Microsoft’s has held a 50% stake in MSNBC.com since 1996, and the deal is reportedly worth $300 milion. MSNBC.com is also changing its name NBCNews.com.
A deal held by Microsoft since for almost two decades has ended, allowing the company to cash in on a cool $300 million
Microsoft’s 50% stake in MSNBC.com – soon to be renamed to NBC.com – has ended, it has been announced. Comcast has bought out Microsoft’s stake, reported to cost $300 million, and the site’s Editor-in-Chief said that the name of the website is changing but the function isn’t.
Jennifer Sizemore, the EIC, said the deal will take around two years to fully transition from Microsoft. Reuters reported that people familiar with the deal claim the cost is $300 million due to profits between Microsoft and MSNBC.com.
In 1996 Microsoft invested $220 million to form a cable news channel for the 50% stake. While the company has ultimately made a profit, $220 million in 1996 is approximately $300 million now.
It was also announced, this fall, a new news service aimed at online consumers will launch. Details were scarce, but social network integration will use search to provide breaking news. Comcast previously announced that it would sell its 15% stake in A&E, the owner of the History Channel.
Push Towards Digital Age: Late To The Party
The New York Times added that the deal comes when TV-based news services are looking for online advertising revenue. NBC will apparently invest in areas such as mobile apps and website optimization, which is crucial with smartphones and other mobile devices growing in popularity.
Also, while the deal was positive at first, refocusing from both companies has caused other websites to race ahead (and new website-blog hybrids, such as The Verge, pioneering video content and features).
I think part of the future of website’s is building a connection with readers outside of text, whether through podcasts or video or even meeting them in person. Developing a website which produces news is great, and a difficult task, but the possibilities for video content are endless and allow opinion to be expressed in a way text doesn’t allow when you’re conforming to a particular style.
The deal seems to be a convenient get-out for Microsoft.