May 6, 2004 5:44 PM PDT

MSN and FoxSports strike portal deal

Microsoft has signed a deal for sports content with News Corp.'s FoxSports.com, which will replace Walt Disney's ESPN on the MSN Web portal.

As part of the multiyear agreement, which launches July 1, MSN's sports channel will link directly to FoxSports.com, Lisa Gurry, product manager at MSN, told CNET News.com. The companies will collaborate to offer Fox's video clips from sporting events and programs such as "The Best Damn Sports Show Period" via MSN Video, the software giant's streaming media service. Microsoft and Fox will combine efforts to sell advertising, with Microsoft focusing on online sales and Fox focusing on more traditional TV advertisers.

In addition, the co-branded site will embed MSN's Web search into its pages, a business that has become lucrative, thanks to its commercial relationship with Overture Services, a Yahoo subsidiary.

The companies said they plan to announce the new arrangement late Thursday.

"They offer a wide range of content today, and I think it will present a great opportunity to partner with them now," Gurry said in an interview. "We share a similar long-term visionary approach to deliver the ultimate sports site online."

Gurry and FoxSports declined to comment on financial terms.

Online sports content has become an increasingly high-profile business, involving the biggest Web, media and entertainment companies. Professional leagues have explored ways to offer Web audiences a taste of their games and promotions to varying degrees. Web audiences have also turned to the Web for scores, information and collaborative for-pay games such as fantasy leagues.

Major League Baseball has been the most aggressive in controlling its online destiny. It recently struck a series of deals to distribute live streaming video and audio broadcasts of its games. Its biggest agreement, with Microsoft, is valued at $40 million over two years.

Parting ways with the Mouse The signing of FoxSports will terminate a nearly three-year relationship between MSN and ESPN. Originally struck in September 2001, ESPN had touted the deal as a way to distance its lead against its archrival, SportsLine.com. Microsoft viewed the partnership as a way to secure well-known content and to market its other software products through the site.

A Disney spokesman described the parting as amicable.

Sources close to Disney and Microsoft said the desire between both companies to end their partnership was mutual. ESPN has achieved its status as the online giant for sports news and information. MSN had become less enthusiastic about balancing its interests with ESPN's, as played out in ESPN's decision to launch its own online video service, though it's still based on Microsoft's Windows Media technology.

MSN's branding used to wrap around the top and the right-hand side of all ESPN pages. Today, only the header remains MSN-branded, with the side panel featuring the ESPN Motion video service.

"We did see some differences in strategy that we wanted to pursue," said MSN's Gurry. "The delivery of video is a good example."

 

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