"This summer has been an unusual hunting season for the start-up world, with nascent Internet companies firmly in the crosshairs of major media conglomerates."
CNet.com
August 15, 2007
"A growing number of media conglomerates have established divisions to take minority stakes in small Internet and technology companies. Other media companies that already have such venture capital arms are expanding.
‘So many media companies are setting up venture arms,’ said Alan Patricof, managing director of Greycroft Partners, a venture firm that has invested with the media companies in several start-ups. Now, he said, ‘they are really part of the venture community.’
…Traditional venture capitalists measure success exclusively by how much they sell the investment for, but NBC and most other media arms have a dual goal.
‘We’re looking to get a return at some point, but these are properties we expect to grow with,’ Elizabeth J. Comstock, president for integrated media at NBC Universal said. ‘We want to get great access to early technology that might give us a competitive advantage.’"
New York Times
October 19, 2007
"[CEO Les] Moonves said CBS is looking at Internet sites ‘every single day of the week … We look at thousands of them to see where we should invest, what we should buy.’"
Reuters
September 18, 2007
"GE is launching a $250 million equity fund to invest in…areas that could help NBC Universal’s digital business."
CNN.com
April 17, 2007
"In recent months, CBS acquired Wallstrip.com, a daily [video] show about Wall Street culture and pop culture, and Discovery Communications bought Treehugger.com, an eco-lifestyle Web site that produces video segments."
Wall Street Journal
August 28, 2007
A big reason for the above activity: the TV business is in decline. Consider:
"Preliminary figures show ratings for the four big networks down 11% versus last year among 18- to 49-year-olds, the demographic advertisers pay the most to reach."
Crain’s New York Business
October 15, 2007
"U.S. advertising spending was little changed at $72.6 billion in the first half as gains in Internet and magazines made up for declines in broadcast television and newspapers, according to TNS Media Intelligence.
…Spending on TV networks fell 3.6 percent to $11.8 billion."
Bloomberg.com
September 11, 2007
"In the latest sign of television’s decline as the primary media device, 19% of respondents [to an IBM survey] said they spend six hours or more each day on personal Internet usage. That compares with 8% who said so about the TV. One to four hours of TV usage was reported by 66%, compared with 60% for the Web."
HollywoodReporter.com
August 22, 2007
"Today two-thirds of the average media plan is devoted to TV, because it’s what advertising agencies know and do best. In three years, however, it will be down to half (which is still more than $125 billion). TV seems easier to buy then, say, 20 web sites, but those sites would likely deliver a better return on a marketer’s investment. Once they get over their bias, ad agencies will start to play the field in earnest — to the tune of $40 billion."
Watch This, Listen Up, Click Here: Inside the 300 Billion Dollar Business Behind the MediaYou Constantly Consume
David Verklin and Bernice Kanner
2007
