Time Inc. Inks AOL Deal
Time-Warner Inc.'s (TWX) Time Inc. said its new media strategy will add distribution of the company's magazine cyber-content via America Online, under an agreement announced Monday.
Five of Time's properties will be available on AOL: People, Time, Entertainment Weekly, ParentTime and Money. Two will be on its CompuServe service, Money and Fortune. People Online will be exclusively on AOL. The first Time editorial material on AOL is expected early next year, a Time Inc. spokesman said. Financial terms of the agreement were not disclosed. Sources close to the companies indicated America Online is not paying Time for the content, and that Time Inc. will sell advertising on the AOL space and will keep a "substantial share of the revenue."
Working with AOL (AOL), said Time Inc. new media president Linda McCutcheon, "is a reflection of the high and growing value of quality digital content. It illustrates why distributing our digital content to wherever consumers gather in cyberspace is central to Time Inc. New Media's marketplace strategy." Another Time executive added, "The online world is not just the Web."
Time Inc. was one of the first major publishers onto the Web, grouping its publications in a kind of online content mall called Pathfinder. However, after several years' experience and changes in management, one top Time executive conceded at an industry conference that making money on the Web was taking longer, and proving more frustrating than the company would like.
Time Inc. and AOL have been partners in content since January of this year, when they launched online Teen People, exclusively on AOL. Utilizing an integrated production approach, print and online editorial staffers work together, using the Web as a vehicle to stay in touch with readers and identify trends and develop story ideas. On the newsstands, where the printed version competes against established publications like Seventeen, a Time spokesman said it is "besting" the competition.
"The big picture is that we are pursuing a brand strategy, not a Pathfinder strategy," Graham Cannon, director of strategy and communication told CBS.Marketwatch.com. While the Pathfinder.com domain will stay on the Web, it's the magazine titles which people know and which will be emphasized and exploited.
"Pathfinder is increasingly a 'trade term', a convenient way for sales and marketing people to explain to advertisers how to reach an audience with a variety of the company's publications. But consumers come to the magazines' sites."
Cannon indicated Time is also likely to expand its relationships. This could mean versions of its magazines for the soon-to-arrive electronic book products, and other deals with Web publishers. He said the maturing of the Internet is encouraging the company to take its minstream publications into electronic distribution.
"We call it the graying of the Web," Cannon explained. "It's looking more and more like ordinary Americans. It used to be predominately male and 25, and now it's more female and ages are moving to 35, 45 and 55. The Web looks more like a mass market, and that's where we've spent a lot of time."
Written By Frank Barnako