Google will provide search and advertising across Fox Interactive's network, including MySpace, and they've guaranteed minimum revenue share payments to FIM of $900 million based on Fox achieving certain traffic and other commitments. These guarantee payments are expected to be made over the period beginning in Q1 2007 and ending in the Q2 2010.
I'm sure that Ross Levinsohn, a former VP from AltaVista, knew what he was doing on this one. "We find that the largest amount of people leave MySpace to Google…that was the most attractive part in the decision leading to the deal."
The fact that so many people went to Google from MySpace is not surprising ... Their Yahoo/Overture search sucked.
It will be interesting to see if this relationship helps Google move forward with social search. A $25M/month guarantee is not too high a price to pay when you think about what it could represent. Google will have a base of over 100 million people to develop/refine a social search engine. And in the meantime, I'm sure they must be pretty happy about what this represents in terms of AdSpace inventory.
Here's the press release. Rafat has a nice summary of the analyst and press conference call. There's more commentary and discussion on TechCrunch, Niall Kennedy, Jeff Clavier, and Mashable.
Technorati Tags: social.networks, advertising, myspace
Tuesday, August 08, 2006
this is buying dollars for 75 cents. a no brainer
# posted by steve olechowski : 3:07 PM, August 08, 2006
Nice when it is a win-win ... Fox gets guaranteed $, which are sure to please the markets and quell any residual scepticism about the MySpace deal - and it might help get the next one through, too. Google, as you say, buys dollars for 75 cents. And they've got plenty of quarters.
# posted by George Nimeh : 3:41 PM, August 08, 2006