Vivendi Universal is discussing ways to increase the domestic distribution of its television and film product, working with the likes of USA Networks, Liberty Media Group and its new partners-Sony Corp. and Yahoo!-in Duet, a downloading and streaming music alliance it announced last week.
“This is only the first of many close commercial alliance efforts that we may be able to develop between our groups-Vivendi Universal, Sony and Yahoo!-all in a very consumer-focused way,” said Jean-Marie Messier, Vivendi Universal chairman and CEO.
All of the Duet principals last week agreed the alliance built on Yahoo! Music’s existing online platform is a giant step toward providing the streaming and downloading of all kinds of secure copyright materials to consumers.
Basking in the promise of their new joint venture, Vivendi Universal, Sony and Yahoo! officials declined comment on discussions they have had about similarly distributing and even providing secure downloading of films and TV programming within the next 12 to 18 months.
“I’m not going to give any further comments on that. Everyone understands content distribution online is a key application for the future and a key demand for consumers. With the penetration rates of broadband, basically if music is a key content for today, movies and [TV] images will be key content for tomorrow,” Mr. Messier said.
Vivendi Universal has had discussions with USA Networks, in which it has a 43 percent stake, and with Liberty Media, which has a 20 percent stake in USA Networks, about how it can increase the distribution of its television and film content on existing or newly formed program services in the United States. Well-placed sources say those discussions have been productive but that nothing is imminent.
Vivendi Universal also has been conducting content distribution discussions with U.S. cable and wireless operators, including AT&T, sources say. Vivendi Universal and the multimedia players that could surface as its TV and film content distribution partners in the United States all decline comment on any potential deals.
Mr. Messier last week confirmed he is seeking ways to interface Vivendi Universal content with USA Networks’ cable outlets, Ticketmaster, HSN, CitySearch and Hotel Reservation Network. Mr. Messier has said he is more focused on extending his company’s reach through alliances and strategic equity partnerships than through acquisitions.
The company has declined comment on speculation that it will seek to increase its 43 percent stake in USA Networks, although USA Networks Chairman and CEO Barry Diller would have right of first refusal on such a move and would retain voting control of the company.
Also last week, Vivendi Universal confirmed it has resumed talks with Rupert Murdoch’s News Corp. about possibly merging their respective satellite TV channels in Italy, Telepiu and Stream, both of which are operating at significant losses.
Mr. Messier said last week he will spend two weeks every month in New York to secure additional content distribution alliances and to increase the stake of U.S.-based investors from a current 25 percent ownership stake to at least 50 percent of Vivendi Universal. Sony’s alliance with Cablevision Systems to provide advanced digital set-top boxes and services beginning later this year is likely to afford Vivendi Universal an important cable platform from which to launch new program services or through which to distribute its TV and film content to existing cable program services.
Vivendi Universal also could strike a streaming and downloading arrangement for some of its TV and film content with Yahoo!, which offers an especially strong platform for such early-stage applications. Mr. Messier said the Duet service will allow users to personalize and share playlists to create like-minded communities of music listeners in a model that will easily be extended eventually to streamed and downloaded television programs and films.
Pricing and other details of Duet, which premieres in summer, have not been disclosed. The service is expected to go global by year-end.