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When Snocap was founded in 2002 it was supposed to become Shawn Fanning’s coming of age; the original Napster founder’s arrival into legitimate music distribution success.  If peer to peer Napster was to be his fame, Snocap’s music licensing service was to be his cash cow.   Over four years, dealing with the complexities of selling music online,  that dream become less and less realistic.   Over the past few months, it began to look like it could finally be possible.  With DRM Restrictions waning, iPod owners which represent the majority of the digital music buying public, were starting to become potential customers.  They no longer have buy all big label music on iTunes.  EMI, and to a limited extent, Universal Music, are selling music without encryption.  Through deals with big players like MySpace (September 2006) and start ups likes Imeem (June 2007) were giving Snocap distribution.

Now it looks like those little successes were too little too late. The market isn’t maturing fast enough.  Like Virgin, Sony, Anywhere CD and other’s who have recently shut down online music ventures, competing with Apple’s iTunes in a world where much of the music sold is restricted is proving a costly business; one not worth being a part of.

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Electronic Arts, again under John Riccitiello, is a different animal than they were before he left in 2004.  As a company, they’re now getting more streamlined, more efficient. They’re increasing their focus on alternative revenue streams (casual gaming, dynamic games, online gaming).   They’re also increasingly breaking out a pen to sign a partnership or opening the checkbook to acquire assets. 

Not even a weeks ago, EA bought SCI – bringing technology tools for online gaming.  Now they’re acquiring content assets with the purchase of VG Holdings Corp. (“VGH”) – the owner of game studios Bioware and Pandemic.

Announced Thursday afternoon, EA will pay up to $620m in cash plus allocate  up to $155m in equity for delivery subject to performance milestones.   EA will also loan VG Holding Corp up to $35m through closing. 

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Like the old maxim of killing two birds with one stone, sometimes a small change can fix several problems. Tuesday, GE’s NBC Universal unit said it would pay $925m for Oxygen Media, the woman-centric cable TV network. $925 may not be a small change but NBC is certainly hoping it will be one of the especially effective stones.

If the promise of the deal is realized, in one move the acquisition could both breathe new life into an occasionally faltering Oxygen, recharge NBC owned Internet property iVillage and fortify NBC’s mission-critical cable property portfolio.

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Some analysts are forecasting the gaming industry will grow 9% per year to $47b by 2009. The fledgling In-Game advertising industry earned a meager $55m last year but riding on the backs of the gaming world’s growth, it too is expected to explode; reaching upwards of $2b by 2012. With that scale and growth it’s only natural to see the 800lb gorillas of gaming and advertising getting involved.

Today, Sony (Corp of America “SCEA”) took the plunge and announced they too were getting involved. To plot strategy and explore the space, Sony created a unique division. Darlene Kindler, who was an early executive at Nintendo and recently the VP of Publishing at Google acquired in-game advertising Adscape Media, will helm the unit.

In-Game advertising has been profiled before on Metue. Click to Read More

The video game Halo 3 earned $300m at the cash registers during its first week of release.  It earned more than $170m in its first day.  That easily trounced the all time best opening day box office returns for the movie industry (Spider-Man 3 earned $59.8m (source: Box Office Mojo)).  That makes Microsoft’s announcement today to spin off Halo’s creator, Bungie Studios, seem curious at first glance.  On a second look, it’s not actually that surprising.

Game Development is a little bit like movie production and venture capital.  For every hit, there are dozens of failures.  Companies spend extreme sums of time and money developing projects all the while knowing full well that many of the efforts will ultimately have to be supported by a few leaders in the portfolio.   Click to Read More

Almost definitely in ten years, and very possibly 5 years from now,  if I want to watch a movie, chances are I’ll be able to download a rental, or buy the rights to own it, through some combination of online and offline services.  Maybe I can hit a button on a remote and that’ll be it; a copy of my purchase stored on a home-hard drive, an electronic debit for payment and nothing else to deal with.  Chances are within the next decade, I won’t need to get a DVD in person.  But for today, and the next handful of years?  They’re not going anywhere and my viewing pleasures are still likely to be tethered to optical discs (DVDs).

But as for how I get my DVDs? or how many titles are available?  Those are questions that may be answered differently, questions answered with evolutionary changes rather than a changing of the guard.  Hewlett Packard is one of the companies hoping to be responsible for that.

For several years, Hewlett Packard has had a small but successful business venture selling technology and services to digitally restore old films.  They’ve also been focused on building digital content libraries – both by building out IT infrastructure and by signing licensing deals (for which they have a partnership with Ascent Media).  The eventual end goal of HP’s efforts, about which they haven’t been shy, is to pioneer print-on-demand DVD services.

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With the start of the fall television season, a great deal of attention is focused on traditional media companies’ online efforts.  Who’s streaming what.  Premiers being aired online before television.  Much of the discussion is centered on the television networks and their experimentation with video distribution strategies and platforms.   In the cacophony of all this noise, Disney, despite being the parent of a major network (ABC), has managed to stay relatively unnoticed.  Disney’s efforts are worth calling out.

Over this past year, Disney has launched a handful of online content and gaming communities. They’ve redesigned some of their existing properties. They’ve even bolstered their portfolio with the purchase of popular children’s destination, Club Penguin.   The combined efforts are paying off.

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