Tech Talk—Intertainer Riding High on Wings of Fiber-Optic Firm

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Amid all the mudslinging and doubts cast over the Los Angeles City Council’s approval of Western Integrated Networks (WINfirst) plan to build a big fiber-optic network in the city’s 14 franchise areas, one local technology company is celebrating.

Days before the City Council approved WINfirst’s $2.5 billion network, Culver City-based Intertainer announced that it had inked a five-year agreement to offer its video-on-demand services over WINfirst’s fiber.

Intertainer is expected to announce a similar deal with one of L.A.’s largest cable companies in the next few weeks, according to the company’s chief executive, Jonathan Taplin.

Terms of the WINfirst deal were not disclosed, but even getting on an upstart’s pipes is critical for Intertainer. WINfirst has franchise agreements with eight U.S. cities. One of them Sacramento will launch commercially this fall. For Intertainer, it’s a potentially massive and much-needed footprint.

But Intertainer has had to scramble as broadband access companies struggle to roll out fast pipes. The broadband marketplace has lagged because content owners have been holding out for a bigger audience; meanwhile, cable, phone and fiber-optic companies like WINfirst depend on slick applications and services like video-on-demand to entice a paying audience.

Taplin said his company has a vast content library and well-capitalized shareholders like Intel Corp., Microsoft Corp. and General Electric Co.

Intertainer has inked other deals with media giants Vivendi Universal and AOL Time Warner Inc. Its technology partners are equally impressive and include Microsoft, Comcast, Intel and Sony Corp.

“The thing we love about WINfirst is that they have created a state-of-the-art network architecture,” Taplin said. “This is a chance to start from scratch and build the network the way it should be built.”

As for WINfirst, its president Frank Casazza said Intertainer’s video-on-demand services are among the offerings that drive the need for WINfirst’s increased bandwidth.

“There are so many products and services coming down the pipe video-on-demand in particular that will require more bandwidth than the incumbent franchise holders can provide today,” he said.


GoTo Blazes

You’d think we were in the Internet hey-day with all the hype surrounding Pasadena-based GoTo.com Inc. and its recent earnings report.

Last week, the company reported a narrower-than-expected loss and raised its revenue and profit outlook thanks to growth in its pay-for-performance search engine.

Analysts were understandably pumped up about one of the few positive earnings reports coming from the battered Internet sector, especially from a company that is ad-supported.

GoTo reported a net loss of $2.9 million (6 cents per diluted share) for the second quarter ended June 30, compared to a loss of $20.3 million (42 cents) in the like year-earlier quarter. Analysts expected a loss of 17 cents a share.

Its second quarter revenues were $62.5 million, nearly triple the $21 million GoTo reported in the like year-earlier quarter, and up 20 percent from the first quarter.

But Dave Nadig, a fund manager and co founder of MetaMarkets.com, was not impressed. He said GoTo made its numbers through aggressive cost-cutting.

“They’re living on the cutting edge of a cost-cutting industry,” he said. “People had been spending money like water because it was there. So there was an awful lot of things for them to cut.

Staff reporter Hans Ibold can be reached at [email protected] or by phone at (323) 549-5225 ext. 230.

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