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Weekend Video: Stats Blast From eMarketer CEO Geoff Ramsey
The Online Publishers Association's Forum For The Future in London on Thursday handed the task of engaging delegates after lunch to Geoff Ramsey, founder of digital research analyzer eMarketer. He did the job admirably - hit this 18-minute video for a lively and engaging quick-fire injection of this year's key new media metrics…
More On WPP-Yahoo Exchange Deal: Walrath: 'We've Reached Scale'
Although WPP CEO Sir Martin Sorrell coined the term "frenemy" to describe Google's (NSDQ: GOOG) relationship to the ad industry, to a lesser degree the the word was often applied to Yahoo (NSDQ: YHOO) as well, as it too was viewed as encroaching on agency territory with every interactive marketing acquisition. It would seem that at least as far as Sir Martin is concerned, the issue of crossed boundaries on the part of Yahoo is a thing of the past as the two companies agreed to partner on the sale of display ads through Yahoo's Right Media exchange.
I spoke to Mike Walrath, SVP, Yahoo Advertiser Marketplace Group, about the deal (shameless plug: he'll be appearing at our EconAds Seminar on June 3rd). With WPP now on board, Walrath, the former CEO of Right Media, is now concentrating on signing up other ad-holding companies. "We're talking to everybody," especially all the major ad firms, Walrath said, though he declined to drop any names or offer a timeline as to when the next agreement might close. The most likely agency company to follow WPP is Publicis Groupe, which has been almost as aggressive as its UK rival in building up its digital capabilities through acquisitions and partnerships over the past year. More details from my conversation with Walrath after the jump.
-- The pitch: So what have Walrath and Yahoo been saying to convince agencies to join them? Agencies have realized that the ad exchanges, which offer auction-based, automatic targeting for ads across thousands of websites, still don't represent much of a threat to traditional media buying. The idea is that exchanges can extend the advertisers' reach on the web, supplementing the usual functions of media buying and promising greater efficiencies. "The real benefit here to WPP's clients is that they can be more precise in what they target and, obviously, create more return for marketers' ad spending."
-- Learning curve: Publishers may still be concerned that exchanges and ad networks treat ad space like a commodity, but advertisers don't seem to mind. "There is still a lot of confusion about ad exchanges and ad networks, mostly on the part of publishers, but really, it's akin to the differences between the New York Stock Exchange and Merrill Lynch. We're starting to see, and the partnership with WPP represents this, companies are embracing new ways of managing their digital ad spending. The only concerns advertisers have - which stem from publishers' wariness - is whether this will ever be a liquid enough market for this to be really beneficial, will it ever get to a large enough scale. But with 6 billion ad impressions a day being traded among 5,000 participants in the marketplace, I can say that we've reached that scale. And this is where the tipping point comes."
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App Analytics Firm Sometrics Raises Seed Round From Mail Room Fund
The big news here is the investor: Sometrics, a start-up providing analytics for social net apps, has raised an unspecified seed round from the Mail Room Fund, the fund launched by Accel, Venrock and the William Morris Agency. Also participating in the unspecified round were AT&T (NYSE: T) and Greycroft Partners. The fund does have a maximum investment cap of $1 million, as it is truly a seed fund. The LA-based company was started last year, and measures traffic, conversions and other data for apps across the usual suspects: Facebook, MySpace, Bebo and others. Release.
The Mail Room Fund was first announced without a name back in March.
Disclaimer: Greycroft is an investor in our parent company, ContentNext Media.
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As Icahn Storms The Gates, Yahoo Sends Google Ad Smoke Signals Again
Every time things heat up at Yahoo (NSDQ: YHOO), they seem to play the Google (NSDQ: GOOG) card. In the days before it went into failed negotiations with Microsoft (NSDQ: MSFT), the company leaked word that an ad deal with Google would be announced soon, possibly the following week. That didn't happen once the deal collapsed. And now, with Yahoo totally back in play, here it comes again: News.com is corroborating a New York Post story from this morning, suggesting a deal is imminent and that an announcement is expected—wait for it—next week.
When Microsoft and Yahoo fell apart, the price gap was part of it, but Ballmer also saw the Google deal as an impediment to making it work. But then Ballmer also wanted to keep things friendly. With Icahn now in control, this type of maneuvering on Yahoo's will probably just steel his resolve that the board and top brass has to go.
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Sex And The Single Site: Turner's TheFrisky Likes The Single Life, For Now
Last month, after AOL's (NYSE: TWX) stealth work on an edgy women's lifestyle site, one of our readers pointed us to TheFrisky.com as a beta version of the site AOL was working on. Wrong Time Warner family. Maybe TBS, with syndication rights to shows like Sex And The City? No. Turns out TheFrisky, unveiled in mid-March and unlabeled save for the privacy policy, belongs to the New Products group of Time Warner sib Turner Broadcasting—producing buzz for itself amid the obscurity of its parentage.
For the moment, that's how Turner likes it. Although conceived by the New Products group as a one-off beta to coincide with the release of Sex And The City the movie, TheFrisky is enjoying the freedom of not being tied down to any of the properties in the Time Warner family. Kind of like online dating, TheFrisky (tagline: "a daily romp on the sexy side") is talking with other similarly focused sites, like Yahoo's Shine and StyleHive, about sharing its news, commentary and videos—but right now, it's all casual, nothing serious. I spoke with Guhan Selvaretnam, New Products' group lead, and Lea Ann Leming, the New Products group managing editor, about their plans for the site and sudden appearance of a number of new sites for women.
-- Sex and the single women's site: Taking inspiration from Sex And The City, which was produced by Time Warner siblings HBO and New Line Cinema, TheFrisky's connection to the movie is decidedly downplayed. The goal isn't to serve as an online vehicle for the film - or any Turner programming either, for that matter, said Selvaretnam. That said, Turner's popularity with women in general provided enough of an impetus for the company to create a standalone site. Selvaretnam: "We launched in beta in mid-March and it will remain in that state for a while. The underlying rationale, was actually a sales rationale initially, where we were looking at creating cross-platform, integrated sales opportunities. We found that many of Turner's on-air properties are number one in the 18-34 female demo. And TheFrisky represents our ability to deliver that demo to our marketers, especially given our dominance on air. That said, TheFrisky is not tied to any of the Turner brands. The online audience is pretty independent in terms of the sites they value, so we didn't see the need to tie it to any of Turner's existing properties." More after the jump.
-- Filling the gap: While there isn't exactly a dearth of women's websites, Leming felt that most lean a little too far in a single direction. Leming: "We did look closely in the marketplace and did see a gap for women. In terms of love and sex topics for women, you have generic content about dating and how to meet a man, and on the other end of the spectrum, you have content that is overtly sexy: essentially sites that are talking about 'how to do a man.' That wasn't representative of most women. They want something different and more subtle. Getting back to Sex And The City, it really changed the conversation on TV and we wanted to do the same online. And just as the show isn't just about sex, neither is TheFrisky. We also cover fashion, health, travel and news, along with a mix of recurring columns as you would find in a magazine."
-- Platform leap?: When I asked Selvaretnam and Lerning about the crowded landscape with Yahoo (NSDQ: YHOO) Shine and NBC's recently announced Women@NBCU, as well as Warner Bros. TV Group's MomLogic and current work on Essence magazine's revamped website, the two said that they are in talks with competitors about ways they can partner. But Selvaretnam said the site needs to develop greater scale first before it can embark on a serious relationship. Down the road, though, other possibilities remain, he said: "Does this potentially lend itself to a magazine or TV show spinoff? That's something we've discussed. But let me be clear, that's not Turner's position, nor is it Turner's intent. That said, there are good examples like [AOL's] TMZ, which started off as a site and has made the leap to TV. This site has sparked tremendous interest among our partners, who are themselves thinking about doing a joint venture into different mediums."
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CBS-CNET: Ad Execs Bless The Marriage, Adding 'CBS Isn't Getting Any Younger'
As a TV company, CBS (NYSE: CBS) has long skewed older, a notion CEO Les Moonves has both embraced and bristled at. The company's $1.8 billion purchase of CNET (NSDQ: CNET) Networks could help alter that image, even as CBS has made notable strides on its own with CBS Interactive and digital acquisitions like WallStrip and Last.fm. I spoke with several digital ad agency execs about their initial impressions and, so far, it's hard to find much downside for either company. The main points: CBS gets access to a younger audience interested in tech products - meaning, unless CBS flubs things somehow, it will have an easier time attracting consumer electronics marketers, in much the same way having MarketWatch brought in financial services advertisers.
Although the announcement was made a day after CBS' upfront presentation, during which Moonves and company highlighted the network's wider focus on new media in addition to TV, the combination isn't likely to impress buyers and advertisers all that much yet. Greg Smith, COO of Neo@Ogilvy, OgilvyOne's digital and direct media unit, told me: "I think the acquisition will be mentioned in passing, but the upfront is still all about TV. Buyers might congratulate CBS and then say, 'Okay, let's talk about Wednesday night primetime.'" More after the jump.
-- Cross one item off the wish list:Tim Hanlon, EVP-Ventures, Publicis' Denuo: "It's a smart, focused vertical buy that gives [CBS] credible content in the tech genre that can easily be leveraged across multiple CBS properties, especially radio and news. Simultaneously, it gives CBS broader reach online with a top publisher. I could easily see this becoming a template of sorts for other vertical content forays, and you've got to think Weather Channel/weather.com might be next up on CBS's wish list."
-- CBS' life line: Curt Viebranz, the former head of Tacoda and AOL's (NYSE: TWX) Platform-A, said he views CBS' move as buying a new lease on life - or at least it has the potential: "CBS is in a dying business so making a digital bet makes sense to me. In the meantime, CNET has had two ex-Time Inc.-ers Jack Haire and David Morris - Haire as a consultant and Morris as an employee - with deep brand sales experience courting traditional brand advertisers and trying to raise CNET's profile in the ad community. I presume that CBS feels as if they can improve the performance of the business with minimal cost cutting. Remember the days of MarketWatch—and I actually say that CNET is a better fit than MarketWatch."
-- All about scale: Alan Schanzer, managing partner, at WPP Group's MEC Interaction said this deal won't affect the current TV marketplace negotiations but it will help CBS follow through on the emphasis it gave to "the portability of content" at Wednesday's upfront presentation. Schanzer: "It gives them more places to showcase their programming or invite audiences back to view their programming. This is where scale becomes critically important. It's not always going to be the case where people go home and turn on their TV to watch CBS. It will be much more about CBS going out to this mass audience of people and saying we have this content, come watch it. That's why we think the blended marketplace that this deal creates is so interesting, because the flow of content works in both directions."
-- A place in the valley: There aren't many CNETs out there, said Dave Morgan, Tacoda's founder and also a Platform-A alum, lauding CBS' decision. "It diversifies an advertising base for them, because the tech advertisers were not ones that CBS could historically reach… It also gives them a big Silicon Valley footprint. It makes them a player there now. I know Michael Marquez [VP, strategy and corporate development at CBS Interactive] has been out there. But buying CNET gives CBS greater access to talent, to deal flow. A lot that happens in this space happens in the Valley, and if you're not there, you're not part of it."
-- Mutual benefits: In the end, said Neo@Ogilvy's Smith, the deal is about the need for CBS to acquire content and update its identity as a media company that is mainly known as a broadcaster. "CNET has been moving from a heavy-duty tech site to more of a lifestyle site, albeit with an emphasis on technology. By having CNET as part of the family, you can have CNET's talent, content and authoritative reputation on CBS TV and its other properties… CBS is primarily a TV company. The news division has been increasingly under-financed and this can provide a shot in the arm. Plus, CBS isn't getting any younger over there."
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EconAds, June 3, NYC: Speakers From Google, MEC Added; Space Limited
We've added Penry Price, VP of Google (NSDQ: GOOG) ad sales for North America, and Adam Shlachter, senior partner and group director, MEC Interaction, to an already-strong roster for EconAds, our first seminar dedicated to advertising. We're not quite finished—we'll announce more in the next few days.
EconAds takes place June 3 in New York at New World Stages from 1:00-5:30 p.m. More details at the EconAds site. Space is limited so don't wait to register here.
Other Confirmed Speakers
Doug Anmuth, Analyst, Lehman Brothers
Samir Arora, Co-founder, Chairman & CEO, Glam Media
Lynda Clarizio, President, Platform-A, AOL
Russ Fradin, Co-founder & CEO, Adify
Peter C. Horan, CEO, IAC Media and Advertising
Lance Maerov, SVP, Corporate Development, WPP
Dave Morgan, Founder, Tacoda
Nancy Peretsman, EVP, Managing Director, Allen & Co
Mike Walrath, SVP, Yahoo Advertiser Marketplace Group; Former CEO, Right Media
Sponsors: Platinum: IAC. Gold: Wall Street Journal Digital Network. Silver: Imaginova. For underwriting the event, e-mail our business side at advertising AT contentnext.com.
A special thanks to Digital Hollywood for helping us co-locate our event at New World Stages along with its Advertising 2.0 conference on June 4-5 presented with AdAge. (You can buy a combo ticket to both events for $995, a $180 discount. ) Both are part of Internet Week, produced by the International Academy of Digital Arts and Sciences in cooperation with the City of New York.
Online Marketing System Hubspot Raises $12 Million Second Round Funding
Hubspot, a maker of online marketing tools, has secured $12 million in a second round led by Matrix Partners. Previous backer General Catalyst also participated in the latest round. The Cambridge, Mass.-based company, which was formed in 2005, raised a $5 million first round last July and received $500,000 in a seed round two years ago. Hubspot plans to use the new proceeds to build up its sales and product development staff. The company's products range from search engine optimization, lead gen, analytics services. Release
Online Slideshow Editor Animoto Takes Funding From Amazon
Animoto, a site that lets users edit musical slideshows, has taken an unspecified investment from Amazon.com (NSDQ: AMZN). The NYC-based company lets users upload their photos and choose a song—the system then assembles it into a slideshow or music video. The service launched in August of last year and claims 150,000 users. Not surprisingly, it touts a Facebook app with 750,000 users. The slideshow space alone is very competitive. In addition to Slide, there are plenty of smaller ones. As for Amazon's participation: don't necessarily assume this will lead to a strategic relationship. (Indie music retailer Amie Street, also invested in by Amazon, doesn't have one.) Animoto is a customer of Amazon's web services, which is supposedly how the two sides came together. Release.
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Time Warner: Effort To Separate CEO, Chairman Fails; Parsons May Leave; Way Cleared For Bewkes
It looks like Jeff Bewkes will get to be chairman of Time Warner (NYSE: TWX). At its annual meeting of shareholders today, a proposal to keep separate the roles of CEO and Chairman failed, with only 43 percent of votes cast in favor of the measure, according to Reuters. Meanwhile, sitting Chairman and former CEO Richard Parsons described the meeting as his "last shot at this" noting that he would soon be the outgoing chairman. This outcome is not a surprise, seeing as it was a key part of Bewkes' contract: if he is not appointed chairman, he would have the right to resign with pay and without a non-compete.
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Top Headlines Of The Week From paidContent:UK, mocoNews And contentSutra
Top headlines of the week from our sister sites paidContent:UK, mocoNews and contentSutra:
paidContent:UK:
-- @ OPA: Guardian Mulls India Launch - But What Price A Brand Extension?
-- TNS To WPP: What Part Of No Don't You Understand?
-- Thomson Reuters Plans 'Immediate Reduction In Headcount'
-- Radiohead: 'iTunes Killed The Greatest Hits Compilation'
-- Lycos Europe To US: Don't Worry About The Numbers, Just Buy Us
-- Will Kangaroo Jump To SeeSaw? Highfield's Switch Imminent
mocoNews:
-- MocoNews Review With Video: AT&T's MediaFLO Is Best Chance For Mobile TV To Take Off
-- Virgin Mobile USA Confirms Early Talks With SK Telecom
-- Cablevision's Plan To Pay $350 Million To Provide WiFi In One Market Is At Odds
-- Sprint Nextel Says The iDen Network Stays; Aims To Have 40 New Push-To-Talk Markets Soon
-- Deutsche Telekom May Still Be Considering A Sprint Nextel Buy-Out
-- Update: RIM-Thomson Reuters To Launch $150 Million Mobile App Fund; BlackBerry Bold Debuts
contentSutra:
-- First Look At Web18s Horizontal Portal In.com
-- Times Of India Group Planning An IPO: Report
-- Sony Entertainment Television Sells 32 Pc Stake To BK Modi For $320 Million
-- Shiksha.com To Launch On This Week; Thoughts On The Education Segment
-- Private Treaties Acquires Stake In ApnaCircle.com; MouthShut Doing PT Deal For Dekhona?
-- Our Coverage Of The NDTV New Media Congress
Yang To Yahoos: Stay Focused; Still Open To Strategic Alternatives
Just when Yahoo (NSDQ: YHOO) thought it could get back to putting their heads down, here's CEO Jerrry Yang again, reminding the Yahoo team that it needs to stay focused during a "very important time in our Company's history." In an internal letter, filed with the SEC, Yang reminds the company's bosses on its key talking points. They should be pretty familiar with them by now: Yahoo is in a strong position, is executing well, and has great assets. But if the right cards were to fall into place, yes, strategic alternatives are always being explored. And again on Icahn, as stated in last night's letter, he misunderstands the situation. A similar, less detailed letter to all Yahoos is here.
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Yahoo, WPP Partner On Ads Marketplace, Right Media Linkage
Consoling each other at acquisition travails and an overly-dominant Google (NSDQ: GOOG) respectively, Yahoo (NSDQ: YHOO) and WPP are trumpeting a partnership that will see the ad firm place its agency clients' messages in to the portal's Right Media Exchange network. WPP's 24/7 Real Media will develop "a proprietary media trading platform" using what it said are its own "proprietary targeting capabilities" so partner firm GroupM can place ads in to the exchange. Sounds like WPP wants to both play a part in Right Media and keep a tight (proprietary) reign. This also creates a "WPP marketplace" of Yahoo's ad networks and 24/7's Global Web Alliance. WPP chief Martin Sorrell had advocated the Microsoft-Yahoo acquisition as a foil to what he sees as an increasingly powerful Google ads operation.
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Senate Votes To Roll Back FCC's Loosening Of Media Regulations; Veto Pen Looms
Last night the Senate voted to roll back the FCC's decision to loosen media cross-ownership rules, which it announced last December. The Senate vote comes less than a month after the Commerce, Science and Transportation Committee approved the same thing. The "resolution of disapproval" was passed by a voice vote, according to the AP. So what does this mean right away? Not much: Even if the House does the same thing, President Bush's veto pen most likely lies in wait. But if the November elections usher in a President less sympathetic towards media deregulation, we know the Senate has the appetite to push the issue.
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Top Jobs Of The Week In Digital Media
Latest jobs in digital media posted this week:
MySpace Music: Director of Label Relations
Grandparents.com: Business Development Director
The Knot: Senior Manager of Insight and Analytics
Business & Legal Reports Inc: Director of Product and Market Management
More with Grandparents.com and on our job board.
Video: Larry Kramer On CBS-CNET: Pressure On Quincy; CBS To Bring Big Brand Ads To CNET
Larry Kramer was there from the start when CBS (NYSE: CBS) started getting serious about digital with the predecessor to what became CBS MarketWatch until the eventual sale to Dow Jones (NYSE: NWS), and then was brought in again by Les Moonves when CBS Digital was founded March 2005...he left in November 2006 when Quincy Smith was brought in, and CBS moved from the build-only mode to add the buy mode. Kramer consulted with CBS for a while after that, and of course, as you know, is on our company board now. I was with him at the OPA conference in London today, and did a short video on his reaction about the deal. Some of the main points:
-- Transformational deal for CBS...needed to bulk up to get more respect internally and externally
-- Timing of the deal
-- Operational challenges on the integration of CNET (NSDQ: CNET) into CBS
-- The need for a strong management for CNET under CBS
-- The difference in pace between CBS and CNET
-- The pressure on Quincy Smith and the team to show this deal as an operational success.
-- Online advertising in the next year, and its effect on the deal
-- San Francisco as a digital hub for CBS
Disclaimer again: Kramer is on our company board.
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Inside the Deals: Look, Ma, No Debt
If the recently salvaged Clear Channel (NYSE: CCU) buyout was the signature media deal of the 2006-2007 era, then the just-announced CBS (NYSE: CBS) acquisition of CNET (NSDQ: CNET) is the signature deal of 2008. And they couldn't be more different.
Clear Channel was among the last big deals of the LBO boom—a mega deal, even at the reduced price of $17.9 billion. The buyers, Thomas H. Lee and Bain Capital, are two big players from the private equity industry that ruled the deal world until the credit markets freaked out last summer. Clear Channel, the radio and advertising giant, sold out at the top of a seller's market. It had the luxury of playing two sets of private equity firms against one another. The huge price required the winners to take on so much debt that the banks tried to kill the deal.
The CBS-CNET deal is an entirely different breed, one that represents the new environment that is taking shape in a stricter credit environment. At $1.8 billion, it's a sizable but altogether manageable transaction. CBS, a strategic buyer, is paying for CNET with cash from its $2.26 billion-strong balance sheet. There's no debt or banks to muck up the works. The price is an earthy 4.5 times revenue. That's modest compared to the 6.7 X revenue multiple that Microsoft (NSDQ: MSFT) offered for Yahoo (NSDQ: YHOO). And the seller was more than happy to take the price. CNET has been on the market since the memory of man. It has a big shareholder activist, hedge fund Jana Partners, putting pressure on management and the board. This was the only exit in sight, and CNET wisely took it. If the Yahoo board had been as realistic, it would have accepted Microsoft's offer, and it wouldn't have a Carl Icahn-led proxy fight on its hands.
CNET and Yahoo are both first-generation Internet companies that face slowing growth and contracting multiples. The difference is that CNET has accepted the new reality of lower valuations and returns for most players. CBS said it expects to generate an internal rate of return of about 13% on the CNET deal. That's less than half of the IRR that private equity firms expected a year or two ago, when debt turbocharged their results. And it's far lower than the returns of the late '90s, when a soaring stock market made a big IPO or M&A exit possible. Sellers like CNET understand that they can't hold out for an astronomical price if the buyer is paying in cash and expecting a return in the teens.
The new environment has a lot of advantages. As the stalemate between buyers and sellers comes to an end, buyers and sellers are likely to come together and do some interesting things. CBS and CNET isn't the only sign of the changing times. Comcast (NSDQ: CMCSA) bought social networking site Plaxo this week for an undisclosed sum. They will try to merge set-top boxes and social networking and see what happens. It wasn't a huge sum. But for Plaxo, it was a lot better than sitting around for a few years, banging its head against Facebook and MySpace and waiting for a monster suitor from another era. Those days are over.
Inside The Deals is a weekly column about M&A in the media written by veteran business journalist Steve Rosenbush. Steve is based in New York, and previously was the finance writer for BusinessWeek.com, responsible for coverage of M&A. His interests include the evolving business of media. He can be reached at steve AT paidcontent.org.
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CBS-CNET: Merger Details; Exec. Compensation
If you haven't had your fill yet of CBS (NYSE: CBS) and CNET (NSDQ: CNET), then check out their big 8-K getting down into the nitty gritty of the deal. In addition to the standard stuff (all poison pills have been denatured), it details how much the top execs at CNET stand to make by keeping their jobs, as opposed to getting forced out in a proxy battle.
-- Neil Ashe: "Mr. Ashe will be paid a salary of $750,000 per annum and will also be eligible to receive annual bonus compensation, with a target bonus of not less than 100% of Mr. Ashe's salary. Mr. Ashe will also be eligible to receive annual grants of long-term incentive compensation under the CBS long-term management incentive plan, with a target long-term incentive award and a grant date value equal to not less than $1,625,000 for each year of the amended and restated employment agreement. In addition, Mr. Ashe will be eligible to receive an award of stock options under CNET's 2004 Long-Term Management Incentive Plan, with a value of $1,625,000, following the close of business ten (10) trading days after the Merger."
-- Zander Lurie: "Mr. Lurie will be paid a salary of $400,000 per annum and will also be eligible to receive annual bonus compensation, with a target bonus of not less than 50% of Mr. Lurie's salary. Mr. Lurie will also be eligible to receive annual grants of long-term incentive compensation under the CBS long-term management incentive plan, with a target long-term incentive award and a grant date value equal to not less than $1,000,000 for each year of the amended and restated employment agreement. In addition, Mr. Lurie will be eligible to receive an award of stock options under CNET's 2004 Long-Term Management Incentive Plan, with a value of $1,000,000, following the close of business ten (10) trading days after the Merger."
-- Competing bids: CNET can't solicit another bid, but if someone comes along: "...CNET may conduct discussions and negotiations with such person regarding such Inquiry or Company Acquisition Proposal without first having to determine whether such Company Acquisition Proposal is likely to lead to a Company Superior Proposal (as defined in the Merger Agreement). "
-- Termination: And if they do take another offer: "Upon a termination of the Merger Agreement under the following circumstances, CNET is obligated to pay Parent a termination fee of $35,000,000"
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Industry Moves: Simon & Schuster Shuffles Digital Deck Amid Hires, Promotions And A Departure
Simon & Schuster Digital has made key additions and changes to its existing staff:
-- Adrian Norman joins as VP-marketing and new products and former Oxygen Media CTO Steve Morgan as VP-engineering. Norman, most recently executive director-digital media for Disney-ABC Television, will supervise digital products, including ramping up online promotions and creating revenue opportunities, along with connecting to online communities. Morgan's responsibilities include designing the infrastructure for the company's digital warehouse and content management system.
-- Sue Fleming has been promoted to VP, executive director of content & programming and Radhika Nayak has been promoted to VP, director of product management.
-- Kate Tentler, a 12-year S&S vet , leaves as SVP-Simon & Schuster Digital at the end of June.
Yahoo Responds To Icahn: You're Wrong; We're 'Crystal Clear'
The Yahoo (NSDQ: YHOO) board's response to Carl Icahn just came over the transom in the form of a letter from Roy Bostock, chairman of the board. The gist: Icahn's take is wrong on the events leading to Microsoft's (NSDQ: MSFT) withdrawal of its bid so he should not be allowed to take over the board.
Bostock: "Unfortunately, your letter reflects a significant misunderstanding of the facts about the Microsoft proposal and the diligence with which our board evaluated and responded to that proposal. A fair-minded review of the factual record leads to one conclusion: that Yahoo!'s ten-member board, comprised of nine independent directors along with Yahoo! CEO Jerry Yang, remains the best and most qualified group to maximize value for all Yahoo! stockholders. Conversely, we do not believe it is in the best interests of Yahoo! stockholders to allow you and your hand-picked nominees to take control of Yahoo! for the express purpose of trying to force a sale of Yahoo! to a formerly interested buyer who has publicly stated that they have moved on.
Bostock reminds Icahn there is no offer on the table but insists "we have been crystal clear in our stance that we have been and remain willing to consider any proposal from any party including Microsoft if it offers our stockholders full and certain value." The full text, which can be found after the jump, details the Yahoo version of the bid saga and concludes with a line that runs a tad counter to the rest: "We look forward to a productive dialogue." (Icahn's letter is here.)
Full text:
May 15, 2008
Dear Mr. Icahn:
We are in receipt of your letter with regard to your intention to seek control of Yahoo!'s board of directors.
Unfortunately, your letter reflects a significant misunderstanding of the facts about the Microsoft proposal and the diligence with which our board evaluated and responded to that proposal. A fair-minded review of the factual record leads to one conclusion: that Yahoo!'s ten-member board, comprised of nine independent directors along with Yahoo! CEO Jerry Yang, remains the best and most qualified group to maximize value for all Yahoo! stockholders.
Conversely, we do not believe it is in the best interests of Yahoo! stockholders to allow you and your hand-picked nominees to take control of Yahoo! for the express purpose of trying to force a sale of Yahoo! to a formerly interested buyer who has publicly stated that they have moved on. Please may I remind you that there is currently no acquisition offer on the table from that company or any other party. That said, we have been crystal clear in our stance that we have been and remain willing to consider any proposal from any party including Microsoft if it offers our stockholders full and certain value.
From the beginning of the process with Microsoft, Yahoo!'s independent directors focused on one central goal: how best to maximize stockholder value. At all times directing this process, Yahoo!'s independent directors carefully considered Microsoft's initial unsolicited proposal, which was at the time valued at $31 per share. After considering input from its financial advisers the board unanimously concluded that Microsoft's proposal significantly undervalued Yahoo! and was, therefore, not in the best interests of the company or our stockholders. While we rejected this offer publicly on February 11, 2008, we could not have been more clear in that communication and in every subsequent communication, both public and private, that we were and are willing to enter into any transaction that would maximize value for stockholders and provide them certainty of value.
The record of our efforts to engage Microsoft in meaningful discussions is unequivocal. Following receipt of Microsoft's proposal on January 31, our board of directors has met over twenty times to review Microsoft's proposal and Yahoo!'s other strategic alternatives. Throughout this process our board kept an open mind and an open ear. Our independent directors met with several of our largest stockholders to solicit their views and to make it clear that Yahoo!'s independent board is fully committed to maximizing stockholder value. In addition, at the direction of our board, our management team met with many of our investors to provide insight into Yahoo!'s strategy and views on value.
Our board's openness also extended to Microsoft. Without reciting all of the contacts between us and between our advisers, the senior-most management of Yahoo! and Microsoft and the companies' respective financial advisers spoke on numerous occasions and met in person seven times. During those meetings, Yahoo! discussed its strategic objectives in search and display advertising monetization, its perspectives on operating strategy and integration in a transaction with Microsoft, its perspectives on transaction synergies, and other non-price deal terms. Because certainty of closing is a critical issue, we sought to understand Microsoft's thinking with regard to the regulatory issues associated with a potential transaction. In fact, at the board's direction, our lawyers on March 28 asked for additional information in this regard, information which was never forthcoming.
On April 15th, a meeting was held at Yahoo!'s request. At that meeting, which included our respective financial advisors, we made clear, once again, that we were open to a transaction with Microsoft. During those discussions, Yahoo! made a detailed presentation of its strategic and financial plan, its thoughts on integration and its view with respect to the potential synergies that could be achieved in a transaction, essentially laying the foundation for Microsoft to understand--and respond to--our board's conclusion that Microsoft's offer substantially undervalued the company. Following that meeting we also provided to Microsoft a list of key non-price deal terms that our board believed were critical items to be addressed in a deal to provide reasonable protections for our stockholders.
Throughout this period, Microsoft continued to state that it would not raise its offer, and even suggested that it could lower it.
Despite this failure by Microsoft to respond in any substantive way to any of Yahoo!'s requests, on May 2nd, the same day we first learned of Microsoft's apparent willingness to increase its proposal to $33 (although this oral "offer" was never delivered in writing and did not include details of a cash/stock mix), our board determined to continue discussions, instructing Jerry Yang to indicate to Microsoft that we would be prepared to enter into a transaction that valued Yahoo! at $37 per share and that provided reasonable certainty of value and certainty of closing. This was communicated to Microsoft in-person at a meeting in Seattle on May 3rd. With Microsoft's offer at $33 and Yahoo!'s counter-proposal at $37, Microsoft elected, within hours, to walk away from the negotiating table and informed us that they were "moving on," having never engaged further on price or any of the key non-price deal terms.
In short, Yahoo!'s board was at every point in this process prepared to enter into a transaction with Microsoft that would maximize stockholder value--and included certainty of value and closing. What Yahoo!'s independent board refused to do was to allow control of this company to be acquired for less than its full value.
That brings us to today. Our business is performing well as evidenced by our first quarter results. As we have publicly stated, our board continues to actively and expeditiously explore strategic alternatives to maximize stockholder value. None of the alternatives we are considering would preclude us from entering into a transaction with Microsoft or any other party.
We continue to believe that Yahoo!'s current board has the independence, the knowledge, and the commitment to navigate the Company through the rapidly changing Internet environment and to deliver value for Yahoo! and its stockholders.
We look forward to a productive dialogue.
Very truly yours,
Roy Bostock
Chairman of the Board
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