Sony Pays $65 Mil for Eyeballs, Videos

While News Corp and Viacom have been plunking down big bucks for Internet properties, Sony is only now getting into the act. Although, it is being much more thrifty.

Sony says it will pay $65 million for Grouper Networks, a popular video sharing site.

Let's face it, Sony has tried to build its own Internet properties, but it has been mostly a bust – despite the company's top-notch technology and breadth of content assets.

The good news is that it looks like Sony will take a hands-off-approach to Grouper. Usually, Sony tries to smother its acquisitions with huge doses of synergy – often killing the customer base. For a site like Grouper, which relies on a community, it is imperative that it has lots of discretion and not be overtly commercial. In fact, this has been extremely helpful in the case of MySpace.

Besides, Grouper has an experienced founder, Josh Felser. He was the cofounder of Spinner.com, which he sold to AOL in the late 1990s.

But according to stats by Hitwise, Grouper is a small player, with less than 1% of market share of the video sharing space. Of course, the dominant player is YouTube, with about 43%.

So, Sony has a long way to go. But, at least it is starting to move out of the "pause" mode.

Tom Taulli is the author of various books, such as the Complete M&A Handbook and operates InvestorOffering.com.