Liberty's TCI Music Unit Buys 10% Stake in MTV Networks

Computergram International, May 21, 1999

By Rachel Chalmers

MTV Networks, a division of Viacom Inc, has formed an internet music alliance with TCI Music Inc, part of Liberty Media. The deal will see TCI change its name to Liberty Digital and acquire a 10% stake in MTV Networks' online music ventures. For its part, MTV Networks will acquire the SonicNet web site from Liberty. It has also agreed to buy The Box, a 24-hour all-music cable network. Add that to its February acquisition of Imagine Radio and the outlines of MTV Networks' internet initiative, scheduled to launch in June, begin to emerge.

The MTV Networks project, reportedly rejoicing in the code name "Buggles", seems likely to be a combination of content with aggressive cross-promotion, targeted not only at America but also at lucrative overseas markets. Apparently MTV Networks reasons that what worked for TV will work for the net. It should be noted that the same logic has ruined more than one of its rivals (anyone for Pathfinder?)

That said, the company is building on a reasonably solid foundation. SonicNet was founded in 1995 and includes five key content properties: Addicted to Noise, a news site; Streamland for on-demand videos; Trouser Press, a magazine; Cinemachine, a movie review search engine; and the Alternative Buyers' Guide for record reviews. Perhaps recognizing that past performance is no guarantee of future success, MTV Networks undertakes to invest heavily in SonicNet's future growth.