• by Wayne Friedman , Staff Writer, September 16, 2005

With a possible Microsoft/Time Warner deal in the works, MSNBC might soon just stand for--MoStlyNBC.

MSNBC has struggled for years--mostly in fourth place--to be somewhat competitive in the cable news race, and its venture with Microsoft could be threatened by the ripple effects of a possible deal in which Time Warner would sell AOL to Microsoft.

MSNBC becomes perhaps a rockier venture, especially if Time Warner doesn't completely sell AOL to Microsoft--as it more likely would do--but possibly inks a joint venture instead. Daily Variety riffed that if such a deal occurred, Microsoft might find smoother sailing with new partner Time Warner and its stronger CNN cable news connection. This would give Microsoft's big MSN portal some increased juice in the news content area.

Microsoft would be trading up--but only a couple of floors. While CNN is way more competitive than MSNBC, CNN is still another elevator ride to the Fox News penthouse. Primarily, the deal looks to help MSN's new struggling search business by adding the AOL search component--which isn't all that big itself, since giants Google and Yahoo control 90 percent of the revenue in that market.

Traffic data paints a better picture for both MSN and AOL. Nielsen//NetRatings' July ranking of search services had Google with 46 percent share, Yahoo!, 23 percent; MSN, 13 percent; and AOL, 5.4 percent.

Microsoft and NBC could finally unravel their struggling financial partnership with MSNBC. Long a consideration among Microsoft executives, the split would achieve the software giant's realization that content and entertainment aren't its strong points.

The initial intent of the MSNBC deal with Microsoft meant that NBC could lay off financial costs associated with the growing pains of a new cable channel. That proved prophetic. Since its inception in the late 90s, MSNBC has struggled to find its way, only finding a buzz of audiences briefly during last year's Democratic and Republican conventions.

Problems abound. On its own, NBC Universal's MSNBC could mean losing the MSN connection, from which MSNBC.com gets a lot of its traffic. That would require more of NBC's financial wherewithal to boost the quality of its content, Internet partnerships, and cable operators' marketing happiness.