Viacom's 11 Virtual Worlds

From Forbes; "Since being named president of global digital media for Viacom's MTV Networks in late 2006, Mika Salmi has presided over a rapid expansion of the company's online properties. MTV Networks' Internet and digital businesses run the gamut from multimedia Web sites associated with hit shows on MTV, Comedy Central and Nickelodeon to standalone Web video properties, virtual worlds, online gaming sites and console videogames. Salmi has been with Viacom (nyse: VIA - news - people ) since 2006, when MTV Networks acquired his company Atom Entertainment. In an interview, Salmi discussed the company's strategy of using its sprawling portfolio of brands to target niche audiences online. (Sorry--if you're looking for any updates on Viacom's lawsuit against YouTube for copyright infringement, Salmi said he couldn't comment on the litigation.) Forbes.com: MTV Networks has been growing its network of online distribution partners to expand the reach of its programming on the Web. At the same time, you've continued to launch new vertical Web sites for The Daily Show, iCarly and other hit shows. So what's more important--building destination sites or getting your content to where your viewers hang out online?

Mika Salmi: I don't think we actually view this as which is more important. Our goal is to go deep with the consumer, we want to really meet the consumer's needs. And the Web is fragmenting in a big way. People are using search to find what they are looking for, and they want to go deep into what their passions are. We're building our own verticals. We're also allowing people to take content from our verticals via embeds and other mechanisms to put them where they want, on their blogs, on their social networks. We're also doing some deals with select partners for distribution.
So the whole end result is, we think, that we're trying to serve the consumer wherever they might be and do our best on our own also. That's why our sites have become much deeper, things like [TheDailyShow.com, SouthParkStudios.com]. Real deep vertical, all the clips available, all the episodes, community built into it, the whole thing.

You've suggested before that giant portal sites will decline in importance over time. AOL, MSN and Comcast's Fancast.com site are among your distribution partners. What does the future hold for them?

I think they all have a fairly large audience to date, so people do go there. The way they get there generally is through their ISP service, Comcast Fancast or AOL--they tend to be the default place to go. Depending on the surveys you see ... over 50% [of Web surfers] are using search as their electronic program guide. They're typing into a search box for what they want and they go in deep. That tends to bypass the portal model. But a lot of the "portal" sites are breaking themselves up and trying to get closer to the niches and the targeting. I think they're meeting that need. They're understanding the consumer behavior out there.

MTV Networks said last year that it would invest more than $500 million in developing its gaming business over the next two years. It also secured an exclusive deal with Jerry Bruckheimer in December to develop videogames. What can we expect from that business in the next 12 months?

Our gaming business we've split into four categories. The first is games media and that's things like Game Trailer, which is all about information about games or video about games. Then we have casual games, which is Addicting Games, Shockwave plus some of the Nickelodeon properties. Very simple flash-based games, which is a huge category for us. AddictingGames.com is the most trafficked Web site of all our 300-plus Web sites. Then we have console games, with "Rock Band" kind of leading the charge there. And there are probably some Bruckheimer games in the console area. And our fourth category is virtual worlds, and we now have 11 virtual worlds.

For each of those, it's very much a vertical entertainment strategy. We've really gone after certain types of verticals, even in the casual gaming area. There's Addicting Games [for] teen boys, and Shockwave, which is parents and moms. What's coming is more of that. We haven't done a lot in teen girls. So we're looking at what we should do in the teen girl space.

How has advertiser interest been in Neopets and your other online virtual properties?

Neopets has the longest [average monthly] time spent of any of our Web sites. Advertisers like that because people spend a lot of time there. The more [teen-oriented] virtual worlds, "Virtual The Hills," "Virtual Pimp My Ride," "Virtual Skate Park," those have been fantastic. In "Second Life," [advertisers] kind of get lost with where to put something in there. There aren't many mainstream plays [in online virtual worlds] and I think even though our plays are very vertical and very niche, they are attached to television shows or least some of our brands, so they have a much more mainstream or palatable flavor to advertisers.

The music industry is desperately in search of new revenue streams as music sales continue to slide. MTV.com and VH1.com work regularly with record labels to promote new releases. Is there anything that the recording industry isn't doing online that it should be doing?

[ Chuckles.] That's a loaded question. The simple answer is they're doing a lot they should be doing. The whole new artist area, we have been doing quite well with. We started something last fall called 52 Bands. It's not just on TV, but it's also online. [Record labels are] not funding as many new bands because they're not seeing the returns on them, obviously. A lot of companies [like MySpace and Facebook] have done well with new-artist discovery and new-artist promotion. And I think there's more to be done in that area.