This NY Times article is all about Actv. Maybe Lisa should have asked who is the interactive and convergence company behind it all.
May 20, 1999
MTV to Acquire Web Music Rival
By LISA NAPOLI
Just weeks before it is to unveil a new online music service, MTV Networks on Thursday announced that it would acquire two new-media businesses.
MTV will acquire SonicNet, one of the first commercial sites on the Web dedicated to music, and The Box, a pay-per-view cable television music service. In exchange, MTV will give a 10 percent stake in its online service to the owner of the two properties, TCI Music, a company based in New York that provides audio and video music through cable, satellite and the Internet.
--------------------------------------------------------------------------------
Related Articles
Viacom Plans to Create Online Music and Children's Sites
(February 24, 1999)
SonicNet: Music Site Is a Silicon Alley Survivor
(October 19, 1998)
Complete Coverage of Music on the Internet
Forum
Join a Discussion on Internet Music
--------------------------------------------------------------------------------
Tom Freston, chairman of MTV Networks, said the company's online music division would be spun off as a separate publicly traded company sometime in the next 9 to 15 months. The new online music service, whose official name will be announced next week, will debut sometime in June, he said.
In a phone interview on Thursday, Freston called the online music business, which has reached a frenzied pace as the major music labels seek ways to distribute music on the Internet, "ripe for consolidation."
"Everyone is looking to operate differently than they did previously," Freston said. "I wouldn't say it's a land rush, because no one knows what's there. But a lot of companies are trying to figure out where they find their future, as far as the Internet goes."
TCI Music, a division of Liberty Media Group of Englewood, Colo., also announced that it would change its name to Liberty Digital. Liberty Media Group, a cable television programming distributor, is part of the huge cable company TCI, which was bought by AT&T Corp., although Liberty Media continues to operate independently.
MTV Networks, a division of Viacom, is available on television in 300 million homes around the world, and Freston said an expanded online presence is a logical next step for the company. He spoke by telephone from Singapore, where MTV will launch a Web site for the Asian market on Friday.
Industry analysts said the move is a sign that traditional media companies are realizing the power television has to send viewers to the online medium, as well as the power of the Internet to extend what they can offer viewers in the finite time permitted by television.
"Online can support strategies in ways broadcast can't. You don't have the airtime for all you're trying to air," said Mark Hardie, a senior analyst for Forrester Research, a research firm based in Cambridge, Mass. An online presence allows television programmers to direct viewers to their computers for more information or additional services, particularly electronic commerce and eventually, as wider bandwidth becomes available, music videos.
Since the major music labels and technology companies joined together earlier this year to create a secure, standardized format to allow them to distribute and sell music online, much attention has been paid to music sites on the Web. Increasingly, people are using their computers as ad hoc stereos, to download and play music files, some using the MP3 format. Since February, when MTV Networks acquired Imagine Radio, a Web site that allows listeners to create their own online "radio stations" to play on their computers in a continuous format known as streaming, several well-known Web sites, like Yahoo and Lycos, have announced the formation of similar ventures.
These sorts of expanded services add up to new opportunities for businesses on the Web not just to offer music news and information, but to engage in electronic commerce, which MTV Networks said will be a key piece of their new online music venture. Freston said there were plans to create an interactive television channel selling tickets, music and other merchandise.
--------------------------------------------------------------------------------
SonicNet is well regarded by those involved with the alternative music scene, whereas MTV has a hold on the mainstream music markets.
----------------------------------------------------------------------"Our strategy is anyone who can drive traffic is going to be in a position to sell a lot of merchandise, a lot of tickets," Freston said.
The audience SonicNet brings to MTV is different than the one the network already attracts online, he added. SonicNet, a site that offers music news and information, is well regarded by those involved with the alternative music scene, whereas MTV has a hold on the mainstream music markets. Nicholas Butterworth, president and chief executive of SonicNet, said the interest by the major music labels over the past year has intensified the landscape of music on the Web.
"There's been a real change, and for the first time you're hearing people talk about digital delivery as an opportunity, not a threat," he said. "The labels want to work with partners they trust, and MTV has always been supportive of the labels."
Wider use of the Internet, along with bandwidth that makes the Internet a better delivery mechanism for music and video, have piqued the interest of the music industry in the online music area, said Lee Masters, president of TCI Music.
"Before it was information about the Web and you were able to do a little bit of streaming" audio and video, Masters, a former general manager of MTV, said in a telephone interview. "Now you're starting to see deployment of broadband, which is only to get better faster."
"A year ago, how many of us were talking about MP3? This is all new stuff, and I think that's forcing the major record companies to take the whole notion of merchandising seriously."
--------------------------------------------------------------------------------
Related Sites
These sites are not part of The New York Times on the Web, and The Times has no control over their content or availability.
MTV Networks
Viacom
SonicNet |
