Digital Media

An e-mail was sent on Thursday to Facebook users who were members at the time that its controversial, now-defunct Beacon advertising program was operated: it's the official notice about the proposed settlement for the class-action lawsuit against Beacon. The terms of the settlement have been public since September, but the court-ordered summary notice is the last step in the process before final approval on February 26.

"This is not a settlement in which class members file claims to receive compensation," the notice explained (possibly crushing the hopes of any Facebook members who might have got excited that this would be an easy way to make some pizza money). "Under the proposed settlement, Facebook will terminate the Beacon program. In addition, Facebook will provide $9.5 million to establish an independent nonprofit foundation that will identify and fund projects and initiatives that promote the cause of online privacy, safety, and security."

A Web site has been set up to explain the terms of the settlement for the case Lane et al. vs. Facebook Inc. et al., which was originally filed last summer.

Beacon, an advertising program that shared members' activity on participating third-party sites on their Facebook profiles without much warning or notification, was a much-hyped part of the Facebook Ads initiative that debuted in the fall of 2007. But it was, unfortunately for Facebook, a complete public relations disaster.

Pressure from privacy and activist groups resulted in notable changes to the product and member controls thereof, but image repair proved to not be enough and Facebook let Beacon fade to black.

Alec Baldwin fans needn't worry that Comcast will soon pull "30 Rock" or other NBC Universal shows off the Web.

The entrance of NBC Universal's office building at 30 Rockefeller Center.

(Credit: Greg Sandoval/CNET Networks)

Comcast managers said Thursday, following the company's announcement it had acquired a controlling stake in NBC Universal, that it will be business as usual at Hulu, the joint venture operated by NBC Universal, News Corp., and Disney.

Ever since rumors of the acquisition began to swirl in September, questions were raised about whether Comcast would try to kill Hulu to discourage cable customers from dropping their subscriptions. Some critics of the deal said Comcast could also limit access of NBC Universal's TV shows and films to other popular distributors, such as Netflix and iTunes. It appears that some of this may happen and some of it may not.

During a conference call, Comcast executives said they anticipate that some content will appear online at Hulu, and other shows will appear on TV Everywhere, the Hulu competitor that Comcast, Time Warner, and other cable companies rolled out last summer.

"Comcast is too deep into their Internet-related investments for me to believe that they are hoping to clamp down on consumer enjoyment of NBC content," said James McQuivey, a digital-entertainment analyst for Forrester Research. "They have spent far too much money buying companies and developing infrastructure to suggest they are going to make it a 'my-way-or-the-highway' distribution scheme. It would be absolutely foolish to buy an expensive property like NBC Universal and then cut the legs off of it."

Hulu's freedom
Okay, so Hulu won't disappear once the acquisition--which still needs government approval--is finalized, but Hulu fans are concerned about how the site will develop. Many had long hoped that the service might one day offer a better selection of full-length feature films and past episodes from hot TV shows. Now, Hulu offers only a smattering of films, and to watch episodes of a TV show from a prior season, a fan must plunk down for a DVD.

Most importantly, Hulu fans want to continue watching without paying subscription fees, which has been discussed publicly by some of Hulu's backers, including Jeff Zucker, NBC Universal CEO.

Free content was the promise that made consumers so giddy about Hulu and YouTube not that long ago. Cable subscribers were thrilled by the possibility that they could watch the best shows and films without having to pay fees. The NBC Universal acquisition is just the latest sign that this dream might be in jeopardy.

Paul Gallant, an analyst at Concept Capital's Washington Research Group told The Washington Post that Comcast could "harm consumer welfare by preventing Internet video from becoming a viable cut-the-chord threat."

"It's a little bit Pollyannish to say 'I can cut cable because everything I want is on the Internet,' because it isn't," McQuivey said.

The big knock on Hulu and other legal video sites is their selection of films and TV shows is still pretty poor. Under Comcast ownership, Hulu will unlikely be unable to change that. More probable is that Comcast will use NBC Universal's content to sweeten its offering to paying subscribers.

"The goal of Comcast is not to make it hard for people to get content," McQuivey said. "The goal of Comcast in the future is to make it really easy to get content and that's what people will pay for.

"In the future, Comcast isn't going to say 'Here's 500 channels delivered to one set-top box,'" he continued. "In the future, they'll say 'Hey, you know that subscription you're paying us every month, that buys you red-carpet access to the best content. No matter what you want to watch we have the license to it. We're going to deliver it to you online, to your game console, to your connected television or Blu-ray player.'"

But what about Netflix and iTunes? Doesn't the Comcast-NBC Universal deal put them in a position of competing with a major supplier?

Is Netflix friend or foe?
Netflix looks less like a DVD-rental business and more like the Web's version of a cable company with each passing day. For more than a year now, Netflix has streamed movies over the Web to anyone who pays the company's subscription fees. CEO Reed Hastings raised the stakes in the competition with cable companies by partnering with set-top box makers and TV manufacturers to create systems that enabled Netflix customers to watch streaming films on their flat screens.

Jumping to the TV set was huge for Netflix. No longer latched to the PC, the company was now threatening cable companies on their home turf. But if content is king, then Netflix was offering only a duke.

Just like Hulu, Netflix offered cable subscribers a cheaper alternative. Just like Hulu, Netflix's library lacks new and hot titles. Without the best content, the cable companies still hold an advantage over Netflix. Since Netflix is now a direct competitor to Comcast and other cable companies, it will be interesting to see what kind of terms the Web's No. 1 rental store gets from the new NBC Universal?

As for Apple, it's highly unlikely that Comcast will tinker with NBC Universal's arrangement for digital download sales at iTunes. The very public quarrel between the companies over pricing in 2008 is behind them.

In that case, Apple gave NBC Universal more flexibility over pricing. Apple CEO Steve Jobs has shown respect for Hollywood's lucrative practice of giving exclusive film access to certain distribution platforms over specified periods, called "windows." Jobs is also purveyor of the Web's most successful video-download store, so the relationship will likely remain unchanged.

But McQuivey sees a potential problem for Apple should the company decide to broaden its video business.

Apple could become an over-the-top pay TV provider," McQuivey speculated. "Apple should say 'You buy an Apple TV from us and pay $28 a month and we'll give you access to this number of downloads and all of this TV-network content for free. They are one of the few companies that could really create this amazing little business model of mixing Internet downloads with Internet streaming with over-the-air HD broadcast...Lets be honest, Apple users have fairly shared tastes and as a result it would be easier for Apple to serve its customer base this way than it is for, say, Comcast. Comcast has to offer the world, where as Apple only has to offer what's cool."

It should be noted that in every scenario McQuivey discussed, he mentioned price. In his vision of the digital future, Internet distribution looks a lot like cable.

According to McQuivey, "All of these Internet delivery solutions are going to face some kind of reckoning over the next couple of years. It shouldn't come as a surprise that Hulu is going to evolve to include some kind of pay model."

The 2009 holiday season thus far is revealing much stronger online sales figures than what was witnessed in 2008, market-research firm ComScore announced late Wednesday.

According to the company, which has monitored spending for the first 30 days of the November-December shopping season, sales are up 3 percent to $12.26 billion, compared to the same period in 2008. Cyber Monday sales hit $887 million in online spending, tallying a 5 percent gain over the same day last year. That amount also matched "the biggest spending day on record, December 9, 2008."

"We've seen an encouraging start to the online holiday shopping season and it would appear that retailers' aggressive and early marketing efforts have so far succeeded in persuading consumers to open their wallets online," ComScore chairman Gian Fulgoni said in a statement. "Thanksgiving Day and Black Friday were atypically strong online sales days this year, and Cyber Monday has continued that trend by outperforming the season-to-date average growth rate and matching last year's record day of $887 million in online spending."

The good news doesn't stop there. Cyber Monday also saw an increase in the number of buyers, ComScore found. The total number of online buyers grew 6 percent to 8.7 million people. That said, the average amount each person spent dropped 2 percent to $102.19.

True to the day's origins, the majority of sales originated from work computers. The company found that 52.7 percent of all purchases were completed in the office. Just 41.6 percent of shoppers picked up items from home, ComScore said.

ComScore wasn't the only company reporting strong numbers this week. eBay said that Cyber Monday transactions outpaced Black Friday's by a whopping 35 percent. More than 2.4 million transactions were completed on Black Friday and Cyber Monday, eBay said. The site even has a heat-map graphic that shows how the transactions pored in over the course of those days.

ComScore and eBay's data follows another strong report from marketing-optimization company Coremetrics, which said earlier this week that sales were up 13.7 percent at some online retailers that it received data from.

It's official. Comcast, the nation's largest cable company, announced Thursday that it is buying a controlling stake in the TV network and movie studio NBC Universal.

The total value of the blockbuster media industry deal, which had been rumored since September, is estimated at around $37 billion. The new joint venture will merge Comcast's cable channels, which are worth about $7.25 billion, with NBC Universal assets that have been valued at around $30 billion, the companies said Thursday.

Comcast also plans to contribute about $6.5 billion in cash. The cable heavyweight will own 51 percent of the venture, and General Electric will own 49 percent. Jeffrey Zucker, who has been president and CEO of NBC Universal, will lead the joint venture.

GE, which owned 80 percent of NBC Universal before the deal, is getting about $8 billion in net cash for its contribution. The joint venture is taking on about $9.1 billion in debt, which reduces the amount of cash that Comcast has to put up for the deal. And it also provides the cash to pay GE.

The deal will make Comcast a major media player with several very profitable cable channels, including USA, CNBC, MSNBC, and Bravo. It will also have control over NBC's broadcast networks and TV stations, its film studio, and its amusement parks.

The New York Times reports that Comcast and GE had been working on the deal since March. Rumors of a pending joint venture surfaced in the press in September. But the final deal was delayed as GE negotiated a buyout with French media company Vivendi, which owned 20 percent of NBC Universal. Earlier this week, GE and Vivendi reached an agreement whereby Vivendi will get $5.8 billion for its 20 percent share. If the deal does not close by September, GE is still responsible for paying Vivendi about $2 billion, or about 38 percent of the agreed price.

Brian Roberts, chief executive of Comcast, said in a statement that NBC Universal is a perfect fit for Comcast, and it "will allow us to become a leader in the development and distribution of multiplatform 'anytime, anywhere' media that American consumers are demanding."

Roberts tried and failed to buy another major media company, Disney, in 2004.

Will cable-bashing undo the deal?
The deal is likely to be scrutinized by government regulators, namely the U.S. Department of Justice and the Federal Communications Commission.

Craig Moffett, an equities analyst with Bernstein Research, said in a research note in late October, when rumors of the deal were heating up, that regulators may find plenty of reasons to reject the acquisition.

The biggest problem for the deal could be the fact that GE and Comcast will try to close it during a midterm election year. Politicians taking sides on Net neutrality issues and the national broadband plan may find it easy to bash Comcast. And a marriage between the nation's largest cable and Internet service provider and one of the nation's three broadcast TV stations may ignite old fights over media ownership, a la carte billing, retransmission consent, and cable prices.

"Cable-bashing in an election year is a no-lose bipartisan proposition," Moffett writes in his note. "The headline risk is quite material. Approval of a deal, should one be reached, cannot be assured."

Comcast argues that the deal will be good for consumers by getting some movies on cable TV and on-demand services more quickly, since Comcast will control NBC Universal's movie catalog. Comcast may also be able to put content more quickly on cell phones.

Still, some consumer advocates, such as Free Press, oppose the deal. They say Comcast would have too much power in the entertainment industry.

One issue of concern is that Comcast could use NBC's programming to undermine rival TV services from phone companies, such as AT&T or Verizon Communications, or from cable operator Dish Network. Comcast could charge these competitors more for cable channels, while giving its own cable TV business a better deal. Comcast officials say this is unlikely. And the company has already proven that it offers fair pricing with its existing cable channels, such as E! Entertainment, G4, and the Golf Channel.

The deal may also have an effect on online video services, such as Hulu, which is owned by NBC, News Corp., and Walt Disney Company. That said, Comcast has been experimenting with its own online video service for some premium channels for Comcast customers. The company also already has a Web-based video aggregator called Fancast, which streams full TV shows and movies for all Web users.

I am consumed, as I am sure all imperfect beings are, by the furor surrounding Tiger Woods' sudden and somewhat vertical descent from his image pedestal.

There will be those who will have much sympathy with his plight, as there will be those who will have none.

However, I was reading a quite brilliant editorial on Yahoo Sports offered by Dan Wetzel.

I was fully absorbed by Wetzel's strong, persuasive arguments that Woods should really not bleat about the tabloid world, when my right eye was drawn to an ad from the Professional Golfers Association. I immediately took a shot of it, because, well, please look at it.

(Credit: Chris Matyszczyk)

Some clever word-associating media planner or algorithmic program has managed to juxtapose this article about revelations in the life of Woods with an offer from the Professional Golfers Association to reveal the secrets of Woods' great rival, Phil Mickelson.

His, um, golfing secrets, as far as one can judge.

This touching coincidence approaches the poignancy of the Twitter billboard seen recently in Mobile, Ala. And one wonders how quickly anyone will notice that perhaps this is not in the finest of tastes, especially as it is coming from an organization that makes quite a lot of money from Woods' exertions.

As I am typing this sentence, the "Phil's Secrets Revealed" ad has moved on. One wonders just how quickly it will return.

The world's second-largest PC maker has designs on being the first to offer a Chrome OS Netbook.

Acer Chairman J.T. Wang said in an interview with Digitimes that he's "confident" his company will be first out of the gate with Google's open-source operating system pre-installed.

Chrome OS will be coming to Netbooks next year. Acer says it will be first.

(Credit: Stephen Shankland/CNET)

The earliest it would be available is mid-2010, according to Digitimes' unnamed sources.

Acer was just one of several hardware makers previously announced to be working with Google on implementing Chrome OS, along with Asus, Hewlett-Packard, Lenovo, and Toshiba. Dell, which hasn't committed to it fully yet, has released an experimental version of Chrome OS based on the source code that will work on the Dell Mini 10v Netbook, though it's not an official product.

Though Wang didn't offer details or specifications for Acer's Chrome OS Netbook, the guys behind Chrome OS have already let on what they're expecting.

At the OS's first public demonstration last month, Google said its vision includes slightly larger keyboards and screens than what's currently available, x86 or ARM processors, solid-state drives, and 802.11(n) Wi-Fi chips.

Following modifications to its "First Click Free" policy that gives Google News users access to some content that would otherwise be behind a pay wall, Google has released an additional tweak that lets publishers decide whether they want their sites to show up in Google News, Google Web search, both, or neither.

Previously, if a publisher wanted to request inclusion in one or the other, but not both, sending a request to Google was required. This now automates the process.

These updates to Google's news indexing come at a time when media outlets are once again pointing fingers at the search giant as a revenue suck--and in response, Google insists it's good for publishers because it drives traffic. News Corp. CEO Rupert Murdoch has made concrete threats that he will pull his publications' content from Google and is reported to be in talks with Microsoft to strike an exclusive deal on its Bing search engine.

By offering more flexible options for choosing where exactly news outlets want their content to appear, Google comes across as friendlier and less authoritative--at least on the surface.

(Credit: U.S. District Court for the Northern District of California)

Start-up Spring Design has been denied an injunction to halt Barnes & Noble from selling its Nook e-reader, according to court documents.

The company had requested the injunction, in addition to monetary damages, as part of a recent lawsuit filed in federal court in San Jose, Calif. The suit charges that the bookseller misappropriated Spring Design trade secrets in the design of its Nook, which launched October 20, the day after Spring Design announced its Alex e-book reader.

The court's decision (PDF), based on a Monday hearing, denies Spring Design's request for a preliminary injunction, but states that a halt to sales could still be appropriate if the plaintiff ultimately prevails. The court also says it will expedite the pre-trial process to accommodate Spring's request for an early hearing.

Barnes & Noble does not comment on litigation as a matter of policy, a company spokeswoman said Wednesday. CNET has contacted Spring Design for a comment and is waiting to hear back.

The Nook, like Spring Design's Alex (which has yet to be released), combines a color touch screen with an e-ink display, and both readers use the Android operating system. In its lawsuit, Spring Design said it showed its plans for the Alex to Barnes & Noble, which showed interest in the product and gave no indication it was working on a similar device.

So sales of the Nook will move forward for now, though not without hitches of a non-legal sort.

You know that apocalypse thing we're always being told might be just around the corner? Well, do you feel the chilling breeze? Do you feel the troubled twittering in the trees?

For here is a tale that I know you will discuss with your loved ones, perhaps with other people's loved ones, even with your psychological professional, the minute you hear it.

It appears a man called Dana Hanna is standing at the altar on November 21. He utters those most solemn vows about how he will love and obey or whatever it is that married people claim to do these days.

The officiant pronounces that Dana and his lovely bride, Tracy, are now married. Does Dana weep? Does he kiss his bride?

Ah, no. For Dana's Twitter moniker is TheSoftwareJedi and his first loyalty is to his digital followers. So, much to his wife's surprise, he whips out his cell phone and updates his statuses on both Twitter and Facebook. Right there at the altar. He also hands his wife's cell phone over to her.

Now that he has uploaded the evidence (which we're assuming isn't staged), Dana insists that this was all done for fun.

Indeed, he explained on YouTube: "I have a lot of family scattered around the country and we all use Facebook a lot to keep in touch. So when Tracy and I were engaged, most of my family found out via Facebook because we updated our statuses."

If you're wondering what it is he tweeted from the altar, here it is: "Standing at the altar with @TracyPage where just a second ago, she became my wife! Gotta go, time to kiss my bride. #weddingday"

However, another tweet sent on Monday night by Hanna, who is chief architect of NextDayPets.com and president of Torian Technologies, might perhaps offer an even greater insight into his complex and socially networked psyche: "Just changed over the laundry for @TracyPage and was thrown off by the fact a bra was in there. Not used to living with a woman again."

Oh, Tracy, are you sure about this? I only ask because I just tried to access the Tracy Page Twitter feed and received the message "this page doesn't exist."