Pink Slip Watch: Viacom, AT&T and More

pink slip noticeThe deceleration of the economy and the utter implosion of both the banking and auto industries has officially tipped the dominoes of misfortune to the media industry.  The flow of advertising dollars has shrunk.  Car dealerships are spending less to promote their products.  Banks are buying fewer ads. Historically big spenders aren’t spending. Even celebrity endorsements are falling victim.   So…this year,  instead of holiday bonuses, many tech and media companies are handing out pink slips.  

It’s hard to say whether all the cash conservation and restructuring is truly necessary or if some is just opportunistically timed to squeeze the write-offs and one-time charges into 2008 fiscal year accounting.  For a lot of people, that’s irrelevant.  This season’s greetings are anything but cheery.

Today, it was  media giant Viacom that lowered the hatchet. The parent of MTV Networks, Paramount, BET and Nickelodeon, announced a workforce reduction of approximately 7%, or 850 jobs. Click to Read More

Project Kangaroo Runs Into Antitrust Issues

project kangaroo stopIn the U.S. NBC Universal and News Corp’s joint video on demand service, Hulu, has proven to be a big success, drawing both audience (Quantcast data) and advertisers.  In the U.K., BBC Worldwide, ITV and Channel 4 had hoped to follow a similar path with their own web service, Project Kangaroo (also known as UKVOD).  Their route now looks complicated, if not potentially impassable.

Wednesday, after a prolonged review, the U.K antitrust authority, the Competition Commission (“CC”) issued a provisional finding that the joint venture would unfairly restrict competition. Specifically, the CC believes, as currently defined, Project Kangaroo will lessen essential competition in the supply of UK TV Video on Demand programming.

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Kleiner iFund Funding Applications Accidentally Exposed

kpcb info ifundIn March, venture firm Kleiner Perkins allocated up to $100m for an iPhone related investment initiative and provided an online form to allow open submissions from prospective entrepreneurs.  Thanks to an error, some of these entries were recently exposed to the public.  The mistake opened a brief but unintended window into the kinds of proposals that have been submitted.

The cause of the leak was apparently KPCB’s  former web hosting company Meteora Technologies Group.  At some point in time, an employee accidentally posted a SQL file to the web that contained 588 proposals submitted through KPCB’s online iFund submission form.

According to Tech Crunch, which first got the story, Mac developer Fruxx discovered the error and alerted Kleiner Perkins.  The file was removed but not before Google’s ever efficient spiders indexed the page and copied a portion of it into their storage cache.

While it was available, the SQL file, which was readable with any text editor/reader, provided detailed information Click to Read More

Rumor Mill:Jon Miller Raising Yahoo Buyout Fund?

rumorsNext  to Jerry Yang, Steve Ballmer and Carl Icahn, few names have been mentioned more frequently in Yahoo’s ongoing survival story than Jon Miller.  The partner at Velocity Interactive, and former AOL chief (2002 to 2006) was mentioned as an adviser in the failed Micro-hoo combination.  In Carl Icahn’s proxy fight he was expected to be a Yahoo board appointee until blocked by a non-compete.  Presently, he’s among the leading candidates in the press to assume the Yahoo CEO position.   And now, he’s also rumored to be a buyer.

The Wall Street Journal, citing sources “familiar with the matter,” is reporting Jon has been “sounding out” private equity and sovereign wealth funds for months, all in an effort to raise a buyout fund to takeover Yahoo.

The deal being pitched, the WSJ story writes, is a potential acquisition in the rage of $20 to $22 a share.

Is Jon Miller really looking to assemble as much as $30 billion in this market to acquire Yahoo?

It’s certainly possible.  Any rumor that passes through the editorial filters and finds its way onto the pages of A-list publications like the WSJ usually has to pass the sniff tests of plausibility.  Even so, plausible and probable are sometimes far apart….like here.

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Need a Miracle? Need Tickets? Try Blockbuster

bbi lyv ticketsBlockbuster wants to be your entertainment superstore.  They’ll sell you electronics, rent you a movie or now, even get you into a concert.

Today, Blockbuster and Live Nation announced a three year deal to make Blockbuster the brick & mortar retail outlet for Live Nation’s soon to be launched concert ticket service.  500 stores in cities home to Live Nation operated venues will take on the new sales task.

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Cash for Huffington Post

huff financingIt takes strength or ingenuity to swim upstream and navigate a strong current.  More often than not, companies raising sizable venture rounds in this economic climate are relying on their strength (at least when measured by the scale of prior capital commitments).   Last week it was hopeful television visionary Sezmi confirming reports of a $33m round.  This week, it is aspiring media empire Huffington Post that’s claiming their due.

In a series C round committed singly from Oak Investment Partners, Huffington Post has reported a $25million draw.

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Redstone Bails out of Midway

Sumner Redstone has often shown a deft hand in his media investments. Gaming just hasn’t been his thing. Through 2005, he acquired about 87% of Chicago area gamer, Midway.  The average purchase price was probably close to $8 a share but, over several years of buying, he paid as much as $20 to $24 a share.  In the time since, the company has failed to perform or thrive.

In the quarted ended Sept 30, Midway reported a $76 million loss on revenues of just $36.7 million. Friday, the stock finished at just 38cents a share. With other issues lingering, Redstone hit the eject button. Friday, he reached an agreement to divest his stake entirely – at a fire sale price.

According to regulatory filings, Redstone, his family’s theater holding company, National Amusements Inc., and Sumco Inc. (a company he formed in 2005 to shift debt obligations created in acquiring Midway stock), agreed to sell their 87.2 percent interest in Midway to private investor Mark Thomas.

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