Viacom apparently isn’t put off by Microsoft’s abandonment of the URGE music service that their MTV subsidiary created with Microsoft, because they have signed on for a new long term advertising and content deal.
Viacom Inc. (NYSE: VIA and VIA.B) and Microsoft Corp. today announced a broad-based, strategic alliance under which major divisions of both companies will collaborate on advertising, content distribution, event promotions and games over the next several years.
The deal includes the following:
- Viacom broadcast content for Microsoft online sites: “Microsoft will license, on a non-exclusive (emphasis mine) basis, long- and short-form television and theatrical content from across Viacom’s cable network and motion picture businesses, including MTV, Comedy Central, BET and Paramount Pictures, for use on Microsoft properties such as MSN and Xbox 360.”
- Viacom broadcast content for a new joint online site “During calendar year 2008, Microsoft and Viacom will partner to promote a co-branded Web site with exclusive content from at least four MTV Networks and BET Networks events, such as the MTV Video Music Awards and BET Awards, and will share certain advertising revenue generated by the site. Microsoft will provide a pre-determined amount of online promotion for each event.”
- Viacom themed games on Microsoft sites: “Viacom will work with Microsoft’s casual gaming platforms (MSN, Windows and Xbox) to provide downloadable casual games to the substantial base of consumers playing quick-to-develop, easy-to-learn games on these platforms.” Also, “Viacom will work with Microsoft on opportunities to become a preferred publishing partner across Microsoft’s casual gaming platforms.”
- Microsoft ad serving and sales for Viacom sites: “Microsoft’s Atlas division will become the ad server for Viacom’s U.S. Web sites and Microsoft will have the exclusive right to sell remnant display advertising inventory on Viacom’s U.S. Web sites.” Sounds like a dump for banner ads. Atlas was part of the aQuantive acquisition.
- Microsoft ads on Viacom broadcasts: “Microsoft will buy advertising on Viacom broadcast and online networks over a five-year period and the companies will work together on promotions and sponsorships for MTV Networks and BET Networks award shows.”
“Detailed financial terms were not disclosed, but the deal has a projected base value of approximately $500 million in financial considerations and business services between the two companies over the initial five-year length of the agreement.” No word on how the bucks balance between the two.
If I had to offer a capsule description, it would be “Microsoft loves banner ad sales and old media.”
Update: Todd Bishop observes that the previous Viacom online ad server was Doubleclick which is in the process of being acquired by Google (over complaints by Microsoft and others) and that Viacom is suing Google over alleged copyright infringement on YouTube.
Update: Google: Microsoft-Viacom deal helps our DoubleClick defense.