Ross Levinsohn: 'Traditional Media Are Becoming More Aggressive on the Internet'
The head of the interactive division at News Corp. views Google and Yahoo as new competitors, as company chief Rupert Murdoch eyes more Internet buys to follow MySpace, Scout and IGN. (Hey, how about I Want Media?)

By Patrick Phillips
I Want Media, 01/09/06

News Corp. boss Rupert Murdoch delivered a pivotal industry speech early last year, warning media folk to wise up to the potential threat of the Internet. "We need to realize that the next generation ... [has] a different set of expectations," he said. Murdoch's company spent the remainder of 2005 making high-profile Internet acquisitions -- the youth-oriented social network MySpace, online sports publisher Scout Media, and online video gaming firm IGN Entertainment.

Overseeing Murdoch's charge to the Internet is Ross Levinsohn, president of Fox Interactive Media. Levinsohn previously headed up the interactive media businesses of Fox Sports. The Los Angeles-based FIM was formed last July with the goal of leveraging the company's entertainment, news and sports brands online.

I Want Media: Rupert Murdoch seems to have had an epiphany last year regarding the Internet. What brought this about?

Ross Levinsohn: He recognized, along with the other senior management here, that the way people were consuming media was changing. He saw how advertising dollars were starting to migrate to other platforms. And he saw the viability of the Googles and the Yahoos in our new media world.

IWM: Are Google or Yahoo more of a competitor to News Corp. today than, say, a Disney or a Viacom?

Levinsohn: No, they're just added competitors. On a different level, Google and Yahoo are competing for ad dollars and content, just as we are. It's sort of a broadening field.

IWM: Is News Corp. more aggressive in the Internet space than other traditional media companies?

Levinsohn: We've been a little more visible. But I know for a fact that all of the players in the traditional media space are becoming more aggressive on the Internet. You see the announcements every day.

IWM: News Corp. just promoted company exec Jeremy Philips to oversee Internet investments. How does that affect what you do?

Levinsohn: Jeremy will focus on investments and strategic planning, working with a variety of folks on the corporate side. I will continue to oversee what's best for the Internet business, and work with him where appropriate. He's another person who can help us grow the business.

IWM: What will MySpace, a high-profile acquisition, do for News Corp.?

Levinsohn: The strength of and the passion of that audience manifests itself every day in expression, in culture, in its trend spotting. We're already seeing how that audience interacts with the content we own.

We created a profile page for a plotline within Fox's "Nip/Tuck" around a character called The Carver. We saw a large audience -- almost 100,000 -- sign up and start participating. They've become very vocal fans of the show. MySpace's audience is identifying for us what music, TV shows and other forms of media are important to them.

IWM: MySpace has a strong music focus. Is it the new MTV?

Levinsohn: MySpace aspires to be as well-recognized as MTV. You can argue that before there was MTV there was "American Bandstand" for a generation. And I think to today's younger generation, MySpace means something similar to what MTV meant, frankly, to me when I was that age.

I'm 42, and MTV was kind of in the sweet spot when I was growing up. It was revolutionary at the time. MySpace has a lot of those same characteristics. But it's a very different experience for consumers today than passively turning on a television and watching it.

MTV has a traditional publishing model, where a studio is fired up and a bunch of producers come in and create content. MySpace has a completely different model. Frankly, the margins on a business like this are far greater because we're not hiring a bunch of people to produce content.

IWM: MySpace triggered a user backlash when it recently blocked mentions of YouTube, a video-sharing site and competitor. What's the story?

Levinsohn: Everything's fine now. Chris DeWolfe, the CEO of MySpace, has been speaking with the folks at YouTube.

YouTube is a vibrant and growing business, at least from a user perspective. It's something that MySpace and other social networks will take a look at.

IWM: Do you have a profile on MySpace?

Levinsohn: I do. I don't have any friends, but I have a profile page. Well, I have a couple of friends. My wife is happy that I don't have too many.

IWM: Rupert Murdoch has said that he's not interested in making a bid for newspaper publisher Knight Ridder, which is up for sale. Are newspaper properties now seen as secondary to the Internet?

Levinsohn: Newspapers are certainly an important part of the legacy of News Corp. And they will continue to be extremely relevant to this company.

IWM: Was the AOL-Time Warner merger a mistake?

Levinsohn: It's probably too early to tell whether it's a success or a failure. If the folks who were at Time Warner at the time could do it over again, they'd probably do it a little differently.

The amazing thing about this industry is that yesterday's darling may disappear. I'm not saying that AOL is going to disappear. But technology moves so fast. Now we have Google -- which didn't exist seven years ago. I mean, MySpace didn't exist two years ago ...

IWM: Are you concerned that MySpace could become "yesterday's darling"?

Levinsohn: Of course there are concerns. That's why we're working as feverishly as we can to make sure that that audience continues to experience new things. But that's true, frankly, for every business.

News Corp. is in an interesting position because we're combining traditional, top-down content publishing with bottom-up, self-created publishing. And if we can create the paradigm where we bring those two elements together -- and what exists when you do that is sort of a new experience of content -- then we've got a very defensible position against everybody.

IWM: A columnist for The Daily Deal suggested recently that, given the rise of the Internet, you "loom as the logical successor" to Rupert Murdoch at News Corp.

Levinsohn: It was the most ludicrous thing I've ever read. I mean, there are so many brilliant people in this company. You've got Peter Chernin; you've got James Murdoch, who is brilliant; Lachlan Murdoch, who is taking a sabbatical and I'll assume he'll be back. And you've got Roger Ailes, who is one of the smartest minds in this business.

There many brilliant executives here I'm leaving out. That article was written by somebody who doesn't have an understanding of what exists here at News Corp. I'm never going to be CEO. Let me be clear. It's ludicrous.

IWM: Does Rupert Murdoch surf the Web?

Levinsohn: Well, he loves the sites he owns. There are times I've walked into his office when he's on the Times of London, he's on the New York Post, checking out sports scores on FoxSports.com. He's looked at his many profiles on MySpace -- he's got a few of them, you know. He loves it.

IWM: Is News Corp. interested in blogs?

Levinsohn: Sure. We took the blog software that we acquired as part of [MySpace parent firm] Intermix, retrofitted it and put it on FoxSports.com, to allow sports fans to start blogging about sports.

McDonald's came in as the charter sponsor. We built a promotion around it, telling the audience that we're looking for the Next Great Sportswriter. At the end the promotion, we're going to choose somebody and offer them a job at FoxSports.com.

IWM: How much is News Corp. planning to spend on Internet acquisitions?

Levinsohn: Rupert Murdoch has said publicly that $2 billion was around the right number. I think we'll be opportunistic in the near future.

The next couple of years are going to be very interesting. Who buys who, I don't know. Google is tremendously positioned, but so are companies like ours.

IWM: Would Rupert Murdoch be interested in acquiring I Want Media?

Levinsohn: [laughter] Well, I don't know. We'll have to take a look at the opportunity there. I will tell you that I've probably got a hundred sites in my bookmarks, and you are one of my first stops every day.

IWM: I wasn't fishing for a compliment. I was fishing for money.

Levinsohn: Well, make us a proposal.

IWM: I'll get back to you.



PREVIOUS MEDIA INTERVIEWS