NBC today said it agreed to buy an equity stake in Snap!, the portal division of Internet media player CNET, Inc., and announced it will run the service as a joint venture.
The move is the first major example of a traditional media giant aligning with a search and navigation guide in an effort to stake a claim in the emerging Web portal space.
Industry analysts have been predicting for some time that one or all of the leading television networks would partner with a portal player such as Yahoo!, Excite, or Lycos to deliver co-branded content via the Net.
Under terms of the agreement, NBC will acquire a minority stake in Snap!,
with an option to increase its ownership position up to 60%. NBC also said it purchased 4.99% of CNET common stock for $26 million.
During a conference call today, NBC announced it has set aside $38 million for the eventual 60% stake, and has currently acquired 19% ownership of Snap! for part of that sum.
The broadcaster said it aims to leverage its major brand association, advertiser and marketing relationships, and significant promotional opportunities to turn Snap! into a major portal contender.
Snap! is distributed by over 40 Internet service providers and PC makers including major industry players such as GTE Internetworking, MCI Internet, Earthlink Network, and Sony Electronics.
The service maintains a directory of online resources segmented into 16 topic areas including Arts, Business, Computing, Entertainment, and Sports, and distributes content from more than 75 Web publishers, including Mecklermedia’s InternetNews.com and Internet World newspaper.
“We are clearly defining the Internet and interactive media as fundamental
to NBC’s growth strategy,” said Bob Wright, President and CEO, National
Broadcasting Company. “The addition of Snap! will enable us to utilize the power of NBC to reach out to current Internet users, as well as to the 80% of the country that is not yet online.”
“Our goal is to make Snap! the starting point that the nation’s TV
viewers are most aware of,” said Tom Rogers, President NBC Cable and Business Development and EVP.
Snap! recently added to its portal services on May
21 when it announced the launch of a free e-mail service.
