Twelve major TV station groups have banded together to try to harvest big bucks from the Internet.
Led by Tribune, Gannett, Cox, Post-Newsweek, E.W. Scripps, Meredith and Media General — all among the 25 biggest broadcast groups in the U.S. — the new Los Angeles-based network, called iBlast, will sell digital content such as music, video and games to Netizens.
Two of the three principals in iBlast, Mike Lambert, co-founder and CEO, and Ken Solomon, president, are former top executives with broadcast companies. Lambert was once the president of domestic TV for Fox and now owns and operates a TV station group. Solomon is a former president of Universal Studios and Studios USA and former co-head of DreamWorks TV. The third principal, Oliver Luckett, co-founder and chief technology officer, has served in network-development positions for a number of technology/communications companies.
What triggered the creation of iBlast, which promises to be up and running within a few months, is the potential revenue to be generated by the digital spectrum, which the government has assigned all TV stations. The new company will use a portion of that bandwidth spectrum to deliver an array of services that client TV stations will then transmit to computers users — in their homes or businesses — with the appropriate receiver.
The services could include everything from news headlines and movie trailers to music videos and updated virus-protection software. Lambert says these uses would not interfere with the more high-visibility applications of the digital spectrum by TV stations, such as delivery of high-definition pictures for theatrical movies and sports events, and simultaneous multicasting of other 24-hour services such as a local-news channel or a local-weather channel.
Lambert declined to discuss dollar figures, but sources say iBlast has amassed a war chest of up to $50 million to make sure it runs smoothly. There are 143 TV stations already on board, covering 102 markets, for a reach of more than 80% of U.S. homes.
All of the stations are putting up seed money in exchange for an equity stake in iBlast. They’ll also share in the revenues and be able to tap into the proprietary technology to send local content to their customers. The goal of iBlast is to get its service into 95% of the country by the time it’s ready to launch, Lambert says.
The other station groups in the iBlast partnership are Lee Enterprises, the New York Times Co., McGraw Hill, Smith Broadcasting and Northwest.