New media buys

2006’s new media acquisitions

Who buys whom can say much about trends, and heading into 2007, it makes sense to reflect on the year nearly expired. I’ll mention just a few.

NBC is in the news today due to its posting on YouTube the uncensored version of a Saturday Night Live sketch that was bleeped on television — bleeped 16 times. Right after the broadcast almost two weeks ago, the network posted it both on NBC.com and YouTube.com. The online version had logged more than two million downloads on YouTube alone in the week following the broadcast.

NBC is embracing new media. In addition to working with YouTube.com, licensing the Google division to present NBC content, the network bought iVillage back in March. Most interesting about that buy was the primary reason why, as articulated by NBC Universal’s president of digital media, Beth Comstock: “What we are excited about here is that it is a community.” NBC Universal didn’t buy the women’s site to deliver its content, it acquired it for the same reason Google got YouTube — for the user-generated content. Crowdsourcing.

The metrics are incredible. Google bought YouTube for $1.6 billion (?!?). NBC paid $600 million for iVillage, a 10-year-old company with revenues in 2005 of $91 million and profits of just $9.5 million.

Yahoo! acquired Flickr, an agreement that led to a third-party alliance with Reuters, a deal that had Reuters using amateur or citizen submissions of photography via Flickr.  As I mentioned, Google bought YouTube in late summer, and with it a raft of litigation against YouTube for copyright infringement.

In November, Google also agreed to begin selling advertisements to run in the print versions of 50 major newspapers, running bids for print space just as it has for its own online ads. It is an important step toward Google’s goal to be able to advertise anything in any medium, and it is a recognition by Google of the nearly $50 billion spent on newspaper advertising.

New and old media will continue to converge. My question: How long before a big media company buys SecondLife? My guess: Six months.