Comcast's NBCUniversal Agrees to Invest $200 Million in BuzzFeed
August 18 2015 - 9:17AM
Dow Jones News
By Lukas I. Alpert
Comcast Corp.'s (CMCSA) NBCUniversal is investing $200 million
in new-media star BuzzFeed, as the cable giant continues its
efforts to attract younger audiences that are fleeing traditional
TV.
The equity investment will value BuzzFeed at roughly $1.5
billion, nearly double its valuation a year ago, people familiar
with the matter said.
The deal, which comes a week after NBCUniversal made a similar
$200 million equity investment in BuzzFeed-competitor Vox Media,
gives the media company more exposure to sites that specialize in
reaching millennials with a combination of news, lists and
advertiser-sponsored content. BuzzFeed's prowess in online video is
part of what NBCUniversal finds attractive, one of the people
said.
The companies said they will explore strategic partnerships in
the coming months. Kenneth Lerer, BuzzFeed's executive chairman,
said that could include collaborating on television content,
movies, the Olympics, and joint partnerships with brands and ad
agencies.
"It's a fascinating time for the media industry; social, mobile,
digital, and broadcast platforms are converging to create new
opportunities to connect with global audiences, and we're excited
to partner with NBCUniversal to combine our respective strengths to
build the future of news and entertainment," said Jonah Peretti,
BuzzFeed's founder and CEO.
NBCUniversal, which owns channels such as USA, Bravo, E! and
MSNBC, has struggled like other media companies to maintain a
connection with young viewers, who have increasingly dropped their
cable connections in favor of watching video online.
More than half of BuzzFeed's 82.4 million unique visitors in
July were between the ages of 18 and 34, according to comScore Inc.
Vox Media, which is made up of eight websites focused on sports,
politics, food, fashion and technology, had a combined 54.4 million
unique visitors in July, with more than 40% between the ages of 18
and 34. The investment in Vox Media last week valued the company at
about $1 billion.
Comcast had been scouting out investments in several new-media
companies in recent months, as it seeks a way to turn around
viewership numbers that show that younger audiences are not
watching as much TV as past generations did.
According to a Horizon Media analysis of Nielsen data, the
median age of prime-time TV viewers rose from 46.3 to 50.5 in the
past five years. And only about a quarter of people aged 18 to 34
watch prime-time TV, compared to 53.1% of those over 55.
Prior to the NBCUniversal investment, BuzzFeed had raised $96.3
million in five investment rounds. Last year, it raised $50 million
from venture capital firm Andreessen Horowitz, valuing the company
at $850 million.
BuzzFeed used much of that money to invest heavily in BuzzFeed
Motion Pictures, its Los Angeles-based video production unit.
Write to Lukas I. Alpert at lukas.alpert@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 18, 2015 09:02 ET (13:02 GMT)
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