Microsoft Makes Play for Concert Webcasts
SAN FRANCISCO — The media landscape is shifting again: Network Live, a Beverly Hills startup devoted to broadcasting live music over the Internet, said Tuesday that it had parted ways with such high-profile backers as AOL and struck a deal with Microsoft Corp.
In July 2005, fresh off its successful broadcast of the benefit concerts known as Live 8, Time Warner Inc.'s AOL created Network Live with XM Satellite Radio Holdings Inc. and concert promoter AEG Live. With Live 8 executive producer Kevin Wall as chief executive, Network Live shot 59 shows during its first year, including Madonna and Bon Jovi, and shared the advertising revenue when AOL and XM broadcast the concerts.
But the companies said Tuesday that the partnership had not worked out the way they had hoped. Wall bought out his partners for a sum that surpassed $6 million, a person familiar with the negotiations said, and signed an exclusive Web distribution deal with Microsoft's MSN Internet business. Network Live also changed its name to Control Room.
The new alliance highlights how quickly executives will switch loyalties in seeking a digital-media foothold.
"It's a little bit like a marriage that didn't work, but we'll be great friends leaving," Wall said. "We took the house and they got the dog."
The deal also signals Microsoft's emergence as a player in online video distribution. Once seen as a laggard behind the likes of AOL and Yahoo Inc., Microsoft has launched a flurry of recent activity, including creating a video-sharing site, teaming with TV producer Ben Silverman to create original Web shows and buying the online syndication rights to the former Fox show "Arrested Development."
"I would give Microsoft some credit for pushing the envelope on video, even more than some of the other big guys," Jupiter Research analyst David Card said.
AOL was riding similar momentum in the summer of 2005 after it gained widespread praise for its online broadcast of the Live 8 benefit concerts, which took place in 10 cities across the world. While MTV Networks had to cut from one performance to the next, sometimes awkwardly, for the TV broadcast, AOL let Web users decide with a mouse click which performance they wanted to see. Five million people tuned in to AOL to watch during the show.
The online broadcast of Live 8 was designed to promote a strategic shift for AOL, as it began to offer free services to counter its declining base of dial-up Internet subscribers.
