MTV Networks is tying its Web site and two TV channels together
in an attempt to attract music fans with greater access to tunes and
The project, dubbed MTV360, is the cable network's latest effort to marry
the old and new media through a range of features, such as a music-download
service, instant messaging and an Internet radio channel. It unites
MTV.com, the MTV channel and MTV2, which features only music videos.
The cable network faces stiff competition with AOL Time Warner, which has
been beefing up its online music offerings, including Spinner, Winamp and
the AOL Music Channel. In January, AOL Time Warner's America Online unit said it would expand its relationship with
Warner Music Group by promoting new releases from Warner's labels,
including Atlantic Recording, Elektra Entertainment Group, London-Sire and
Warner Bros. Records.
Analysts said that although AOL Time Warner knows how to work the Web to
its best advantage, they see MTV360 as a good move.
"By being able to bring the two parts of the MTV universe together along
with their reputation for music in the industry and with the digital
distribution aspect, they really have a powerful model to move forward in
the music industry," said Jarvis Mak, analyst at Nielsen/NetRatings.
"They understand their audience...Every new high school class is a new
audience for them."
Solid fan base
Mak said that MTV already has a large number of music fans logging
onto its Web sites. MTV.com received 2.6 million unique visitors for February, falling between popular online music sites MP3.com at 3.3 million
and MusicMatch at 1.5 million, according to Nielsen/NetRatings. MTV-owned VH1.com had 690,000 unique visitors in the same month.
As part of the new project, MTV will offer instant messaging to let music
fans interact with one another. If a music fan were watching an MTV show,
that person could find and chat with other viewers. It also is providing
an Internet radio player on MTV.com. Launched last week, the Radio MTV
player includes 42 different channels ranging from hip-hop to garage music.
Nicolas Butterworth, chief executive of MTV's Internet arm, said that
although the company is still trying to figure out the right business model
that balances the needs of artists and consumers, it will probably offer
some form of subscription service.
He added that MTV is already working with the major record labels to ensure
the radio station is compliant with the Digital Millennium Copyright Act.
It pays a license fee to labels and artists so that they're compensated for
their work, an arrangement that has been lacking in many music-swapping
services, such as Napster.
Butterworth said MTV has been experimenting with convergence
programming since 1995; it decided to launch MTV360 now because technology
is available that lets the company build a music application service as
well as "strong community features."
"Our audience has become an incredibly wired, techno-literate audience
who's fundamental approach to entertainment has changed," Butterworth said.
"We think that there's a huge difference in the way young people approach
entertainment today in the post-Napster era than they did three or four
years ago. People expect to get things on demand, they expect to access
them anywhere, and they expect to share them with friends."
MTV said it will also offer advertisers MTV360 packages to sponsor the new
project, which will be announced on-air in the next two weeks.