Power plays for portals

As last week's issue of Computerworld ran a story on page one discussing News Ltd's latest masterstroke in further securing online omnipresence, the rumour mill continued to churn out reports surrounding the hush-hush discussions Murdoch's mob was having with Yahoo.

We weren't the first to run such a story highlighting the growing trend of marriages between traditional and new media, and judging by what is expected to come, we certainly won't be the last.

Regardless of whether News Corp is ready to Yahoo or not, escalating press coverage on media magnates slugging it out for pole position on the portal front can only be good for IT.

More than ever before, IT is finding its way into top-level boardroom discussions as a mission-critical weapon in future business warfare. Take James Packer's Publishing and Broadcasting Ltd (PBL) and Fairfax Holdings. Along with News Corp, they're hot on the heels of Time Warner's multibillion dollar deal with America Online, and all three are determined to follow suit. Each is sizing up prospective companies, like the Yahoos, to help them get a piece of the action.

As you and I watch this story unfold, these three media titans will transform their traditional content-rich services, such as print, free-to-air TV, cable TV, existing portal sites, and the like, to further seduce us to a one-stop mega shop, in what some say will be a battle played out to the end.

Each has invested heavily in divisions to position them as cutthroat contenders. For Murdoch, it's News Interactive, for Packer it's ecorp and for John Fairfax Holdings it's F2.

Yet, speculation surrounding an imminent war zone over who will become the next portal powerhouse suggests existing partnerships between the media moguls may soon be jeopardised.

Consider News Corp and PBL for instance. Despite being fierce competitors, they're also allies in various business ventures, each owning 25 per cent of FoxTel. Then there's Telstra, which owns 50 per cent of FoxTel. The initial FoxTel deal stipulated that all three parties must strive to deliver high-level entertainment through the venture. However, the subsequent investment by both News Corp and PBL into One.Tel was said to have received a cool reception by senior management in Telstra. Yet, to make it even more incestuous, Telstra was allegedly on the hunt for a rich content provider - as it too wants to be a portal success story - and was recently touted to soon bid for Packer's Nine Network in what would be a multibillion deal. No confirmation there, but thanks to the Internet and the race to rule supreme, things could get more complex. Add to that future complications over cross-media ownership and it could get downright messy.

To help set the record straight, future issues of Computerworld will take a thorough look at how the proliferation of portals is set to kick-start a seismic shift in the way the big boys of news and entertainment deliver their goods Down Under.

Angela_Prodromou@idg.com.au

Editor

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More about America Onlineecorpf2FoxtelJohn Fairfax HoldingsNewsNews InteractiveOne.TelPublishing and BroadcastingTelstra CorporationTime WarnerYahoo

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