Microsoft and Viacom Announce a Content Agreement

DailyTech - Microsoft and Viacom Announce a Content Agreement

Entertainment giant Viacom is looking to party with its best buddy Microsoft

Microsoft aggressively tried to expand its media offerings in 2007. It acquired advertising firms such as aQuantive, energetically marketed its Zune player, featured in this year's Holiday Audio Guide, released new models and continued to make improvements to its Zune marketplace.
Not to be forgotten is Microsoft's mighty efforts to expand its XBox Live offerings and launch more family friendly arcade edition Xbox 360 consoles, in an attempt to knock off the market leader, the Nintendo Wii. It even tested its hand in social-networking with an investment in Facebook.

Now Microsoft has a major media deal solidified, which will bring new content and new opportunities to all the aforementioned avenues. Microsoft has signed a deal with media corporation Viacom, which is valued at close to $500 million USD.

Microsoft and Viacom were already partners -- though their relationship became slightly rocky over the last year. Microsoft pledged to co-promote a music service called URGE with Viacom for use with the Zune. However, it instead snubbed Viacom, slightly, by promoting its own Zune Marketplace which overshadowing URGE.
A big check, goes a long ways to patching up hurt feelings and Microsoft and Viacom are back to being best friends again.

Among the content Viacom is offering up for Microsoft's use are movies from Paramount Picture and TV content including Comedy Central and MTV shows. These Viacom properties will be offered in online forms and through the Xbox 360's LIVE service, helping to make it a more viable competitor to iTunes in terms of TV and motion picture offerings.

Microsoft also gets to advertise with its Atlas service, which is an aQuantive product, on Viacom's various US websites. Microsoft will also get to sell the leftover banner space with profits being shared between the two companies.

The final component of this complex and confusing media extravaganza is Microsoft and Viacom's plans for video game related advertising. Microsoft plans on possibly putting Viacom ads or video shorts in its console games. It also plans to offer mini-episodes of Viacom network TV shows via Xbox Live and offer show specific games through its MSN services. Viacom also plans on including Xbox or Windows Live tie-ins on its reality show TV content. So you might be seeing more Xbox 360s on "Cribs" if the writer's strike ever ends. Lastly, both companies will explore new cell phone distribution approaches.

The deal is a big one, but it's likely not the last from the ever active Microsoft, whose aim is nothing less than total electronics and media world domination.