Euro TV station group SBS said Wednesday it has created SBS New Media, a wholly owned subsidiary that will oversee the company’s aggressive Internet expansion in Europe. A big first step is SBS’ alliance with giant Euro production house Endemol for a Dutch entertainment portal.
SBS also plans to announce today that revenue for the third quarter ended Sept. 30 jumped 22% to $84.3 million and net losses widened to $25.6 million from $16.3 million. Strong numbers at TVNorge in Norway and TvDanmark fueled revenue growth.
Following the lead of such U.S. broadcasters as CBS, SBS said it will take a 15% stake in Bidlet, the owner of Sweden’s largest auction site, in exchange for $2.5 million in cash and $15.5 million worth of ad time over five years.
SBS, which plans to roll out the site into other Euro markets, will use the leverage of its TV and radio assets to direct audiences to the Web site — and vice versa. More similarly structured deals are likely to follow.
CBS has been pursuing a model of taking equity stakes in Web sites or their parent companies in return for advertising across all its platforms: broadcast, network and outdoor.
SBS has also forged a strategic partnership with Washington, D.C.-based tech company ZeniMax Media to develop European entertainment sites and Web portals. ZeniMax’s L.A. studio, e-Nexus, has built relationships with the Hollywood creative community that will help to build proprietary content for new SBS sites.
Greger Larson, senior VP of sales for SBS, will be managing director of the new-media unit.
As for financials, SBS said its wider loss was due in large part to a $9.4 million, one-time expense related to the termination of its agreement to acquire rival Euro station group CME. SBS’ deal earlier this year to buy Central European Media Enterprises collapsed in a costly mess as the key CME station asset, Prague’s Nova TV, foundered in litigation.
SBS owns TV stations in Scandinavia, Holland, Belgium, Switzerland and Hungary. SBS has radio operations in Denmark, Sweden and Finland and is present in Slovenia and Switzerland.
SBS stock closed at 38¾ on Tuesday, up 3/8.