As reported two weeks ago a consortium led by NBC has finally agreed terms to acquire Atlanta-based Weather Channel. NBC says that its new Weather Channel (it already broadcasts a similar service) will operate as a separate unit and stay based in Atlanta where HDTV kit was recently installed.
Bain Capital and the Blackstone Group are part of the NBC consortium, and the players said they hoped to formally close the purchase later this year. A number of banks are involved in the financing, including Deutsche Bank, GE Commercial Finance, GSO Capital Partners and Sankaty Partners. Terms were not formally revealed, but are believed to be under $3.5bn when debt is included.
NBC would also get Landmark's interest in Pelmorex, a weather broadcaster in Canada, the company said. Pelmorex almost mirrors the Weather Channel with a TV station, interactive web site and the ability to send alerts by e-mail. Weather Services International and its subsidiary, Enterprise Electronics, a maker of weather radar systems based in Enterprise, Alabama are also included in the asset transfer.
"This will further position NBC Universal as the leading provider of news, information and weather, both online and on television," Jeff Zucker, president and CEO, NBC Universal, said in a statement.
The Weather Channel comes with one massive benefit for NBC – its regular web-users. In May, for example, all of NBC’s assorted sites and channels (including NBC.com, Universal Studios, CNBC.com, Sci-Fi, Access Hollywood and USA Network) generated between them a perfectly respectable 13.2m unique users (according to Nielson’s online data). NBC’s iVillage generated another healthy 13.5m. But the mighty Weather Channel, a single site, generated a phenomenal 38m unique visitors!
That’s a massive number. And now NBC-U’s control of The Weather Channel means it can count on an overall dependable 51m unique users. This, as far as the United States is concerned, is still behind Amazon’s 55m, and behind Wikipedia’s 57m, eBay’s 66m, News Corp’s collective 79m, Time Warner’s 108m, Yahoo’s 116m, Microsoft’s 123m and do no harm’s (Google) 128m. In other words NBC-U still has a way to go, but the road map is clearer.
One number we have excluded is its j-v with Microsoft, MSNBC, that does very nicely with 35m uniques a month. But even with MSNBC stripped out, The Weather Channel would place NBC overall into the Number 10 position behind the aforementioned names and ahead of the New York Times. Greater cross-promotion will inevitably benefit both parties, although it’s tough seeing NBC climb much higher in the short term.
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