The chairman of Chiat/Day, Venice, Calif., is joining James Robinson III, former chairman-CEO of American Express Co., in acquiring a minority stake in Interactive Connection, a fledgling online service available over the Internet (AA, April 25).
Interactive Connection is the brainchild of President Neal Weinberg, a brash and boisterous 27-year-old former ad sales manager for Prevue Networks, and Exec VP-Chief Information Officer Alan Ellman, 31, a more subdued former director of finance for ABC Radio Networks. The new service's technology allows photos and text to be transmitted simultaneously at high speeds, something none of the other major online services can do.
Interactive Connection is gearing up for a Sept. 1 consumer launch. So far, no ads have been sold for the service. The company is working out of the offices of Crane Media Sales, a New York cable TV rep firm that is helping the fledgling service sell ads.
Messrs. Chiat and Robinson are investing about $500,000 each and will be charged with bringing in additional capital.
"Jim and Jay will be giving us their advisement as to a number of matters ranging from future investment capital to business operations," Mr. Weinberg said.
Mr. Chiat declined to comment, but an agency spokesman characterized the deal as "a private investment by Jay."
Mr. Chiat was one of several high-profile communications industry executives courted by Mr. Robinson, who opened New York investment company J.D. Robinson Inc. after leaving AmEx in early 1993.
Ironically, Messrs. Chiat and Robinson worked together before, during the tumultuous year Chiat/Day was AmEx's charge card agency. Chiat was dumped in November 1992 for Ogilvy & Mather, the agency Chiat replaced.
While owning a piece of a tiny, start-up online service isn't the same as buying America Online, Mr. Chiat's investment nevertheless takes the agency world in yet another new direction as it confronts interactivity.
Ad agencies are scrambling to invest in software developers and other content providers, but none so far has expressed interest in owning the pipeline.
The Internet connection gives Chiat clients, including Nissan Motor Co. USA, NutraSweet Co. and Quaker State Corp., immediate access to a burgeoning interactive medium. Interactive Connection made presentations to Chiat executives this month.
Ads will play an integral role in the service, often linked to content providers. And those content providers are an eclectic mix.
For $12 a month and 10 cents per minute of online time, subscribers will be able to read South Florida, New Jersey Monthly, New Jersey Bride and South Florida Bride online; check sports stats from SportsTicker; and download military documents and photographs from the Military Channel.
An extensive travel forum will offer color brochures from tourism offices and attractions, including the British Tourist Authority. Deals are pending with the Travel Channel and Weather Channel that may involve bartered ad time in exchange for positioning on the service.