Virtual Pet Shop Boys
Back in July I took note of an announcement by MTV that it had purchased Neopets, the parent company of popular website Neopets.com, for an undisclosed sum. Here's the strategic logic behind the acquisition, according to the Houston Chronicle:
From about 90,0000 members five years ago, Neopets has grown to about 25 million members today — 60 percent of whom are over age 13 — who create and care for "virtual pets" that inhabit a mythical world called "Neopia." The site is one of the world's largest and fastest-growing among youth, MTV said. "Neopia" has its own geography, pet species and games.
"The combination of NeoPets and Nick.com gives us a one-two punch leadership position in the online entertainment space among kids and young adults," said Herb Scannell, vice chairman of MTV Networks and president of Nickelodeon Networks. Neopets Chairman and Chief Executive Doug C. Dohring said aligning with MTV will expand the Neopets brand offline into television, movies and publishing. Dohring said the site's original characters offer "tremendous opportunity for creative innovation."
I agree with Mr. Dohring that these media properties offer tremendous opportunities. The acquition of Neopets would seem to have the potential for MTV to be to 'tweens what Disney as been to kids and what MTV is now to teens and young adults. But despite all the positive spin- which, of course, is all that CEO's and PR folks will give you when major acquisitions are first announced- there is reason to be skeptical. As the AOL/Time Warner debacle showed, owning valuable media properties and brands does not automatically confer either high profitability or the synergy that will be required to produce it.
I will be anxiously awaiting more details on Dohring's strategy for assimilating this latest acquisition. Per the usual, if it works out they'll be heroes. And should it not, he and his top managers will be sacked. Either way, in the annals of corporate acquisitions they'll forever be known as the Virtual Pet Shop Boys.
I've had enough of scheming and messing around with jerks; My car is parked outside, I'm afraid it doesn't work I'm looking for a partner, someone who gets things fixed; Ask yourself this question: Do you want to be rich?
I've got the brains, you've got the looks; Let's make lots of money; You've got the brawn, I've got the brains Let's make lots of money
You can tell I'm educated, I studied at the Sorbonne; Doctored in mathematics, I could have been a don I can program a computer, choose the perfect time; If you've got the inclination, I have got the crimeOpportunities, Lyrics by The Pet Shop Boys Further Reading: 'Creative Destruction' Economic Theory Why Neopets is heavenly Neopets - The new craze of Virtual Pets neopets