MediaFile

TV Content wars, blackouts could spur M+A

Liana B. Baker

Jul 19, 2012 13:52 EDT

Evercore analyst Bryan Kraft believes the prolonged blackout that has left DirecTV’s 20 million subscribers without MTV, Comedy Central or Nickelodeon for a week, could lead to some industry consolidation.

In a research note out late Wednesday night, the analyst said if content providers Viacom, as well as home of ‘Breaking Bad’,AMC, which was dropped from No. 2  satellite provider Dish Network in July, get the upper hand, it raises the chances of a merger between satellite companies and cable providers.

If DirecTV and Dish comes out the winners, he said, it encourages cable TV networks to merge, but only when their valuations fall. DirecTV has pushed backed against what it claims are exorbitant increases in Viacom’s programming fees that it says it does not want to pass on to customers.

And DirecTV viewers aren’t the only ones suffering. Kraft estimates that the dispute is making Viacom lose about $14 million a week. Meanwhile DirecTV would need to lose 1.15 million subscribers before its cash flow was impacted. Kraft said that if DirecTV expects to lose more than 1.15 million subscribers, it should pay up the $3 per subscriber fee Viacom is likely seeking.

As one of the most high profile blackouts stretches into its second week, time will tell whether the spat will be the one that changes the pay TV landscape for good or whether it just causes viewers to change the channel.

Twist – a new app for the punctuality-challenged

Alexei Oreskovic

Jul 18, 2012 12:44 EDT

The minds of Silicon Valley have yet to find the cure for tardiness, but they have figured out a way to make being late less rude.

A new app call Twist notifies friends and colleagues when you’re running late, calculating the estimated time of arrival to your destination on-the-fly and zipping off text messages to the people waiting for you.

The free app, available on Wednesday for iOS devices, can be used for trips by car, bike, foot and public transportation in most major U.S. cities. In development for the past year, the app’s algorithms crunch through various data streams, such as the average speed you travel and real-time traffic patterns, to calculate ETAs that co-founder Mike Belshe says are 98 percent accurate.

Belshe, a former Google employee who was a founding member of the Chrome group, teamed-up to create Twist with Bill Lee, a serial entrepreneur and angel investor who has backed Tesla and Posterous.

“A lot of guys are just focused on ‘where,’” said Lee, referring to the spate of location apps that have flooded the App Store in recent years. “We’re the first to focus on ‘when.’”

The San Francisco-based company has $6 million in funding from backers including Bridgescale Partners, Jeff Skoll, the first president of eBay, Eric Hahn, the former chief technology officer of Netscape, as well as Lee and Belshe.

Besides making life easier for the serially late, Twist is touting its safety aspect:  no need to risk an accident while driving so that you can text your friends to let them know you’re going to be late. The company even commissioned a survey by Harris Interactive that found that 24 percent of Americans admit to having sent a text or email while driving to notify someone that they were on their way.

Mayer can’t save Yahoo – because Yahoo can’t be saved

Kevin Kelleher

Jul 18, 2012 12:00 EDT

Yahoo eats CEOs. The perennially ailing company lures talented managers into the corner suite of its Silicon Valley headquarters, then it sucks their good reputations out of their veins and casts them aside. They inevitably pass through the revolving door an empty shell of their former selves.

Terry Semel, Jerry Yang, Carol Bartz, Scott Thompson. All took the CEO helm with visions of invigorating Yahoo into an Internet leader for the 21st century. Most became mired in Yahoo’s stubbornly byzantine culture. And all probably collected their severance checks wishing to themselves they’d never heard of the company with its stupid hillbilly name and its superfluous punctuation mark.*

Now it’s Marissa Mayer’s turn. Mayer – an early Google hire who instrumentally forged its successes in search, maps and online email – has become such a positive, likable presence in Silicon Valley that I actually felt sorry for her when I heard it was her time to be Yahoo’s help. A failed tenure as Yahoo’s CEO couldn’t happen to a better-qualified candidate.

Mayer’s appointment was something of a bombshell – many people expected Yahoo would appoint Ross Levinsohn, a seasoned ex-News Corp executive, as CEO. In the Internet industry of 2012, the gambit boils down to advertising versus engineering – which is to say, vision versus monetization. Any good Web company wants the sweet spot that welcomes both. With Levinsohn, Yahoo would have got an ad guy to oversee a product that is largely computer code. With Mayer, Yahoo gets an engineer with executive experience.

Three years ago, Mayer signaled that she was ready for a new company. Mayer, famously, was responsible early on for the invitingly spartan homepage of Google.com. Later she had a hand in core features like Gmail, Google News and Image Search. During her five years as vice-president for Google’s search and user experience, she oversaw some of the company’s biggest projects, balancing the site’s intuitive interface with the need to generate more ad revenue from it.

In recent years, her trajectory seemed to lose energy. Nearly two years ago, Mayer made a move seen by some as a demotion. She was sidelined from search into local initiatives. At the time, local was key to Google’s push into the mobile web, but it also became an area where Google lost ground to Facebook, Groupon, Yelp and others.

Finally, a reason to exclaim Yahoo!

John C Abell

Jul 17, 2012 14:15 EDT

Forget the cloud wars, the tablet wars and whither Digg. The summer tech news doldrums just got a jolt. Now we have a real story.

One of Google’s earliest and most respected employees, the highly visible Marissa Mayer, has left the search giant to become the CEO of Yahoo. This kind of thing doesn’t happen all that often, since Google is still one of the top workplaces in Silicon Valley and, even with its stock price well off historical highs, still considered an ascendant company in the high-stakes, “live fast and die hard” high-tech industry.

But most interesting is why Mayer is moving on: Not to relive her youth at a startup and prove that she isn’t a one-hit wonder. No, Mayer has agreed to move not to the garage but to the corner office to fix one of the tech industry’s most infamous basket cases.

And with that, Mayer becomes one of the most prominent women CEOs not only in the Valley but in corporate America. For trivia fans she is also Yahoo’s second female CEO: Carol Bartz was fired less than a year ago. At 37, Mayer is also the youngest CEO of a Fortune 500 company.

Mayer was Google employee No. 20, and the executive responsible for Google’s search page, Gmail, Google News, Images and Maps — many of the things that most people associate with the company. She was even in charge of the Google Doodle program, which playfully changed the Google logo for special occasions.

But despite her strong street cred and the confidence of founders Sergey Brin and Larry Page, it was not likely that she would run Google, at least anytime soon, since the founders are so young and one of them, Page, is only just back in the corner office.

So it’s a flyer for Mayer – and where better than at Yahoo, which brought on its own curse of the Bambino with Jerry Yang’s sloppy rejection of Microsoft’s merger proposal. As Thomas Edison is said to have said: “To invent you need a good imagination and a pile of junk.” Same goes for reinvention.

With Openbucks investment, Jerry Yang goes a little less Yahoo, a little more show-me-the-money

Let one Ms. Marissa Mayer worry about how to turn around Yahoo, the struggling Internet company he co-founded. Jerry Yang,  43, has focused his attention to an increasingly hot field: online payments.

Mountain View, Calif.-based Openbucks has reeled in Yang as its latest investor. He led a $4.8 million funding round for the company, joined by former Yahoo CEO Terry Semel, Greycroft Partners, SV Angel, and others.

Openbucks allows customers to purchase gift cards from companies such as Burger King, CVS and Subway. They can take those cards and use them to purchase things online beyond the products sold by the vendor of the gift card. Right now, that’s gaming services only, but Openbucks says the cash will help it expand to other services and stores.

Openbucks is geared toward people who might not have credit cards or bank accounts and thus can’t easily make online payments, or those who want to keep their online transactions private, a spokeswoman said.

Catering to underbanked consumers is becoming increasingly popular with investors, with lending services like Wonga and ZestCash winning backing from venture capitalists.

Yang has invested in a handful of companies– ranging from social-travel app Jetpac and developer-platform service DotCloud– since stepping down as Yahoo chief executive at the end of 2008. He serves on the board of Yahoo Japan and Cisco Systems, and is a trustee of Stanford University, his alma mater.

African Web video service Iroko raises more funds, targets cable TV

Iroko Partners, an online distributor of African movies and music, has raised another $2 million in its latest round of funding from a Swedish venture capital group as it seeks to take the service to cable and satellite TV partners in the U.S. and Europe. The Lagos, Nigeria-based company raised the funds from Sweden’s Kinnevik, an early investor in Groupon Inc. Iroko previously raised $8 million from U.S.-based hedge fund Tiger Global in April as investors in emerging markets seek to tap into one of the fastest growing movie businesses in the world.

Kinnevik investments head, Henrik Persson, said his firm, which has invested in African telecoms, sees tremendous opportunity in African media and online services. “It has very low penetration and we see a really strong growth trend. He added: “A part of our investment philosophy is that we think that the perceived risk is higher than the real risk in this market..what people see as a lack of opportunity is a lack of supply.”

Iroko has focused on forming partnerships with most of Nigeria’s leading filmmakers for distribution on its own platform as well as with major partners like Google Inc’s YouTube. Though the majority of Iroko’s operations are based in Lagos, it also has set up offices in London and New York. Founder Jason Njoku said the majority of the company’s revenues come from users across the African Diaspora in the United States, Britain and Canada and other countries outside the continent. The Nigerian movie industry is now widely acknowledged as the third largest after Hollywood and India’s Bollywood in terms of the number of movies produced. While so-called Nollywood movies are typically distributed within Nigeria and around the world on DVD or Video-CD discs, Njoku spotted a gap in the market to digitize the movies for online distribution. Most of the Web viewers have been in developed countries with fast-enough Internet traffic speeds to enable video streaming. The company’s revenues are predominantly generated through advertising around the movies. But in July it launched a monthly subscription with the promise of earlier windows for fans to catch new films without advertising. Since launching two weeks ago the subscription service Iroko TV has signed up just under 5,000 paying subscribers according to Njoku. It already had 560,000 registered users since the Iroko TV service launched in January. “Our users have such an intense relationship with the content, they spend hours watching.” Njoku said the new funding will focus primarily on helping expand operations outside Nigeria. He said the next stage for the company is to find ways of licensing its partners’ content to cable, satellite TV companies and international airlines. “The Internet is one of the most poorly monetized platforms for content,” said Njoku. “Since we’re platform-agnostic it would be mad for us not to try and form relationships with TV.” Iroko sees itself as a global business with pan-African roots so it is also looking to license more movies and other content from around Africa from countries like Ghana and Kenya among others.

Survey: VCs more confident investing domestically, in IT sectors

If every cloud has a silver lining, the silver lining for global venture capitalists during the current economic gloom appears to be cloud computing, according to results of a confidence survey from Deloitte and the National Venture Capital Association released Monday.

The first Global Venture Capital Confidence Survey measured the input of more than 440 venture capital, private equity and growth equity investors from around the world, revealing that global VCs have higher confidence investing domestically versus abroad and in information technology sectors like cloud computing and social media.

Venture capitalists favored Brazil, China and the United States for investing, showing the least confidence in France, Japan and South Africa. Cloud computing, software and new media/social networking held the most confidence by industry, with the lowest confidence in semiconductors, telecommunications and clean technologies.

Respondents from Brazil, Canada, Israel and the Netherlands expressed the most confidence in their country’s ability to enact investment-friendly policies, while VCs from India, Australia, Japan and Taiwan had the least confidence.

A spokeswoman from the National Venture Capital Association said Deloitte and the NVCA hope to repeat the survey going forward to create a historical database of global venture capitalist confidence.

(Photo: Reuters/Fabrizio Bensch)

50 shades of like

John C Abell

Jul 13, 2012 10:39 EDT

We are losing our faith in TV news as fast as those high-speed chases it’s so happy to show us. At the same time, we’re driving like maniacs on the social-media highway, letting it all hang out with the top down.

What do they have to do with each other? Both are advertiser-supported media. One prints money, the other not so much, at least not yet. And yet one is on the downswing, the other ascendant. What does this say about human nature and tapping into elusive and guilty pleasures?

In its annual poll, Gallup Politics found that only 21 percent of respondents expressed a “great deal” or “quite a lot” of confidence in TV news – less than half what it was when the poll was first conducted in 1993, but down only a point from last year.

But then this report, from RTDNA and Hofstra: TV news hiring is up – way up:

The survey found that TV news added 1,131 jobs in 2011 to reach a total full-time employment tally of 27,653, representing a 4.3% gain over the previous year. (The highest level of TV news staffing occurred in 2000).

42.9% of stations reported that they increased staff in 2011 and 46.2% said that staff size stayed the same. Fox-affiliates were more likely than any other group to increase staff size, and stations in the South were more likely to have added employees than stations in other regions.

We mistrust TV news, yet ratings and thus job numbers are improving. What’s going on here?

Google’s Schmidt wants to put you in a self-driving car

Alexei Oreskovic

Jul 12, 2012 21:48 EDT

Google executives never miss a chance to talk up the futuristic self-driving cars the company is developing.

Executive Chairman Eric Schmidt gave an update on Google’s automotive efforts during a chit-chat with reporters at the Allen & Co conference in Sun Valley on Thursday.

“We have had conversations with all of the manufacturers globally, when politicians come by we love to put them in the car and drive them around at full blast,” Schmidt said.

Schmidt even revealed that Google maintains a little race course in a parking lot, where drivers can try to outgun the self-driving cars (typically a modified Toyota Prius).

“We ask you to race the Prius, inevitably the Prius wins against you,” said Schmidt.

The technology is not yet completely “mature,” Schmidt explained. And Google hasn’t figured out how it will “productize” the cars, perhaps licensing the technology to other companies.

But Schmidt was fervent that the self-driving cars will eventually make their way into the real world, predicting that “self driving cars should in our lifetime become the predominant way.”

Ad startup SessionM nabs big clients, expands

Poornima Gupta

Jul 12, 2012 12:29 EDT

Advertisers have long sought to grab the attention of the notoriously inattentive mobile user. And Lars Albright is seeking to provide just that by “gamifying” mobile ads.

The co-founder of Quattro Wireless, which was bought by mobile device giant Apple for $275 million in 2009, left Apple last year to start SessionM, which aims to engage mobile users by tempting them to play a game, watch a video, take a poll or share information with friends – all for “M” points.

The “M” points can then be redeemed for anything from gift cards to discounts to charitable donations.

Advertisers, and even  app makers, find it tough to hold the attention of mobile users, given the various distractions and sites vying for their time.

“There’s so much fragmentation of people’s attention,” Albright said, adding that the goal is to get users to be more active and spend more time on applications.

Albright, who spent about two years working in Apple’s iAd division, said 95 percent of users who click on the ads powered by Session M complete them.

The startup, based in Boston, has been in business about a year, but its list of clients include big advertisers such as Ford Motor Co, Honda, Volvo, McDonald’s and Fox Sports.