It's all over: Microsoft and NBC dissolve their joint venture

As divorces go, it's hardly up there with TomKat, but the union between Microsoft (Nasdaq: MSFT) and NBC previously known as MSNBC.com has been torn asunder after 16 years, leaving a new entity called NBCNews.com being run by Comcast (Nasdaq: CMCSA)-owned NBC.

The divorce could be pricey, but all that's really known is that NBC has decided to buy out Microsoft's 50 percent interest in the joint venture and move it from Microsoft's headquarters in Redmond, Wash. to NBC's home base in New York City.

An Associated Press report said the two parties felt they needed to divorce based on the "inherent constraints of being locked into a joint venture (that) sometimes handcuffed Microsoft and NBC."

The move clears the way for Microsoft to launch its own news service this fall with a staff predicted to be roughly the same size as the 100 folks who created content for MSNBC.com. Overall, MSNBC.com had about 300 employees, about 170 of whom worked in the Seattle area. Many of them will remain there even as the operational base moves.

"Being limited to MSNBC.com content was problematic to us because we couldn't have the multiple news sources and the multiple perspectives that our users were telling us that they wanted," Bob Visse, general manager of MSN.com said in the AP story.

Microsoft joins Yahoo! and AOL as Internet companies that branched off on their own even though Microsoft will be restricted—at least a little bit—by an agreement to highlight the top NBC stories for the next two years.

As with any divorce, there are two sides of the story. NBC is "going to have more flexibility to make our own decisions," said NBC News' chief digital officer Vivian Schiller in the AP story. "This is really an amicable breakup. We think competition will make us better.

For more:
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Related articles:
CNBC goes Yahoo! in online move
NBCUniversal may buy Microsoft's stake in MSNBC.com

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