In the middle of the whirlwind week, MTV Networks Chief Operating Officer Michael Wolf talked to MediaWorks' Abbey Klaassen about the latest acquisition, how MTVN sees its digital mission and the evolution of its deal with Google.
MediaWorks: In Viacom's earnings call, digital media accounted for 6% to 9% of MTV Network's upfront volume. As far as we know no other cable network group has had digital revenues that have accounted for more than 5% of total take. What drove that?
Michael Wolf: We are probably the only organization that is able to really effectively execute the multiplatform sale, to package both TV and digital together and provide a way for our clients to reach our audience and work with them. We want to be the on-ramp for consumer marketers for the internet, and that's a group that's been way underrepresented in internet advertising until now. At same time, we're helping a lot of mainstream agencies move their business into digital. And that's reflected in what you're seeing.
MediaWorks: Talk to us about the Google deal. Do you envision the deal will become more flexible as time goes on? For example, might sites with fewer than 100,000 monthly visitors be able to air your video content or might a site be able to link to an individual clip without having to take an ever-changing series of clips that you decide how to program?
Mr. Wolf: First of all, I'm glad you brought that 100,000 number up. That is not a restriction. Essentially we want our video to be widely carried by all sorts of different sizes of sites in Google's network. We want to use our content to create a network effect. Right now we're updating content because we want to be able to maintain the freshness of the content, but as we start to test this we'll see what works. Just as Google launches everything as a beta, that's how we're launching this. We're going to use this as a way to do what we always do -- figure out what our audience wants. We think this hyper distribution method will give them each what they want. ... Around the Google deal, it really is the first time where anybody in the content business can use video and create a new content economy on the internet by marrying a video to an advertisement and allowing smaller owners to place that on their sites. It promises to be a groundbreaking way for content to be distributed and monetized on the internet. We brought this idea to Google. Eric Schmidt and I negotiated the deal and it's the first of many [MTV will] be doing in the digital media space.
MediaWorks: Your $200 million acquisition of Atom Entertainment is your sixth -- and most expensive -- acquisition over the past year. Are you done acquiring or are you still in the acquisition market?
Mr. Wolf: We're going to continue to build organically and acquire assets that uniquely fit with the presence we're trying to create in the digital media space. The issue isn't the size of the transaction but what the business will add to us.
MediaWorks: Do you anticipate Atom Films will be integrated into MTV Networks or operate fairly independently?
Mr. Wolf: Our plan is that we have a strong presence in casual gaming, especially in kids and family sites. So while we want Atom to operate independently, we want to have lots of links to and integration of their features and gameplay. ... In terms of casual gaming we see kids and family as big drivers. Separate from that, we're strong in the male demo thanks to Xfire and Gametrailers.com.
MediaWorks: How does Atom Entertainment's video sites -- AtomFilms.com and AddictingClips.com -- complement or overlap with iFilm and the video stuff you're doing on individual network sites? And might you use AtomFilms.com as an incubator of on-air talent?
Mr. Wolf: It's very complementary to iFilm because iFilm does not produce original content. It's more of an aggregator and promoter of content. Atom Films is a way of showcasing and providing for the discovery of new creators and producers. Online video content is going to be critical to our success in future -- having original video content is important for both users and advertisers. ... [As for using Atom Films as an incubator] we've already done that with iFilm through our "Web Junk" program. We see the same thing with Atom Films. It's a pipeline for creators to be able to work both on small and big screens.