@ Media Week: CSFB Day 2: MSLO CEO Lyne: Internet Will Be One-Third Of Company’s EBITDA By 2010

Updated: Martha Stewart Living Omnimedia has big plans for the internet. Although online revenues currently account for five percent of revenue, the lifestyle company expects the internet to be one-third of its EBITDA by 2010 with long-term margins of 40 percent. Publishing and merchandising each are projected to account for one-third of EBITDA by the same time.
MSLO isn’t waiting for its upcoming major site relaunch to make changes on MarthaStewart.com. Take the search shift last month — look up a chicken recipe and you get links to other sites from MSLO editors and sometimes Martha. Search traffic is up since the change went into effect, CEO Susan Lyne told analysts and investors at CSFB today. (She used a specific stat during q-and-a but later decided there wasn’t have enough data to be comfortable with that number.) She also said traffic is up since Yahoo Food launched last month with MSLO as a partner but told me later that they aren’t ready to release any specific numbers. During the q-and-a after her presentation, Lyne said to expect more partnerships: “We believe that one of the ways we’re going to grow our traffic to our own website is by migrating our content across the web and pulling people back in.” Would she consider a partnership with NBCU’s iVillage, which topped her competitor list? “Could very well … We have not had conversations there as yet.”
On video: “We do have about 1,600 hours of video. A lot of it’s evergreen .. Christmas comes around every year, Thanksgiving comes around every year. … How to carve a turkey remains a hugely popular video on our site. The video libraries have been retagged with the relaunch in mind. Martha’s daily television show is offered on a day-delay; users can watch by segment or find what they wanted. They are also expanding original content for web. “I think you can expect to see more of that as we get into ’07.”
On competition: “IVillage has a pretty strong user base. They don

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