By SARA FISHER
Staff Reporter
Before he died last Aug. 27, former NBC Entertainment head Brandon Tartikoff was enthusiastically promoting a new entertainment network one delivered to viewers online.
As chairman of Entertainment Asylum, Tartikoff helped pioneer a company that would produce original interactive programming serial dramas, comedies, information-based shows and others delivered over the Internet.
“Brandon was so excited about participating in the dawn of a new medium,” said Scott Zakarin, president of programming and the creative brain behind Entertainment Asylum. “He said that he wasn’t around for the television revolution, but he was here for this.”
After being on the drawing board since November 1996, Entertainment Asylum finally launched on Oct. 27, two months after Tartikoff’s death. Now the question is, can it survive without his clout?
After all, Microsoft Corp. pulled the plug last month on the production of TV-like serial online programming for its MSN Network, and some wonder if cyber programming can ever match what’s available on television.
“It will come down to (people’s) choice on where they choose to spend their entertainment time whether they flip on their TV, or turn on their computer,” said Jim Jonassen, president of the Los Angeles New Media Roundtable who thinks TV will win that decision most of the time.
Entertainment Asylum executives say they offer more than TV-like programming for example, there are interactive talk shows and chat rooms.
“Entertainment Asylum’s products are interesting, but it is going to be an uphill battle to survive,” said Seema Williams, an online analyst with Forrester Research Inc. in Cambridge, Mass. “And the relationships that Tartikoff established in Hollywood will definitely be hard to maintain, but aren’t likely to disappear.”
The Culver City-based company does have one decided advantage over MSN it has the backing of America Online and its 10 million subscribers. It’s a wholly owned affiliate of AOL, which acquired Zakarin’s company LightSpeed Media to reincarnate it as the Asylum. Over the last 10 months, Entertainment Asylum’s workforce has grown from 12 to 65 and several staffers are Internet veterans.
President of programming Zakarin, for example, was the mastermind behind the first cybersoap, “The Spot,” which attracted a dedicated but limited audience.
“Scott understands online content better than anyone else out there,” Jonassen said. “And Hollywood is acknowledging that he is a player.”
President and CEO Monica Dodi was a founding member of MTV Europe and spearheaded the restructuring of Walt Disney Co.’s consumer products business in Europe.
“Our site traffic … and our advertising revenue are better than we hoped. People are really curious about new media,” Dodi said.
The company estmates that 300,000 hits are received each day.
Asylum executives believe what sets them apart from other entertainment Web sites is their interactive program, which features exclusive interviews with music, television and movie stars via real-time audio and video clips. The Asylum also has extensive genre entertainment sites, such as the Pulp Cult Horror Highway and the Comedy Clinic, which present current and kitschy information.
A major challenge facing the company remains high operating costs. Though Asylum executives would not release numbers, Dodi said she expects the company to break even within the next 24 months.
Williams said standard television and studio Web sites can cost up to $100,000 to build and maintain, and she believes the Asylum’s costs are higher.
“The reason why everyone is jumping ship in this industry is because it is extremely expensive,” she said. “Original content has a high cost structure.”
Another cost strain is having a parallel presence on both AOL and the Internet. Each site requires a different method of programming, which takes time and money.
“It’s like having twins: There’s no question that it is a big job to service both the AOL and the Web communities,” Zakarin said. “We see about a 30 percent increase in our costs because of the dual sites.”
The company tries to offset those costs through advertising and franchise opportunities.
Columbia House has signed a two-year online ad deal, and Barnes & Noble Booksellers, 1-800-Flowers and Godiva Chocolatier Inc. also have agreements.
“Studios are our next priority for ad and commerce revenue,” Dodi said. “Studios are discovering just how expensive it is to run their own Web pages, so are becoming increasingly interested in advertising their movies on our site as a cost-effective move.”
Dodi also meets with Fortune 500 companies to discuss advertising and cross-promotion opportunities.
“We’re interested in long-term strategic deals, and we’re already seeing a lot of open doors in Hollywood and I believe we’ll see more develop with Fortune 500 companies,” Dodi said.
The Asylum’s main competitors both for viewers and advertisers come from such sites as E! Online and Entertainment Tonight Online. Because these sites are connected with television shows and networks, the TV presence can be used to promote the Web site giving them a major advantage over the Asylum.
“Entertainment Asylum is going to be a case study on how viewership can be generated,” Williams said. “It’s going to be hard for them to differentiate themselves in the market and to develop an online following large enough to break even.”
Not a problem, say the Asylum people.
“The key for us is to make Entertainment Asylum a brand name and a household term,” Dodi said. “And we will.”
