In This Update:
• Sun Shares Plummet After IBM Talks Collapse
• Glam Media Adds $10 Million Funding; Total Funding $124 Million To-Date
• Analyst: YouTube Will Lose Almost $500 Million This Year
• Facebook Completes Rollout of Haystack To Stem Losses From Massive Photo Uploads
• Time Warner Seeks Leeway for AOL Assets
• Amazon No Longer Allows Associates To Bring In Traffic Via Paid Search
• MediaDefender Buys MediaSentry for $136,000
• TomTom to Track Traffic, Weather, Gas Prices in Real Time
• Skype’s iPhone Limits Irk Some Consumer Advocates

Sponsored by:
McCarter & English, LLP
The law firm of new media. Major offices in New York, Boston, Newark, Stamford, and other cities. Advising new media companies from start-up to exit. Venture capital, IP protections and disputes, employment matters, outsourcing, joint ventures, acquisitions, to name just a few. Contact

 

Sun Shares Plummet After IBM Talks Collapse
REUTERS
Shares of Sun Microsystems Inc tumbled 24 percent on Monday after the company rejected rival computer and software maker International Business Machines Corp’s $7 billion offer. Sun shares fell to $6.44 in pre-market trading after Sun pulled the plug on the deal which might have spelled the end of an era for a networking company that was once synonymous with the Internet.
Source>

Glam Media Adds $10 Million Funding; Total Funding $124 Million To-Date
CENTER NETWORKS
Women’s vertical network Glam Media has announced a new round of funding to the tune of $10 million dollars. This new round comes from Japan and Germany. In Japan, the funding comes from Mizuho Venture Capital and in Germany the funding comes from Hubert Burda Media. Glam has raised over $124 million in funding to-date. Additionally Glam entered into a new joint venture with regards to their Japanese organization, Glam Media Japan KK. The joint venture brings in investments from ad agencies Dentsu and ADK and magazine publishers Shogagukan and Syueisya. There was also a local investment by Mizuho which already is an investor in Glam Media.
Source>

Analyst: YouTube Will Lose Almost $500 Million This Year
PAIDCONTENT
Google’s YouTube may be dominating the online-video market, but that’s not translating into profits-at least not yet. Just how much it’s losing a subject of great debate. In a report today, CreditSuisse analyst Spencer Wang estimates that the site will lose $470 million this year. Wang says YouTube’s revenue will jump 20 percent to $240 million, but that the increase will be offset by a staggering $710 million in costs. More than half of that comes from bandwidth costs, which Wang puts at $360 million.
Source>

Facebook Completes Rollout of Haystack To Stem Losses From Massive Photo Uploads
FACEBOOK
One nugget of information Facebook leaked out to press last week during the Gideon Yu fiasco: the company has been EBITDA profitable for five quarters, but doesn’t expect to generate positive cash flow until 2010. Why the discrepancy? There’s only one answer to that – Facebook is paying out big dollars for something that must be depreciated over time. If they could just write off the expense in full as they paid it they’d be having much bigger losses now that matched cash flow, and they’d hit profitability sooner.
Source>

Time Warner Seeks Leeway for AOL Assets
WALL STREET JOURNAL
Time Warner Inc. is seeking consent from bondholders of $12.3 billion worth of debt to adjust covenants that restrict the company from transferring AOL’s properties and assets, a sign that the media giant may be preparing for a spin-off of AOL. Analysts and investors have been calling for years for a spinoff of the sluggish Internet business.
Source>

Amazon No Longer Allows Associates To Bring In Traffic Via Paid Search
TECH CRUNCH
Amazon has decided to make some changes to its Associates program, no longer allowing third parties to bid on keywords that would send visitors straight to Amazon websites where they’d earn a referral fee for each purchase. The change only applies to the Associates programs in North America, and the company is referring Associates based outside the U.S. and Canada to check their respective terms and conditions agreements.
Source>

MediaDefender Buys MediaSentry for $136,000
SLASHDOT
“SafeNet paid $20 million for MediaSentry in 2005, but has just sold it to rival MediaDefender for a paltry $136,000, with a promise of more later. MediaSentry’s new owner says the combination will allow it to ‘dramatically expand its effectiveness.’ Is it time for an official government inquiry into MediaSentry and the RIAA? A Chicago student said she was planning on killing herself because the RIAA promised her she’d land in court unless she paid almost $10,000 to ’settle’ an alleged copyright infringement. She ‘couldn’t sleep, couldn’t study, couldn’t live a normal life because of the worry.’
Source>

TomTom to Track Traffic, Weather, Gas Prices in Real Time
VENTUREBEAT
Navigation system maker TomTom has struck a deal with startup TrafficCast International to provide its users with continuously updated traffic and weather conditions, as well as nearby gas prices, right on their compact device. All of this data will be folded into its Go 740 Live device, TomTom’s first wireless model with traffic information to launch in the U.S. GPS companies like TomTom (and its nemesis Garmin International) have seen some sales erosion due to smartphone applications that provide pretty much the same services. Several – like the built-in “Maps with GPS” or the “California Traffic Report” for the iPhone – also track traffic and can reroute trips accordingly (though many of them are confined to particular geographic areas).
Source>

Skype’s iPhone Limits Irk Some Consumer Advocates
USA TODAY
Apple’s unique treatment of the new Skype Internet calling feature on the iPhone – the free app works only on Wi-Fi, not the cellular or 3G network – is raising concern among public-policymakers and consumer advocates. They say it’s a clear example of AT&T, the sole carrier of the iPhone in the U.S., trying to handicap a direct competitor. “Consumers will pay the price for AT&T’s blocking,” says Chris Murray, senior counsel to Consumers Union. By using Skype on the iPhone, consumers can sidestep AT&T, allowing them to get by, potentially, with cheaper voice plans that offer fewer minutes. Consumers can also save a bundle on international calls.
Source>

Tags: 3G, Amazon, AOL, Apple, Boston, eBook, Facebook, Garmin, Germany, Glam Media, Google, Hubert Burda Media, IBM, Informa, iPhone, Japan, Local, New York, Reuters, Safenet, Sun Microsystems, Time Warner, TomTom, Video, Wi-Fi, WSJ, Yahoo, YouTube