News Corp: $900M Google Deal Still Not Signed

There has been a persistent buzz that Google’s three-year, $900 million advertising pact with News Corp.’s Fox Interactive Media has never been signed. Today at Merrill’s media conference, FIM boss Peter Levinsohn addresses the question head on: It’s true — sort of…

Here is the distinction: The two sides have signed a “short form” but not the “long form” of the agreement. Levinsohn goes on to say that the deal, originally announced a year ago, is binding: “It is not a deal that’s been done on the back of a napkin. It’s a 20-plus page document.” Google has been paying FIM for months, he says. Good thing, since News Corp. expects Google dollars to contribute half of FIM’s growth this year.

So why hasn’t it been wrapped up? The conventional wisdom is that since Google began competing with FIM by acquiring YouTube shortly after agreeing to the ad deal, relationships have been strained. But Levinsohn says that’s not the case — the two sides haven’t signed because they’re talking about different deals beside the original ones, so no one has gotten around to signing the final document. Hmmm.

Levinsohn is a little more straightforward when asked about IGN, the lad-mag and video game property that FIM bought at the same time as MySpace, for about the same money, but which has underperformed. He says uniques are stable, page views are up, and that it is doing fine. So why did they just bring in a new boss for the unit? “From a strategic perspective, we haven’t done as much as we possibly could have,” he says. The new manager, Roy Bahat, comes with strategy bona fides.