you wonder, what role does each company’s digital strategy play right now and over time (of course, Viacom is now half of what it was last year, since CBS was spun out).
Read Viacom’s here and News Corp.’s here. The News Corp. release report is complemented by some things that FIM’s CEO Ross Levinsohn stated. Mr. Levinsohn, it should be said, has had the Midas touch since turning Fox sports into a competitor against SI and ESPN. And since he was handed the digital mandate, he has been second to none, stealing MySpace and IGN from Viacom.
Anyway, the following is taken from PaidContent. Some of the most interesting storylines in media hail from the “traditional media” space and as such, I am adding my two cents after Mr. Levinsohn’s quotes off PaidContent:
– GoogTube: It was the right deal for YouTube and interesting tool for Google….it would have been a fun process to watch, had we participated in it. I think it is going to successful. We wouldn’t have been able to participate at the price that came down.
=> This shows Mr. Levinsohn’s diplomacy. I do not think that News Corp.’s lawyers would have ultimately encouraged a deal for YouTube to go through. You see how much of a wild card it is to keep content on the site when it was independent; as part of Google it becomes complicated but as a media company, you have no choice but to listen. But in News Corp.’s hands, why would you even hesitate to yank the content? Do you really think Viacom would allow Comedy Central’s content to stay pro bono on a News Corp.-owned site? I doubt it. I also think that the direction that News Corp. is taking with FIM’s MySpace is the way to go. As great as IGN is and will be over time, MySpace clearly is a social phenomena and it simply makes sense to galvanize their resources (including focus) on MySpace. As such, it only makes sense to push MySpace Videos and not ”split the atom” between YouTube and MySpace Video.
The message, methinks, he is sending though is: if you are a hot startup or private company, call us. Especially considering that this came a couple of days after CBS Digital brought in Quincy Smith who said he wants to hear from all entrepreneurs. The premium being placed on new companies is increasing, because as both companies admitted: it’s hard to start from scratch within an established company.
– Google CEO’s visit afterwards: It was pretty genuine of Eric Schmidt and others to come down….we have put our deal up with Google in beta across a few areas just two days ago.
=> In turn this shows Mr. Schmidt’s diplomacy. I am sure when the YouTube deal went down, Google figured that despite the legal risks outlined above, News Corp.’s Murdoch’s ambition would incline News Corp. to show interest, and if the deal was done so quickly, they probably knew that it was not exactly an open bidding system, and that would upset News Corp.’s pride, if nothing else. And, Google agreed to pay $900M to News Corp. and if News Corp. decided to take their business to Yahoo!, Ask.com or MSN, Google would see it as a relatively big hit, not financially, but from a marketing perspective.
– MySpace deal: We are in a frenzy and it is a really hard business. It is slogging every single day of my life. That’s why we have all our attention on MySpace.
=> Not surprising. MySpace has grown 300% since News Corp. bought it, between Cyworld looking to enter the US market, Facebook opening up, Murdoch putting his wife (and former China-based executive) in charge of MySpace China and launching a joint venture with Softbank to enter Japan, I can imagine. This also sheds light on why IGN’s founder Mark Jung left. The MySpace shadow was too large for some to handle. That’s the crown jewel, and I think that News Corp.’s upper management saw that and it made things hard for IGN.
– Traffic on MySpace: It is a seasonal dip…most sites are down from August to September. We added 320K yesterday, so the growth is still phenomenal. 38 billion pageviews.
=> Hitwise just came out and confirmed this.
– Acquisitions: We are looking for more acquisitions…if you are not looking, you are not doing your job. To me this is the greatest time to be in media business.
=> I think that this is the best time to be an entrepreneur. Capital is available, technology is cheap, marketers of all sizes are rushing to spend their money online, you can pick up the phone and get anyone from an established, multi-billion company on the phone. Yet, we’re not in a bubble environment either.
– A feature does not make a company, and we have a lot of great features out there…if you are building a feature, you should sell it. If you are building a next Google, you should not sell it.
=> This is something that every entrepreneur needs to print out and stick on their wall.
– Brad Greenspan: Life’s too short…
=> Indeed it is and maybe, just maybe, that is some advice that Mr. Levinsohn will heed himself.
[Editor’s Note: Original version has been modified on or about February 5, 2007.]
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