In This Update:
• Google Unveils “White Space” Airwaves Plans
• Justice Dept. Approves XM-Sirius Satellite Radio Merger
• Digimarc Sells ID Business to L-1 Identity Solutions, $250 Million Deal
• SonyBMG Developing Subscription Music Service
• Citigroup Says Microsoft Likely to Raise Yahoo Offer
• Report: Media Groups Share Content in Ad Deals
• ESPN Cuts Ties with Ad Networks
• Education Services Firm Follett Acquires E-Book Marketplace CafeScribe
• Security Lapse Exposes Facebook Photos
• Demand Media Raises Another $35 Million; Total Comes To $355 Million
• South Park Makes Every Episode Available for Free Online
• Viewdle Funded by KIT Capital, Partners with ROO
• Mobile Content Delivery Firm 4DK Technologies $1 Million
• Tapioca Mobile Raises $5 Million for Mobile Media Monetization
• Amid Flat Ad Spend In ‘07, Display Grew 15.9 Percent

Google Unveils “White Space” Airwaves Plans
REUTERS
Google Inc on Monday unveiled plans for a new generation of wireless devices to operate on soon-to-be-vacant television airwaves, and sought to alleviate fears that this might interfere with TV broadcasts or wireless microphones. In comments filed with the Federal Communications Commission, the Internet leader outlined plans for low-power devices that use local wireless airwaves to access the “white space” between television channels. A Google executive called the plan “Wi-Fi 2.0 or Wi-Fi on steroids. The airwaves can provide huge economic and social gains if used more efficiently …,” Google said in the comments. Rick Whitt, Google’s Washington telecom and media counsel, said this class of Wi-Fi devices could eventually offer data transmission speeds of billions of bits per second — far faster than the millions of bits per second available on most current broadband networks. Consumers could watch movies on wireless devices and do other things that are currently difficult on slower networks.
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Justice Dept. Approves XM-Sirius Satellite Radio Merger
WASHINGTON POST
The Justice Department approved the merger of XM and Sirius yesterday, ruling that the union of the nation’s two major satellite-radio services does not create an anti-competitive monopoly. The decision eliminates what was viewed as the toughest legal hurdle facing the $13 billion deal, which must be approved by the Federal Communications Commission. Consumer groups and traditional broadcasters have urged the FCC to impose conditions on the merger.
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Digimarc Sells ID Business to L-1 Identity Solutions, $250 Million Deal
DIGITALMUSICNEWS
Watermarking expert Digimarc is now selling portions of its identification technology for $250 million, according to details revealed Monday. The ID Systems unit is being shuttled to L-1 Identity Solutions for a mix of stock and cash. The resulting combination will allow L-1 to strengthen its focus on government security, which includes technology related to credentials like driver’s licenses. Digimarc shareholders will receive a cash payout totaling $120 million, according to the company. Then, Digimarc and L-1 will determine which assets belong to ID Systems, and which belong to the Digimarc-owned watermarking unit. The watermarking division will then be spun off into a wholly-owned subsidiary of Digimarc, a move that will allow the company to refocus on its media watermarking charter.
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SonyBMG Developing Subscription Music Service
AP via YAHOO
The CEO of Sony BMG Music Entertainment says that the company is developing an online music subscription service that would give users unlimited access to its music and be compatible with a host of digital music players. Sony BMG’s artist roster includes newcomers like Leona Lewis, along with stalwarts like Alicia Keys and Celine Dion, as well as country singer Carrie Underwood among others. In an interview with the newspaper Frankfurter Allgemeine Zeitung published Monday, chief executive Rolf Schmidt-Holtz did not offer a timeline for unveiling the service.
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Citigroup Says Microsoft Likely to Raise Yahoo Offer
REUTERS
Citigroup said it is likely Microsoft Corp will raise its $31-per-share offer for Yahoo Inc and upgraded Yahoo shares to “buy” from “hold.” The brokerage also raised its price target on Yahoo’s stock to $34 from $31, saying it believed Microsoft remained committed to its offer and “is capable of and willing to” increase that bid to conclude the deal. “While we continue to see no other competing bidders, we believe Yahoo is aggressively pursuing strategic alternatives,” analyst Mark Mahaney said in a note to clients. One possibility is a tie-up with Time Warner, whereby Time Warner would contribute its online content assets to Yahoo in exchange for a stake, the analyst said.
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Report: Media Groups Share Content in Ad Deals
PHYSORG
Media companies are sharing more than advertising sales as they form networks of like-minded sites to combat the growing ad-selling might of major Internet portals. Sharing news headlines and other content is a component of many of the revenue-sharing partnerships being forged to give marketers an alternative to Google Inc. and other tech-centered advertising vendors when they want to reach an audience larger than any single site could deliver. By letting blogs carry the headlines along with the ads, media companies can leverage the trust and reputation they have earned from their offline channels.
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ESPN Cuts Ties with Ad Networks
MEDIAWEEK
Top Web publishers are planning a revolt. Even as more prominent sites experiment with selling remnant inventory through online ad networks, and in some cases ad exchanges, ESPN.com is saying thanks, but no thanks. The site recently cut ties with Specific Media and several other unnamed ad networks, and is taking the bold stand that ad selling that relies heavily on arbitrage and algorithms is not for them. “We’re heading down a path where it no longer suits our business needs to work with ad networks,” said Eric Johnson, executive vp, multimedia sales, ESPN Customer Marketing and Sales. Sources say that ESPN would like to rally support from other publishers behind this move and ultimately tamp down ad networks’ growth. Turner’s digital ad sales wing is rumored to be considering a similar move, though officials said no decisions are imminent.
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Education Services Firm Follett Acquires E-Book Marketplace CafeScribe
PAIDCONTENT
Follett Corporation, a provider of educational services, such as textbook distribution, has acquired Salt Lake City-based Fourteen40, the parent company of e-book store CafeScribe. The site offers a platform for purchasing electronic textbooks, as well as software called MyScribe to read the texts. There’s also a social component to it, as students can find each other, and study collaboratively. Terms of the deal were not announced, nor has Fourteen40 announced any past investments. The company will be rolled into Follett Digital Resources, the company’s digital arm.
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Security Lapse Exposes Facebook Photos
AP via MSNBC
A security lapse made it possible for unwelcome strangers to peruse personal photos posted on Facebook Inc.’s popular online hangout, circumventing a recent upgrade to the Web site’s privacy controls. The Associated Press verified the loophole Monday after receiving a tip from a Byron Ng, a Vancouver, Canada, computer technician. Ng began looking for security weaknesses last week after Facebook unveiled more ways for 67 million members to restrict access to their personal profiles.
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Demand Media Raises Another $35 Million; Total Comes To $355 Million
PAIDCONTENT
Demand Media, the Santa Monica-based social and domain name media firm, has raised another $35 million in its fourth round of funding, according to SEC filings. The company recently bought social media tools firm Pluck, for about $67 million, as we reported earlier this month. Demand raised $100 million for the fourth round last year and this is new money into the round. For the $100 million, investors included Goldman Sachs, 3i Group, Generation Partners, Oak Investment Partners and Spectrum Equity Investors. No word on who invested in this $35 million raise.
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South Park Makes Every Episode Available for Free Online
NEWTEEVEE
South Park have made every episode of their hit show available for free online. South Park Digital Studios will house everything South Park including all the episodes 3,000 embeddable video clips and spearhead other digital initiatives. The studio is part of a joint venture between creators Matt Stone and Trey Parker and Comedy Central, with the two splitting ad revenue 50/50. The site continues with MTV Networks’ strategy of launching many vertical sites around individual brands.
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Viewdle Funded by KIT Capital, Partners with ROO
TECHCRUNCH
Viewdle, a startup developing facial recognition technology for video, has received an unspecified amount of funding from KIT Capital . As part of the deal, Viewdle will partner up with ROO , another KIT portfolio company focused on IPTV broadcasting. The partnership will provide ROO with full and exclusive access to Viewdle’s white label technology. Both companies will also work together to promote each other’s services. Reuters currently uses Viewdle’s technology to index the people in its video archives
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Mobile Content Delivery Firm 4DK Technologies $1 Million
DIGITALMEDIAWIRE
4DK Technologies, the developer of a platform for delivering content to wireless devices, has raised $1 million of a projected $3 million first round of venture capital, Tech Journal South reported, citing a regulatory filing. Information on investors was not disclosed. Founded in 2005, Virginia-based 4DK offers a “superconnectivity” platform for wireless devices that provides real-time interoperability between services.
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Tapioca Mobile Raises $5 Million for Mobile Media Monetization
MASHABLE
Tapioca Mobile is a mobile content and advertising network that very little information seems to be disclosed about it by either the press, blogosphere or the company itself. The company has just raised $5 million in Series A, with Venrock as lead investor. The system is described as one that lets “lets publishers deliver video, images and audio through SMS messages on a cell-phone.”
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Amid Flat Ad Spend In ‘07, Display Grew 15.9 Percent
PAIDCONTENT
As ad spending in the U.S. was essentially flat last year, display ads continued their double digit growth, according to data from TNS Media Intelligence. The researcher, which doesn’t measure search or broadband video advertising, found that display grew 15.9 percent in 2007 to $11.31 billion from $9.7 million the year before. In 2006, display registered a 17.3 percent increase over 2005. The slowing growth rates for online ad revenues have tended to reflect the law of large numbers, as opposed to the impact of the sagging economy.
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Tags: Ad Spend, Brand, Facebook, FCC, Google, Intel, IPTV, ISP, Local, LTE, Microsoft, MSN, MSNBC, MTV, Music, NBC, Oak Investment Partners, RIM, Series A, SMS, Sony, Sony BMG, Time Warner, Turn, U.S., Venrock, Venture Capital, Video, Watermark, Wi-Fi, Yahoo