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IQ Analysis: Web Networking

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In teaming with local TV news stations, Internet Broadcasting Systems plans to make its own news.
Calling itself the nation's newest network, New York- and Minneapolis-based Internet Broadcasting Systems has begun rolling out dozens of local TV news Web sites, seeking to reach 42 markets in all by the end of the year.
So far, IBS has created 20 sites, most of which partner with the top local TV news station in its given market. And like those local affiliates, IBS's Web sites are both independent and linked, creating and sharing both content and ad sales across the network. The sites also have individual looks and names, reflecting the character of their individual television news team siblings.
For example, in Cleveland, WEWS Newschannel 5's Web site is called NewsNet5.com, while in Boston, WCVB-TV has TheBoston Channel.com. "It's important that the sites have a look, feel and brand that reflects the larger stations," says IBS CEO Tolman Geffs.

Working Side By Side
But whatever the name, the IBS format remains the same: In what is typically a 12-week process, IBS designs and staffs each site, with both editorial and ad sales employees hired locally. Each site is then a 50-50 partnership with the station, with all online profits split equally between the two.
"We create a Web newsroom within the TV newsroom," says Geffs, noting that the company currently employs about 250. "It's four Web journalists working side by side with the TV news team, re-purposing news for the site because Web journalism is a different animal [than broadcast journalism]."
But while the Web staffs are paid by IBS, they still work hand in hand with the news and ad sales teams of each station, according to Bob Marbut, chairman and co-CEO of New York-based Hearst-Argyle Television.
"All day long they are in constant close communication, helping one another," says Marbut. "The IBS folks know what our news assignments and priorities are during the day. They know what we're promoting during the day ... The same is true on the ad-selling side. While [the sales reps] do most of their selling individually, there are a lot of four-legged sales calls where they're selling both our Web site and our television station and making what we call convergence sales."
Nevertheless, Marbut says he worried at first that the two staffs might not mesh.
"One of the concerns we had was whether our cultures would clash," he says, "whether, for example, our newspeople would see them as intruders. I think [the broadcast staffs] see [the Web staffs] now as extensions of what they're trying to do and as partners who don't happen to be in their cost center, which is kind of nice as well."
Few broadcasters have the people available to run effective news Web sites, notes Geffs, "and frankly, [they] generally don't have the budget or the resources either."

Building a Network
Until recently, IBS's resources were also small. Founded by Reid Johnson, who at age 29 was once the youngest major market news director in the country, the company launched its first site, Channel4000.com for Johnson's former employer, WCCO in Minneapolis/St. Paul, in 1996, but as of last year still only operated five sites in all.
"Six months ago, this was a company that had the local market licked," says Geffs. "It did a good job driving local advertising and building local content. We told the world, though, that we could build a network and distribute content and drive dollars."
Some broadcasters have begun to listen and invest: IBS plans to roll out sites in a total of 24 U.S. markets in partnership with Hearst-Argyle, while Post-Newsweek Stations Inc. has signed on for another six. Additionally, IBS has launched five sites in Canada, so far, with Winnipeg-based broadcaster CanWest Global Communications.
At Hearst-Argyle, Marbut said the partnership's revenue impact is "beginning to be noticeable," while traffic at the initial eight sites that have re-launched in recent months under IBS has already quadrupled. "All the numbers are good," says Marbut, "and I think that in all except one of our Web markets, they've exceeded the original ramp-up plan." For example, he says, TheBostonChannel.com saw its traffic triple on its first day under IBS to 92,000 page views, generating more than 2 million page views in May.

From Web Site to Web Station
Two million is also the monthly goal that Henry Maldonado, vp of audience and sales promotion for Post-Newsweek stations, is shooting for with his stations' IBS sites, noting that Click2Houston.com, which partners with KPRC, has already reached the mark.
Maldonado's attention is now focused, however, on ClickOn Detroit.com, Post-Newsweek and IBS' newest Web site, which launched June 23 after a full-blown ad campaign on its partner station, WDIV. "We promoted this like a separate product," says Maldonado, adding that the station also runs the site's URL during broadcasts.
The original WDIV site had been successful, Maldonado says, but that's just what it was, a site that would be updated a few times a day. "This is a much more aggressive approach now," he says. "What IBS is creating is less like a Web site and more like a Web station."
It seems to be working. Geffs points to a a recent survey of Channel4000 users in Minnesota, in which 40 percent of respondents said they had seen something on the site that prompted them to watch the station. "Not coincidentally," he says, "CCO just had its best May book in years."
And yet, the sites' biggest competitor still remains the local newspaper's site; in nearly all of IBS' markets--except its oldest, in Minneapolis/St. Paul--the local metro's Web site is winning. But IBS' sites have something newspaper sites don't: an endless feed of daily, local video. "On a good day, we're pushing 80,000 video streams," says Geffs. "We're already by far the biggest provider of local news video."
Additionally, IBS has begun using its Minneapolis-based news staff as a hub, creating finance, health and technology feature packages to be shared throughout the site network, in some cases with national sponsors tied in. And in May, IBS produced its first "convergence series," creating a series of 20 on-air consumer affairs segments that followed five people each trying a different popular diet. The series aired on each of IBS' partner TV stations and tied into added content features on each of their sites.
In return, the sites receive free promotion from their partner affiliates. "That gives us a big audience," says Geffs. But, he adds, "it's a TV station's audience. We want a broader audience, so we reach out to online partnerships to pull in bigger audiences to the site. And then we drive these audiences back to the station."
Still, he says, the TV-Web connection is helping IBS grow its base of local online advertising. "What we're really good at is creating these packages that drive on-air revenue and get the TV sales forces pushing the Web," he says. "It's a client we wouldn't have otherwise gotten to."
Nationwide, IBS is also working to sell space across its network, including a recent seven-figure deal with Hotjobs.com, a New York-based online recruiting service, to appear on each IBS site. Other similar, multi-site buys have included AT&T and YouDecide.com, a Los Angeles-based financial services site.
Says Geffs, "This is entirely new revenue for a TV broadcaster because no individual broadcaster, even a network with its owned and operated stations, is going to be able to do this with a sufficient national footprint." n