Companies like Viacom Inc., News Corp. and Time Warner Inc. worry that they will miss the rapid expansion of Internet advertising while their own, more-traditional sources of revenue growth are slowing. Some hope to directly challenge the giant portals like Yahoo Inc. and Google Inc. — Web sites that serve as gateways to the Internet. Others are transferring some of their most valuable content to online sites, even though that risks alienating their traditional distribution partners.
“There is an awakening occurring at the traditional media companies,” says Larry Kramer, president of Viacom unit CBS Digital Media.
Although it’s too soon to say whether the media industry’s latest approach will bear fruit, the companies are finding some areas more fertile than others. They have been investing heavily in youth-oriented Web sites, like gaming, and less in areas like prime-time entertainment programming that is still a cash cow for the television networks. They’re also mostly avoiding the pay-per-view model, which hasn’t yet gained traction online.