VIACOM TO ACQUIRE XFIRE, INC. FOR $102 MILLION
Gaming and Social Networking Service to Join
MTV Networks’ World-Class Global Multiplatform Portfolio
NEW YORK and MENLO PARK, CA, April 24, 2006 – Viacom Inc. (NYSE: VIA and VIA.B) today announced that it has reached a definitive agreement to acquire Xfire, Inc., the fastest-growing online gaming community in the world, for $102 million in cash.
The acquisition brings Viacom and its MTV Networks unit the premier community that connects online gamers. Xfire and its users fit squarely into the Company’s multiplatform strategy to build an engaging universe of music, gaming, entertainment, news, networking and interactivity for focused audiences. As part of MTV Networks, Xfire will be better able to maximize its advertising revenues through more aggressive marketing, greater global penetration and comprehensive integration with the Company’s other digital and cable properties that address the gaming demographic.
Launched in 2004, Xfire has four million registered members who use its software. Its one million active users average 91 hours per month, with an average session length of over three hours. The robust, ad-supported Xfire application supports hundreds of the latest PC games and provides social networking, instant messaging and information for online gamers. In addition, the Xfire application provides traffic to its popular website, featuring forums and gaming downloads.
Tom Freston, President and Chief Executive Officer of Viacom, said, “On both a strategic and an economic level, this is a terrific deal for Viacom. Xfire is far and away the leading PC gaming communications and community platform, has outstanding management, and is a perfect fit with our growing digital businesses at MTV Networks. It's a bull's eye against our young audiences, and meets our strict financial targets.”
Judy McGrath, Chairman and Chief Executive Officer of MTV Networks, said, “Online gaming is an intensely social phenomenon, with millions of young adults around the globe interacting constantly, not only to play, but also to share information and evaluate games. Xfire is the leading gamer community platform, and we look forward to integrating its services and user base into our multi-platform strategy at MTV Networks, which already includes assets like Neopets, GameTrailers, iFilm and more. We are thrilled to welcome Mike Cassidy, Chris Kirmse, Adam Boyden and the rest of Xfire’s management team to the table.”
Mike Cassidy, Chief Executive Officer of Xfire, said, “We can think of no better home for Xfire than MTV Networks, a company that’s as user-obsessed as we are. We look forward to working together with a shared commitment to giving teens and young adults the best in digital entertainment, and the operational flexibility to maintain the integrity of the Xfire brand for our users. Having the benefit of MTV Networks’ marketing expertise and the power of their brands behind us will allow us to reach more users in more countries, across more platforms. We’re excited to work with Judy McGrath and everyone at MTV Networks to continue to deliver even more for our members.”
Xfire has a distinct combination of tools, including:
- Friend List for Gamers – Users can see when their gamer friends are online and what games they are playing.
- One-Click Join – Users can see what games their friends are playing and use the one-click join feature to play alongside their friends instantly.
- Xfire In-Game Messaging – Xfire users can send and receive instant messages while playing in many games without having to minimize or leave the game.
- Stats Tracking – Through automatically updated player profiles, Xfire displays what games users are playing and how many hours they have played them.
- File Downloads – Xfire’s file download system delivers demos, patches, trailers, and other files to users via a closed peer-to-peer distribution system.
- Voice Chat – Allows gamers to talk to each other over a private peer-to-peer chat network.
Xfire will join MTV Networks’ other targeted digital properties, such as Neopets, Parents Connect, GoCityKids.com, iFilm and GameTrailers.com and its broadband networks, MTV’s Overdrive, Nickelodeon’s Turbo Nick, VH1’s VSPOT, mtvU Über and Comedy Central’s MotherLoad. MTV Networks also has more than 90 branded websites across the globe.
Xfire, Inc. is the fastest growing online gaming platform and community in the world. Xfire helps gamers play with their friends much more easily. Xfire is also a server browser, IM, and file download system designed just for gamers. Xfire has 4 million members in more than 100 countries. Xfire is funded by Draper Fisher Jurvetson, NEA, and Granite Global Ventures. Xfire is supported by advertisers and marketers trying to reach the 18-34 male audience.
ABOUT MTV NETWORKS
MTV Networks, a unit of Viacom Inc. (NYSE: VIA and VIA.B), is one of the world’s leading creators of programming and content across all media platforms. MTV Networks, with more than 100 channels worldwide, owns and operates the following television programming services – MTV: MUSIC TELEVISION, MTV2, VH1, mtvU, NICKELODEON, NICK at NITE, COMEDY CENTRAL, TV LAND, SPIKE TV, CMT, NOGGIN, LOGO, MTVN INTERNATIONAL and THE DIGITAL SUITE FROM MTV NETWORKS, a package of 13 digital services, all of these brands are trademarks of MTV Networks. MTV Networks connects with its audiences through its robust consumer products businesses and its more than 90 interactive properties worldwide, including online, broadband, wireless and interactive television services and also has licensing agreements, joint ventures, and syndication deals whereby all of its programming services can be seen worldwide.
Viacom is one of the leading global entertainment content companies, with prominent and respected brands in focused demographics. Offering programming and content for television, motion pictures and digital platforms, Viacom’s world-class brands include MTV Networks (MTV, VH1, Nickelodeon, Nick at Nite, Comedy Central, CMT: Country Music Television, Spike TV, TV Land, Logo and more than 100 networks around the world), BET, Paramount Pictures, Paramount Home Entertainment, DreamWorks SKG and Famous Music. More information about Viacom and its businesses is available at www.viacom.com.
Cautionary Statement Concerning Forward-looking Statements
This news release contains both historical and forward-looking statements. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and section 21E of the Securities Exchange Act of 1934. These forward-looking statements are not based on historical facts, but rather reflect the Viacom’s current expectations concerning future results and events. Similarly, statements that describe our objectives, plans or goals are or may be forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors that are difficult to predict and which may cause our actual results, performance or achievements to be different from any future results, performance and achievements expressed or implied by these statements. The forward-looking statements included in this document are made only as of the date of this document, and, under section 27A of the Securities Act and section 21E of the Exchange Act, we do not have any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances.
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Executive Vice President, Corporate Communications
Executive Vice President, Corporate Relations