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19 December 2007

Products, Partnerships and Deals

French DVB-T and DVB-H chip maker DiBcom has taken on investment from NIF SMBC and NTT Finance, ironically Japanese investors. Japan is a country where DVB-H and DVB-T are unlikely to take off. NIF SMBC Ventures, leader of the round, is the largest private equity firm in Japan and part of the Sumitomo group. DiBcom however has recently created chips compatible with Japan’s ISDB-T standard, for automotive equipment for Japan.

AT&T said this week that its U-Verse IPTV system is on track to reach 1 million subscribers by the end of 2008 with a service reach of 30 million customer locations by 2010. AT&T’s CEO Randall Stephenson said it finished the third quarter on just 126,000 subscribers but insisted ‘we know how to scale these things,’ and he anticipated build-out in nine Southeastern states formerly served by BellSouth, as well as AT&T territories during 2008. AT&T claimed that the cost per living unit passed was still in the low-$300 range and that U-Verse would be a multi $billion dollar revenue stream over the next two to three years. Installs are 10,000 a week now and will rise to 40,000 per week by the end of 2008.

The US Commerce Department’s National Telecommunications and Information Administration (NTIA) announced today that eight of the largest consumer electronics retailers in the US — Best Buy, Circuit City, Kmart, RadioShack, Sam’s Club, Sears, Target, Wal-Mart — have been certified to participate in the TV Converter Box Coupon Program along with more than 100 other retailers, representing more than 14,000 stores throughout the nation. Consumers may purchase converter boxes to keep their analog televisions working with over-the-air broadcasts after February 17, 2009, when full power television stations convert to all-digital signals.

The UK Competition Commission wants BSkyB to reduce its holding in leading UK commercial broadcaster ITV from 17.9% to between 5% and 10% and will give it six months to do so. On current pricing that would lead to a considerable loss.

Dow Jones is now part of News Corp, with stockholders voting at a special meeting this week to approve merger terms which passed with 60.3% of the voting power voting in favor. There are no more obstacles in the way of the deal and by now it should be signed and sealed. Dow Jones stockholders got $60 cash for each share.

Invidi Technologies, a specialist in targeted advertising for broadband TV, said this week it secured $25 million in a third round of funding with
GroupM, a unit of WPP, leading the round and Menlo Ventures, InterWest Partners, and EnerTech Capital VC backers joining in. Invidi offers technology which works out (infers) who is watching TV within the household at any point in time and make that information available to addressable advertising systems. The company says it works closely with Motorola, Scientific Atlanta, Acxiom, Experian and Nielsen, among others.

The Third Screen for Entertainment is a new report from our close colleagues Rider Research and it describes the current state of how entertainment content will be delivered in future over high-speed wireless networks. The $695, 70 page report provides an overview of the industry for delivering entertainment to mobile devices, profiles of some of the key players and provides a preview of what is likely to lie ahead. A free extract of the report is available for evaluation by e-mailing [email protected]

MovieBeam is closing down yet again, this time probably for good. The service was initially trialed and launched by Disney in 2003, and stores 100 films on a special set top box. The films are delivered using spare broadcasting capacity or datacasting on public service broadcasting, and under Disney each film that was viewed was separately charged. It was then sold to a VC group who sold it on to DVD rental retailer Movie Gallery, which bought it for $10 million just a few months back, before filing for Chapter XI bankruptcy. We said at the time that it was too little, too late.

Swisscom will continue building out its DVB-H mobile TV service, despite the withdrawal of both Sunrise and Orange who were planning to partner with the service. That means that all of the costs will now have to be met by Swisscom Broadcast, and it has to have a significant amount of the network up (reaching 44% of the population) by the UEFA Euro soccer finals in June 2008.

The European Court of Justice has changed it mind yet again and says that permission should never have been given for Sony and Bertelsmann Music Group to merge into Sony-BMG. The decision came after an Independent Music Publishers and Labels Association (Impala) complaint was upheld by the European Court of First Instance. The merger was initially passed by the European Commission in 2004, then annulled in 2006, then cleared once again and now once again the deal needs to be reversed. Almost 4 years after the fact, we hope everyone can remember which assets belong to who.

Reports firm Packaged Facts says that eBay has become a market research goldmine citing the fact that there were $330 million of video game systems (including Wii, Playstation and Xbox) bought during 2006, a total of 1.3 million units.

According to InfoWorld Google has begun work on a rival to Wikipedia. Right now it is in beta, but Google will host it and provide authors with tools to produce and edit entries. The article reports that contributors will have to provide their photo and will get some advertising revenue share on their contributions.

A report just published by Understanding & Solutions predicts global revenues from mobile gaming will rise from $3.6 billion this year to $6 billion by 2011. The says subscription based and advertising supported models are on the rise, but pay-per-download is still the most significant revenue generator. It said that China and India are seeing the fastest uptake of mobile games.

Forrester Research says residential broadband in Western Europe will rise from 44% penetration now, to 71% by the end of 2013. This will represent 48 million new broadband connections in the next six years and dial-up services will fall to just 2% of all online connections.

French mobile streaming specialist Streamezzo has secured $22 million of finance in a third round that takes its total funding to $48 million. Kuwaiti investment group NTEC (National Technology Enterprise Company) joins the latest round, along with all of Streamezzo’s existing investors including Sofinnova Partners, AXA Private Equity, I-Source Gestion, Sofinnova Ventures, Qualcomm and GET Valorisation.

Vuze, a high resolution web TV service, which claims 15 million client downloads, said it has secured $20 million in its C round of funding led by New Enterprise Associates, with existing investors Redpoint Ventures, Greycroft Partners, BV Capital, and Jarl Mohn. The company says that it has closed more than 100 premium content partnerships.

Apple is thought to be in talks with both DoCoMo, and Softbank about introducing the iPhone into Japan next year. Both are apparently worried about paying Apple a share of subscriber revenue, as it has managed in deals in the US and parts of Europe.

US encoder designer Envivio, said it is providing a converged video headend to Norwegian ISP RingNett so it can roll out a new IPTV service. RingNett’s service is already available over GPON high speed fiber and it now wants the service available over both over ADSL2+ and VDSL2, with encoding done on the Envivio 4Caster C4 multichannel IP video compression system.