Details scant in venture with IAC, NBC's Silverman

July 27, 2009 By ANDREW VANACORE , AP Business Writer
FILE - In this May 12, 2009 file photo, Ben Silverman, co-chairman of NBC Entertainment and Universal Movie Studios, poses for a portrait at Universal Studios Hollywood in Universal City, Calif. Silverman will be leaving his job to head a new venture with Barry Diller's IAC/InterActiveCorp focusing on producing and distributing multimedia content, IAC said Monday, July 27, 2009. (AP Photo/Dan Steinberg, file)

(AP) -- A new venture that NBC Entertainment co-chairman Ben Silverman is leaving the network to form with Barry Diller's IAC/InterActiveCorp promises better integration of ad campaigns by involving advertisers earlier in a show's development.

It also promises to develop content and marketing across every medium, "from Twitter to television," as Silverman puts it.

Yet analysts question how this marriage of television, the Internet and advertising will play out.

The new production company's name and corporate structure are still undetermined. IAC says it will eventually become a separate entity that won't affect its own earnings, but IAC will provide an undisclosed amount of startup capital. Other investors may be brought in later, including possibly NBC.

Whatever shape the new company takes, Silverman said he expects it to be the first of its kind, bringing producers, distributors and advertisers under one roof to come up with content for TV and the Web.

As things work now, "a guy like Silverman comes up with a concept, it's funded by the studio, they take a lot of risk, (and) advertisers come into the picture later on," said Ross Sandler, an analyst with RBC Capital Markets.

The new company intends to bring all stakeholders together at the outset so advertisers can figure out ways to integrate their brands into the programming. Marketers are already experimenting with more creative product placements as digital video recorders make it easier for consumers to skip commercials.

But will Silverman's umbrella organization work?

"I think it's really too early to tell," Sandler said.

IAC, a collection of Web properties including search engine and dating site, said more details won't be available until the formal launch in September. The company would not make anyone else available to speak.

Silverman has already had the chance to test drive some of the concepts he hopes to foster during his time at NBC, which he joined in June 2007.

He pointed to a partnership with Microsoft Corp. to promote Bing, the software company's new search engine. NBC's "Late Night with Jimmy Fallon" had audience members play a game that incorporated the site, a move away from the standard 30-second TV spot.

"Attention is the toughest commodity to harness," Silverman said in an interview. "To get people's attention you have to disrupt, you have to make things part of the culture, not just part of the marketing."

Silverman's tenure at NBC has been spotty, however.

He helped produce two hits with NBC's "The Office" and the reality show "The Biggest Loser." But he hasn't been able to lift NBC out of fourth place in the network race.

In any case, analysts don't expect the new venture to have much of an impact on IAC's business for now.

But it could reveal something about the company's overall direction since splitting into five separate companies last year, said Jeff Rath, an analyst with Canaccord Adams.

"People have been waiting for IAC to articulate a strategy, if you will, since it became a sort of pure-play online media company," Rath said.

Last year, IAC trimmed down to its core assets, spinning off the home shopping site HSN Inc., time-share business Interval Leisure Group Inc., ticket provider Ticketmaster and lending and real estate business Inc.

Of the new venture, Rath said, "I suspect as we move forward, they're going to peel the onion back and better articulate how they're going to execute."


AP Technology Writer Rachel Metz in San Francisco contributed to this report.
©2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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