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CBS takes stake in portal
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October 5, 1999: 2:01 p.m. ET
Link with CTC Bulldog may provide media firm an umbrella for other online holdings
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NEW YORK (CNNfn) - CBS Corp. continued to add to its growing Internet empire Tuesday, purchasing a majority stake in new online search service CTC Bulldog Inc.
The deal gives the media conglomerate an undisclosed controlling stake in the newly launched search and content portal iWon.com, which hopes to attract customers by offering daily, monthly and yearly cash giveaways.
In return, CBS has agreed to provide roughly $70 million in advertising, promotion and other consideration to iWon.com, which launches a $40 million advertising campaign next week.
The deal provides CBS its first access to an Internet search portal. Up until this point, the company has taken the rather unorthodox approach of building a network of content sites. Only now has it acted to add the portal service to drive traffic to those sites.
Its main competitors generally have established a portal site early on -- such as Walt Disney Co.'s (DIS) Go.com network -- and built in the content from there.
Like Walt Disney's Go.com structure, the CTC Bulldog deal also may provide CBS with a corporate umbrella under which it can house its other Internet holdings -- which include cbssportsline.com, cbs.com and a planned stake in jobs.com.
"It certainly is a possibility," said Dana McClintock, a CBS spokesman. "It's a great investment, but that's all it is right now."
CBS Chief Executive Officer Mel Karmazin and Chief Financial Officer Fred Reynolds will sit on iWon.com's board of directors, which will be chaired by Neil Austrian, president and chief operating officer of the National Football League.
The board will be rounded out by company co-founders Bill Daugherty and Jonas Steinman, as well as a representative from Chase Capital Partners, which also plans to take an equity stake in the company.
Founded by Daugherty and Steinman in January, CTC Bulldog approached CBS executives in March about doing an ownership and content deal.
"We had CBS in mind from the get-go," said Jon Brod, a CTC Bulldog spokesman. "It's a perfect fit. They didn't have a portal relationship and we needed a strong partner."
In addition to inking an investment deal with CBS, several CBS subsidiaries also are providing content for the new site, although Brod said the Web site is not bound by contract to select CBS affiliates for that role.
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CBS Corp.
iWon.com
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