Best Buy understands that the future of commerce isn’t likely to revolve around customers getting in their cars and driving to a big box at the nearest regional shopping mall. That’s especially the case for media, such as movies, music and video games, which have traditionally been an important part of Best Buy’s business.
With that as a backdrop, the company announced on Wednesday the creation of a new digital media investment fund. The fund is part of a strategic partnership with Velocity Interactive Group, a southern Califonia venture capital firm. (Velocity also simultaneously announced that it is changing its name to Fuse Capital.)
The fund is design to develop “the next generation of leaders” in music, movies, video games and media management, the companies said.
“Best Buy is the pre-eminent retail leader in technology and entertainment products and services, and is exceedingly well positioned to take advantage of the massive shifts occurring across the media and commerce landscapes,” said Ross Levinsohn, managing partner at Fuse. Levinsohn also sits on the board of Napster, a company Best Buy acquired last fall.
All Things Digital writes that the fund is “[a]nother sign Best Buy is serious about this whole digital thing, or at least wants to signal that it is.” Neither Fuse nor Best Buy have disclosed how much money will be in the fund, but ATD speculates that given Best Buy paid $121 million for Napster, it’s probably ready to spend that much again.
Financial Times writes that Best Buy hopes with the help of experienced Internet veterans it can avoid the missteps of other retailers moving into the digital sphere. Wal-Mart, for example, abandoned a movie downloading service in late 2007, the newspaper notes.
Levinsohn, one of three Fuse partners who will be steering Best Buy’s investments, is a former News Corp. executive perhaps best known for helping that company buy MySpace in 2005.