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Disney does deal with MSN

The entertainment giant will offer its online children's service, Disney's Daily Blast, initially for free through Microsoft Network.

The Walt Disney Company outlined its biggest step yet into the online children's market today, announcing a deal with the Microsoft Network to deliver its long-awaited service.

As reported by CNET, Disney's Daily Blast will provide online games for children, stories, and sports and news from Disney's other properties--both through MSN and on the Web. Family.com, Disney's online content for parents, also will be part of the service.

"There is something new everyday on Disney's Daily Blast," the site read today. "Interactive stories with clickable surprises--from the Lion King to the new Hercules; animated comics with your favorite characters, like Aladdin and Darkwing Duck; [and] news for kids with top stories and science tips, quizzes, polls, and reviews from ABC News."

The service, aimed at children aged 3 to 12, will be launched on the Internet next month for $4.95 per month at the Daily Blast Web site. At the same time, it will be offered for free to MSN members in an exclusive arrangement for ten months, after which Disney can strike deals with other online services.

News of Disney's exclusive distribution deal with the Microsoft Network leaked out on Easter Sunday. The decision to partner with MSN presents a direct threat to America Online, at least for the duration of the deal, in the family market that AOL has made its No. 1 priority.

"We feel that the combination of Disney's Daily Blast and the high-quality network and programming of MSN will be a strong draw for families," Disney Online president Jake Winebaum said.

MSN vice president Laura Jennings added: "Children and families are an extremely important audience for us."

Disney's Daily Blast is the latest site trying to charge users for content on the Net. This small group also includes ESPN, also owned by Disney; the Wall Street Journal; and soon, Playboy magazine.

Microsoft has struck similar deals with media giants such as Dow Jones as it seeks to expand its fledgling online service as part of its general foray into new media. On Thursday, the company will jump into the city directory business with its Sidewalk series of regional publications. Its growing Interactive Services Group also includes MSN, online gaming, and online travel.

Disney hopes to leverage its reputation for providing safe, high-quality content for children at its theme parks, in movies, and in videos. The company's expansion comes as many parents worry about they safety of the Internet.

CNET reported last week that Disney had quietly set up the Daily Blast site, which bore a message saying it is still "under construction." Another link on the home page, in a hidden space, connected to a page reading: "Welcome to Disney's Daily Blast Beta Test Site."

It also says users must have computers equipped with Windows 95, a Pentium processor, 16MB or more of memory, and a 14.4-kbps or faster modem.

Another page on the Daily Blast site features an animated menu bar with categories for user guide, instructions, troubleshooting, member services, and frequently asked questions.

To go further, however, you need a password for both "Daily Blast and Family.com," a family entertainment site that Disney already offers on its corporate Web site. The Daily Blast is rich in animation featuring technology such as Flash by Macromedia.

Disney's move into the children's market has been watched closely because of its size and market clout. It faces stiff competition, however, from the companies such as Viacom, which offers Nickelodean in a pact with America Online and says it plans to offer a children's product called Nick.com on the Web soon.

In a recent study, Jupiter Communications predicted that the number of children using online services will increase to about 20 million by the year 2002. At the end of 1996, revenue stood at $306 million from the online kids market, but it could grow to $1.8 billion by the end of 2002, the study said.

Disney is expected to offer a fee-based service featuring its famous characters. Some analysts have speculated the company would charge less than $5 per month and distribute the product through ISPs similar to the way cable television companies offer premium services such as HBO and Showtime.

Later this year, Disney is expected to launch a more comprehensive service with features such as "D-mail," a branded form of email for children. The company also has signed a deal that could allow it to offer 3D chats with Disney characters.

Disney registered the domain name "dailyblast.com" in November. Last month marked the first anniversary of its Disney.com Web site, which underwent a major redesign. The free site features Disney's products and services in theater, cable TV, publishing, records, home video, and on the Internet, as well as theme park information.

The Disney.com site also has a search function that turns up games based on movies such as Toy Story that can be downloaded.