HOLLYWOOD — Time Warner’s CNN News Group has acquired a $20 million minority stake in Internet streaming video and audio service InterVU Inc., a move that shot shares of the online company’s stock up 20%.
San Diego-based InterVU, which began providing online video broadcasts of President Clinton’s grand jury testimony and Senate impeachment trial for CNN’s Web sites in early 1998, is hoping that by teaming up with a major broadcast partner, the company will be able to boost its brand identity and expand its corporate reach.
As part of the pact, InterVU will deliver live and on-demand broadcast streaming services for CNN and Turner Broadcasting’s Web properties, which include CNN.com, CNNfn.com, CNNSI.com, roughcut.com, TBSsuperstation.com, CartoonNetwork.com, WCW.com and turnerclassicmovies.com over the next three years.
Virtually happy to be here
In return, CNN will promote InterVU across its Web sites and cable channels. CNN’s Web sites average 556 million page views per month.
“We are extremely pleased that CNN’s relationship with InterVU has grown into a broader alliance,” said Bill Burke, CEO of news and information for Time Warner Digital Media. “A growing number of CNN.com’s users are accessing both live and on-demand video, and we believe that the demand for Internet video content will increase dramatically.”
Investors embraced the deal, sending InterVU’s stock up $12.56 to close at $76.13.
InterVU has quietly built itself into one of the top streaming technology companies, partnering with media giants such as NBC, House of Blues, Microsoft and Bertelsmann.
The company, however, has yet to earn significant revenues and saw its stock languish earlier this year. It also faces stiff competition from rivals RealNetworks and Broadcast.com.
“We are excited to have CNN as a shareholder, and we look forward to building our alliance as CNN’s needs for streaming media services grow,” said InterVU CEO Harry Gruber.