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Web Design Business Branches Out Into Software

Web design agencies are a dime a dozen in Los Angeles. But they usually don’t develop their own software.


Studio 7 Media, with only eight full-time employees, is an exception. Its tech expertise has helped the South Bay company win huge clients, including 20th Century Fox, Fisher-Price, Hewlett-Packard, Amgen, Nike, MTV and CNN.


Most recently, the company developed a software product for DVDs produced by 20th Century Fox that allows consumers to download movies to computers and portable devices. Microsoft technology supported, the application is embedded in movie DVDs such as “Juno,” “Alien vs. Predator” and “Live Free or Die Hard.”

Twentieth Century Fox licenses the software from Studio 7. The firm owns two such software properties and plans to roll out more.

This week, Studio 7 announced it would focus more heavily on developing new technology for clients by forming its own research and development division.

“This is a way for us to put a spotlight on what sets us apart from other Web design companies,” said Cyndee Sugra, chief executive.

It helps that Chief Technology Officer Marlon Mehr is particularly tuned in to technology for consumer products. Previously, he was a tester for the operating systems of Microsoft, Dell and Toshiba.

With a few significant contracts in the pipeline, the firm stands to double its size in the next couple of months, said Sugra.

Sugra founded the company seven years ago, when she was 23. A musician by training, Sugra learned her first lesson in marketing as a teen promoting her band.

Studio 7 expects to bring in revenues of $8 million this year.


Mobile Show

For the past two decades, Culver City-based talent agency Famous Frames Inc. represented storyboard artists, getting them work on thousands of television commercials, video games and films, including box office hits such as “Titanic” and “Matrix.”

Using the same artists as independent contractors, the company created a firm in 2005 that produces mobile content, Famous Frames Media Interactive. The original content includes short movies, animated messages, screen savers and games.

FFMI released its first animated “mobi-sodes,” including “Three Stooges,” this week. The company of eight animators partnered with Morph Studios in Seoul to create the computer-generated short videos.

Mark Miller, chief executive of FFMI and president of Famous Frames Inc., said online videos don’t have a history of production values, but his product will be different.

“This is high-quality content,” he said.

Most producers of mobile content have skimped on cost by using young film school grads instead of experienced pros, because companies have not yet figured out how to monetize mobile content.

Miller said he expects to see revenues through sponsorship advertising and download fees. Viewing clips is free, but there’s a nominal fee for downloads.

He acknowledges that trying to run a company in the mobile space is like traveling through the Wild West.

“We are taking a risk,” Miller said. “But the industry is catching up. Since the company launched, you’ve seen a release of a bunch of sophisticated phones geared toward playing content. This is where it’s heading.”

Unlike Amp’d Mobile, a content producer and phone service that tanked last year, FFMI is not leasing any data space from phone carriers to deliver its programs.

It’s using a digital delivery platform, called nGen, which essentially plugs FFMI’s content into the nation’s top cell phone carrier networks.


Software Money

Passenger, a software developer, raised $8 million from its previous investors, StarVest Partners, Shelter Capital Partners and Steamboat Ventures.

The Los Angeles company creates software applications that can be used on enterprise Web sites to conduct focus groups using social networking tools. The two-year-old company boasts high-profile clients such as Coca-Cola, Chrysler and Disney. It has doubled the number of employees to 55 over the past year.

This latest round of investment brings the company’s total funding to $20 million.

Passenger executives said the company will use the cash to strengthen its technology and expand internationally.


Ad Way

Criticisms that some social networking sites, such as MySpace, have sold out users by bombarding them with ads haven’t discouraged one new company. The new site SocialVibe unabashedly mixes branding and sponsorship with the social networking concept.

Users select brands for sponsorships on their profile pages and accumulate points based on how many people view the ads. The users can then use those points to donate to charities or win trips and gadgets.

The West Hollywood company has signed on partners such as Coca-Cola, NBA, Sprint and Nestle. SocialVibe claims users have donated more than $30,000 to 14 charities over the past three months since it launched.

In December, the company received $4.2 million in funding from Redpoint Ventures.



Staff reporter Booyeon Lee can be reached at

blee@labusinessjournal.com

or at (323) 549-5225, ext. 230.

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