Investors Race to Place $40 Million Bet on Spot Runner

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Spot Runner Inc., the Los Angeles-based online ad agency, has secured a $40 million equity investment from a group of ad and media companies.


The firm, which made its name by providing archived video templates that can be used by small businesses to produce cable TV commercials at affordable rates, is broadening its scope. The company wants to provide comparable services for businesses and consumers on formats including online video, video on demand and Internet Protocol TV.


The cash was invested by two marketing and ad conglomerates, WPP and Interpublic Group and CBS Corp. Spot Runner had already received a $20 million cash infusion from Index Ventures and Battery Ventures, both of which took part in the new investment, as well. Other backers included Lachlan Murdoch, the elder son of media mogul Rupert Murdoch, financier Vivi Nevo, Allen & Co. Inc., Tudor Investment Corp. and Capital Research and Management.


SpotRunner.com allows small businesses to buy cable TV advertising on such stations as the History Channel, CNN, TBS, TNT and others for very low rates.


A Spot Runner spokesman said the initial buy-in for a TV ad is $499 with a $550 minimum buy for time on the cable networks, which can be as little as $20 per spot depending on the networks used.


“Spot Runner’s technology provides broadcasters the opportunity to expand the demand for local advertising by providing clients with a quick and easy way to promote their businesses in ways they never thought were available to them,” said Joseph Ianniello, senior vice president for CBS.



Peers at the Pier

Peer-to-peer the network system that relies on computer power and bandwidth rather than servers to shift data is a hot topic for Internet industry types.


P2P, as it is known, was a big part of the buzz at the entertainment and technology conference Digital Hollywood, which drew more than 4,000 attendees to the Loews Santa Monica Beach Hotel last month.


But it was a more traditional form of peer-to-peer, that of colleague to colleague, that drove this confab, according to Digital Hollywood Chief Executive Victor Harwood.


“This event empowered attendees with a clear mandate to grow and accelerate their businesses,” he said. “It’s very much about exchanging cards, exchanging information and networking.”


The turnout, nearly double the figure from a year earlier, has event backers considering a shift to the Santa Monica Civic Auditorium for its November 2007 gathering. For its next meeting, in June, the event will hold a number of sessions at the nearby Merigot Hotel as well as the Loews Santa Monica Beach Hotel venue.


This year’s event included lectures, presentations, slide shows and productions on user-created content for cell phones, monetizing Internet social networking, video blogging and the redefinition of cable, telephone, satellite and broadband content and delivery.


Martin Lafferty, chief executive of the Distributed Industry Association, said the conference was a terrific marketing opportunity for the peer to peer computer industry.


“For the rights holders, it’s by far the most efficient method for transferring content,” Lafferty said.


Some of the P2P companies that Lafferty’s organization represents include Santa Monica-based Intent Media Works Inc., San Francisco-based VeriSign Inc., LTD Networks Inc. and the Canadian-based Nettwerk Music Group.


There was plenty of shopping going on.


Roaming the halls for digital companies that were looking to outsource production in India was Kevin R. English, media and entertainment senior vice president for Satyam Computer Services Ltd.


Also looking for pickups was Google Inc.’s Technology Program Manager Mark Yoshitake, who was eager to meet with content producers to augment Google’s recent purchase of YouTube.com.



Downloading New Tune

The online file sharing industry may be developing a copyright conscience, after all.


VMix Media Inc., the online video site based in Hollywood and San Diego, has recently signed content deals with the CW Network, “The Tyra Banks Show,” Bravo TV, the Discovery Channel, Fox Sports Channel, A3tv and Happy Tree Friends Channel.


VMix, founded last November by Greg Kostello, boasts more than 1.4 million unique visitors per month and has already forged content partnerships with Sony Entertainment, Fox Home Entertainment, Universal Studios and Warner Bros. Studios. That’s all of the major studios except for the Walt Disney Co., which is allied with online titan Apple Inc.


“VMix respects the copyrights and digital rights of the creator, whether that creator is a teenager or a major Hollywood studio such as Fox,” the company said in a statement.


The news comes on the heels of last week’s announcement that News Corp. Inc.’s MySpace.com will use “audio fingerprinting” technology to block users from uploading copyright music to the social networking site.


Several record labels recently announced licensing deals with YouTube, which has chosen to share ad revenue with record labels rather than filter music itself.



Staff reporter Dan Cox can be reached at (323) 549-5225, ext. 223, or at

[email protected]

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