News

MTVN’s 'Social’ Life in Flux

9/26/2008 8:00 PM Eastern

MTV Networks has acquired Social Project, a small Los Angeles company developing social-networking Web features, as part of the programmer’s strategy to push its video and other content to millions more Internet users — and their friends.

MTVN had previously held a minority stake in Social Project and was the biggest customer for Flux, a set of Web tools to let users share video and communicate with each other. Financial terms of the deal weren’t disclosed.

Mika Salmi, president of global digital media for MTVN, said at a briefing here that the deal will further the media company’s “vertical entertainment” strategy.

“The Web is fragmented,” he said. “We wanted an open, media-centric way to let people find the niches they’re interested in.”

MTVN’s move comes three years after it lost out to News Corp. in negotiations to buy MySpace, which remains one of the biggest social-networking sites on the Internet.

Currently, Flux counts more than 7.5 million registered users, whereas both Facebook and MySpace claim to have more than 100 million active members.

Unlike MySpace or Facebook, MTVN executives said, the idea with Flux is to provide a “connective tissue” linking together multiple disaggregated sites.

Flux lets users contribute any video, image, text or link — regardless of whether it’s from a Viacom-owned site — and other Flux users can then track their friends’ posts and comment on them. Users also can post content to other social-networking sites, like Facebook and MySpace.

The Flux social-networking service is used by 35 MTVN sites, including MTV.com, ComedyCentral.com, TheDailyShow.com, Spike.com and Atom.com, as well as 1,000 smaller entertainment, pop culture and music Web sites.

As part of the acquisition, MTVN named Josh Dern senior vice president and general manager of social media overseeing Flux, who will report to Kenny Miller, executive vice president and creative director of global digital media. Dern most recently served as vice president of MTVN’s social-media strategy and operations.

“We’ve designed Flux with one goal in mind: How do you get in front of the biggest audience possible?” Dern said.

In the future, the Flux platform could extend to wireless phones and provide interactive features through cable set-top boxes, like sharing videos and chatting with friends, he said.

MTVN first invested in Social Project — previously known as Tag World — in November 2006. Executives said that MTVN will more actively recruit new external Web publishers to the Flux network.

Of the programmer’s own sites currently running the social-networking feature, the biggest is MTV.com, which more than 600,000 verified Flux members. The site added a quarter-million of those users in the five weeks prior to this year’s Video Music Awards.

For third-party sites that join the Flux network, MTVN splits 50% of the advertising revenue generated each month on Flux-hosted pages (such as profile pages and community pages).

Social Project, which has 31 employees, will remain based in Santa Monica, Calif., while Dern will remain based in New York.

“We want them to be integrated with what we do, but we also want them to stand on their own,” Dern said.

September