Microsoft and NBC, Splitsville
Apparently, NBC did not like sharing control of MSNBC with Microsoft (NAS: MSFT) . After 16 years, the 50-50 joint venture between Microsoft and NBC is now over. MSNBC.com is now NBCNews.com, which will be a part of NBC News Digital, a new division.
One source of irritation to NBC with its joint venture with Microsoft had been in what's called cross-media sales. Many advertisers wanted to buy ads on both the television newscasts and the MSNBC websites. NBC felt it could not sell to both media effectively because Microsoft controlled the ad sales.
Comcast (NAS: CMCSA) , the owner of NBC Universal, is paying Microsoft $300 million for complete ownership of the venture. NBC News president Steve Capus said, "We will fully own our digital businesses."
Mr. Capus told The New York Times that "it's undeniable how big a part of all of our businesses the digital properties are going to be. We think we have a much better opportunity to shape them, and frankly grow the news division over all, if we have direct control over all of it."
NBC's move is going against the grain of companies relying on Web portals to attract visitors to their websites. Disney's (NYS: DIS) ABC News has combined with Yahoo! to garner 81 million unique visits a month in the United States alone. The MSNBC.com websites grab 50 million visitors. The CNN sites get 56 million.
For its part, Microsoft will start its own online news site, according to NBC News. It has already started hiring for that site, which is expected to launch this year. MSN.com had relied solely on NBC News for all of its news content. NBC News will still provide content for MSN.com, but the site is now able to work with other news operations. MSN.com general manager Bob Visse said, "We're going to go out and build a world-class news team."
The media companies want to have more control of their websites because they can glean more information about their visitors, which results in more cost-effective advertising. To make the best use of this information, the companies need to sort through the massive amounts of data they gather. "The Only Stock You Need to Profit From the NEW Technology Revolution" is a Motley Fool report that is a must-read for any investor wanting to take advantage of a company that is a leader in the field of data mining and business intelligence. This report is essential reading and it's free!
The article Microsoft and NBC, Splitsville originally appeared on Fool.com.Fool contributorDan Radovskyhas no financial interest in the above-mentioned companies. The Motley Fool owns shares of Microsoft and Walt Disney.Motley Fool newsletter serviceshave recommended buying shares of Microsoft and Walt Disney.Motley Fool newsletter serviceshave recommended creating a bull call spread position in Microsoft. The Motley Fool has adisclosure policy. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.