October 19, 2005

FOR IMMEDIATE RELEASE

NEW YORK - MTV Networks has acquired iFilm, a top video Web site, for $49 million.

iFilm collects and purveys video over the Internet. Its offerings include material from Hollywood studios, amateur filmmakers, and user-generated content. According to an MTV press release, the site has the biggest library of short-form entertainment video on the web and reaches over 10 million users per month.

The deal, announced late Thursday by MTV networks head Judy McGrath, is a key step in a larger strategy: For MTV is a unit of Chairman and Chief Executive Sumner Redstone's Viacom (nyse: VIAb - news - people ). And the media giant's co-Chief Operating Officer Tom Freston has had his eye on the Web.

The co-COO and co-president oversees Viacom's cable networks such as MTV, its Paramount movie studio--and its online businesses. In September, Freston had said that Viacom's young Internet and mobile businesses are already generating close to $200 million per year.

Sharing the co-COO and co-president titles with Freston is Les Moonves, who runs Viacom's CBS and UPN broadcast TV networks, Infinity radio station group and other properties. The two C-level execs' units are soon due to be split up into two separate, publicly traded companies--and Freston and Moonves will each have his dream of being CEO, without the once-dreaded corporate gladiator match for Redstone's seat.