IP Democracy: Another Hollywood Tie for Google

Google has hit two out of the park today — on the heels of its video ad deal with Viacom, Google announced a deal with News Corp.’s interactive media division to sell all search, text and display advertising across the division’s properties, which include monster hit MySpace. Fox Interactive, however, will continue to sell banner ads to big advertisers, although Google will get to sell unused inventory.

Google has agreed to pay out $900 million in revenue to News Corp. from 2007 to 2010, with $400 million of that coming in fiscal 2007. Google won the deal in a bidding contest with Yahoo! and Microsoft, the second high profile contest Google has won over the past year. (In December, Google proved victorious in a much-watched contest to continue providing search to AOL).

This deal should further serve to dispel the doubts that some analysts have held about the wisdom of News Corp.’s July 2005 $580 million purchase of MySpace parent, Intermix Media. Moreover, the deal with Fox gives Google another potential partner in the Hollywood community for its video ambitions, although admittedly this pact doesn’t extend to distribution of Fox content.

Posted by Cynthia Brumfield on August 7, 2006 6:55 PM to IP Democracy