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Digital Media M&A

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

Yahoo Sells Off European Comparison Shopping Site Kelkoo To PE Firm — Yahoo (NSDQ: YHOO), which has been trying to sell off its European comparison shopping service Kelkoo for a while now, has finally found a buyer, according to a report: it has been sold to a little-known UK-based private equity firm called Jamplant, for something less than euro 100 million ($126 million). Yahoo bought the service in 2004 for a price then of about 475 million euros (now $598 million).  

Disney Sold Movies.com To Comcast For $17 Million — Earlier this year in June, Fandango, the online movie tickets service that is part of Comcast (NSDQ: CMCSA), bought out movies-info site Movies.com from Disney (NYSE: DIS), for a then-undisclosed sum. Now the amount has come out, in Disney’s latest annual 10-K filing with the SEC: The movies.com business was sold for $17 million on June 18, 2008, resulting in a pre-tax gain of $14 million.

Articles of the Day

Posted in Digital Media, News with tags , , , , , , , , , , on November 3, 2008 by Dave Liu

Comcast Interested In Acquisitions For All Business Units — Comcast, a cable operator in Philadelphia, is interested in M&A for all its business units, said Chief Financial Officer Michael Angelakis at a recent conference. Pundits speculated that M&A may grind to a halt as companies grapple with valuations in today’s market, but when Comcast is ready to acquire again, its priorities are likely to be digital video content and technologies, they said. An industry banker said Comcast has to think about what good a cable system will be if all content is delivered ubiquitously over the Internet. He named three privately held potential targets, Brightcove, Veoh Networks and VideoEgg. Brightcove, based in Cambridge, Massachusetts, is an interesting company gaining attention in the industry, the banker said. It manages, publishes and distributes content, and Comcast currently does not own the technology to do that. Brightcove did not return phone calls for comment. Brightcove has received USD 81m in venture financing. Source: mergermarket.

Wall Street Grows Bearish On Online Ad Market, J.P.Morgan Slashes Outlook For Second Time In Two Months Citing a pronounced weakening in market conditions in recent weeks, the influential Wall Street equities research team at J.P.Morgan has reduced its online advertising forecast for the second time in two months. Emphasizing that it hoped it was the last downgrade it would be making for a while, the analysts issued an advisory to investors attributing the downgrade to “further economic deterioration” that is weakening demand from online advertisers.

MySpace and MTV Networks Tie Up on Videos, Ads; Auto ID of Clips — MySpace is following YouTube in trying to identify uploaded clips and then insert ads in them: it is starting with one media company first, MTV Networks (NYSE: VIA), and will likely add other media companies later. For now, when users upload clips of any MTVN shows including popular clips from Daily Show or Colbert Show, it will identify those clips automatically and insert ads, both video and overlays. The company is using technology from a seven-year old tech TV fingerprinting firm Auditude. Interestingly, Auditude’s CEO is Adam Cahan, former EVP of strategy at MTVN…he joined the startup a year ago. MySpace already uses similar ID technology from Audible Magic, but Auditude takes it a step further as ads can be inserted into the uploaded premium content. YouTube has a similar ID and ad insertion system called Video ID.

AOL BlackVoices Adds Male-Focused Blog — AOL’s BlackVoices channel has started BV Power List, a new blog that offers men tips on how to succeed in all aspects of their lives. A key feature is the editors’ weekly picks of five leading African-American influencers. The first Power List includes Barack Obama, Tyra Banks, Tyler Perry, Magic Johnson and Mellody Hobson.

Global Budgets To Boost Online Advertising — Despite advertisers’ cuts to traditional media budgets and a slowdown in the rate of growth, the total dollars spent on Internet advertising will continue to increase, according to a report from the Rubicon Project to be released today. The report suggests that millions of dollars are being shifted from traditional advertising budgets into online, and that Web advertising has become a global industry that is less subject to any one country’s economy.

Scripps Overhauls Web Ads; BusinessTargets Get Smaller, More Local — EW Scripps, one of the rare newspaper publishers to report negative interactive ad revenues in Q2, is trying a quick turnaround. NYT has an overview of the Cincinnati-based company’s plans, including altering the commission structure for online ads, reducing the reliance on convergent print/web ad sales and expanding its universe of advertisers to smaller and more local marketers. In addition, Scripps is counting on Yahoo’s new APT ad delivery and targeting system to boost revs, which slumped 8 percent in Q2. The company reports Q3 earnings Friday. The four-year goal: If all goes as Rusty Coats, VP for interactive, projects, Scripps will sell enough ads to support the staff and costs of the print and online newsrooms by 2012—all without the job cuts that have become a near daily occurrence in the newspaper industry. In order for online to start producing more revenue, Scripps believes the incentives have to change for online ads.

WaPo Profits Plummet 85.8 Percent; Online Revs Grow 13 Percent — The newspaper business has been suffering for a while, and that’s the part that pulled down The Washington Post (NYSE: WPO) Company’s Q3 earnings, as the more profitable education and cable TV units failed to offset print losses. Year-over-year, net income fell 85.8 percent to $10.3 million ($1.08 per share) from Q307’s $72.5 million ($7.60 per share). The newspaper company also said operating income declined 63.5 percent in the quarter to $40.3 million from $110.5 million from last year on a $59.7 million goodwill impairment charge and $12.5 million in accelerated depreciation at The Washington Post.

Articles of the Day

Posted in Digital Media, News with tags , , , , , , , , , , on August 20, 2008 by Dave Liu

Yahoo Buzz Takes Down Barriers — Yahoo Buzz, the Web portal’s social news platform, is opening its doors to content from Web publishers from CNN.com to niche blogs. The site, which ranks stories based on user voting, launched six months ago with about only about 100 top publishers before expanding to 400. Buzz buttons have increasingly been popping up on third-party sites alongside other social bookmarks such as Digg, Sphere and Reddit. Yahoo says the service has drawn 5 million users to date.

Microsoft (Probably) Can’t Catch Google — In the wake of Live Search Cashback and the latest news from Nielson Online that Google’s search share grew another 16% in the last twelve months, BusinessWeek’s Rob Hof declares that Microsoft’s inadequate vision of search simply won’t be enough to catch Google — “not for a long time, anyway.” Not that Microsoft isn’t trying. At the Search Engine Strategies show in San Jose, Satya Nardella, Microsoft’s senior VP of search, portal, and advertising platform group, said that it’s early yet in the search game, and that he sees the sector moving from searchers typing in keywords to actually executing simple tasks. As Hof says, “not coincidentally, getting tasks done is essentially Microsoft’s main business, so that sounds a little too convenient.” However, Nardella cited an interesting figure, claiming that roughly half of Live Search queries are part of search sessions lasting 30 minutes or more. In other words, users aren’t finding what they’re looking for right away.

Yahoo and Intel Working on Widget Framework For TV, Along With Comcast — Glad to see Yahoo still has some activity going on in its Connected Life unit: Intel, on its developer day, has previewed plans for the Widget Channel, a TV application framework to bring online apps/widgets onto TV…it has tied up with Yahoo for it, which will supply its “Yahoo Widget Engine”. These will bring content, information and community features available online onto the TV and manageable through the remote control. It will allow integration of services such as Yahoo Finance, Yahoo Sports, Blockbuster and eBay. To help create new Widgets for this, Intel and Yahoo plan to make a development kit available to developers, including TV and other CE device makers, advertisers and publishers. No specific timeline of launch has been released.

Mormon Church Trying to Buy Facebook [VentureBeat] — The Church of Jesus Christ of Latter Day Saints — a nonprofit religious organization that may have up to $30 billion in wide-ranging assets — is trying to buy Facebook. That’s what Zach Klein, the co-founder of video site Vimeo, now employed at comedy site CollegeHumor, is hearing from within the company. Klein has friends in and close to Facebook. Also, another Tumblr-using entrepreneur named Brady Brim-DeForest claims to hear similar things.

Microsoft Looks To Semantic Search For Delivering Ads — Microsoft is exploring ways of using Powerset’s semantic technology to deliver search ads, says a Powerset exec quoted by CNET. General manager Scott Prevost believes natural-language processing could be used to help advertisers find highly targeted ad spots next to search results. “If people aren’t bidding on keywords and are bidding on concepts, it could completely change the ball game,” says Prevost. Microsoft acquired Powerset in July as part of its effort to improve the performance of its search engine. Powerset’s natural-language processing aims to improve web search by understanding the meaning of a query rather than simply matching keywords. The system is currently only used to search articles on Wikipedia, the user-generated online encyclopaedia. However, Microsoft is looking for ways to integrate semantic technology into its search engine.

YouTube Won’t Offer Live Streaming Until 2010 — Google has decided that YouTube will not offer live streaming video before 2010, says Silicon Alley Insider. YouTube’s struggle to break even was reportedly a big factor. Google estimates that if just 10% of YouTube users took advantage of live streaming, the company would be forced to add at least 20% to its server and bandwidth infrastructure. With those additional costs, there is no real business case to offer live video. Advertisers choose carefully between the existing less bandwidth-hungry videos on YouTube’s site. Google is still attempting to build a viable business model around YouTube for which it paid USD1.65bn. Yahoo! launched its own live video service in February but it hasn’t attracted viewers or advertisers. On average about 100 people watch live video casts on Yahoo!’s service.

Digital Media M&A

Posted in Deals, Digital Media, News with tags , , , , , , , , , , , , , , , , , , on August 8, 2008 by Dave Liu

Comcast Interactive Media Acquires DailyCandy For $125 Million — This time the rumors were true, at least when it comes to the sale if not the price: e-mail service DailyCandy, the equivalent of an all-day sucker when it comes to the length of time on the block, finally has been sold to Comcast Interactive Media for an undisclosed sum. SAI, which shares an investor with DailyCandy in Pilot Group, has a source that puts the figure at $125 million, also being reported by WSJ. Viacom was among those talking to Pilot but dropped out of the bidding weeks ago before the final round, according to a source familiar with the discussions. (Update: Just talked to a Viacom spokesperson, who confirmed that the company looked but dropped out of the process in early June and never made “any kind of a bid.”).

Sony Buys Bertelsmann’s 50 Percent Stake In Sony BMG For $1.2 Billion — As expected, Sony Corp. and Bertelsmann AG have reached an agreement that has Sony buying Bertelsmann’s 50 percent stake in Sony BMG for $1.2 billion. The music company will be called Sony Music Entertainment Inc. and will become a wholly owned subsidiary of Sony Corporation of America. Sony and Bertelsmann AG originally created the Sony BMG joint venture in August 2004. Details about the financials are here (PDF). Bertelsmann had been seeking $1.5 billion for its stake, though it was expected with only $1.2 or $1.3 billion at most. Under the deal’s terms, the two have also agreed to continue to share the company’s manufacturing and distribution requirements between Sony’s manufacturing unit, Sony DADC, and Bertelsmann’s services company, Arvato Digital Services GmbH, by extending the agreements with Arvato for additional terms of up to six years. In addition, Bertelsmann will be taking over selected European music catalog assets from Sony BMG.

ESPN Buys Motorsport’s Racing-Live.com, Disney Bags RaisingKids.co.uk — ESPN is buying Racing-Live.com, an independent motorsports site founded way back in 1995. Racing-Live.com claims three million monthly uniques and has four sites – F1-Live.com, Moto-Live.com, Rally-Live.com and Raid-Live.com – covering F1, Moto GP, superbikes, rally, sports cars and karting. It was started by Montpellier-based racing fan Michel Marvie – who first began publishing motorsport news to France’s Minitel in the 80s – and has grown to offer live race updates and news in English, French, Japanese, Italian, German and Spanish.

Google Sells Performics SEM Unit To Publicis — After Google completed its acquisition of DoubleClick earlier this year, it announced plans to divest itself of Performics, the search marketing firm that came with the package. That Google wouldn’t want to be in the SEM game was pretty easy to comprehend. Today the company has announced that the unit will be sold to advertising firm Publicis for an undisclosed sum. The Paris-based ad holding company says it will combine the unit with its existing SEM practice and that it will strengthen its VivaKi Nerve Center. Performics has 200 employees around the globe who will report to Vivaki head Curt Hecht. The deal is expected to close this quarter.

Internet Brands Buys 12 Websites, Expands Careers And Shopping Verticals — Internet Brands buys in bulk. In April, the internet holding company announced it was buying five sites. In February it bought nine. Today it’s picking up 12, as it expands two major verticals: shopping and careers. No terms on the deals were disclosed. Shopping: The four sites acquired were Bargainist.com (lists good deals), Boddit.com (again, bargain hunting), Deallocker.com (user-submitted deals) and Ultimatecoupons.com. Obviously, the common thread is that they all appeal to people looking for a bargain—probably a smart approach in this economy. Careers: The other side of the economic coin: people are concerned about jobs. Hence a massive expansion of its careers category. Here are the 10 sites listed in the category, each of which should be self explanatory: AirlinePilotCentral.com, AviationEmployment.com, ClassADrivers.com, HospitalJobsOnline.com, ifr*eelance.com, ModelMayhem.com, NursingJobs.org, PPRuNe.org (The Professional Pilots Rumour Network), RealPolice.net, WAHM.com (Work At Home Moms). PPRuNe.org isn’t a new acquisition—it was just in a different category—and it seems that one other of these sites was also not a buy, though it doesn’t say which one. The point is: the company now has a vertical in careers comprising of ten sites.

Time Inc. Strange Buy: Acquiring Reader’s Digest School Funding Raising Unit QSP For $110 Million — Time Inc. has bought out QSP, a school and youth groups fundraising company that was part of Reader’s Digest Association, for $110 million in cash. RD is owned by PE firm Ripplewood Holdings. For Time Inc, the fit is, well, I’ll let them describe it: “It sees fundraising as a growing area for subscriptions across the magazine publishing industry and envisions benefits to operating QSP’s large direct-selling force in North America.” In other words, it will focus QSP on selling magazine subscriptions as a way to raise funds, something the company was already doing in addition to other incentives/gifts such as food items.

Articles of the Day

Posted in Digital Media, News with tags , , , , , , , , , , , , on July 23, 2008 by Dave Liu

Yahoo Q2 Weak; Revenue, Income Below Estimates — Maybe the bar was still too high… Here’s the quick read on Yahoo’s just-released Q2 numbers. Revenue ex-TAC came in at $1.34 billion, up 8 percent from last year, but a little behind analyst estimates of $1.37 billion. Adjusted net income was $139 million, just shy of the $140 million analysts had been expecting. It’s also down from $163 million in the year-ago quarter. Revenue on Yahoo’s O&O network was up 14 percent to $1.01 billion, again, a little shy of the 15 percent some analysts had been anticipating. Why the miss? Not totally clear yet. CFO Blake Jorgensen touted the company’s “solid results” despite the weak economy.

Netflix Backs Off Original Content Investment; Closes Red Envelope Unit — This falls into the Casablanca category as in the police captain being “shocked” to find gambling going on at Rick’s … Netflix is closing its nascent Red Envelope Entertainment unit because it competes with the studios it relies on for its main business. Red Envelope invested in more than 100 films and had four employees who are leaving the company as a result of the closure, according to a spokesman, who said the original staff count published by Bloomberg and others was wrong. The departures include Liesl Copland, who joined as head of acquisitions in 2006.

Omnicom Group Says It’s Finally In Buying Mode — After reporting that Omnicom Group’s Q2 net income and worldwide revenue both rose 11 percent, the ad holding company’s CEO John Wren told listeners to the company’s earnings call that the company was finally ready to get serious about acquisitions. As Omnicom expects to do more deals, its rivals’ acquisitive streak has weakened their balance sheets because they “aggressively paid, in our opinion, uneconomic prices.” Therefore, they will be hard-pressed to challenge the company for the independents that are still left.

ESPN Rolls Out New Search Platform This Week; Foundation Of Forthcoming Site Redesign — ESPN.com is planning a major site revamp, but first, it wants to get search right and will then build around some of its new functions. On Thursday, the Disney-owned sports news franchise will begin beta testing its ESPN Sports Search. The platform was about a year in the making. Those with an ESPN Insider account, which includes a magazine subscription and access to special online content, will be invited to begin testing the new search features on Thursday. ESPN wouldn’t say how many “insiders” there are—only that they number in the “hundreds of thousands.” A wider beta test is planned sometime in August.

BSkyB, Universal Form JV To Launch Subscription Music Service — Pretty soon, everybody will be offering a subscription music service. Latest is UK satcaster and ISP BSkyB, 39 percent owned by News Corp. it’s secured Universal’s Total Music repertoire (which includes Amy Winehouse) for a new launch that will allow unlimited MP3 downloading and on-demand streaming for a monthly subscription in the UK and Ireland. And it’s starting a new joint venture company for the purpose, in which it will be the majority partner. Universal is becoming a shareholder.

Comcast Unit Cuts Web Deals To Handle Online Video — The Seattle-based subsidiary of Comcast, thePlatform, has reached deals to deliver video to Web sites aimed at subscribers to the high-speed Internet services of Time Warner Cable Inc., Cablevision Systems Corp. and Cox Communications Inc. Cable operators are increasingly seeking to become destinations for online video, as consumers spend more time watching television shows, movies and other clips that they download from Apple Inc.’s iTunes, Google Inc.’s YouTube and other Internet sources. ThePlatform provides a service that functions as a management system for converting TV shows into the latest online-video formats, inserting promotions from online-advertising networks and transmitting the content to distribution networks that speed up the delivery of Web video to consumers. The company earns money like a utility, charging clients an undisclosed fee for the amount of video they store online and a usage fee every time a user clicks on the clients’ videos.

AOL’s Propeller News Site Launches 2.0 Today — Propeller , AOL’s Digg-like news site, launches version 2.0 later this morning. The site sports a new design and logo and now has a mascot. But the biggest feature change is the removal of a pure Digg-like vote count. In its place is an algorithm based popularity ranking of 1-10, which takes into account “many more aspects of participation” when determining popularity.

TiVo And Amazon Team Up — TiVo will introduce a “product purchase” feature today in partnership with the Internet retailer Amazon.com. Owners of TiVo video recorders will see, in TiVo’s various onscreen menus, links to buy products like CDs, DVDs and books that guests are promoting on talk shows like “The Oprah Winfrey Show,” “The Late Show With David Letterman” and “The Daily Show.”

Digital Media M&A

Posted in Deals, Digital Media, News with tags , , , , , , , , , , , , , , , , , , , on July 18, 2008 by Dave Liu

Social Messaging Apps Firm BigString Buys IM Firm Buddystumble — Two companies I had not heard of before, but I guess they exist: BigString, an OTC-traded provider of social networking messaging apps, has bought out Buddystumbler, an IM-based social network that integrates all other major IM clients in an online environment…both of them are similar to the much bigger and well-known Meebo. The deal was done as an all-stock transaction, and future rev share.

Twitter Buys Micro-Blogging Search Site Summize; Reportedly $15MM Cash+Stock — Twitter announced today that it has officially acquired Summize, according to a post written by Twitter co-founder Biz Stone. All five of Summize’s engineers will move to San Francisco and take jobs at Twitter, according to the company. “This is an important step forward in the evolution of Twitter as a service and as a company,” Stone wrote. Summize will help users search Twitter and keep up to date with news real-time (which they have already enabled, as shown above and on their site)—two examples they use is keeping up to date on Mars, and what people are thinking of the new Will Smith movie. As for the details, the company says the Summize service and API will be merged with our own and integrated under the Twitter brand. To get an idea of how search works, it can be checked out at search.twitter.com. The terms of the deal were not announced, but Silicon Alley Insider is reporting that Twitter paid $15 million in cash and stock. Twitter has received a lot of criticism recently for its ability to handle all of its traffic, but as of recently seems to be making a bit of a turnaround.

Expedia Buying European Hotels Site Venere — Expedia is following its acquisition of a majority of India’s TravelGuru site by buying Venere.com, an Italy-based travel site listing about 29,000 hotels in Europe and the US, for an undisclosed amount.. All told, it means an extra 10,000 Europe, Middle East and Africa hotels for Expedia. Venere, which has offices in Rome, London and Paris, has been majority-owned by buyout house Advent since 2006, though the four founders retained stakes and still keep hold of those shares. Originally started by Microsoft (NSDQ: MSFT), Expedia was later acquired and spun off by IAC and is steadily building (or, rather, buying) a big footprint, also owning TripAdvisor and Hotels.com. Expedia CEO said Dara Khosrowshahi (via release): “Acquiring Venere will bring a well-known, respected European consumer brand to the Expedia portfolio.”

Merrill Reaches Deal To Sell Bloomberg Stake: Report — And it sounds like earlier details were basically correct… WSJ is reporting that Merrill has reached a deal to sell its 20 percent in financial news service Bloomberg for $4.5-$5 billion. The buyer is Bloomberg LP, which had a right of first refusal. News of an imminent deal at this prace was first reported last week. There’s no word on when the announcement will be made, but it could come as early as tomorrow, when capital-hungry Merill announces quarterly earnings to much anticipation.

Comcast-Owned thePlatform Buys Social Media Apps Firm Chirp Interactive — thePlatform, the broadband and mobile video services provider that is now part of Comcast,, has acquired assets from San Francisco-based Chirp Interactive, a provider of social media applications…some of Chirp’s employees are transitioning into the bigger company. Chirp’s standalone service will not continue, but its community and content discovery features will be integrated within thePlatform’s media publishing system. In addition, thePlatform, based in Seattle, is now expanding into Silicon Valley, including opening a branch office.

Glam Media Uber Alles: Expanding Into Germany, Buying Munich’s Codex Media — Glam Media is opening a German site with help from its backer Burda Cross Media. Glam is also getting some extra assistance from its latest acquisition, Munich-based digital marketing firm Codex Media, the company announced. Terms were not disclosed. The move is part of a wider European expansion Glam has been pursuing lately, including last month’s acquisition of London-based online ad sales rep firm firm Monetise.

Google Buys Russian Search Firm For $140 Million — Fresh from its poor second quarter earnings report, Google is aiming to boost overseas revenues through the acquisition of Russian contextual ad firm ZAO Begun. TechCrunch reports that the search giant has agreed to pay UK-based Rambler Media $140 million for the firm. Rambler owned a 50.1% stake in Begun, but agreed to by the rest of it in order to sell to Google at a profit. The UK company will net about $50 million from the deal. As part of the deal, Rambler will now use Google AdSense for its search and contextual services.