As the market grows for e-book readers such as iPad, Kindle and Nook, a Culver City company is in the process of getting patents that would give it an advantage for placing custom advertising in e-books.

Wowio, which sells e-books on its website, has been issued a notice of allowance – meaning that the United States Patent and Trademark Office is processing its paperwork – for 32 patent applications related to its sponsored book and in-book advertising methods.

A number of Wowio’s pending patent applications cover its reader-specific advertising. The ads are placed in the book automatically, based on that reader’s profile and past ad-browsing habits. Wowio’s in-book advertising allows it to provide most of its e-books for free or a discounted price.

The e-book market has grown significantly in recent years. Apple now sells e-books for the iPad on its iTunes store, and Amazon sells digital books for the Kindle. Revenue from e-books is expected to reach $500 million in the United States by the end of this year, according to Cambridge, Mass., market research company Forrester Research.

Wowio Chief Executive Brian Altounian said the patent applications, which the company first applied for in 2006, will give it a competitive advantage over Amazon, Apple and other e-book distributors when selling advertising for its books.

“Ads are coming to e-books as a way to help subsidize the cost of the content,” he said. “Our patent protection will allow us to be the leader in that space and prevent others from providing ads in e-books.”

Since Altounian took control of Wowio in 2009, he has taken a number of steps to broaden the company’s focus from comic books to a wider range of digital media.

Wowio announced last week that it has formed a partnership with Ingram Content Group, a La Vergne, Tenn., book and e-book distributor, to add the company’s thousands of titles to Wowio’s online e-book marketplace.

“The goal for the company is to be a much broader media distribution company,” Altounian said. “It’s an exciting time for us.”

Ad Addition

With his company’s recent purchase of Fox Audience Network, Frank Addante, chief executive of advertising technology firm Rubicon Project, plans to build a display advertising platform big enough to challenge Google’s dominance in the online ad market.

Rubicon announced last week that it agreed to give News Corp. a minority stake in the company in exchange for FAN, an ad technology platform developed by the media giant.

Rubicon sells display advertising for more than 350 web publishers, including NBC, the Washington Post and Tribune Co. With the acquisition of FAN, it will add a number of customers, including all of News Corp.’s online properties.

Prior to the acquisition of FAN, Rubicon announced that it became profitable in October and would generate $100 million in revenue this year.

Addante said the company’s financial growth and the addition of FAN technologies will give Rubicon the foothold necessary to become a player in the fight for dominance over the display advertising market.

“FAN’s technology gives us a complete platform. We now have the market share and financial position to compete with Google,” he said.

As part of the acquisition, Rubicon added 100 FAN employees to its West L.A. headquarters last week, bringing the company’s total number of employees to 250. To accommodate the new staff, Rubicon took over the building next door, adding 30,000 square feet to its 20,000-square-foot office.

FAN and Rubicon engineers will now be integrating FAN’s technology. Addante plans to relaunch Rubicon’s advertising platform in April.

“Between now and then, the engineers have a lot of work to do,” he said. “But they’re excited about it. They’re excited to go head to head with Google.”

Voicemail Sale

Audioo, a website where users can post funny voicemails, has been put up for sale by parent company AudioMicro.

The music company, headed by Ryan Born, listed Audioo on eBay and website seller Flippa last week. Audioo, which was started by Better PPC founder Ben Padnos, wasn’t making enough money, Born told technology blog SoCalTech.com.

AudioMicro, a Sherman Oaks company that sells royalty-free music and sound effects, bought Audioo from Padnos in May.

The website is listed on Flippa for $2,500 with eight bids. It was removed from eBay last week because it wasn’t generating enough interest, according to SoCalTech.com.

Staff reporter Natalie Jarvey can be reached at njarvey@labusinessjournal.com or at (323) 549-5225 ext. 230.

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