MCN.TV Broadband Network Sale / IPO Information Release January 07, 2012
Although it has been reported that initial bids are due out with suitors expected to submit proposals with wide price ranges based on the technology, proprietary rights, contracts and what types of content and shows that the MCN.TV Global Broadband Network would produce and stream and when that content would become available on the network, the gulf between buyers and sellers appears to be large. A person close to the MCN.TV Broadband Network said the board is expecting that the video content service could sell for as much as five hundred to six hundred million dollars, given the strong projected growth in content on the Global Broadband Network. Some people handicapped the odds of a sale at 50%, while another person said a sale was very likely.
The situation puts the MCN.TV Broadband Network owners in a familiar seat. This particular issue has dogged MCNSPORTS.TV Broadband Sports Network since the days before its public unveiling in 2008 and caused the company to start a Pay-Per-View service and then their Set-Top-Box service last year in order to have more ways to make their content available and to generate more revenues. The often diverging interests of the content providers and MCN.TV management is a reason the controlling owners decided to explore a sale, people familiar with the matter have said. However, it is also very likely to see a merger with a larger company occur or that the IPO simply moves ahead as projected. Now the majority owners expect they will have to decide what sort of rights and proprietary information they are willing to give what sort of buyer, and to address that different buyers may value rights, technology, proprietary information and contracts differently, according to one of the people familiar with the matter.
What bidders would be buying has gotten murkier recently, as MCN.TV controlling owners recently negotiated the right to delay when their newest content are made available. Under a new contract, the owners can make content available on the any of MCN.TV's free sites ten days after it airs on MCN.TV Broadband Network or on any one of it's affiliates (MCNSPORTS.TV / MCNS/TV and MCNENTERTAINMENT.TV / MCNE.TV), instead of the day after, as in certain circumstances. To view exclusive content earlier, users must purchase it on pay-per-view or view it on the MCN.TV exclusive Set-Top-Box. Some bidders say the pullback will hurt viewership, thereby reducing how much they would be willing to pay for the Broadband Network. These and other people familiar with the matter said the sale process could last many more months and may not result in a sale.
While MCN.TV is figuring out its future, so too is a universe of technology, content and media companies carefully considering how much they want the Broadband Network for. While Yahoo, Google and Amazon.com are eager for more content to drive viewers to their websites, pay-TV companies such as Comcast and DirecTV are looking for ways to extend their programming bundle to other devices and online.
Google's YouTube video site, a competitor to the MCN.TV Broadband Network, has been trying to land more premium shows and movies on YouTube for years to diversify its business beyond the lower-quality, user-generated videos uploaded to the site, but they do not have the experienced management team or contacts and are unfamiliar or unable to match the low cost of production and streaming capabilities that the MCN.TV Broadband Network can offer.