Archive for August, 2008

Digital Media VC

Posted in Deals, Digital Media, News with tags , , , , , , , , , , , , , on August 29, 2008 by Dave Liu

Conviva Raises $20 Million In Series B — San Mateo, Calif.-based provider of a live media platform for online video delivery, has raised $20 million in Series B funding. UV Partners led the round, and was joined by return backers Foundation Capital and New Enterprise Associates. It had previously raised $9 million.

Demandbase Raises $8 Million In Series B — San Francisco-based pay-as-you-go service for buying marketing lists and sales leads, has raised $8 million in second-round funding. Sigma Partners led the round, and was joined by return backers Altos Ventures and Adobe Systems.

Picateers Inc Raises $6.6 Million In Series A-2 — San Mateo, Calif.-based online photo sharing and fundraising service for schools, has raised $6.6 million in Series A-2 funding, according to a regulatory filing. Backers include Norwest Venture Partners.

Microsoft Invests in Heavily-Backed HD Online Video Service Move Networks — So Microsoft is also jumping into the online video investment space, and has done an undisclosed amount of strategic investment in already-heavily backed online HD video tech provider Move Networks. This is technically part of its third round, when it earlier closed $46 million from investors such as Benchmark Capital, as well as Cisco, ComcastInteractive Media, and Televisa. Prior to Microsoft coming in, the American Fork, UT-based company had raised $67.3 million in funding.

JumpTap Raises $26 Million In Series D — Cambridge, Mass.-based mobile search and advertising company, has raised $26 million in Series D funding. AllianceBernstein led the round, and was joined by return backers General Catalyst Partners, Redpoint Ventures, Summerhill Venture Partners, Valhalla Partners and WPP. The company has now raised around $73 million in total VC funding.

Brand.net Raises $10 Million In Series B — San Mateo, Calif.-based online advertising network, has raised $10 million in Series B funding. Norwest Venture Partners led the round, and was joined by return backer InterWest Partners.

Chinese Deals Trade Site Zero2IPO Raises $60 Million — Zero2IPO, an online financial info services provider on the China VC and PE markets, has raised a big $60 million round from a total of 46 different investors, according to SEC filing, picked up by PEHub. The company started as an online database of VC and M&A deals in the Chinese market in 1999, and since expanded into financial advisory service, events and other allied services.

The Active Network Raises 80 Million In Series F — San Diego-based online community and application technology provider for the active lifestyle/sports market, has raised $80 million in Series F funding. Return backers include ESPN, Canaan Partners, North Bridge Venture Partners and Performance Equity Partners.

SpeedDate.com Raises $6 Million In Series B — San Mateo, Calif.-based online speed dating service, has raised $6 million in Series B funding from return backer Menlo Ventures. It had raised a $2.6 million Series A round last year.

Ngmoco Raises $5.6 Million In Series A — San Francisco-based publisher of games for the iPhone, has raisedapproximately $5.6million in Series A funding, according to a regulatory filing. Kleiner Perkins Caufield & Byers led the round, with Maples Investments also participating.

Digital Media M&A

Posted in Deals, Digital Media, News with tags , , , , , , , , , , on August 29, 2008 by Dave Liu

Amazon Buys Another Books-Focused Social Site Shelfari — Amazon is buying up another books-focused social network Shelfari, three weeks after it acquired AbeBooks, which holds a 40 percent stake in Shelfari’s main rival, LibraryThing. The Seattle-based startup was founded last year by Josh Hug, the former director of device engineering at RealNetworks, and in fact Amazon was a seed investor in the company…it had raised a total of $1 million.

DriverSide Acquires FairBenjamin — DriverSide Motors, a San Francisco-based operator of an automotive research and information website, has acquired FairBenjamin, a website for finding local mechanics. No financial terms were disclosed. DriverSide has raised an undisclosed amount of VC funding from Catamount Ventures.

United Online Completes Acquisition Of FTD For $754M: FTD Growth Slow In Latest Quarter — One of the more unexpected M&A deals closed today, as United Online (NSDQ: UNTD) completed the acquisition of floral company FTD for $754 million in cash and stock. The deal, which gives FTD shareholders 15 percent of the combined company, was originally valued around $800 million. The company says the combined company has trailing twelve month revenue of $1.14 billion, and op income of $169.1 million.

Lifetime Networks Acquires ParentsClick Network For About $10 Million; First Digital Acquisition — Lifetime Networks’ digital push continues with its first acquisition—picking up privately held ParentsClick Network, both for its technology and its content. With it, Lifetime now is a player in the parenting and moms online category. The company started as MothersClick in 2006 and since then expanded into other sites as well. The sites include MothersClick.com, which provides tools to find or start groups and share info, and MomBlogNetwork.com, a content aggregator and promoter with more than 2,500 registered blogs. ParentsClick’s dowry includes more than 200 parenting-related domain names. Terms weren’t disclosed. Sale price is about $10 million, our sources say.

Articles of the Day

Posted in Digital Media, News with tags , , , , , , , , , , , , , , on August 29, 2008 by Dave Liu

Microsoft Beats Quadrangle To Buy Research Firm Greenfield For $486 Million; Selling Off Most Of It — In a complex and slightly confusing transaction, Greenfield Online, the online market research and surveys company, which earlier this week rejected a bid by media PE firm Quadrangle, is now being bought by an unlikely buyer: Microsoft (NSDQ: MSFT), for about $486 million, $60 million more than the previous bid. MSFT is paying through a cash tender offer for $17.50 per share for the Wilton, Conn-based firm, as opposed to Quadrangle’s $15.50 a share bid.  BUT, as part of this buyout, Microsoft will sell off what Greenfield is best known: its online surveys division, and will only retain its European comparison shopping services part. Greenfield, through its Greenfield Online and its European Ciao comparison shopping websites and affiliate networks, collects, organizes and sells consumer opinions in the form of survey responses to marketing research firms and end users. It was founded in 1994, among the first such online survey firms, and current CEO Albert Angrisan is the former COO and president of survey biggie Harris Interactive.

MySpace Passes Yahoo In Display Impressions — MySpace owner Fox Interactive Media has overtaken Yahoo as the top display advertising property in the U.S., according to new data from comScore. In June, 56.8 billion display ads were viewed on the News Corp. company’s sites, giving it a 15.2% share of the total U.S. display market. Yahoo, meanwhile, served 53.1 billion display ads in the same time period, accumulating a 14.2% share. The data represents a rather big change from May, when Yahoo was still top of the display pile with a 15.9% share, compared to FIM’s 13.5%. Dow Jones points out that the June data will raise fresh concerns about Yahoo’s ability to grow its online advertising business. “It’s a continuation of this trend that eyeballs are going to other places on the Internet, and advertisers are recognizing that,” Piper Jaffray analyst Gene Munster said. “It’s a step in the wrong direction for where Yahoo wants things to go.”

Veoh Decision A Boon for YouTube — Analysts and legal eagles watched with a keen eye as Judge Howard Lloyd of the U.S. District Court for the Northern District of California ruled on Wednesday that Veoh did its part to protect copyright holders, thus qualifying for “safe harbor” protections under the Digital Millennium Copyright Act (DMCA). Adult entertainment company Io Group alleged that the online video provider had not done enough to stop users from uploading unauthorized clips of its adult sex films. “The DMCA was intended to facilitate the growth of electronic commerce, not squelch it,” Judge Lloyd said. The DMCA protects publishers from being held accountable for the content uploaded by their users, as long as they make it clear that uploading copyrighted material is prohibited, and swiftly comply with official takedown notices. TechCrunch’s Michael Arrington noted that it’s also helpful to have fingerprinting technology in place to detect copyrighted material, in addition to lots of non-infringing content (Veoh only received takedown notices on 7% of its content).

U.S. News’ College Report Online Revenues in Seven Figures — So says U.S. News & World Report president Bill Holiber, talking about the relaunch of its America’s Best Colleges online portal, in an interview with Folio. Its flagship franchise list saw about 15 million page views in the last one week, and online revenue around the story is up 500 percent. “We’re well into seven figures just online for this story,” he said. The publisher has sold major online ad packages on the site to Dell and Microsoft (NSDQ: MSFT) Office Student. Meanwhile, the print edition of the mag is still bleeding: ad pages fell 30.2 percent and estimated ad revenue drop 26.1 percent, according to Publishers Information Bureau figures. It is dropping its weekly frequency to a bi-weekly by next year, and recently formed a new U.S. News Media Group, in an effort to develop more franchises beyond the weekly under it.

WPP Digital Leverages Global Production System — WPP’s digital investment and operating arm WPP Digital has established a global digital production hub to distribute work among its stable of digital agencies. The objective of the new outfit, Deliver, is to better leverage WPP’s existing production capabilities in Asia, Eastern Europe, Latin America and South Africa in a “distributed model,” according to Neal Prescott, CEO of Deliver.

Wikileaks To The Highest Bidder — The initial idea behind Wikileaks was to publish secretive documents from “oppressive regimes in Asia, the former Soviet bloc, Sub-Saharan Africa and the Middle East,” but the reality has been exposing Swiss banks, Mormons and Scientologists. However, now that the site has started selling secrets at auction, the bigger fish are swimming closer to the harbor. Apparently, a senior official inside Venezuelan President Hugo Chavez’s administration has some dirt for sale. But the documents aren’t really for sale, per se. Whoever wins the right to the information will only have a set period of time to make use of it before it becomes public. In this case, the leak in question is a series of emails from a senior aide to Chavez, which may or may not contain incriminating information.

Google Android App Store: Like iTunes, With One Big Difference — Google has unveiled its long-awaited answer to the iTunes app store for the iPhone: The Android Market, which will sell programs for the upcoming “Gphone” from T-Mobile, and every other handset that runs on Google’s mobile OS. The big difference: Apple runs it own store with a pretty firm hand. If you want in, you’ve got play by their rules. But Google has an open door policy: Developers who want to put their program on the market just register, upload, and they’re in business.

Articles of the Day

Posted in Digital Media, News with tags , , , , , , , , , on August 28, 2008 by Dave Liu

Google Lags Badly In Corporate Software — Google reps are shilling the heck out of Google Apps to business owners, but with relatively little success, Fortune reports. Indeed, the search king has a long, long way to go before it cracks the market for corporate software that Microsoft so thoroughly dominates. As one IT professional said recently (after declining an offer from Google), “I don’t know if [Google Apps] is ready for prime time yet.” Eighteen months into its corporate push, Google Apps is only being used by a handful of Fortune 500 and mid-sized companies–and none of these embraced the Google software suite in its entirety, most opting to stick with Microsoft Office instead. Meanwhile, the earnings gap between Google Apps and Office is enormous: last year, Microsoft sold $12.2 billion worth of Office software, while Google pulled in just $4 million from Google Apps.

Warner Bros. Resurrects TV Network On Web — The WB, long gone from your television, is being resurrected on the Web. Tomorrow, Warner Bros. will relaunch the defunct television network as a Web hub for its television shows. According to TechCrunch, TheWB.com will be more “feature-rich” than competitors like Hulu, allowing users to mashup clips from each show, for example. The report says its most impressive feature is video search, which allows users to search for specific words or phrases used in any show. Digitalsmiths, the search provider, uses technology that automatically transcribes and indexes dialogue from each episode. TechCrunch claims the search engine only works about 50% of the time, “but when it does work, it’s pretty impressive.”

ESPN Leads $80 Million Investment In The Active Network; Will Pursue Acquisitions — The Active Network, the big provider of sports-related technology, has just closed a huge, $80 million sixth round led by ESPN. Past backers participating in the round include Canaan Partners, North Bridge Venture Partners and Performance Equity Partners. The company, which has now raised $275 million since 1999, will use the funding towards infrastructure and towards “appropriate acquisitions.” Acquisitions are a key part of its strategy: Since 2007, it has acquired 11 companies, including Hy-Tek Sports Software, LaxPower, Cool Running and Golfbuzz. Its flagship site is Active.com a sports training and registration portal. In addition to the online communities it runs, The Active Network provides marketing services and other technologies geared towards sports management. It’s also worth noting that it’s not just a sports company, as it offers services towards organizations like schools, campgrounds and governments.

Facebook Penetration Still Weak In Asia; Malaysians Overwhelmingly Choose Friendster — With ad agencies like WPP Group increasingly focused on Asia, Nicholas Guan, a social media researcher at the ad holding company’s OgilvyOne unit, decided to look at the prospects for marketers considering ads across Facebook. The verdict: Facebook is fine for reaching Americans and those educated in the west, but there are plenty of other social nets throughout Asia that are much more popular. Using Google Insights, he compared Facebook with the most popular social nets in each Asian country. While cautioning that the results are not quite accurate since Google is not the number one search engine in most Asian countries, the numbers are meant as a rough gauge of where Facebook stands. (Earlier today, Joseph posted an item about Japan’s most popular social net, Mixi, and its plans to expand its presence in the U.S. and Europe.)

Japanese Social Net Mixi Sees US Markets In Its Future, Eventually — Top US social nets Facebook and MySpace haven’t been able to capture the top spot in Japan, where publicly traded Mixi reigns supreme. Mixi itself, however, may be looking to expand in North America and in Europe. In an interview with Reuters, CEO Kenji Kasahara said the company would like to eventually enter English speaking markets, although the end service could be something other than the actual Mixi service. Beyond that, it sounds like any plans won’t take hold for awhile, as Kasahara said the expansion will come “some day”. Right now, the main thrust is on looking for ways to diversify its business—95 percent of revenue comes from ads. Also, per the article, the stock is off 40 percent since its explosive IPO two years ago, so there’s added pressure to goose the business.

Articles of the Day

Posted in Digital Media, News with tags , , , , , , , , , , , on August 27, 2008 by Dave Liu

Microsoft’s InPrivate Could Make Ad Prospects More Private — Tech publishers and bloggers are buzzing about the impending release of a new version of Microsoft’s popular Internet Explorer browser – still the dominant tool used to access the Web – that has new privacy features that could more readily delete the browsing history and cookies of individual Internet users, making it more difficult for advertisers and publishers to track and serve ads to them. Consumer privacy experts are hailing the forthcoming release of Microsoft’s Internet Explorer 8 (IE8), and its so-called “InPrivate” blocking feature, but industry analysts say it could be an anathema for targeting and serving online ads.

Rumored Google, Verizon Search/Mobile Deal Signals Major Shift In Attitudes — News of Google’s potential mobile search deal with Verizon Wireless comes as no surprise to analysts who monitor the mobile search and advertising space. In fact, according to Mike Boland, senior analyst at The Kelsey Group, the deal is indicative of a huge shift in the way that mobile service carriers are starting to view technology companies, paved in part by AT&T’s groundbreaking deal with Apple for the iPhone. The deal would essentially make Google search the “on deck” option on Verizon mobile devices, and they would split any ensuing ad revenue.

NYTCo: June Numbers Signal Another Tough Quarter; Revs Fall Sharply; Internet Growth Slow — Q3 is getting off to a rough start at NYTCo… the publisher came out with July numbers showing total revenue fell 10.1 percent to $235.9 million. Ad revenue, which fell 16.2 percent, was weak across all categories. The internet, normally a “bright spot” is rapidly losing its luster: Internet ad revs at the News Media Group were up just .9 percent, hurt by weakness in online recruitment. NYTCo says growth in the current month is up in the “low double digits” helped by improved display advertising on NYTimes.com.

GfK Ends Bid For TNS—All Clear For WPP Takeover? — German audience measurement firm GfK appears to be withdrawing its bid for British research company Taylor Nelson Sofres, according to Reuters, which cited a story in Germany’s Manager magazine based on unidentified sources. GfK is said to be dropping its bid because Apax, the PE firm that agreed to help back it in the deal, began making demands for extensive control over the merger. The German company started to get cold feet last month, when UK ad holding company WPP Group began maneuvering for a hostile takeover of TNS. WPP had sent TNS a formal offer for a 264.2p-per-share offer that values TNS at £1.158 billion ($2.1 billion) – a 55 percent premium from April 28, when TNS said it would merge with GfK.

Greenfield Online Spurns Quadrangle For Higher Offer; Will Pay $5 Million Breakup Fee — Greenfield Online, a provider of online market research, says it’s nixing its sale to media PE firm Quadrangle. The company had already indicated that it received a potentially higher offer than the $426 million or $15.50 per share it was set to get from Quadrangle. The new buyer, an un-named Fortune 100 firm, will pay $17.50 for the company. Per the original agreement announced in early June, Quadrangle will get a $5 million fee for its troubles. Quadrangle could still increase its offer if it acts before August, 29. Full story —

Carat Lowers Overall Ad Outlook, Boosts Online’s — Carat has revised its global and U.S. ad spending outlooks for 2008 downward, but has slightly increased its projections for online ad spending in 2008 and 2009. In a new forecast released early this morning, Carat said it now expects the global advertising marketplace to expand only 4.9%, and U.S. ad spending to rise by 2.1% in 2008. In its preliminary forecast released in March, Carat had projected worldwide ad spending would grow 6.0% and the U.S. would rise 3.8% this year.

Articles of the Day

Posted in Digital Media, News with tags , , , , , on August 26, 2008 by Dave Liu

Google TV Ads: The Uphill Struggle To Court Cable Providers, Marketers Continues — Google TV Ads, which exited out of beta earlier this summer, hasn’t moved much from where it started. For the past year, Google has sought to offer targeted ads through cable set-top boxes the way it has served ads online. Adweek checks in and finds Google TV Ads still working with only one pay TV provider, EchoStar (NSDQ: DISH) and a much smaller, local California cable company. That only gives Google access to the satellite TV company’s 14 million households out of a roughly 65 million basic cable subscribers, according to figures from the National Cable & Telecommunications Association.

ESPN Will Pay $2.25 Billion For Some SEC Rights; Live Streaming Included — As a former card-carrying member of the SEC, I can only look at these numbers in awe … ESPN will announce later today a major deal for the SEC TV rights not held by CBS (NYSE: CBS), according to Sports Business Journal. SBJ’s “industry sources” peg the price at $2.25 billion for 15 years, or roughly $150 million a year. The Southeastern Conference, one of the top athletic conferences, just announced a 15-year deal with CBS for a reported $825 million or $55 million a year. No details yet on the broadband and mobile rights but it would be surprising if ESPN didn’t have a lock on multi-platform rights for its games. SBJ also says to expect a deal that puts ESPNU on Comcast systems; Comcast has a major SEC presence and this would be the right lever. SEC schools include Alabama, Arkansas, Auburn, Florida, Georgia, Kentucky, LSU, Ole Miss, Mississippi State, South Carolina, Tennessee and Vanderbilt.

High School Sports Site ESPNRise.com Launches Today — Another ESPN story worth mentioning … after 18 months of acquisitions and building, the Disney sports unit is launching its major online high school initiative aimed at 14-18 year olds. ESPNRise.com later today. (For now, it defaults to ESPNU’s football recruiting site.) ESPNRise.com represents significant inv*stm*nt and a basket full of all of the company’s high-school hopes. It’s designed as “a complete source for national high school sports and lifestyle coverage” and a community that connects athletes, teammates, friends and families. The name comes from the acquisition late last year of School Sports Inc, publisher of RISE (now ESPN RISE) magazine and RISEmag.com, among others. Since 2006, ESPN also has acquired Hoopgurlz.com, Student Sports Inc., and what is now ESPN Scouts Inc.

Will A Strong Greenback Sap Internet Earnings? — Throughout the past several earnings periods, we’ve noted when companies were benefiting from the weak US dollar. Of late, the dollar has reversed course, firming against foreign currencies, and the effect this will have on earnings is becoming a big discussion point. A couple weeks ago, there was a report on what the changes meant to HP, one of several tech firms with significant international exposure. In a note today, Bernstein’s Jeff Lindsay specifically looks at what it all means to major internet firms. Under the most pessimistic scenario—the dollar gaining another 10 percent by the end of 2009—earnings could be whacked by 8 percent at a company like eBay (NSDQ: EBAY) and 13 percent at Yahoo.

Vudu Still Trying to Break the Voodoo: Does Some Layoffs, New CFO — Vudu is trying to break the voodoo curse of online-TV boxes, but is having a tough time: it has laid off about 16-18 of its employees out of 100, and is now trying to build on its retail presence. It has also hired a new CFO: Chris Watts, a former eBay executive, as the former CFO left for “personal reasons,” according to company rep, quoted in this News.com story. Recently the company added adult movies within its portfolio, always a desperation move for most online video providers. It has $21 million in funding from Greylock and Benchmark. The company added Mark Jung, co-founder and former CEO of IGN and COO of Fox Interactive Media, as its CEO in fall last year, but still hasn’t gotten much traction in the industry. Competition is fierce, even though the market is still very nascent and small. Moviebeam, Akimbo and others are prime examples…there has been some positive reaction to the Netflix-Roku box but too early to make any trendlines out of that.

Articles of the Day

Posted in Digital Media, News with tags , , , , , , , , , , , on August 25, 2008 by Dave Liu

Microsoft Considers Unloading aQuantive’s Avenue A/Razorfish To WPP; Possible Price: $800MM — Microsoft’s talks with WPP Group seem to be taking a more serious turn on the subject of the software giant selling off digital ad shop, Avenue A/Razorfish, AdAge reports. Microsoft acquired Avenue A/Razorfish when it bought parent aQuantive last August for about $6 billion. That purchase also included other aQuantive properties, among them ad network Atlas and digital marketing solutions provider DrivePM. Initially, Microsoft felt the online agency business represented by Avenue A/Razorfish was fairly ancillary to creating an online ad platform that would compete with Google and DoubleClick. But Brian McAndrews, at the time aQuantive’s CEO and now SVP for Microsoft’s Advertiser and Publisher Solutions Group, convinced Microsoft to accept the unit whole. Six months in, however, Microsoft began having a change of heart and looked for potential buyers who might be more interested in taking the agency business. So far, the main prospect has been WPP CEO Sir Martin Sorrell.

LA Times Group Joins In Launching Real Estate Auction Buiness and Site ZetaBid — As the print side keeps bleeding, the Los Angeles Times Media Group keeps trying to extend into other platforms, both offline and online: the parent of LAT newspaper has jointly launched ZetaBid, a business that will auction foreclosed homes and other properties…it also has a website where the properties could be viewed. The newspaper has nothing to do with the new business, reports the newspaper. The other partners are London-based GoIndustry-DoveBid, an auction specialist, and CataList Homes of Hermosa Beach, a real estate brokerage. The partners will share fees paid by the buyer on each home sold. Bob Bellack, who is president of digital media, classified and development for Times Media Group, will be chairman of the new enterprise. This is an innovative idea of expanding its commercial opportunities, and though the real estate market is on doldrums, the foreclosure market as a result is not.

Yahoo Seeks To Expand Yahoo News — Yahoo is aiming to turn Yahoo News into a major news organization, a la Reuters or The Associated Press. According to AFP, the Web giant is moving away from aggregating others’ news content and is instead cutting deals with wire services and investing heavily in its own roster of reporters. “We have been doing a lot of original reporting and we are going to be doing a lot more,” director of editorial programming Jessica Barron told AFP in an interview. Yahoo News already reaches about half a billion people worldwide. “Our aim is to reach these bigger names and use our reporting talent to break news,” Barron said. “We are really going for the kinds of questions that will make news.” For the Democratic and Republican party conventions, Yahoo is teaming with Politico reporters to cover the event; the team will field questions on behalf of Yahoo’s users and relay the answers online.

Harbinger & Co. Unlikely To Shake Things Up At Cablevision — Whoever said talk was cheap hasn’t been following the action at Cablevision: Shares of the Long Island-based cable operators have staged a strong rally in recent months, courtesy of the Dolan family’s jib-jabbing and jawboning alone. But don’t expect the fun to continue says Citi analyst Jason Bazinet, who downgraded the stock today. Despite the fact that activist Harbinger has taken an 8.1 percent stake in the company, class A shareholders (non-Dolans) don’t have the muscle to force anything, like an asset sale. Even though the top non-Dolan shareholders are consolidating their grip (besides Harbinger, top firms like Gamco and Clearbride have added to their stake), the Dolan’s control of the Class B shares ensures that they’ll retain 73 percent of the voting power.

Telemundo Unifies Digital Media Division; Blacker As SVP — Telemundo, the Hispanic language media company owned by NBC Universal, has unified all its digital media efforts and created a new unit called Digital Media and Emerging Businesses Division. This new unit will include Yahoo (NSDQ: YHOO) Telemundo, holamun2.com, its international digital media efforts and its emerging platforms unit (which included mobile and licensing and merchandising efforts). It will be headed by Peter Blacker as EVP, who was previously SVP. He joined NBCU after a stint as VP, Multicultural & International for AOL Media Networks. The mandate of the new unit is to develop custom branded entertainment, digital and mobile cross-platform solutions.