CMGI to compete with Broadcast.com
By Matthew Broersma
02/17/99 02:36:00 PM
The company is hiring a former NBC exec and pouring $100 million into the venture.
Venture firm CMGI said Wednesday it will build and launch an Internet broadcast firm with Neil Braun, the former president of NBC Television Network, possibly bringing Broadcast.com its first serious competition.
CMGI (Nasdaq:CMGI), of Andover, Mass., will invest $100 million in the new company, which will focus on the delivery of live audio and video over the Internet, according to CMGI.
"The Internet marketplace has only just begun to capitalize on the potential of this medium to deliver audio and video content," said CMGI Chairman and CEO David Wetherell. "I'm confident that the resultant company from this partnership will have a strong, unique position, and we look forward to its emergence and impact."
Braun was an NBC executive since 1994 and has more than 20 years of experience in television.
The investment firm said it plans to tie its other Internet properties to the broadcast company, but did not specify what kind of involvement there would be. The new company is slated for a second-quarter 1999 launch. "This is a strategic move by a media company looking to best position itself for the next stage of content on the Web, which is arguably going to be one where content is richer and is disseminated in a way similar to what users are used to in television," said analyst Ron Rappaport of Zona Research. CMGI, formerly called CMG Information Services, was a direct marketing firm that found major success in a few early Internet investments, among them stakes in Geocities (Nasdaq:GCTY) and Lycos Inc. (Nasdaq:LCOS), of Framingham, Mass. The company has been a key player in Lycos' proposed absorption into USA Networks (NYSE:USAI), and could nix the deal or force USA to sweeten things for Lycos shareholders.
More details to follow. |
