AOL, Viewpoint Strike Rich Media Deal

America Online has struck a $10 million technology and services agreement with rich media player Viewpoint in a deal that cements ties between the two and confirms AOL’s commitment to rich media.

Under the terms of the deal, Viewpoint will license AOL the source code and the permanent rights to certain parts of the company’s visual application development, content creation and delivery technology.

The companies went onto say they plan to co-develop technologies and rich media content and advertising products. As part of the announcement, Viewpoint said Sreekant Kotay, Viewpoint’s senior vice president of strategy, will become America Online’s senior vice president for client products.

The deal has America Online paying Viewpoint $9 million to license what is known as the Viewpoint Platform, and AOL is expected to pay an additional $1 million for related services.

The Viewpoint Platform is an application development and visualization platform that enables the creation of rich media and Internet applications and presentations that intermix video, audio, 3-D and 2-D images as well as formats such as Macromedia Flash, QuickTime and SVG, the companies said in a joint statement.

The Viewpoint Platform is a key aspect of AOL’s 9.0 Optimized and several of its features, including SuperBuddy icons; AOL Instant Greetings; customizable desktop themes; the KOL service, a robust new experience on the AOL service for kids aged 6-12; and the KOL JR. service, a customized version of the AOL service for pre-schoolers and parents.

Back in August, Viewpoint underwent a restructuring saying that it conducted a reduction of force in line with its plan to achieve a flatter, more nimble business infrastructure. The exercise resulted in the elimination of more than 20 positions, 50 percent of which were senior positions of vice president or higher. Several of the positions eliminated were also among the company’s sales force.

As internetnews.com recently reported, DoubleClick research reveals the growth of rich media advertising. The company said more pop-ups, and ads that incorporate Macromedia Flash technology are showing up more frequently on the Web.

DoubleClick said rich media advertising grew from 17.3 percent of all ads served in the first quarter of 2002 to close to 37 percent in the third quarter of 2003.

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