Free WiFi Hotspot Locator from TechNewsWorldLiberty Media, parent company of the QVC home shopping network, became the latest traditional media company to make a strong push into the Internet space, buying food-based e-tailer Provide Commerce, Inc. in a deal worth US$477 million.
The all-cash deal gives Liberty Media control of Provide's family of perishable-goods e-commerce sites, which include ProFlowers, Cherry Moon Farms, which sells fresh fruit and produce and Uptown Prime, which retails meats directly to consumers.
Liberty said it would seek to leverage the connection between its QVC family of shopping channels and its new e-commerce holdings.
"Provide Commerce is a market leader in online perishable goods and through its advanced supply chain and superior execution, has built scale and a strong competitive position," said John C. Malone, Liberty's chairman and CEO. "We believe in the power of video to drive television and Web-based retailing businesses and Provide is a compelling addition to our strategy."
In addition to QVC and other TV networks, including the cable movie channels Starz and Encore, Liberty owns minority stakes in several businesses with a significant online presence, including travel site Expedia (Nasdaq: EXPE) 
, and IAC/InterActiveCorp., which this year bought the Ask Jeeves search engine as well as catalog retailer Cornerstone.
Second Gear
QVC is Liberty's main business, responsible for some 88 percent of its cash, with $1.48 billion in revenue in the third quarter.
The Provide buy is Liberty's second Web-based acquisition in as many months. In November, it bought online game developer FUN Technologies for $144 million.
Provide CEO Bill Strauss said Liberty's culture was "consistent" with his firm's "unrelenting focus on our customers."
On its Web site, Provide said that its supply-chain model enables it to become a link between suppliers and consumers, eliminating a potential slew of middle-men, from importers and distributors to wholesalers and retailers.
But Provide has struggled to become consistently profitable, despite strong revenue growth, including a 34 percent increase in sales in the third quarter to $27.8 million. The company brings a balance sheet with some $60 million in cash on it to the deal, reducing its overall value to about $417 million.
Crossing Over
Liberty is following a well-worn path from the traditional media world into the world of the Web, be it e-commerce, online gaming, or online entertainment. Rupert Murdoch's News Corp. has made several acquisitions with similar goals, as has Viacom (NYSE: VIAb) , the parent of CBS, MTV and others.
Analysts say it remains to be seen how well Liberty can meld the two separate sales channels of TV -- with most orders placed by phone -- and the Web.
But Forrester analyst Josh Bernoff said many traditional media companies have been forced to take notice of the Web, not only because of its booming importance as a marketing channel, but also because more users are getting video content there.
"With video moving onto the Web, the lines are getting more blurred and companies with a presence on both sides of the convergence will play from a position of strength," Bernoff said.
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