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July 15, 2008 3:25 PM PDT

For teens, the future is mobile

by Stefanie Olsen
  • 4 comments

SAN FRANCISCO--Marketers convened here this week to figure out how best to reach teens on the Internet. The answer: It's all about the mobile phone.

Advertisers are clamoring to reach teens in digital environments because that's where they're spending much of their time--either online, with cell phones or playing video games. What's more, teens wield an estimated $200 billion annually in discretionary spending.

Fuse, a marketing agency based in Vermont, talked in recent weeks to senior technology executives from companies such as Sony, MTV Networks, Yahoo, and Nokia to find out what the future of technology will look like for the teen market.

Among the predictions: Mobile phones in the United States will surpass the popularity of desktops for teens. Only an estimated 20 percent of teens currently own a smartphone such as the iPhone, but mobile phone and content companies are counting on the idea that smartphone adoption will spread fast among teens in middle America and other areas.

"The iPhone is just the beginning of the all-in-one device. Uses of mobile devices will expand to include all kinds of bar code applications and prepaid debit card payment methods," said Bill Carter, a partner at Fuse, who presented the findings here at the YPulse 2008 National Mashup, a two-day conference on teens and technology.

That's likely why geographic ad targeting to teens via the phone is expected to explode in the coming years. Right now, mobile phone providers analyze an estimated 4 billion Internet Protocol addresses to provide street-level targeting to consumers. Companies like U.K.-based Blyk, for example, are reaching teens through the phone with ads and information on nearby nightspots. Teens sign up for the service.

"When you combine this new technology with teens giving their permission to market to them, the growth could be exponential," Carter said.

But, he said, mobile phone providers likely won't succeed as the entertainment leaders for the phone, despite their efforts to sell ringtones, games, and music. Other companies like Apple, Google, and Yahoo will be more effective at "side-loading" the cell phone with services.

Case in point: Most teens download music to their iPod that's been ripped from a friend's collection as opposed to bought from the iTunes music store. "There's a natural gravitation to get content on a device that's different than the one the manufacturer intended," he said.

As a corollary, he said that most teens will eventually buy subscription-based music services, much like the cable TV model. He predicted that Apple's iTunes will offer an unlimited monthly download service for music. Mobile phone companies, too, will launch music subscriptions on the smartphone.

Another prognostication: Other technology platforms will save, not kill TV networks, Carter said. The analog-to-digital conversion will make it possible for teens to watch live TV on portable devices. The technology will help the television networks target programming to specific audiences, and that will buoy the cost of advertising, he said.

"The device is inconsequential compared to the content," he said.

Originally posted at Digital Media
July 10, 2008 9:23 AM PDT

Kodak's answer to Apple TV: The Theatre HD Player

by David Carnoy
  • 2 comments

Kodak's new little black media player.

(Credit: Kodak)

I'm not sure whether I should call the new Theatre HD Player Kodak's answer to Apple TV, but that's the best analogy I can come up with on short notice. Whether it is or not, Kodak is doing its best to get into your living room with a little Wi-Fi-enabled black box that connects to your HDTV, displays images and other multimedia content, and links directly to Kodak Gallery, the company's online photo-sharing service, and Flickr. Due to roll out in September, the Theatre HD Player will retail for $299.99 and continue to add features through firmware upgrades after it's launched.

Kodak calls the Theatre HD Player, "An interactive device displaying personal content--pictures, video, podcasts, music--and Web-based content on a HDTV, while wirelessly connecting to a household's private Wi-Fi network." In a nod to the Nintendo Wii's popularity, Kodak includes gyroscopic remote, and you navigate the onscreen menus much like you would with the Wiimote. Like Apple, Kodak has an alliance with YouTube for video content. RadioTime is onboard for streaming audio.

The Theatre HD Player's connectivity options.

(Credit: Kodak)

In its press release, Kodak notes that the "Theatre HD Player lets consumers relive their favorite, and even forgotten, memories in customized slide shows, incorporating their personal music and video collections, Internet Radio, plus online video- and photo-sharing sites. Consumers can also edit and upload images and videos to popular online content sharing sites on their HDTV from the comfort of their living room." It's able to display high-resolution still images in a 16:9 aspect ratio and 720p video through it's HDMI and component video connections.

I got a look at the unit last night at an event for the product's unveiling (along with a few other Kodak products) and thought it had some nice features and an elegant menu system. There's some promise here. However, the Theatre HD Player is going to pose a marketing challenge for Kodak. Company reps seemed to shrug off the fact that the little black box's price tag approaches that of the Playstation 3, which not only has built-in memory card slots (and a hard drive), a good photo viewing application, and the ability to play back music and video files from your computer, but there's that built-in Blu-ray player--and oh, it plays games and has a Web browser. In my humble opinion, this device needs to cost less than $200 and probably closer to $150 to be viable. Of course, I keep telling Apple TV reps the same thing about their device, but that hasn't seemed to have had much of an impact.

Anybody interested in buying this thing? And, at what price? Or would you rather go for Apple TV or a PS3 for that matter?

Originally posted at Crave
July 9, 2008 10:26 AM PDT

Is Yahoo eyeing Demand Media?

by Dawn Kawamoto
  • 3 comments

Despite a hectic past two months fighting off a proxy battle with investor Carl Icahn, Yahoo is rumored to be sending out buyout feelers for social-networks company Demand Media.

Yahoo's Hilary Schneider, who was recently promoted to oversee the company's U.S. go-to market operations, traveled to Demand Media's Santa Monica, Calif., offices a couple weeks ago to gauge Demand's interest in a $1.5 billion to $2 billion buyout, TechCrunch reports, citing unnamed sources.

But Demand Media didn't bite, TechCrunch notes, adding that company founder Richard Rosenblatt is said to be seeking a price in the $3 billion range.

A post in All Things Digital casts a different perspective on that meeting.

In an interview with All Things Digital, the Demand Media founder said: "There is a lot of potential here, and I want to build a big company for the long-term."

All Things Digital also cites Yahoo sources as saying there has been "no offer floated" to acquire Demand Media.

But both reports note that a hook-up between the companies wouldn't be a bad idea.

Says TechCrunch:

It just so happens that what Demand Media is good at--generating lots of advertising impressions and creating niche social networks for media sites, may be a perfect fit for at least some of what ails Yahoo.

But should Yahoo want to make a play for the company and force a deal, Demand Media doesn't have the same pressures as Yahoo, which is in its own fix with Icahn. Demand Media isn't publicly traded, at least yet...

June 27, 2008 2:14 PM PDT

Google gadget turns PC into media server

by Stephen Shankland
  • 7 comments

The Google Media Server gadget can send audio and video from a Windows PC to another device.

The Google Media Server gadget can send audio and video from a Windows PC to another device.

(Credit: Google)

Google has released a software module that can turn Windows PCs into devices that streams media files to other devices.

The Google Media Server is a gadget that works on the Google Desktop software. It sends the data to other devices over a Universal Plug-and-Play connection such as a Sony PlayStation 3, according to the Google Desktop blog.

With it, people can play videos and music and view photos on a PC. In addition, it can connect to Web sites including Google's YouTube for video and Google's Picasa for photos.

June 23, 2008 4:00 AM PDT

SocialMedia to unveil 'friendship ranks'

by Stefanie Olsen
  • 8 comments

Know how to win friends and influence people? Advertisers want you to peddle their stuff to peers on Facebook and MySpace.

Internet start-ups out to crack the problem of advertising on social networks are developing ad technology that can analyze which people are most influential to their friends on social networks so that they can target those people with pass-it-on messages about Apple's latest iPhone or The Incredible Hulk movie.

The upstarts are basically scouting for the social-media equivalent of a Typhoid Mary who can spread a message, with effectiveness, to friends on sites like MySpace or Facebook.

Two such start-ups, SocialMedia Networks and 33Across, are on track to deliver those influencer services with the goal of becoming the advertising players of the social-media age--that is, if they can carefully navigate privacy concerns. Though they have different business models, their technology is part of a lineage of online ad targeting.

"We're trying to make ads suck less in social networks," said Seth Goldstein, founder of San Francisco-based SocialMedia Networks. (Are SocialMedia and 33Across on a collision course? Read more about 33Across here).

On Monday, Goldstein is expected to announce "social banners," or display ads that turn you or your friends into the hook of a marketing message. In tandem, SocialMedia will announce that it's developed a patent-pending algorithm called FriendRank to power those social banners. It's like Google's PageRank, but instead of ranking pages for their popularity, it ranks friendships.

The company looks at how people interact with Facebook or MySpace applications--those 5,000 widgets in its advertising developer network--to determine who, among someone's 100 or so friends, are most important to them. It might infer relationships by seeing who you've played Scrabulous with or turned into a vampire. (The company said that it works within Facebook's terms of service so as not to collect and store someone's profile data.)

"FriendRank basically helps us choose which friends to put in the ad," Goldstein said in an interview. Beyond that, he wouldn't describe the secret sauce behind the technology.

For example, instead of a banner advertising The Incredible Hulk movie, a social banner would ask which of your close Facebook friends, among a short list, you'd like to invite to see the movie. Or a social banner might inform you that a friend Jim just ranked Iron Man with three stars, and it might ask to "click here to buy tickets at Fandango."

Understanding people's relationships
Of course, online advertising has taken many shapes over the years, and this is just the newest twist. Companies have targeted Web ads to people's demographics, geographies, and behaviors. They've also targeted ads--and it's met with the most success--to keywords typed into the search box or the content of a story page. Those ad models are still in practice, but now that social networks are taking up so much of people's time, a new breed of advertising is taking shape.

"The next step is to understand people's relationships," said Martin Green, vice president of business at social instant-chat site Meebo. Last week, Meebo signed an ad partnership with Mountain View, Calif.-based 33Across to monitor the effect of advertising promotions from Universal Pictures. 33Across is helping Meebo understand which types of people--mavens or influencers--respond to which ads.

Certainly, everyone from Google to Facebook to widget makers is trying to figure out how to better sell ads on social sites, at higher rates than their lows of 5 cents per thousand impressions.

Despite the millions who regularly spend hours on social networks and sites like Flickr or YouTube, advertising spending in the category is worth less than $2 billion annually. (Projections from research firm eMarketer were recently downgraded because of an expected ad shortfall from MySpace.) That's less than 2 percent of the total advertising spending in the United States.

The problem with social advertising is twofold. People aren't very receptive to advertisements in the first place, but they're even less so when "hanging out" with friends virtually on MySpace or sending photos on Flickr. Traditional advertisers, the big spenders on commercials and brand advertising, are cautious when it comes to placing their logo next to racy or potentially inflammatory images. Technology and media companies must find a way around both of these issues.

"The lesson of Beacon was that people have no expectation that they will be linked to or targeted in any way outside of a social network."
--Leslie Harris, president, Center for Democracy and Technology

Goldstein, a veteran Internet advertising entrepreneur, founded SocialMedia in April of last year to initially be a widget developer for social networks. One of its first widgets, Appsoholic, measured how people respond to other applications on the site. With that data, the company realized that it would be better off helping other developers make money from their applications, given that the popularity of widgets can be fleeting.

So it built an automated ad system to sell banner, text, or Flash ads for as many as 5,000 applications running on Facebook, among others. SocialMedia advertisers can target people based on "appographic" parameters like people who've installed dating, car, or travel widgets.

Typical run-of-site banner ads on social networks can cost as little as 5 cents per thousand people they reach, or cost per thousand (CPM), and can go as high as 20 cents per CPM for targeted ads based on someone's profile or interests. Application ads can run as high as 50 cents, according to Goldstein, who's trying to break the dollar mark with social banners.

SocialMedia has tested social banners with BMW in a campaign worth more than $100,000. It created an application for the car company that allows people on Facebook to customize the features of a BMW 1 Series, or create a "dream ride." The related social banners, for example, advertised to Seth's closest friends in their news feeds that "Seth is taking a joyride in a BMW 1 Series on the Autobahn. Would you like to join him?"

SocialMedia's also been experimenting with the ads for Universal Pictures, among others. In early tests, the company has shown that people are 200 times more likely to respond to the social ad. (A non-social ad might command a click-through rate of 0.15 percent vs. a social banner at 0.5 percent.)

Possible privacy concerns
Still, with its social banners, SocialMedia could run into the same privacy concerns that Facebook encountered when it launched Beacon. Late last year, Facebook teamed with sites like eBay and Yelp so that when Facebook members performed an action on one of those sites, like buying a pair of shoes, Facebook would automatically alert their friends to it in their news feeds. After members reacted badly, the company backed off and made the program entirely opt-in for members.

SocialMedia isn't drawing data on people's behaviors from third-party sites, but it is using friendship data it collects to seed marketing messages. That could tick people off. Leslie Harris, president of the Center for Democracy and Technology, said the main issue with social ads like these is that people need to know how they're being targeted and be given the ability to opt out easily.

"People need to have clear notice and the clear opportunity not to participate," Harris said. "The lesson of Beacon (Facebook's controversial targeted-messaging project) was that people have no expectation that they will be linked to or targeted in any way outside of a social network."

Goldstein said SocialMedia will be sensitive to people's privacy, partly because of the backlash prompted by Facebook's Beacon program. People will be able to click a tab on a social banner to read about how it works and how to easily opt out of the program, he said.

At recent social-media conferences, Goldstein has said that programs like Beacon are the future of this type of conversational marketing.

"Technically people are collecting cookies all the time," Goldstein said. "What Beacon has shown us is that when you try to cross information between networks, the psyche isn't ready. But over the years to come you'll be able do this in any forum."

June 16, 2008 10:13 PM PDT

Big ideas, smaller audiences, and too many (or the wrong) metrics

by Tim Leberecht
  • 1 comment
Insights from the Conversational Marketing Summit

John Battelle's Conversational Marketing Summit, which debuted last fall with much acclaim in a more intimate setting in San Francisco, faced a challenging task with its second edition last week in New York.

For starters, the speaker lineup was impressive, but two of the most important players of the social media Web were noticeably absent: Facebook (which, to be fair, took part last year) and Twitter. Yes, where was Twitter, the epitome of online conversations? Or at least another micro-blogging service?

Additionally, and more crucially, the program had to deal with what business lingo calls a "good problem:" the summit last fall had done such an excellent job establishing and exhaustively addressing the topic that it was hard for the NY program to offer new insights. Sure, the trend toward and the need for conversational media have continued and amplified. So has the emergence of the distributed Internet, or in Battelle's words: "To keep building our brands, we have to go to where the audience has gone." And the audience has gone to conversational media, as traffic data suggests, according to Nielsen/NetRatings.

The most successful new online brands are indeed conversational: Blogging service Wordpress, for example, experienced a whopping 202 percent traffic growth since last year, YouTube is up by 80 percent, Wikipedia by 28 percent, Facebook by 72 percent, and Flickr by nearly 86 percent. Sites with tools, services, and platforms that enable conversations to thrive are thriving themselves while the traffic to traditional properties (aka portals) stagnates or shrinks.

"Too many advertisers buy impressions instead of making impressions," Matt Freeman of GoFish remarked. Despite all the momentum that conversational media enjoys, as far as marketers' best practices and tools are concerned, not so much has actually changed since the last CM Summit. And some of the panels seemed to artificially prolong a conversation that had already ended last fall.

B2B = B2C²
Yet it was still an excellent program that Battelle and team put together. Focusing on the role of conversational media in building brands, the summit set out to find the "online analogs to the executions we so love in magazines and television."

Beth Comstock, chief marketing officer of General Electric, was well-suited to provide answers, for she represents an old, venerable brand (the "Hillary Clinton of brands," as someone in the audience framed it) that is successfully adapting to the new branding paradigms on the web. Overseeing a $1 billion budget, she can afford to experiment. But it's not only the money, it's the latitude: "GE is a brand with the permission to do a lot of things," Battelle described it.

Comstock spoke about the importance of "visual storytelling" and GE's continued foray into social media and conversational marketing. She said that the company should--and will--be more aggressive in embracing online conversations, further enhancing the use of embedded video ads and engaging audiences through multimedia content in all of its online channels: "The media plan is becoming the distribution channel." Comstock also made an interesting point about GE's investment in consumer marketing: in her eyes, it elevates the overall brand because it provides a strong umbrella for all of GE's B2B marketing. She's on top of an emerging trend: at the end of the day, enterprise clients are consumers and have the same emotional needs (or as the saying goes, "B2B customers are consumers who have the luxury of having a company pay for what they desire"). On the engagement level, conversational media seem to increasingly force B2B marketers to think like consumer marketers and develop programs that connect directly with the customer--through narratives rather than benefit statements and feature lists.

Will standardized metrics stifle innovation?
The most interesting debates throughout the two-day program centered on the elephant in the room: measurement. Most people in the industry would probably agree that the "end of the click" is near. CPM (cost-per-thousand impressions) and CTR (click-through-rate) do not suffice anymore as go-to metrics for the effectiveness of brand-building display advertising campaigns.

A recent report from Starcom MediaVest suggests that the majority of clicks being purchased are being consumed by unemployed, twenty-something, gambling, shopaholic, Internet addicts: "Heavy clickers represent just 6 percent of the online population yet account for 50 percent of all display ad clicks. While many online media companies use click-through rate as an ad negotiation currency, (...) heavy clickers are not representative of the general public. In fact, heavy clickers skew towards Internet users between the ages of 25-44 and households with an income under $40,000. Heavy clickers behave very differently online than the typical Internet user, and while they spend four times more time online than non-clickers, their spending does not proportionately reflect this very heavy Internet usage. Heavy clickers are also relatively more likely to visit auctions, gambling, and career services sites--a markedly different surfing pattern than non-clickers."

Therefore the cry for new types of brand engagement metrics is getting louder: "There is more and more emphasis by advertisers for greater return-on-objectives in campaigns, particularly in the digital space where the accountability data is so readily available," said Grant Prentice, Starcom USA's director of connections research and analytics. "'Natural Born Clickers' shows us that we can't count on click-through rate as our primary success metric for display ads; Starcom is more reliant on shifts in brand attitude metrics and analytics tying online exposure to sales as the true measures of online advertising efficacy." Added Battelle: "The success of online advertising can no longer be defined only by direct response metrics. Today's brand marketers are focusing on an entirely different set of parameters."

However, at present, there exists a plethora of metrics but no standardized set of measurements that lets conversational marketers prove the impact of their programs.

"One of the greatest barriers that we've seen for marketers in social media has been a general lack of standards and tools for campaign measurement and reporting," said Debra Aho Williamson, analyst at eMarketer. "There are, of course, vendors who supply disconnected data points, but it has so far been up to the marketer to wade through this sea of data themselves. What is needed is a single device or methodology that aggregates relevant data in an easily digestible form." Several companies and industry alliances have developed dashboard models seeking to fill that gap.

Federated Media, the summit organizer, introduced its own product: the Conversational Measurement Toolbox, an open suite of campaign measurement, planning, and reporting tools across the three dimensions--"engagement-amplification-equity"--offering marketers greater control and insight into their conversational marketing efforts.

Not everyone working on the creative side of the business is buying into the quest for a standardization of metrics. George Bennett, founder and CEO of branded entertainment firm Magic Bullet Media, contends that viral marketing campaigns are by nature unmeasurable, at least by standardized measures.

In his eyes, viral content, by definition, spreads through paths that are outside of the marketer's domain and are therefore difficult to track--and that's exactly how it should be. Well, probably not much longer. Video analytics firm Visible Measures announced Monday that it is launching a service that enables advertisers and agencies to measure the viral reach and audience engagement of video campaigns. Visible Measures' technology monitors user engagement in a given video stream, and its Viral Reach Database tracks video performance over 80 million unique videos across 150 of the Web's most popular video-sharing sites.

Let 100 flowers bloom
Amid the fixation on engagement metrics, Rich Silverstein, co-chairman and partner of advertising agency Goodby, Silverstein & Partners, brought back the idea of the good old big idea: "If it's good, it will work. Nice ideas that are big and deep will go a long way." And they even become a broader conversation, a cultural phenomenon, as proven by the recent Clinton vs. Obama Saturday Night Live spot (and a Time cover), both of which were inspired by a Silberstein NBA commercial.

Maybe a standardization of metrics would indeed stifle innovation and social media marketers' appetite for experiments. In the unregulated, fragmented social media space that we're in right now, anything goes, which may very well be a major factor for its vibrancy. Failure is always an option. Andy Markowitz from Kraft Foods quoted Guy Kawasaki: "Let 100 flowers boom."

However, Steve Rubel, senior vice president and director of insights for Edelman Digital, slammed the industry.

"We've gone backwards. There's no standard. The TV screen has a number. A dollar is a dollar. Having a standard makes transactions work. IAB has been moving slowly, fearing, justifiably, that if they come down from Mt. Sinai with two tablets offering a Ten Commandments of metrics, they worry that things could change in six months and render any standard useless," said Rubel, who also writes the Micro Persuasion blog. "Because there are no standards, all agencies are speaking different languages and no one has an answer."

Yet he reminded the audience that the "social Web is made of people" and demanded additional qualitative metrics that measure the impact of conversational marketing on the other side of the equation--the consumer. Social media, at its core, is about collaboration, he argued, and attempts to simply apply the old, quantitative templates of tracking marketing programs would fall short of capturing the essence of online conversations. They are no longer one-way streets: "Consumers are tired of being treated like cattle." They know they are marketed to and expect substantial value in return for their permission, said Rubel.

Consequently, metrics failing to measure the value of marketing programs for consumers would be one-sided and skewed. He also suggested rebranding "conversational marketing" as "collaborative marketing."

"Conversations are just a means to an end," he said, and he finds them valueless if they don't have a positive impact on consumers' lives. That's a somewhat radical proposition, seemingly far ahead of its time. What would truly consumer-focused, impact-driven conversational marketing metrics look like? A good question for the next CM Summit, this fall, in San Francisco.

Originally posted at Matter/Anti-Matter
Tim Leberecht is frog design's vice president of marketing and communications and has worked in the media, entertainment, and high-tech industries. He is a member of the CNET Blog Network, and is not an employee of CNET.
June 16, 2008 9:00 PM PDT

HP MediaSmart Connect due in July for $349

by John P. Falcone
  • 4 comments
HP MediaSmart Connect with open front panel

Behind the MediaSmart Connect's fold-down front panel is a USB port and a slot for an optional removable hard drive.

(Credit: HP)

Hewlett-Packard's line of MediaSmart TVs includes the built-in ability to stream digital media from your home network and the Internet straight to their screens. But for the vast majority of us who don't own an HP TV, the company will soon have a second option: the MediaSmart Connect. The little black box connects to your home network (via its built-in 802.11n Wi-Fi or wired Ethernet) and streams a wide variety of digital audio, photo, and video files--including content from compatible Internet services (including Live365, Vongo, CinemaNow, and MovieLink).

The MediaSmart Connect should be able to pull digital files from any UPnP and DLNA compliant storage devices on your home network--beyond standard Windows PCs, that includes network attached storage devices such as HP's own MediaSmart Server and Media Vault. It can also double as a Windows Media Center Extender when interfacing with Media Center-enabled versions of Windows Vista--allowing the streaming of live or recorded TV at HD resolutions. The MediaSmart Connect doesn't have any on-board storage, but users can use the box to pull compatible media straight from an HP Pocket Media Drive (found on the company's PC desktops) or a standard USB flash drive.

The MediaSmart Connect will be available later this summer for $349, and is now available for preorder. (If it looks familiar, it's because HP has been teasing us with it since January's Consumer Electronics Show.) It'll include a learning remote that can control up to four other devices, an HDMI cable, and a $20 CinemaNow coupon. To drum up publicity for the product's launch, HP is offering a trade-in program where 100 people can exchange their old digital media adapter for the MediaSmart Connect. The company is also teaming with Microsoft to offer a series of four online "webinars" to demonstrate the product's features over the next few weeks. Feel free to check them out, but don't be surprised if you're just getting an infomercial for the product in question.

We'll be doing a detailed hands-on review of the MediaSmart Connect once we get a final production sample in July. (Also on deck: the similar Linksys DMA2200.) Until then, the floor is open: do you have any interest in the MediaSmart Connect, or in Windows Media Center Extenders in general? Is the whole idea of streaming media in the home just a niche market that will never go mainstream? Or would you prefer to go with an Xbox 360, which handles nearly all of the same media streaming functions, and adds game playback to boot?

HP MediaSmart Connect product page

Originally posted at Crave
June 16, 2008 2:52 PM PDT

Accused spammer must pay MySpace $6 million

by Greg Sandoval
  • 4 comments

MySpace continues to wage a legal war on alleged spammers.

An arbitrator has ordered Media Breakaway and Chief Executive Scott Richter to pay the social-networking giant $4.8 million in damages and $1.2 million in legal fees, according to legal filings. The company's employees were also ordered to stay off MySpace.

News Corp.'s MySpace accused Media Breakaway and Richter, who has been accused of spamming consumers in the past, of launching phishing attacks and sending unsolicited messages to MySpace users. Representatives from Media Breakaway were not immediately available for comment.

Richter is a noted and controversial Internet marketer. Two years ago, he paid $7 million to Microsoft to settle a lawsuit that accused him of sending illegal spam. Microsoft originally sued for $20 million.

The $6 million award is a fraction of the $234 million that the courts ordered Sanford Wallace, the so-called spam king, to pay MySpace last month after he failed to mount any kind of legal defense. The anti-spam judgment is believed to be the largest so far under the 2003 Can-Spam Act.

"MySpace has zero tolerance for illegal activity on our site," MySpace said in a statement, "and is committed to bringing to justice those who try to harm our members."

The reason Richter is paying so much less is that the arbitrator said it was unfair to hold Media Breakaway responsible for all the wrongdoing of the site's affiliates. Media Breakaway has loose ties with companies or individuals that send traffic to sites owned by advertisers who pay Media Breakaway for the leads or sales, according to court documents.

MySpace has traditionally been an easy target. Spammers could hit thousands of "friends" with messages with little effort, the records show.

The arbitrator in the case noted that Media Breakaway has made efforts to comply with the law, such as making affiliates sign anti-phishing agreements. Some of the affiliates either ignored or were not aware of the agreements, the arbitrator wrote.

But the arbitrator also found that Media Breakaway's affiliate managers were "deficient or that on more than a few occasions...consciously condoned and encouraged unlawful spamming activities."

June 12, 2008 9:00 AM PDT

Mobile broadcaster Flixwagon hitches to iPhone

by Stefanie Olsen
  • 5 comments

Flixwagon, a tool for live video broadcasting to the Web via smartphones, is working on a version for the Apple iPhone and Windows Mobile devices.

Tel Aviv, Israel-based Flixwagon is still relatively new. In January, the company launched a free downloadable application for video broadcasting for the Symbian mobile operating system, used largely by Nokia smartphones such as the N95. In February, MTV became its biggest customer, by deploying 23 street reporters with Flixwagon-enabled phones to report on Super Tuesday.

Now, the company is developing support for additional mobile platforms so that it can appeal to an even wider set of customers and media partners. Sarig Reichert, the company's co-founder and vice president of marketing, said that it's working on applications for Java, Windows Mobile, and the iPhone. (Demo here.) That will give Flixwagon entree to tens of millions of phones. In the coming weeks, it also plans to update its technology to include greater controls over the quality of video people can capture and post to the Web.

The company's better-known rival Qik has started offering support of the Windows Mobile operating system by invitation only.

With Flixwagon, people can record a video with the click of a button and have it broadcast to the Web within seconds, depending on the mobile phone connection. On the back-end, Flixwagon trans-codes the video file from the phone to a Flash widget, which at its best output, delivers 320x240 video at 15 frames per second. With a bad connection, it might broadcast video at half the number of frames.

On the downside, the rawness of mobile broadcasting can come off like a Blair Witch Project-style documentary. On the upside, it's incredibly fast and efficient for telling a story, updating friends on your life, or archiving video-worthy moments.

People can choose to upload their clips to a public or private page on Flixwagon, cross post the clip to YouTube, or send an announcement to a Twitter account. Flixwagon followers can also chat with people who are posting videos.

Apart from MTV, Web surfers might stumble on more and more Flixwagon or Qik video installments. Reichert said the company is talking to major media companies about using its technology for citizen journalism, news reporting, or even video streaming for reality TV shows.

"MTV opened up the minds of people in the industry about what you can do about live video broadcasting," Reichert said during an interview Wednesday at the On Hollywood Conference.

The company has raised an angel round of funds from investors in Israel, and it will soon close a round of venture capital investment, according to Reichart. The company makes money through partnership like the one with MTV. It charges service fees for hosting and distributing videos. The company also hopes to sign deals with mobile phone carriers, with which it would share revenue.

Here's a rough cut of a home Flixwagon video, a Flash widget cut and pasted into this blog.


Update at 1:45 p.m.: Qik said that it is has a demo version for the iPhone, too.

News.com's Greg Sandoval contributed to this report.

June 11, 2008 4:50 PM PDT

eBay ends online ads sales system

by Steven Musil
  • 1 comment

eBay has pulled the plug on Media Marketplace, a controversial pilot program designed to buy and sell radio and TV advertising on the Internet. The Internet auction house confirmed the closure of the program after one year with the brief message: "We have ended our pilot program in this market."

The system got off to a rocky start, receiving little support from the cable network industry and none at all from the broadcast networks, according to a report in AdWeek. The Cabletelevision Advertising Bureau refused to endorse the system, and only a few of its members--notably Oxygen and Ion--participated in the system. Many complained the system commoditized television ad time.

Last October, eBay officials issued a statement saying, "We've been disappointed by the lack of broad engagement by cable networks. This has caused the initial testing to be slower than expected."

While eBay has abandoned its efforts in selling cable TV ads spots, the company has been working with Bid4Spots on a separate service for selling radio ad time. A notice on the Media Marketplace page urges users to go to Bid4Spots.com for service.

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