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Microsoft is ending its joint venture with Comcast Corp-owned NBC News by selling its entire 50 per cent stake for roughly $300 million, a media report said.
”... the company that controls NBC, Comcast, is acquiring Microsoft’s 50 per cent stake in the joint venture that brought MSNBC.com to life in the mid-1990s — in effect, a big investment by Comcast in the news division’s future,” The New York Times reported saying the deal took place late Sunday night.
“Microsoft is receiving roughly $300 million for the stake... A portion of the total price comes from the joint venture’s past profits,” the daily added citing source.
MSNBC.com, which is a joint venture between the Microsoft and NBC News, will now be called NBCNews.com, owned and operated by NBC News.
“With the changes, we will fully own our digital businesses,” the daily said quoting NBC News President, Mr Steve Capus.
According to the publication, drastic changes in the media business, differing priorities inside the companies and the physical distance resulted in the end of the partnership between the two.
The daily noted that MSNBC.com will automatically redirect browsers to NBCNews.com, and the site will initially look the same, except for a new logo.
Under the deal, production of the site will shift to New York, though some engineers and other technical employees will stay in Washington, where NBC will set up what it calls the NBC News Innovation Center.
Moreover, Microsoft will benefit from the move as the restrictive terms of the joint venture stopped its portal site, MSN.com, from doing deals with any other news providers, putting it at a disadvantage to other portals, the daily said.
About half of MSNBC.com’s traffic came from MSN, and through a new traffic deal between the two companies, the trend will continue for some time. But NBCNews.com may seek other sources of traffic.
NBCNews.com will retain sections for MSNBC’s political programmes. But those will be moved onto a new MSNBC.com early next year, further splintering traffic. Most of the joint venture’s roughly 300 employees will remain employed by NBC, the report said.
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