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Alan Breznick
Playing catchup ball with archrival Network, Road Runner has penned broadband content deals with two major online players, News America Digital Publishing and SportsLine USA Inc.
The two pacts, announced earlier this month, will give News America's Fox Sports Online and Fox News Online Web sites and SportsLine's CBS SportsLine site prominent placement on Road Runner's high-speed Internet access service. All three will be "primary content providers" for Road Runner, supplying news, information and customized multimedia features to the company's 200,000 cable modem customers.
Terms of the two agreements were not disclosed. But sources said both deals are advertising revenue-sharing arrangements with no cash changing hands upfront and each side covering its costs.
The licensing agreements are part of a push by Road Runner to fatten its content offerings as it seeks to expand its distribution nationally. With both telephone companies and satellite providers launching their own ultra-fast services, Road Runner executives know it'll take more than high-speed to sell their product.
"We are actively engaged in very serious negotiations with over a dozen additional partners," said Karl Rogers, VP of programming for Road Runner. "We want to be a great home for many, many brands."
News America and SportsLine officials said the deals show that Road Runner, a joint venture of Time Warner Inc. and MediaOne Group, is committed to bringing in outside content providers as well as Time Warner and MediaOne online properties.
"This is a signal that they're getting very serious about getting to market with content partners," said Tom Jessiman, SVP-operations for SportsLine. "Selling cable modems just based on speed and the always-online feature isn't going to do it. You need content."
Jessiman said SportsLine, which is seeking similar broadband content deals with , phone companies and satellite providers, signed first with Road Runner because of its commitment to heavy promotion. Indeed, Road Runner plans to unveil a splashy new national marketing campaign within two weeks. The campaign, developed by Grey Advertising, was originally intended to be introduced last fall.
"They agreed to really aggressively promote us to their cable TV subscribers," Jessiman said. "That brought us to the table."
Scott Ehrlich, SVP/executive producer of News America, said his News Corp. division is also pursuing broadband content agreements with , phone companies and satellite providers. With cable modems now in more than 500,000 homes in the U.S. and Canada and all the major regional telcos rolling out digital subscriber line (DSL) technology, he expects to see a flurry of broadband deals this year.
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