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Google to tackle Wikipedia with new knowledge service

Google is to go head-to-head with Wikipedia, the web’s largest reference work, in a clash of two of the internet’s most powerful brands.

A new Google service, dubbed knol, will invite “people who know a particular subject to write an authoritative article about it”, Udi Manber, a Google engineer, said.

Like Wikipedia, articles in knol (the name derives from “knowledge”) will be free to read online. In a departure from the nonprofit Wikipedia model, however, knol’s authors will be able to attach advertising to their work and take a share of revenues.

“The goal is for knols [individual articles] to cover all topics, from scientific concepts to entertainment,” Mr Manber said. The project is the latest to distance Google from its roots in internet search and pitch it against well-established rivals in a new sector. The company recently squared up to the mobile phone industry by unveiling its own operating system for hand-held devices. It is also set to bid for a portion of America’s airwaves that it could use to build a wireless broadband network.

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After weeks of criticism, Facebook CEO Mark Zuckerberg Wednesday finally apologized for the controversial Beacon program, which publishes information about members' off-site purchases to their friends. The company also changed the program so that people can now opt-out once and for all.

But yesterday's developments might prove to be too little, too late to satisfy privacy advocates and/or disgruntled users of the site.  At launch, the program publicized information about people's purchases unless they specifically told Facebook not to do so. In other words, the program shared information by default.  This idea is so staggeringly bad that even now, four weeks later, it's still astounding that Facebook ever went ahead with it.

And now that Facebook seems to have realized the mistake, it's not clear what the long-term effects will be. While Facebook's members show no signs of abandoning the site, the company clearly has squandered at least some goodwill.

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Red Ink Forecast For Newspapers Next Year

Retreating somewhat from earlier optimistic predictions, newspaper publishers and analysts now say next year will probably be just as tough for the troubled industry as 2007. With shareholders staking their hopes on a turnaround in 2008, this is bad news for newspaper stocks--and may also torpedo major deals like the planned buyout of Tribune Co. by real estate billionaire Sam Zell.

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 Economic cycles are a fact of life in the advertising business. It's been true since the beginning. But perhaps more predictable than advertising cycles are advertising forecasts. Hey, there goes another one!

The latest significant advertising forecast is from media agency ZenithOptimedia. According to Ad Age's coverage of the report, marketers will spend $195 billion on North American advertising next year, 4.1% more than in 2007, while ad spending worldwide will near $486 billion in 2008 for a 6.7% gain. However, U.S. ad-spending growth this year will reach just 2.5%, far below the 3.7% growth it forecasted last summer and well under 3.6% inflation so far this year. That means that the respective growth of the entire pie is happening elsewhere, particularly in less developed advertising economies.

But that 6.7% growth for 2008 is not so significant when you consider three of advertising's most important catalysts are colliding that year: the U.S. presidential election, the Olympics and a European soccer championship. Once that's over, you can bet all eyes will be on early 2009, seen in many industry circles as a likely peak for the inevitable advertising cycle to begin its downward trend.

Not surprisingly, the Internet is seen as the bright light in this ultimately mediocre forecast. While newspapers, magazines and radio advertising are expected to lose share, "Worldwide Internet ad spending will climb to $44.6 billion from about $36 billion, increasing its share of the market to 9.4% from 8.1%," according to the ZenithOptimedia report.     Dec 07  www.mediapost.com

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Google Stock Price Heads For $900
Bloomberg  Nov 07
Financial analysts continue to raise their target price for high-flying Google. Credit Suisse Group on Tuesday became the latest firm to push its valuation of the search giant closer to $1,000 per share, saying it expects Google to surpass $900 per share next year. According to Bloomberg data, Credit Suisse's valuation is the highest among the 37 brokerages that rate its stock. As of Wednesday morning, Google was trading at $647.85 per share, which means a jump to $900 would represent a 40 percent increase. Google's stock has risen 31 percent so far in 2007.

Analyst Heath Terry says Google's stock will be boosted by the continued shift of media spending toward the Internet. "Tremendous value will be created for Google shareholders as all advertising goes digital, including television, radio, and outdoor, and Google becomes the de facto 'operating system' for advertisers."

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What's next? Content orbiting is coming. I think that we are very soon going to see massively scaled content, social and Web service networks spring up much in the same mold as today's online ad networks. They will take over parts of the pages of widely distributed networks of thousands and millions of sites and "orbit" content around users, just as ad networks "orbit" ads around users. We are already seeing Google and other large players get into the content syndication business. We will very soon see the syndication players become "content orbiters," shifting their models from placing content on pages to targeting highly relevant content to users, on whatever pages they happen to be surfing.

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Blu-ray outsells HD-DVD in Europe

LONDON (Reuters) - High definition movie DVDs in the Blu-ray format have outsold the rival HD DVD standard in Europe this year, breaking the 1 million barrier and constituting 73 percent of all HD movie discs sold.

Citing industry sales data, the Blu-ray disc association said in a statement on Tuesday Blu-ray movie disc sales had topped 1 million units and when counting Blu-ray gaming discs the total number produced for sale in Europe exceeded 21 million units.

Sony's PlayStation 3 game console includes a Blu-ray Disc drive.

Hollywood and electronics manufacturers are hoping that new high-definition DVDs, with better picture quality and more capacity, will revive the slowing home DVD market.

But the launch of the next-generation DVD players has been complicated by the fact that there are two competing technologies available, Blu-ray and HD DVD.

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Online Revenue Grew 21% In 3Q For Newspapers
by Erik Sass
Advertising revenue for newspapers' online operations grew 21% in the third quarter to $773 million, according to figures released Tuesday by the Newspaper Association of America. Overall, online now accounts for 7.1% of total advertising revenue in the newspaper industry, up from 5.4% in the third quarter of 2006.

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BIG-NAME BRAND MARKETERS ARE FED up with traditional media channels and are threatening to shift the lion's share of their budgets online, according to Nick Brien, worldwide CEO of Universal McCann.

"If this happens for another year, significant clients will want to walk," Brien said at an Interactive Advertising Bureau conference on Monday in reference to a general climate of discontent due to increasing viewer fragmentation, disruptive technologies, and the resulting decrease in ROI.

Without naming any specific clients, Brien added they are "just waiting to increase their online spend to 50% or 60% [of their total budgets]."

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Is User-Produced Video Losing its Appeal?
Business Week
The explosion of online video on the Web used to be all about amateurs. Not anymore. Apparently, the average Web user has become bored with clips of lip-syncing 7-year-olds and kittens falling asleep. Professionally produced programming surpasses amateur video as the hottest trend in online video. VideoEgg co-founder Matt Sanchez. z would know: Video Egg provides producers with tools for making and delivering ads to online videos.

His sentiments are underscored by recent moves made by Bebo, a social media site, Sony, and ManiaTV, a video destination with more than 3,000 user-generated video channels. Bebo last week decided to open its pages to traditional media providers to boost its online video offerings. A few weeks ago, ManiaTV scrapped its user-generated channels altogether due. Earlier in July, Sony relaunched Grouper, its online video property, as a professional-grade content site only.

What does that say about user-produced video? The market has reached a saturation point, as sites like YouTube continue to pull in the bulk of user-generated video content. Also, the newness of being able to broadcast yourself online is starting to wear off. Professionals tend to do it better, and more often

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With the Writers Guild of America strike dragging on into its third week, NBC has apparently come up with a contingency plan: Come January, the network will start running the new Web show "Quarterlife" on TV.

The show, created by Marshall Herskovitz and Edward Zwick of "thirtysomething" fame, debuted last week on MySpace.

The show is touted for bringing TV-like production values to the Web, but three years ago ABC passed on the series. Of course, the strike has obviously given TV execs reason to rethink what shows are ready for prime time.

Still, "Quarterlife" was drawing buzz even before the strike started. What's more, the quality of Web shows has steadily increased in the last few years and, with start-ups like Joost promising TV-like images, the viewer experience is likely to continue to improve. Even YouTube, already the most trafficked Web video site, is taking steps to up the quality of its clips, according to recent press reports.

It shouldn't really be a surprise that Web video is migrating to TV. In many ways, it's similar to the trend that began years ago with text, when broadband wasn't as widespread as it is now. Just as bloggers became book authors and magazine writers, it makes sense that video created for the Web will surface on television -- with or without a strike.

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Microsoft Deal Values Facebook At $15 Billion

MICROSOFT ON WEDNESDAY SAID IT is investing $240 million for a 1.6% stake in Facebook--a deal that values the hot social network at a staggering $15 billion. Beating out Google, Microsoft also won exclusive global rights to sell third-party banner ads on Facebook.

Microsoft has had an agreement to sell ads on Facebook in the U.S. since August of last year. Expanding the deal internationally was seen as critical because 60% of Facebook's nearly 50 million registered users are abroad.

Microsoft believes that user base is on track to exceed 200 million and eventually 300 million members, said Kevin Johnson, president of Microsoft's platforms and services division, during a conference call Wednesday.

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THERE GOES THE NEIGHBORHOOD: CBS Television Distribution, the dominant player in the syndication business, has decided not to attend the annual NATPE syndication conference this year in Las Vegas.

In recent years a number of major studios have downgraded their presence at the event, electing to avoid expensive convention floor positions for less costly, more intimate suites at the Las Vegas hotels.

But with CBS this will be a shutout of sorts: no floor, no suites, no CBS executives anywhere at the event -- except for its international TV sales group.

What does it say about CBS, a company that on any given week offers up eight or nine of the top-10 -rated syndicated shows (including the likes of "Wheel of Fortune," "Oprah Winfrey" and "Dr. Phil") and probably controls 35% of all national syndication ad revenue?

Ticketmaster.com Adds Digital Album Sales Through iTunes

Friday, Nov 9

IAC'S TICKETMASTER HAS ANNOUNCED PLANS to expand its relationship with Apple's iTunes Store, in order to integrate digital album sales alongside concert ticket sales on Ticketmaster.com. At launch, more than 700 acts who sell tickets through Ticketmaster are participating in the service. Through the end of the year, the companies will offer ticket purchasers $1 off every digital album sold on Ticketmaster.com through the iTunes Store. The companies have also teamed to offer Ticketmaster + iTunes gift card packs at Target retail stores; the $50 package includes two $25 cards redeemable at Ticketmaster.com and the iTunes Store, respectively.

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FOLLOWING MONTHS OF DEVELOPMENT AND preparation, MySpace plans to debut its first original series "quarterlife" this Sunday. Toyota has signed on the premiere--and will continue to be featured prominently on the "quarterlife" profile, along with in-stream advertising, for months to come.

Earlier this year, MySpace signed Marshall Herskovitz and Edward Zwick, the creators of "My So-Called Life" and "thirtysomething," to produce the new series--exclusively, at first, for MySpaceTV.

The Emmy-winning producers agreed to create 36 eight-minute episodes of "quarterlife," which focuses on six creative twentysomethings with tendencies toward highly revealing video blogging.

The deal represents an ongoing effort by MySpace--still the most popular social networking site online--to attract more ad dollars with sponsor-friendly programming.

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Alibaba: Biggest IPO Since Google
Forbes.com   November 2007
Shares of Chinese Web firm Alibaba.com skyrocketed in its first day of trading, opening at more than double the B2B firm's initial public offering price and making it the largest technology debut since Google in 2004. Alibaba's IPO raised $1.5 billion at $1.73 per share; yesterday its stock soared to $4.58 per share and figures to go even higher today. The B2B portal is now trading at 281.5 times its 2007 earnings per share, making it far pricier--pound for pound--than, say, Google, whose shares trade at 58.8 times this year's earnings.

So what does Alibaba.com do? Simply put, the company links small to mid-size manufacturers with overseas buyers, which makes it a popular place for eBay sellers, for example, to buy wholesale goods direct from manufacturers. Clearly, the market sees massive potential for this kind of business. However, one of the key criticisms of the company is the lack of trust between buyers and sellers, who sometimes take the money and run.

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Los Angeles Leads Nation in HD-Capable Homes

Nielsen Co. said Tuesday that 13.7% of TV households in the U.S. are equipped with an HDTV and HD tuner capable of receiving signals in HD, while 11.3% are equipped with an HD television and HD tuner and receive at least one HD network or station.

Los Angeles has the highest penetration of HD-capable homes, or 20.4%, and New York has the highest penetration of HD-receivable homes, 17.5%.

Nielsen also reported that among U.S. Hispanic or Latino households, 10.4% are HD capable and 8.2% are HD receivable. Among African-American households, 8.1% are HD capable and 6.9% are HD receivable.   Multichannel News  11/1

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Microsoft Bets On Big Future For Facebook
The Wall Street Journal   10.07
Microsoft's hard-fought victory for a 1.6% stake in Facebook has been laughed at by some critics, but not only is $240 million (the amount the software giant paid for the stake) a mere pittance for a company the size of Microsoft, but the risk reward for investing in an upstart with Facebook's potential is very high.

The opportunity is highly targeted online advertising. Facebook is unique to other content providers because it collects very detailed information about its users: their hobbies, favorite books, movies, music, what schools they went to, etc., in addition to basic age, gender and location information. Perhaps most important, social networks link together people and their friends, dividing them into groups centered around common interests or affiliations. The social networking has become so powerful that some industry watchers believe sites like Facebook could eventually become "the central window consumers use to access the Web."

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Report: Facebook Set to Collect $260 Million More
The Wall Street Journal   Ocober 07
Facebook apparently isn't done collecting money from third-party investors: the Internet upstart is in talks with hedge funds and private equity firms to raise as mnts, like the Microsoft deal, would also value the companuch as $260 million. The news comes just two days after the company completed the sale of 1.6% of its equity to Microsoft for $240 million.

Nothing has been signed yet, but an announcement should be forthcoming, unless the talks, which are preliminary, collapse in the next week or so. The investmey at $15 billion.

What, exactly, does Facebook plan to do with the money? An international expansion is the most likely scenario, as is a new round of hiring, particularly as the company prepares to roll out its new targeted advertising system in the next couple of weeks.

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Blu-ray outsells HD DVD in U.S. for first nine months

Blu-ray DVD titles outsold rival HD DVD titles by almost 2-to-1 in the first nine months of the year, but analysts expect additional HD DVD support and new hit releases to "transform" the high-definition DVD battle score in the fourth quarter.

Home Media Research, a division of Home Media Magazine, said on Tuesday total U.S. sales of Blu-ray discs, using a Sony-backed technology, totaled 2.6 million units from January 1 through September 30, versus 1.4 million HD DVD discs sold. HD DVD was developed by Toshiba. It is backed by Microsoft as well as film studios like Time Warner's Warner Bros.  The division in Hollywood grew deeper in August when Paramount Pictures and DreamWorks Animation signed exclusivity deals to distribute their next-generation discs on HD DVD format for the next 18 months. Walt Disney, Sony, News Corp.'s 20th Century Fox, and Lions Gate Entertainment are exclusively in the Blu-ray camp.

"It's going to be 2008 before the dust will really start to settle. For now, it's like watching a yacht race," said Kaufhold, who expects the standards battle will lead more consumers to dual DVD players such as those made by South Korea's LG Electronics, which supports both Blu-ray and HD DVD.

Samsung Electronics is expected to market a dual format player later this year, ahead of the holiday shopping season.

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Not Enough Web Dollars to Go Around?
Reuters
As Web spending continues to hit new records each year, media execs are wondering whether the growth is sustainable. Are advertising expectations out of control? Some say that new media companies are taking advertising for granted, worrying that there may not be enough ad dollars to go around.

Advertisers will go after the winners, the ones with the highest usage and the most desirable demos. And don't forget that each user has a finite amount of time to spend consuming content, too. Like any ad medium, the cream will rise to the top, but ad formats need to be sorted out first, particularly Web 2.0 sites like Facebook and YouTube, and content needs to be developed with the Web user in mind. On the Web, the networks' half-hour sitcoms and hour-long dramas aren't simply competing with themselves, but also news outlets, blogs and social networks, too. That said, a hefty chunk of TV, print and radio dollars are still set to crossover to the Web. Many firms expect Web spending to double by 2009.

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Why Google Fears Facebook
Fortune
By even the highest valuation, Google is still more than 15 times the size of Facebook. With a market capitalization of $190 billion, Google could eat the social network for lunch, and yet it's Facebook that's got the Web giant running scared. Google understands that it needs to grab a foothold in social networking, but Facebook, frustratingly, isn't for sale. And given its ad ambitions, Mark Zuckerburg's Facebook reminds one of a pre-IPO Google, circa 2003.

Now, many analysts believe Facebook is planning an IPO sometime in 2008. The evidence: in July, Gideon Yu, finance chief of Google's video site YouTube, left to become Facebook CFO; Google Checkout engineer Benjamin Ling is the latest defector, heading to Facebook to oversee its software platform.

 Social networking represents the future of the Internet--and that's where the next great Internet fortune resides, he says

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Universal To Challenge iTunes
Business Week
Its relationship with Apple in tatters, Universal Music Group has decided to pool together other big music companies independent record labels to create an iTunes competitor. UMG already has Sony BMG and Warner Music Group on board, which together would represent 75% of the music market. UMG's plan is to supply iPod competitors like Microsoft's Zune with the fodder it needs to compete with Apple. The service would be called Total Music. No comment yet from UMG.

The move is partly about UMG's souring relationship with Apple, but also about boosting a business in decline. CD sales are falling, while rising digital sales aren't picking up the slack. Apple, meanwhile, dominates the digital music market through its iPod music players and the iTunes service.

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WHAT DO YOU WANT TO PAY?

The disruption to the music industry that started with the original Napster continued this week, as Radiohead announced it would make its new album available online at whatever price consumers wished to pay.

Much like the policy at the New York's Metropolitan Museum of Art, consumers can donate as much or as little as they like for the new album, "In Rainbows," slated for release Oct. 10.

The announcement, made on its Web site, has shaken the embattled record industry. "Radiohead is the best band in the world; if you can pay whatever you want for music by the best band in the world, why would you pay $13 dollars or $.99 cents for music by somebody less talented? Once you open that door and start giving music away legally, I'm not sure there's any going back," one producer told Time magazine.

Pay-what-you-wish is certainly an intriguing idea -- one that reflects many artists' own conflict between wanting the listening public to hear their work and needing to earn enough money to continue making music for a living.   mediapost.com 10/07

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It looks like Facebook is readying a new feature that will let musicians create pages for their bands and promote their tracks and upcoming concerts on the site. News of the service surfaced late last week on PaidContent.

With this initiative, aimed at capturing a bigger share of the indie music crowd, Facebook will challenge rival social networking site MySpace in one of its oldest core strengths.

In MySpace's early days, the site grew a big following of independent musicians, who posted MP3s, concert dates and the like online. Even now, the site continues to leverage its strong ties to the music world, by promoting record labels, bands and concerts. Additionally, last year, MySpace forged a deal with Snocap to allow musicians to sell downloads from the site.

News of Facebook's upcoming musician-oriented service also comes just several days after it was revealed that Facebook also is planning to challenge Linked In by offering members the ability to separate their friends from business contacts and show different information to the different groups.

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Google to Hit $600 on Strong Web Spending
Bloomberg.com
Unrealistic valuations in the blogosphere haven't hurt Google shares in early morning trading on Wednesday, which continue their upward trajectory towards $600 per share. Reaching that milestone would be in line with Wall Street's thinking, as 33 of 36 analysts recommended buying Google shares.

However, price forecasts indicate that Google's bull run should stop around $625--20 of 28 analysts with estimates pegged its price below that mark over the next 12 months. Google's market value is currently more than $180 billion, third among U.S. technology companies, behind Microsoft and Cisco Systems. It has the sixth-highest stock price in the U.S.

"Google is still dominating" Web advertising, said Piper Jaffray & Co. Web analysts in an Oct. 1 report. Its sales growth in its core business has been 70% in each of the last three years, and figures to continue its remarkable growth, boosted by the introduction of display and rich media ads to its search engine. EMarketer believes that Web advertising will fall somewhere in the $21 billion range this year and more than double by 2011--Web search is expected to account for 40% of that.

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Google Valuation Sparks Blog War

Silicon Valley Insider Henry Blodget, a former Wall Street analyst who was banned from the securities industry for life for giving Web companies' valuations he knew were outrageous, started a blog war on Tuesday. He outlandishly predicted that Google, nearing $600 per share, could be on its way to $2,000. According to Blodget, "$2,000 a share would mean a market cap of about $750 billion, which-given a reasonable time horizon-just isn't that far-fetched."

Both Kara Swisher of D: All Things Digital and Michael Arrington of TechCrunch had strong reactions to his post. "Um, Henry, it is far-fetched, as to be borderline fanciful," said Swisher, while Arrington called the post irresponsible.

Indeed, Google has plenty of problems, says Swisher, including the possibility of the DoubleClick deal not going through, what to do with YouTube, high employee and R&D costs, the specter of a recession and the emergence of social networking.

It's one thing to peg a privately owned company like Facebook with a $20 billion valuation, but it's another to say the sky's the limit for a publicly traded company like Google, especially when a blog is read by thousands. This calls into question the ethics (or lack) of blogging. Many people read blogs for their amusing hyperbole, but should those that cover specific industries be held to a higher standard?       mediapost.com   10.08

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Microsoft Sees Future In Media
Business Week
Thirty-two year old Microsoft Corp. has been a software company for most of its life, but media is its future, CEO Steve Ballmer said at a media event in Paris on Tuesday. As growth in operating system and desktop software slows, Microsoft expects that within four to 10 years, 25% of its revenues will come from advertising.

Part of the reason for the change is the growth of free, ad-supported Web services offered by Google; consumers no longer need desktop software to write documents and create spreadsheets, which has left the technology giant searching for new sources of revenue. The other reason is opportunity: "All marketing will be digital sometime in the next 10 years," said Ballmer.

The Microsoft of the future will be a triumvirate of software, ad serving and media content. Thanks to its $6 billion acquisition of aQuantive, the company has become an instant player in ad delivery and marketing services. Other acquisitions, like the in-game advertising company Massive, give Microsoft the ability to deliver ads in media its competitors cannot reach. Mobile advertising, too, figures to be a huge area of expansion for the software giant, which continues to go toe to toe with Google.

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Microsoft Aims to Outgun Google in Facebook Courtship
The Wall Street Journal
Microsoft Corp. is in talks to buy a minority stake in social network Facebook, a sign of a new urgency to jump-start its online business at a time when Google Inc. is leading the Internet-advertising business. Microsoft proposals could value the fast-growing site at $10 billion or higher. If those talks bear fruit, Microsoft could purchase a stake of up to 5% in the closely held startup, at a cost in the range of $300 million to $500 million. But Microsoft must first muscle out Google, which has also expressed strong interest in a Facebook stake.

Along with Google, Time Warner Inc.'s America Online unit, Yahoo! Inc. and others, Microsoft is racing to establish a "platform" -- in this case, a single system through which advertisers can buy ads that appear on sites and Web publishers can tap for ads to appear on their sites. That approach has taken on added importance as users and advertisers increasingly spend time and dollars on sites other than the big, established Web portals.

The existing deal is expected to bring in about $75 million for Facebook this year and a total of at least $200 million to $300 million through 2011. The actual numbers will depend on Facebook's traffic growth and other factors. The existing agreement covers only the U.S. and expires in 2011, but the companies are discussing whether to extend it for a longer period and expand it beyond the U.S.

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BY NEXT YEAR FULLY 25% of U.S. TV households will have some way to time-shift their TV viewing. That number might climb to 33% or 50% in two years.  Yet TV pressure groups keep talking about the family hour of TV programming, the 8 p.m. to 9 p.m. time slot, as if it was the most important part of families' TV and entertainment lives.

Since when can anyone say the family hour was important anyway? Not since Milton Berle was on TV -- or maybe some godawful Western in the '60s. Not since most fathers of families consisting of a wife and two or three kids could easily work to pay for their entire existence -- and get home by 7 p.m.    mediapost.com    Sept 07

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NBC to Offer a Free Video Download Service

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CBS Gets Digital Makeover
Los Angeles Times
On the same day that NBC announced free ad-supported downloads of its TV shows, the L.A. Times had a story about the ambitious Web strategy of NBC rival CBS Corp. Reporter Dawn Chmielewski calls CBS' approach to Web distribution "promiscuous," in that the company seeks as many open, nonexclusive partnerships it can get.

In many ways, CBS' strategy comes from the "Web know-how" its executives accrued from a meeting with 16 next-generation Internet companies in Silicon Valley last year. Among other things, they discussed social media and Web 2.0 distribution. "The key lesson from Silicon Valley is respect for the audience," said Jonathan Barzilay, senior vice president and GM of entertainment at CBS Interactive.

The executives' learning is reflected in the media giant's revamped homepage, which is no longer merely "regurgitated television," as a CBS executive once described it. The report says the new site, launched in conjunction with the network's fall season, has less clutter and added social networking touches to attract public discourse.

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Study: TV is taking a back seat

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One in five homes now has a DVR
According to a new survey from Leichtman Research Group, more than 20% of homes now have a DVR, up from just 1 in 13 homes two years ago. Leichtman's survey also revealed that 53% of DVR owners reported owning an HDTV set.

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Viacom Opens Micro Social Network
Fortunemagazine.com
While some big media firms try to create high-trafficked online destinations to rival MySpace and Facebook, Viacom's strategy has been to create hundreds of microsites for its many brands. However, critics have wondered how the MTV parent plans to tie it all together.

The answer, it seems is, Flux, a social media system that allows MTV users to personalize pages with social networking tools like blogs, photos, videos and friends. The personalized pages will appear when users sign into any MTV or third-party site in the Flux network. Most importantly, users will be able to save to material from the network's 20 launch partners to their Flux page. Users will also be able to post Flux network material to their MySpace and Facebook pages, too.

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One in four adults say they read no books at all in the past year, according to an Associated Press-Ipsos poll released Tuesday. Of those who did read, women and seniors were most avid, and religious works and popular fiction were the top choices.

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New consumer research from Leichtman Research Group, Inc. based on a survey of 1,300 households throughout the United States, found that over one in every five households in the United States now have a Digital Video Recorder, up from about one in every thirteen households just two years ago.

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CBS Adds Affiliates To Audience Network
Variety.com
CBS Corp. is adding its local TV and radio station Web sites to its Web distribution venture, CBS Interactive Audience Network, which will place its programming on the Web sites of some 29 CBS owned and operated affiliates, 144 CBS Radio Web sites and 183 additional sites owned by CBS affiliates across the U.S. The move will assuage the network's nervous local affiliates, which feared they would be left behind as CBS and others move forward into new Web ventures.

The Web sites will host CBS programming, in addition to providing local news, sports and weather to the CBS Interactive Audience Network, effectively recreating the TV programming experience on the Web. CBS claims that its audience network reaches 90 percent of Web users; the company said that "most" of its new local partners would be ready for the network's fall season, to boost everyone's efforts for online advertising.

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ABC In Online Video Distribution Talks
Mediaweek.com
The networks, confused about what to do with their Web distribution strategy, are trying to make friends with the Web's major audience holders. News. Corp.'s Fox and GE's NBC partnered with MSN, Yahoo, News Corp.'s own MySpace and others to create a digital distribution venture called Hulu. CBS Corp. has also forged distribution deals with many of the same players for its CBS Interactive Audience Network, and ABC is now looking to do something in the same vein.

The Walt Disney Co. company is said to be in talks with AOL, Comcast, MSN, MySpace and Yahoo (nearly the same lineup as CBS and NBC/Fox) about distribution agreements, but an ABC Television exec said only one deal would be announced this fall. ABC's approach is to embed its media player into its publisher partner sites so viewers have the same experience on Yahoo, for example, as they would on ABC.com. CBS allows its partners to design the video experience as they see fit, but retains 90 percent of ad revenue.

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by Erik Sass, Friday, Aug 31, 2007 7:15 AM ET INTERNET AD REVENUES ARE SET to pass radio's for the first time, according to eMarketer, a firm that tracks and analyzes spending trends across various media. EMarketer is pegging Internet ad spending at $21.7 billion, compared to $20.4 billion for radio.

eMarketer's report comes as the Internet already has surpassed outdoor ad spending, and as a recent report from equity firm Veronis Suhler Stevenson predicts that the Internet will displace television as the No. 1 ad medium by 2011.

While this news is unlikely to cheer radio advertisers, it's more a testament to the feverish rate of Net growth than any secular downturn in radio. In fact, radio is also expected to grow modestly in 2007, with a 1.5% increase. Total radio revenues grew 1% in the first quarter of 2007, according to the Radio Advertising Bureau, due mostly to a 1% increase in local revenues and a 10% increase in non-spot. Second-quarter figures aren't yet available.

Still, radio's predicted 1.5% growth rate looks decidedly sluggish next to expected online revenue growth of 22% in 2007. And it's the second major medium to be passed by the Internet.   mediapost.com

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1. Jay Deragon from Link to Your World says:

   Today operators are the only ones profiting from networks. Tomorrow, users will be the revenue kings!

   I have written numerous examples of the shift to the relationship economy where users are enabled to generate revenue from products and services they offer between each other.

   To read more about this shift go to www.relationship-economy.com

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Newspapers Incorporate Video, Other Web Offerings
Newspapers and Technology 
A new study of newspapers' Web offerings shows that online video has become a nearly ubiquitous feature offered by major U.S. publications. The Bivings Group study, which analyzed the Web offerings of the top 100 newspapers according to Fas-Fax data from the Audit Bureau of Circulations, found that 92 of the largest newspaper sites now offer video, a 31 percent jump from a year ago. Their video sources are varied: 39 papers offer original video content, 26 use video from the Associated Press, 13 use video from local news outlets and 10 papers use at least two types of video content on their site.

The study found that use of other online features increased in nearly every category, too. Ninety-seven of the 100 papers offer RSS and text feeds, while 95 have at least one reporter blog. Forty-nine papers have podcasts, compared with 31 last year, while 44 provide some sort of bookmarking, compared with just seven last year. The number of sites requiring users to register also increased to 29, with three requiring paid subscription after registering. Mobile offerings from U.S. newspaper publishers are also on the rise, with some 53 papers creating content specifically for mobile devices.

Newspapers are also adding social media features. The number of papers permitting user comments rose from 19 to 33, while nearly 25 percent accept some kind of user-generated content, from videos to photos and articles. Five papers, including USA Today, The Denver Post and The Washington Post offer social networking on their site.           Yahoo.com

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Apple's iTunes faces some new competition on at least two different fronts.

Wal-Mart has started selling some digital downloads without the much-hated anti-copying restrictions that usually come with iTunes purchases. Individual tracks are priced at 94 cents - - 5 cents less than iTunes.

The move comes several weeks after Universal Music said it will allow some songs to be sold free of the digital rights management software that hinders people from copying the music - - but won't let Apple sell such DRM-free tracks.

Currently, most iTunes tracks are sold with DRM restrictions that prevent users from easily playing them on devices other than iPods. While Apple recently began selling some DRM-free tracks from EMI for $1.29 each - - 30% more than the usual price - - the program so far has been limited.

Additionally, MTV Networks said today it has partnered with Rhapsody's RealNetworks to launch their own online music store to rival Apple. Verizon Wireless will handle mobile distribution.              msn.com news report

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TELEVISION BUSINESS writing has reached a new direction in terms of ratings -- true south.

Imagine a lead paragraph in a TV trade talking about the highest ratings for a particular show -- and that those numbers are a Nielsen Media Research 0.6 household number.

That's right, less than a 1 rating. And, mind you, it's the highest ratings for the show.  This is how Broadcasting & Cable described Oxygen's reality series, "Tori & Dean: Inn Love," about the lives of actress Tori Spelling and her husband Dean McDermott and their adventures in opening up a bed-and-breakfast in southern California.

Of course, you can't blame Oxygen. Being a midsize cable network in some 73 million homes, it can't, as yet, offer up big number of the more established cable networks.

What the 0.6 number really shows is the direction viewer ship numbers will take in the future, especially when it comes to video that runs on super-niche digital platforms.    August 07

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The new site is a virtual tour of a Carnival cruise, where visitors can try out everything from the ship's piano bar, sundeck and karaoke lounge to onshore activities such as 4x4 cruising. The idea is to pique interest by showing what to expect, since fewer than 18% of North Americans have been on a cruise. The site is an example of marketers' increasing sophistication in their use of online video to create not just linear demonstrations that look like TV commercials, but interactive, virtual experiences.

It's an evolution enabled by higher broadband penetration, more-sophisticated web-development technology and a continued rise in TV-ad skipping, which is leading marketers to question the effectiveness and efficiency of the medium that has long been at the center of marketing plans.

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AOL Plight Highlights Larger Portal Problem
The New York Times
AOL had little option but to overhaul its failing business model, but despite a positive start to its new life as a free, ad-supported content provider, the Web portal's ad growth is already narrowing. As a result, Time Warner shareholders are questioning whether it was a smart move for the media giant to keep AOL.

The Time Warner unit is still one of the most popular Web destinations, attracting more than 90 million visits per month, but the name of the game these days is monetizing your traffic, something AOL, with 16 percent ad growth in the second quarter, isn't doing sufficiently. Internet ad spending overall is expected to increase 28.5 percent, according to eMarketer.

AOL's problem highlights one of the great paradoxes of the Web business today: Web portals, which have some of the largest audiences, are failing to benefit from the increase in online spending. Yahoo, for example, reported just 8 percent growth during the latest quarter. The greater problem for the major portals is that younger audiences don't need help navigating the Web; they'd rather read blogs and create customized home pages and social networking profiles. The rise of Web 2.0 firms like Facebook and YouTube has made it harder to keep their users.

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"Traditional" Web Advertising Fails on Social Networks
VNUnet.com
You can't find a lot of effective advertising on social networks, according to Forrester Research. The Web research group says that traditional marketing just doesn't work on sites like MySpace and Facebook, as evidenced by the ineffectiveness of run-of-site, microsite, and other "push" advertising tactics.

Forrester says the ROI of the campaigns it studied was very low, which means marketers have to do better a better job of engaging users by providing something of value. Social networks are built on relationships, so, too, should the advertisers' relationship with users. Social networking pages are meant to be engaging; users will ignore anything that doesn't draw them in.

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Program Reveals Where Wikipedia Entrees Come From
Reuters
A new tracing program that reveals where Wikipedia entries come from is stirring up controversy. People using FBI and CIA computers edited entries on such topics as the "Iraq war" and the prison at "Guantanamo Bay," presenting a conflict of interest for the nonprofit online encyclopedia, according to a company spokesperson.

The so-called Wikiscanner was developed "to create minor public relations disasters for companies and organizations I dislike (and) to see what 'interesting organizations' (which I am neutral toward) are up to," said the program's creator, Virgil Griffith of the Santa Fe Institute in New Mexico. It reveals the origin of the computer that made changes to a Wikipedia listing. However, in the case of the FBI or CIA, changes could have been made by someone with access to the organizations' network.

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300' Sets Blu-ray/HD DVD Sales Record

This is high def!

Warner Home Video may have delayed the launch of its dual-format Total HD disc until the first part of next year, but in the meantime the studio's policy of releasing titles on both Blu-ray Disc and HD DVD continues to pay off.

The studio Tuesday announced it had sold through to consumers more than 250,000 high-def disc copies of the epic actioner "300," which was released on both next-generation formats July 31, the same day as the standard DVD.

Noting that Warner's two-format approach has given the studio six of the 10 top-selling high-def disc releases of all time, Warner Home Video president Ron Sanders calls the "300" sales tally "another high-definition milestone."     biz.gamedaily.com  August

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CNN, Economist Take Down Walls Online; WSJ and NYT Could Be Next

NEW YORK (AdAge.com) -- Charging for web content looked pretty promising back in 1996, when the pioneering new web magazine Slate was gearing up to try just that. "Our belief is that the medium will prove itself over time and people will pay for it," said John Williams, the founding publisher. He never got a chance to test that proposition; he quit for Starbucks two months after launch. Then Slate made its move -- but lasted only a year before going free again in February 1999. Now there's a crescendo of similar falling walls at serious news sites -- including The Economist and CNN -- and the likelihood that the websites of both The New York Times and The Wall Street Journal will soon be free.

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Today the Online Publishers Association issued a new study attempting to quantify people's changing online media habits. The group reports that people now devote more online hours to content than e-mail or other communications, marking a reversal from just four years ago.

Currently, Web users spend 47% of their time online on content sites, up from 34% in 2003. Communications sites like email, on the other hand, draw just 33% of people's online time today, down from 46% four years ago.

The OPA attributes the shift to a variety of reasons, including the ballooning in quality offerings, the growth of Web video, people's tendency to go online for news, and increased broadband penetration. The OPA doesn't break out which content sites are benefiting most, but highlights people's desire to learn more about breaking news as one key driver.

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Site Picks Next Mags To Fold
BusinessWeek
When it comes to predicting print demise, there is an online site that charts potential victims: "magazinedeathpool.com."

Launched in February of last year, it is a run by an anonymous well-versed insider who styles himself or herself the Grim Reaper -- and has a good track record of picking the next books to go down. Among the site's current favorites for early departures are Business 2.0 and Condé Nast's new Portfolio. So far, the site has forecast virtually all of this past year's major closings, including Life, Premiere, Shop Etc., and Jane. All had been publicly struggling, but that doesn't mean much, since many magazines are privately held and often divorced from market realities. Many magazines die; unlike TV shows, they tend to die slowly

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Study: Newspapers In Big Trouble
Silicon Alley Insider
As the newspaper industry continues its slow decline, Silicon Alley blogger Henry Blodget explains why The New York Times cannot escape a future of downsizing and depreciating returns. Its offline business accounts for just 13% of monthly readership but generates 90% of its revenue, while NYTimes.com's 7.5 million monthly uniques covers the remaining 10.

The reasons? Offline display and classifieds ad sell for more than online ads, and physical papers are also sold. People spend less time with NYTimes.com than they do with the physical paper, as competition for ads comes from other online pubs, blogs, social networks, classifieds sites, even services like Google News.
The Times print business will one day fold altogether, he predicts, in which case online readership would receive a boost, perhaps by 2.5 million. Online inventory and revenue would also receive a boost; he says 33%. Paper, distribution, printing and other production costs would be eliminated, along with print ad revenue. However, content creation costs would stay the same-unless it realizes that cuts must be made. Indeed, the paper has to produce less and lay people off. Otherwise, revenue would drop 40% to 50% and the Times Co. will continue to lose money.

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Slide.com Plans Widget Revolution
Fortune
In just a few months, Slide.com has become the most popular widget maker on the Web; its embeddable products allow users to easily post video, pictures and anything sparkles and moves to their Web sites, blogs or social networking pages. The latest Web 2.0 fad, widget use, continues to grow apace according to comScore, which says that some 220 million widgets were consumed in May alone.
What's so special about embedded software apps anyway? For publishers, they make Web pages stickier. Like a Web page within a Web page, widgets allow users to customize their content. For example, an NBA fan could paste a dynamic scoreboard or game tracker on their Google or Yahoo home page. Theoretically, widgets will enable users to watch live or previously recorded games some day.

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Movielink Is Placebo for Blockbuster
Ars Technica
What's the movie download market like? Well, after reviewing Blockbuster's purchase of Movielink on Thursday-estimated at under $20 million by The Wall Street Journal--not so good. Why? The big movie studios backing the movie downloading startup (Warner Bros., MGM, Paramount, Universal and Sony) reportedly dumped more than $100 million into the joint venture. A cheap Movielink, on the market for well over a year, underscores the fact that consumers aren't that interested in purchasing and downloading movies.

Maybe it's the long download times. Maybe it's the ease of movie piracy. Maybe consumers have gotten used to not paying for Net material.

Blockbuster thinks it now has a three-pronged attack (store, mail and download) in its war against mail-rental king Netflix, but the acquisition of Movielink is unlikely to boost Blockbuster's fortunes for one main reason: The movie download business, far from being an add-on, actually cannibalizes on its existing in-store and mail rental services.

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The top-gaining e-commerce category in Q2 versus year ago was video games, consoles & accessories, which jumped 159 percent on the strength of Nintendo Wii and PlayStation 3 sales.  Sport & fitness also saw substantial gains (up 58 percent), followed by consumer electronics (up 51 percent) and event tickets (up 44 percent).

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UMG Opens Music To All But Apple
Ars Technica
This is a test, this is only a test: Universal Music Group has decided to experiment with selling digital rights management-free music, planning a six-month nationwide test in which most of its popular content will be sold using the universal MP3 format. Music sellers like Amazon, RealNetworks, BestBuy, Wal-Mart and others will all get a chance to sell UMG's DRM-free music; conspicuously, Apple's iTunes was left out of the test, per its contractual issues with the iPod maker.

The six-month trial begins on August 21 and ends on January 31; the music giant can simply pull the plug if it doesn't like the way the test is going. What UMG really wants to see is if the initiative adversely affects the industry's astronomically high piracy rates. If it doesn't positively affect sales either, the test comes with an out.

But what's with Apple being left out? In a statement, UMG CEO Doug Morris talks about expanding the online availability of its artists' music, "offering consumers the most choice in how and where they purchase and enjoy our music." How do you validate that statement by conspicuously leaving out the industry's largest seller of online music? Contractual disputes aside, Apple's iTunes is tops on the online music pile, responsible for an astonishing 10% of music sales, according to NPD Group, making it the third-largest seller of music nationwide.

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MySpace Launches New Behavior Targeting Program
Silicon Valley Insider
Fox Interactive's Mike Barrett, the News Corp. company's chief revenue officer, reveals that FIM will report revenue "well in excess" of the $500 million goal it set for itself last year. The company's new targeting program is still in beta with 11 behavior segments, but will soon expand to more than user 100 segments. Barrett says the targeted ads, which attach behaviors like auto, lifestyle, beauty and health to user profiles, will command a 20% to 50% premium over its other ad offerings.

MySpace attaches a behavior by directing say, someone believed to be a fashion aficionado to the MySpace fashion channel with a house ad. If the user goes, then that triggers a related ad to run in front of that user. Barrett did not mention how often the user would have to go to a fashion site to retain that behavior segment. Soon, he says, more granular segments, like "safari travel" instead of just "travel," will be available.