Viacom's MTV ready to take risks on Web

MTV is diving deep into content syndication, digital downloads, and social networks. Unlike its parent company, it isn't warring with technology or users.

In some tech circles, Viacom is the symbol of botched digital strategies and old-media thinking.

There's little doubt that operating under Viacom's umbrella has hurt MTV's hipster cred with some tech-savvy music fans. MTV managers, however, are trying to dispel the notion that the company is technology backward, fearful of sharing its content online, and has missed out on the Internet age.

On Tuesday, Van Toffler, president of MTV Networks Music and Logo Group, and some of his top managers met with CNET News.com at San Francisco's Hotel Vitale to outline the company's digital strategy for the future. Indeed, this unit of Viacom appears more willing than any other part of the conglomerate to strike out into areas it has historically failed at or avoided, such as content syndication, social networking, and digital downloads.

"In this situation cats have to marry dogs. We have to make a successful marriage of our content with technology. And that's what we're going to do."
--Van Toffler, MTV president

"I'm impressed with how experimental they are being," said Charlene Li, an analyst with Forrester Research. "This is a company that is taking a lot of risks...really, more than any other big media company."

Viacom, parent company of MTV, Paramount Pictures, and BET, is perceived by many to jealously guard its content from users posting it on non-Viacom Web sites. Not MTV. The company now offers an embeddable video player that allows users to post every piece of MTV content to which the company owns the rights.

The strategy unveiled Tuesday also details MTV's efforts to get into the social-networking game. In 2005, News Corp. outbid Viacom for social-networking giant MySpace.com. Since then, Viacom has largely been on the sidelines in the growing market. Now the company is focusing on creating a vast array of highly targeted Web sites that are loosely connected and focus mostly on programming such as VH1 Classic, Jackass, and Sucker Free on MTV.

These Web sites will be at the core of the company's digital efforts. MTV sees its content as its strength, and Toffler said he intends to make it more available on the Web than ever before.

In the past year, the company has constructed 32 new sites. The idea is to create a type of assembly line for Web sites, according to Jeff Yapp, executive vice president of program enterprises for MTV Networks' Music & Logo Group.

Those sites that find an audience will continue to be nurtured and those that don't will be stripped down and "reskinned," or refitted for the next experiment. The company also doesn't plan to spend wildly in promoting the sites. It has confidence in their content and the viral ability of the Web to spread the word.

In regards to dowload sales, where the music icon really has missed the boat, MTV is trying to recover from Urge, the online music store and iTunes competitor that it launched in partnership with Microsoft in 2006. The site never truly got off the ground, but MTV announced last year it will try again with help from RealNetworks' Rhapsody service.

MTV is also branching in new directions from its competitors. The company is amid a $500 million spending plan into video games, the high point of which was the 2006 acquisition of Harmonix Music Systems, makers of the rock-and-roll simulation game Rock Band.

The company sold 1.3 million units of the game last year and the deal has helped MTV find a new way to sell music. Rock Band owners pay between 99 cents and $3 to download songs for the game.

Toffler and his staff credit Viacom's management with bankrolling the experiments and allowing the unit to operate like a start-up.

The moves could help convince fans that MTV is still an arbiter of youth culture.

Viacom may have filed a $1 billion copyright lawsuit against Google's YouTube and sends out reams of legal notices demanding that fans remove their video content, but MTV wants everyone to know that it isn't at war with technology or music fans.

"I tell my staff all the time, in this situation cats have to marry dogs," Toffler said. "We have to make a successful marriage of our content with technology. And that's what we're going to do."

While MTV appears very willing to stick a toe into new business models, there are signs that some areas still give it pause.

Forrester's Li said MTV has not been very aggressive when it comes user-generated content.

But Toffler said the company has more surprises coming, including a high-definition video player as well as more music-focused video games from Harmonix.

"We have a lot of confidence in our content," Toffler said. "Were going to make our Web sites more interactive and engage our users with that content. It's not just going to be people chatting online. We'll be able to show advertisers that our users are immersed when they visit our sites."

 

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