NBC Universal invests $200 million in BuzzFeed: Can it win over Millennials?
NBC Universal announced Tuesday that it plans to invest $200 million in Buzzfeed, the Internet news site best known for cat listicles and its ability to garner millions of shares and likes from the now coveted Millennial audience.
The NBC logo and Comcast are displayed on 30 Rockefeller Plaza, formerly known as the GE building, in midtown Manhattan in New York July 23, 2015. Comcast Corp, the largest U.S. cable operator, posted in-line second-quarter results, as its high-speed Internet and NBC Universal businesses grew amid a drop in pay-TV subscriber departures.
Brendan McDermid/Reuters/File
In a bid to attract a younger audience, NBC Universal, the media subsidiary of the cable television company Comcast, is making a foray into the world of new media.
On Tuesday, NBC Universal announced that it plans to invest $200 million in Buzzfeed, the Internet news site best known for its cat listicles and ability to garner millions of shares and likes from the now coveted Millennial audience. The investment comes just one week after the company announced it would invest the same amount in Vox Media, a digital media brand whose eight online news sites have a similar following as Buzzfeed among 18 to 34-year-olds. As more young people ditch cable television in favor of watching news and videos online, NBC Universal is seeking to acquire a sizable stake in the companies that dominate the world of online news, media watchers say.
“Comcast had been scouting out investments in several new-media companies in recent months, as it seeks a way to turn around viewership numbers that show that younger audiences are not watching as much TV as past generations did,” wrote Lukas Alpert for the Wall Street Journal. “According to a Horizon Media analysis of Nielsen data, the median age of prime-time TV viewers rose from 46.3 to 50.5 in the past five years. And only about a quarter of people aged 18 to 34 watch prime-time TV, compared to 53.1% of those over 55.”
Meanwhile, younger demographics appear to favor sites like BuzzFeed. The site boasted of 82.4 million unique visitors in the month of July, more than half of whom were between the ages of 18 and 34. The sites attached to Vox Media, which include news site Vox.com and technology site the Verge, had a combined 54.4 million unique visitors in July, over 40 percent of whom were in the 18 to 34 age bracket.
NBC representatives said they were attracted to BuzzFeed’s 200 million unique viewers and its 1.5 billion unique monthly video views, according to The Guardian. The company investment valued BuzzFeed at around $1.5 billion, while Vox Media was valued at around $1 billion.
“They reach a massive, loyal audience and have proven to be among the most creative, popular and influential new media players,” Steve Burke, chief executive of NBC Universal, told the Guardian. “BuzzFeed has built an exceptional global company that harmonizes technology, data and superior editorial abilities to create and share content in innovative ways.”
BuzzFeed and Vox Media began attracting traffic with aggregated stories and social media-friendly content, but they have recently started producing original stories and videos that compete with those of traditional media companies. They have also been working, successfully, to diversify their revenue sources beyond online ads.
BuzzFeed representatives say a partnership with a more traditional media company will be good for their business, too.
“BuzzFeed and NBC Universal will be great strategic partners and we both have a lot to offer the other,” Kenneth Lerer, executive chairman at BuzzFeed, told the Guardian. “We look forward to collaborating on television content, movies, the Olympics and joint partnerships with ad agencies and brands”.
The deal will allow BuzzFeed to expand its coverage of next year’s Olympic Games in Rio de Janeiro, for which NBC holds the US television rights.