Articles of the Week


Google: AOL’s Not Worth $20 Billion Anymore — Google has filed its 10-Q quarterly, and some interesting language about how it continues to value its 5 percent stake in AOL: “We review our investment in AOL (NYSE: TWX) for impairment in accordance with FSP SFAS 115-1, The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments (“FSP 115-1”). Based on our review, we believe our investment in AOL may be impaired. After consideration of the duration of the impairment, as well as the reasons for any decline in value and the potential recovery period, we do not believe that such impairment is “other-than-temporary” at June 30, 2008 as defined under FSP 115-1. As a result, our investment in this non-marketable equity security is carried at cost on our Consolidated Balance Sheets. We will continue to review this investment for impairment in the future. There can be no assurance that impairment charges will not be required in the future, and any such amounts may be material to our Consolidated Statements of Income. “

Blinkx Bids $41 Million For Miva; Ad Net Rejects Proposal — The Miva board has rejected this bid, “following careful review and consideration”, the company said in a statement. The board said that it “believes that blinkx’s proposal significantly undervalues Miva’s assets, including our technology, brand recognition and network…We don’t believe that the proposal, as currently constituted, is in the best interests of our shareholders. The Board of Directors continues to evaluate all of MIVA’s strategic options in the context of our industry and the broader business environment and remains committed to evaluating and considering offers that maximize shareholder value.” In Blinkx’s letter to the Miva board, the company says Miva faces “several challenges” including new technology costs, “deteriorating cash position”, deterioration of its Media EU business and “continued decline in revenue and profitability”. Blinkx says its matching technology “will enable immediate platform improvements for MIVA”, will bring it higher CPMs and can add to its toolbar product. The pair partnered back in 2005, when Blinkx served Miva ads on to its SmartAds platform. Miva income fell 4.6 percent year-on-year in Q1 while losses improved at $5.1 million (GAAP).

Yahoo: Prepping For A Search Revival — Noah Mallin poses the question of whether Yahoo has been the victim of schadenfraude from the entire marketing industry–that is, we’re all taking pleasure in the Web giant’s bad fortune. While the company has admittedly faced major challenges in recent months, Mallin outlines areas in which Yahoo is charging forward–particularly with search. “A close look suggests that Yahoo hasn’t given up on search and in fact may have the pieces in place for, if not a comeback, at least a stabilization of their fortunes,” he says. “The first bit of evidence is the re-jiggering of their search algorithms this week. There’s also been an upgrade rolled out to Yahoo Maps in the last week or so for better usability and functionality.” Mallin also highlights Yahoo’s advancements with Search Monkey, allowing third-party developers to impact the users’ search experience, as well as the BOSS (Build Your Own Search Service), which lets businesses use parts of Yahoo’s search algorithm to develop their own engines.

The Knot’s Q2 Profits Fall 52 Percent; Revenues Essentially Flat — Weddings lifestyle company The Knot pointed to a challenging economic environment, as it posted a 52.1 percent decline in Q2 profits, as net income was $2.3 million ($0.07 per basic and diluted share) from last year’s $4.8 million ($0.15 per basic and diluted share). Revenues barely rose to $28.7 million from Q207’s $28.5 million. National online revenues were up modestly to $5.4 million and $10.1 million for the three- and six months ended June 30, 2008, respectively, compared to $4.9 million and $8.4 million for the corresponding periods in 2007. Local online revenues also recorded small gains of $8.0 million and $16.3 million for the three and six months ended June 30, 2008, respectively, as compared to $7.6 million and $14.9 million for the corresponding periods in 2007.

Did Facebook Try to Buy German Clone StudiVZ? All Stock Offer — The U.S. company had been negotiating for months to try to buy StudiVZ, but couldn’t come to an agreement. Buying the much bigger StudiVz would have given Facebook a foothold in one of the few big Western markets in which it has not established a significant presence, the story reasons. StudiVZ had 12.2 million users in Germany in June, is about 10 times the size of Facebook.de, the German version of the service. StudiVZ was bought out by Holtzbrinck group, the German publishing giant, for a reported $112 million (IHT says the price was around $134 million, but both numbers were speculations) late in 2006, and the parent wanted many times that reported price. The two companies surely had talks, but one Facebook source IHT quotes says that those were more related to the issue of copying the design. Since Holtzbrinck bought StudiVZ, it has expanded, starting a new portal in February 2007 for middle and high school students called SchulerVZ, and this year added a portal for college graduates called MeinVZ.

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