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Last week at the Reuters Media Summit someone asked EA’s CEO John Riccitiello his thoughts about M&A prospects for the gaming industry moving forward.  It was a fair question, as head of EA he’s a qualified expert on the gaming industry, as a former partner at private equity firm Elevation Partners, he’s well educated and informed about M&A mechanics.  Part of John’s  measured answer was “Is it ripe (for mergers), or has it already been picked? I would argue that it’s been largely picked."

Those remarks underscore just how surprising Sunday’s announcement that Activision and Vivendi Games intend to merge was.  When the two companies said they’d merge to form an $18.9b company, a gaming company with a market cap even bigger than EA (approx. $17.4b) some jaws were definitely hanging slack.

This morning, Vivendi and Activision provided more details which opened a window on the structure and presumed opportunity.

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Positive earnings remain elusive for TiVo (Nasdaq:TIVO) but despite turbulent markets, the "time shift" pioneer may be getting ever so slightly closer. After the close or markets Wednesday, Tivo released Q3 earnings. The numbers were somewhere between flat and positive.

For the quarter ended October 31st, Tivo posted a net loss of $8.24m (8c a share), substantially better than a loss of $11.1m (12c a share) for the same period last year. The return was also far better than last quarter which suffered due to inventory write downs. The consensus analyst expectations were for a loss of 13c a share. Tivo beat the street by a penny.

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While consumers are thinking about gifts to buy for the holidays, Walt Disney Company is getting their shopping lists in order too. Looking to potentially heat things up in the acquisition market, Disney has organized several executives into a specialized Mergers and Acquisitions (M&A) division.

The group, division, or whatever loose title its given, is not necessarily a formal restructuring. Disney’s looking to consolidate management tasks and improve strategic communication in anticipation’s of increased spending. It’s about efficiency. Day to day responsibilities for those involved may go largely unchanged.

First reported by Tech Crunch, and later confirmed by other sources, the group will be run by Kevin Mayer, Disney’s executive vice president of Corporate Development. It’s unclear if he’ll take a new title or adjust his current operational responsibilities.

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Money flowing into Internet video startups doesn’t appear to be slowing down. Just the opposite, the sector continues to expand globally. Pacific Epoch reports Chinese language site Youku.com has closed a $25m Series C Financing.

The round was led by Brookside Capital Partners (subsidiary of Bain Capital) and the Company’s three existing investors Sutter Hill Ventures, Farallon Capital Management and Chengwei Ventures.

Youku.com is very much like a Chinese languageYouTube, right down to the colors and layout of the pages. Also like YouTube, it is a forum for displaying and interacting with user-generated/user-submitted videos.

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The markets may be volatile and concerned but the VC industry is chugging ahead.  There have been 4 IPO’s and 4 $100m-plus M&A exits for portfolio companies at Accel Ventures this year.  Buoyed by that success, the firm just closed their tenth fund with $520m available for investment.  That total, while still below the $950m raised in 2000,  is up a handsome 30% over prior fund Accel IX  (IX closed with $400m in 2004). 

Accel hasn’t been involved in any new digital media or entertainment related deals the past couple weeks, but other firms have committed plenty of capital.  Takkle, Vivox and Vobile are among the recipients.  On the other hand, AmeriTV, a supposed IPTV company that sounds like Joost, apparently didn’t receive capital despite a press release to the contrary.  AmeriTV’s financing, possibly even the existence of the company, appear to have been a hoax that tripped up a few news sites that didn’t check on their facts.

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In February 2006, notable executives from Internet companies and Telecom giants converged on Capital Hill to lobby to consider revising a ten year old Telecom bill.   The issue at stake was the concept of Net Neutrality, a divisive idea suggesting that all internet content (regardless of format) should be treated equally.   

On one side of the debate fell Internet and software companies.  Businesses like Google and Yahoo wanted to insure that all websites – from blog to portal, could be accessed equally.  Even more so, they wanted legislation that would protect different types of content like video, or music, or the technologies that deliver them (like Peer to Peer) from arbitrary exclusion.  Their goal was to insure nothing was singled out and taxed by the ISP’s who control the supply pipeline, the network infrastructure over which Internet traffic flows.  The software and Internet companies wanted to insure their content would always flow freely without tax or toll.

The Telecom companies, on the other side of the stage, wanted the freedom of an unregulated market.  Click to Read More

You can’t call a two horse race until both horses have crossed the finish line. 

When Netflix released earnings about a week ago, things looked good, surprisingly good,  but a comparative assessment with movie rental competitor Blockbuster was missing.  Absent that comparison it was impossible to say whether Netflix gained ground individually, or the movie rental business did well as a whole.

After the close of markets Thursday, Blockbuster released their earnings.  Now the asterisk can come off Netflix’ returns.  The results are in.   It’s official.  In the battle for movie rental dollars, investors can officially chalk the quarter up as a win for Netflix and a loss for Blockbuster.  

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