Word: mci
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Dates: during 1990-1999
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...time at all, as it turned out. On Wednesday, News Corp. and MCI, the long-distance giant, announced a deal to form a worldwide media partnership, one that could add as much as $2 billion to Murdoch's buying power. A year ago, after MCI sold a 20% stake of itself to British Telecommunications for $4.3 billion, it began looking for a partner to transform its worldwide phone network into pathways for "content"-whatever a computer or TV screen can receive, from info-services to movies. "You can hardly think of content without the name of Rupert Murdoch coming...
...Murdoch held a brief get-to-know-each-other meeting at the Los Angeles airport in November. "After about 15 minutes we hit it off personally," he says. "And we both instantly saw that there may be some genuine reason to pursue this." At the end of the pursuit, MCI agreed to invest heavily in News Corp. stock--$1 billion now plus $1 billion over the next four years. In return, Murdoch will send his company's immense fund of grunt-and-grin entertainment, news and information through MCI phone lines into home and business screens. In addition...
Each side will contribute $200 million to a global joint venture in which programming and electronic information produced by News Corp. will be distributed to businesses and consumers in digital form through MCI's vast web of fiber-optic cable. But here too Murdoch may not have to ante up cash, just "content.'' Low risk but high potential profit for him-that's typical of the entire deal. If MCI eventually invests the full $2 billion, it will own 13.5% of News Corp. But the terms of the deal require MCI to vote its shares in the same proportion...
...Internet is a market where just about everyone is betting but almost no one is yet taking home winnings. A similar deal two years ago, in which Bell Atlantic proposed to absorb the cable giant Tele-Communications Inc., was called off before it could go forward. While MCI has a strong customer base among businesses, for instance, News Corp. has little in the way of business information services to offer them. For Murdoch, the most important advantage of MCI's already established presence on the Internet is the second chance it offers to his flagging on-line service, Delphi...
...Internet was built to be an open and cooperative system. That's its strength -- and its weakness. "It's a fragile environment," says Pipeline founder James Gleick. "There's no cleverness in breaking a system like Pipeline. We're not MCI. We're exactly the kind of small-scale operation that gives the Internet its vitality and richness...