By Kate Holton
PARIS (Reuters) - Traditional European media companies expert in selling advertising should snap up online groups such as social networks aggressively to gain audience and an international outlook, a leading Internet investor said.
"New audiences are not in newspapers or on TV or radio. They're online and on mobile and in social media companies," said Saul Klein, a partner at Europe's top Internet venture capital firm, Index Ventures.
European firms had to start competing with U.S. groups for deals that would combine their ad sales forces with the huge audiences on social networks, Klein told the Reuters Technology, Media and Telecoms summit in Paris on Wednesday.
"There are social media networks that have come from nowhere in the last three to four years that have built enormous audiences," he said.
"But without a sales force you're just not going to generate significant revenues and explain to advertisers what the opportunities are."
Klein cited the recent purchase of one of Britain's most popular social networks, Bebo, by Time Warner Inc's AOL Internet division for $850 million as an example of a recent deal involving a U.S. buyer.
Other examples such as eBay's purchase of Internet telephony firm Skype, developed in Estonia, and the deal by CBS to buy Web music and social network site Last.fm highlighted a similar trend of U.S. companies buying European start-ups.
Index Ventures were financial backers of both Skype and Last.fm. Continued...
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