YouTube to Offer Users 'Insight'

Google has introduced a new, free tool to YouTube that will provide
those who post video clips on the mega-popular site--whether they are
semiprofessionals or media conglomerates--with deeper insights into
when, where and how often their video clips are viewed.

Using YouTube Insight, publishers are able to analyze the viewing
patterns or individual videos far more thoroughly than in the past,
when only total views and users ratings were available. For example,
with the new tool, any content producer who posts videos on YouTube
can examine what days of the week or hours of the day traffic spikes,
what U.S. states account for the most streaming and how long
particular clips remain popular.

Theoretically, content publishers can use the tool to determine
programming strategies. Advertisers can use it to test the popularity
of several different ads in different parts of the country. Media
planners could use it gauge when and where their best spending
opportunities lie.

"Effectively, we've become the world's largest focus group," said
YouTube product manager Tracey Chan. "There are so many use cases.
This really enables programmers and marketers to optimize their
presence on YouTube."

One use case that is not available up front is a measure of total
audience reach for an individual video – something that many in the
burgeoning online video space have been clamoring for, but something
that is not available upfront in YouTube Insight. However, Chan said
that several innovations to the new tool are already in the works.

It's even possible that YouTube Insight could be used to measure video
traffic on other sites – something that is mostly Nielsen or
comScore's domain at the moment. "If there is a strong desire, there
is the ability to take it to other platforms," he said. "We're really
open."

Alternative Flash Servers Follow H.264 Path

Last week Wowza introduced live H.264 capability in a preview version
of Wowza Media Server Pro; Red5 promises live H.264 to come in an
upcoming release of Red5 Server.

"As the popularity of Flash player video delivery increases, fueled by
Adobe's support for the H.264 video codec and the release of the Flash
Media Server 3 family of streaming servers, two alternative servers
that have also been growing in popularity continue to add features to
keep pace.

One of those alternatives, the Wowza Media Server Pro, staked a claim
last week as the first Flash media server to support live H.264
encoding using, as Wowza puts it, "readily available H.264 encoders
that support standard RTP/RTSP protocol." While the server won't be
available for final release until April, the preview version has
already begun to create interest. The Wowza Media Server Pro 1.5.0
preview release is available for download from the company's website
and, according to the company's press release, has been tested for
interoperability with Apple QuickTime Broadcaster, Vara Software
Wirecast, and HaiVision SD and HD hai1000 series network video system.
The last encoder mentioned, from HaiVision, is a high-definition H2.64
encoder, which means that Wowza also has provided a path to live HD
H.264 streaming.

Not to be outdone, the team at Red5, makers of the Red5
Server--another alternative Flash server--have also announced their
intentions to put H.264 into their product.

"Red5, or more specifically, our team member Paul Gregoire, is
working on the h.264 support," said Chris Allen in a February 14 post
on FlashComGuru. "We are releasing Red5 0.7 today or tomorrow, and the
h.264 stuff will follow soon thereafter in 0.7.1."

One of the reasons that alternative Flash servers have found a
footing was Adobe's previous pricing policy for Flash Media Servers.
Along the way, though, these alternative servers began to add features
that appealed to certain content delivery networks and broadcasters.
So, while the pricing on the Flash Media Streaming Server has fallen
to the same price as the Wowza Media Server Pro ($995) the market for
alternative servers has not completely disappeared.

Video Search News Conference

There is an upcoming conference I'd recommend you to check: they have lined up great panels, great speakers and great topics! Check it out, it's on April 7-9 in San Francisco.

Click here: VideoSearchNews.com

Should television and Internet ratings for shows be combined?

From Venture Beat:

With more content making its way from the small screen to your computer screen, it was only a matter of time before television executives realized the number of viewers watching a show on the Internet is probably important too.

At the OMMA Global conference in Hollywood yesterday, CBS Interactive's vice president and chief marketing officer, Patrick Keane, suggested that perhaps shows should combine television and Internet ratings, reports Online Media Daily.

The case Keane cited was CBS's show "Jericho," which was once — and still is — near cancellation. The show's 4.2 rating (meaning 4.2 percent of homes with televisions in the U.S. were tuned in) is hardly stellar. However, when factoring in the audience watching it online, the rating jumps almost a full point to 5.1. This difference can literally make or break a show.

Another example is NBC's hit show "The Office." That show was not always a hit and was, in fact, teetering on cancellation when NBC saw an explosion in popularity via Apple's iTunes store. That audience has since helped the show translate into a blockbuster on the network as well.

A combination rating would seem to make sense on the surface, but monetization remains somewhat of an issue for online programming — and a show's life or death naturally boils down to money. iTunes offers direct revenues to networks, but NBC backed away because it felt it was getting a raw deal (somewhat ironic given the above-mentioned salvation of "The Office" via iTunes).

For streaming video, newer services such as Hulu offer a nice online experience with advertisements that are not too intrusive, but the jury is still out on whether it will succeed or not.

Going the other way, a show that originated online, "Quarterlife," was not able to translate its online success into viewership on a network. The show was yanked after just one airing on NBC last month.

Video company Clearleap raises $9 million from Trinity Ventures and Noro-Moseley Partners

Video technology company Clearleap claims it is expanding viewer
options for "what's on TV." The details are vague as the company
appears to be in stealth mode, but it says it is working a new model
for bringing the near-infinite range of online video content to
television.

The Atlanta, Georgia company has raised $9 million in a round led by
Trinity Ventures and Noro-Moseley Partners. There's also a regional
digital media angle here. Atlanta is also home to Noro-Moseley, which
invests in companies based in the South — and to Turner, the large
cable television arm of Time Warner. Notably, individual investor Jim
Chiddix also invested: He's a former chief technology officer at Time
Warner Cable (a different cable division of the Time Warner
conglomerate). So did individual investor Sig Mosley, who's the the
president of Atlanta-based investment firm Imlay Investements.

The company itself boasts a number of founders with experience
building video technology.

Adobe Working on Media Player for iPhone

Adobe Systems Inc. has begun work to create a media player destined
for Apple Inc.'s iPhone, Chief Executive Shantanu Narayen said
Tuesday, thus adding a new wrinkle to a standoff between the two
long-term partners.

The X Factor: Why online pre-roll is dead

From iMedia -

Pre-roll was a bad idea from the start. It was lazy traditional thinking encroaching on an innovative medium. Here's why.

Online pre-roll video is dead. Okay, maybe not dead, but it has checked into a roach motel. Wow, did we screw this one up. All of us. I have received a lot of calls lately from media properties talking about all the extra inventory they have for pre-roll. And the prices dropped again! Wow, isn't that great? I'm reminded of something a friend told me once when we saw a sales sign in a shop window: "2 for 1 Suits." He said: "If they really wanted to screw you, they'd give you three of them."

You see, it's not just about the cost. So what happened? Numerous things, but they boil down to five points:

  1. How the client end is managing the buy
  2. How it is measured
  3. Ad content
  4. Ad content plasticity
  5. Consumer tolerance

Now, you may be sitting there reading this and thinking I'm insane and that your programs are great, but I'll just tackle those points and let you make up your own mind. Oh hell, no I won't, I'm right, just listen. I can sum up all five points easily.

Who is managing: A lot of companies made their initial foray into pre-roll through the traditional side of their business; their offline agency trying to encroach on digital. They had the commercial assets and weren't giving them up easily. "Hey, we can use the television commercial and just put it in front of content online." Done.

How it's measured: How are you going to measure it? "Oh, it's about branding." Pa-lease. As I've said before, if you are not going to measure, and it exists online, don't do it. At least measure the branding impact if you're going to use that cop-out. Dynamic Logic, ever heard of it? And if not that, then Insight Express? Cookie viewers and measure post-view to your site over a week, and then pop your own survey to those that were cookied -- 'cause trust me, if they didn't come within a week, it didn't do your brand any good. And that's where the shift happened. The buys shifted to those who were controlling the online media plan -- the ROI side of things. Once you remove the "branding" escape clause, for many people it just didn't make sense.

Ad content: Let's face it, the ad content sucked. And for the most part, it never got better. Developing web-specific video content is still expensive. Agencies haven't figured out how to do guerilla production, and they charge too much. The time frames take longer to create, and then you have SAG or some other rights agency sucking out more of the budget. It's fine when you're spending millions in TV but absolutely nightmarish for online. Unless it is going to be a massive ongoing effort, the cost benefit analysis just doesn't work. So what do you? You slap that 15-second spot up and call it a day.

ROO Group Signs LOI to Acquire Kamera

ROO Group (OTC Bulletin Board: RGRP - News) today announced that it
had entered into a Content Distribution Agreement (CDA) with Kamera
Content AB, providing for a collateralized and callable advance
payment by ROO of US$300,000. The CDA provides ROO with an exclusive
time period during which to fully negotiate the acquisition of Kamera.
The binding CDA was signed between the companies on March 12, 2008, at
the same time as the execution of a non-binding Letter of Intent (LOI)
for the purchase of 100% of the capital stock of Kamera by ROO.

Kamera is privately held and based in Stockholm, Sweden, with certain
back-office operations in Cairo, Egypt. Through its proprietary
software and content distribution agreements, Kamera enables corporate
clients such as Vodafone, MSN, Orange, Telefonica, O2, Hutchinson and
China Mobile to deliver IPTV channels to their customers over mobile
and online networks. Kamera's content library includes localized,
ready-to-publish clips from ABC News, Associated Press (AP), SNTV and
others, and its proprietary ingestion engine allows for video content
to be transcoded into any mobile/digital format.

Online Video Viewing Down in January after Record-Breaking December

YouTube.com accounted for one-third of the 9.8 billion videos viewed
online in the U.S. in January, according to comScore's Video Metrix.
That total was down slightly from the more than 10.1 billion viewed
during a record-breaking December 2007, writes MarketingCharts.

Google Lead Grows
* Google Sites once again ranked as the top U.S. video property in
January with nearly 3.4 billion videos viewed (34.3 percent share of
videos), gaining 1.7 share points versus the previous month.
* Google's YouTube.com accounted for more than 96 percent of all
videos viewed at the property.
* Fox Interactive Media ranked second with 584 million (6
percent), followed by Yahoo Sites with 315 million (3.2 percent) and
Microsoft Sites with 199 million (2 percent).

Online Video Viewers
* More than 139 million U.S. Internet users spent an average of
206 minutes per person viewing online video in January.
* Google Sites also attracted the most viewers (80 million), and
they spent an average of 110 minutes watching video.
* Fox Interactive attracted the second most viewers (53.9
million), followed by Yahoo Sites (36.3 million) and AOL LLC (21.9
million).

Other Notable Findings from January 2008
* More than three-quarters of the total U.S. internet audience
(75.7 percent) viewed online video.
* 78.5 million viewers watched 3.25 billion videos on YouTube.com
(41.4 videos per viewer).
* 49.4 million viewers watched 534 million videos on MySpace.com
(10.8 videos per viewer).
* The average online video duration was 2.9 minutes.
* The average online video viewer consumed 70 videos.

Hulu’s long tail of old TV shows and movies — something for everyone

Most people know Hulu as the site where they can go to (legally) watch
currently popular television shows like Family Guy, The Office, 30
Rock and movies like Ice Age.

But the Hulu library of TV shows and movies is far richer than
modern-day hits, and users are loving it all. On any given week, more
than 80 percent of videos in the library are viewed, the company says.

Hulu only left its private beta this past Wednesday, so I'm interested
to see how growth on its "long tail" of older shows and movies plays
out on the web. Hulu videos can be embedded on other sites — more than
50,000 were during the private beta — and it partners with
video-sharing sites like Veoh for additional distribution.

These shows are, by this point in history, an important part of
America's cultural heritage. Sample TV titles include 80's detective
show Remington Steele, the 70's sitcom The Mary Tyler Moore Show, 60's
sitcom The Dick Van Dyke Show (below), and one of my personal
favorits, 90's sketch comedy show In Living Color (see this classic
scene featuring "Homey the Clown").

Older shows like Arrested Development, Doogie Howser, M.D. and Airwolf
are regular favorites among Hulu users, the company says. Some of
these shows, like Arrested Development, weren't even popular enough in
their prime to make it past a few seasons.

And, older movies that have caught on with the Hulu audience include
1986 sci-fi flick Planet of the Apes, 1993 semi-fictional biography
Dragon - The Bruce Lee Story and perhaps one of the most brilliant
movies of all time, post-film noir comedy The Big Lebowski (I can
hardly believe I'm able to embed the entire feature length movie at
the bottom of this article, but there it is).

Many of these shows and movies have never been seen before on the web
(again, at least not legally). Old fans are rediscovering them while
new fans — many of whom weren't born when the shows first aired, are
falling for them, for the first time.

This "long tail" of Hulu is most certainly part of the Hulu game plan
(Note: Although the phrase itself has become a cliche, this is a
pretty good case for using it). Just take a look at who's the chief
executive of Hulu: Jason Kilar, a former executive at Amazon.com, a
company that showed that the long tail could be wildly profitable
through serving each niche of book lovers. Kilar was most recently
Amazon's senior vice president of Worldwide Application Software, and
before that, the vice president and general manager of Amazon's North
American media business — in fact, he led its entry into the video and
DVD selling business.

But Hulu is all about online distribution, as Kilar makes clear, and
just getting these shows spread out widely across the web will create
a plethora of new opportunities for advertising and other ways of
making money (more on that here).

It's also easy to imagine broader cultural significance, like a
resurgence of fan sites around these older shows on Hulu. Stay tuned.

Windows Mobile to get Flash content

From Venture Beat:

Microsoft has licensed Adobe's Flash Lite and Reader, so users of phones with the Windows Mobile operating system can access Flash and PDF web content on their smart phones.

On one level, it's a surprising move, because Microsoft clearly wants to compete with Adobe on the mobile front. Earlier this month, the software giant announced it was moving its Silverlight web application developer software onto Nokia smartphones, with Windows Mobile compatibility coming soon. As we noted at the time, Silverlight is going to have a tough time taking on Adobe's dominant Flash player for regular web browsers — but it has a better chance in the mobile market, where Adobe is still bringing Flash Lite technology up to speed.

On the other hand, there's so much Flash content on the web that any smartphones claiming web-browsing capabilities will start seeming increasingly crippled without Flash Lite. The licensing deal gives Windows a leg up over Apple, where founder Steve Jobs said he isn't planning for any Flash or Flash Lite compatibility with the iPhone (our coverage).

Neither company has announced exactly when Flash Lite will become available for Windows Mobile.

Brightroll Ads, Now in HD

Months after receiving $5 million in funding, Brightroll's video
advertising network is coming out with HD ad units, enabling brands to
deliver HD-quality advertisements across Brightroll's network of
content publishers. Despite initial hesitation to push HD content
across the web, the continued merging of web and home theater
entertainment, along with increased use of web distribution for
premium and broadcast network content has kept the spreading of HD
content going across the Internet.

Given the current climate for video advertising and the promise most
content providers and marketers think video advertising holds, it's an
expected progression for an online video advertising network to make.
Finding ways for advertisements to best fit into existing content is a
key component of brands to strive towards, and Brightroll is looking
to make itself a more attractive advertising network in supporting HD
ads.

In doing so, Brightroll is also straddling the fence that currently
divides web and home theater content, even as these two channels of
content delivery are finding more and more ways to overlap each other.
By supporting HD ads, those brands with HD-ready marketing content can
turn to Brightroll for a turnkey solution that fits with existing
content to be spread across the web.

Of course, there's lots more than just HD offering to being the
prominent or all-inclusive advertising solution for online ads, but
it's evident that Brightroll is really appealing to the bigger brand
names with this latest feature. Brightroll already has a good-sized
list of brand name clients, so HD ads is something that Brightroll
needs to do in order to provide continued value as an online
advertising service.

Universal Pictures: Optimizing Video for Search

By Michael Boland, Search Engine Watch

We hear a lot about universal search and how it will keep SEO professionals on their toes with constantly evolving ranking algorithms. So how can local online advertisers take advantage of universal search?

Since universal search algos increasingly look favorably on video, the medium has been discovered by some clever SMBs as a side door into top SERP rankings. For these local marketers, top spots for certain keywords that have a great deal of bid pressure (i.e. "restaurant San Francisco"), suddenly become more accessible with optimized video.

Combine this with the relative dearth of optimized video out there, and it becomes a great opportunity for local video producers that are on top of their SEO game. Most local online video is buried within the listings of Internet yellow pages (IYP) sites that don't optimize the content effectively.

What are some of these optimization tactics? It can be as simple as uploading a video to YouTube that also resides on your Web site or landing page, according to Steve Espinosa, director of product development for eLocalListing. When Google sees that the copy and meta data surrounding your video is the same as the equivalent YouTube clip, it will rank your video and landing page higher as part of its increasing favorability of YouTube content.

Enter eLocalListing

eLocalListing has started to take some of these tactics to market. It's the latest in a growing wave of companies to offer video advertising to SMBs. Unlike many others, eLocal has SEO in its DNA.

"We've had top results in Google within three days of creating and submitting the video," Espinosa said. "These are terms such as 'painting in Columbus Ohio' or 'photographer in Sacramento.' These aren't small cities."

The company's strategy originated because SMBs aren't willing or able to shoot a video ad, convert it to a digital format, upload it to YouTube, and build a corresponding landing page with optimized tags and site copy.

With this in mind, it offers a low barrier video production product, similar to the well known Spot Runner, which lets SMBs customize a short video ad using stock footage. It also offers a landing page for the sizeable segment of SMBs that don't have a Web site (or have one that's poorly optimized). This all costs $99 for set-up plus $159 per month for SEO and SEM placements.

"You pick a video you like, and we'll assemble it with the information you want shown at the end, add the music, and then it becomes part of your online profile," said CEO Tim Judd.

The company's viral distribution and SEO strategy is a double-edged sword, though. While universal search creates the opportunity to push video into top SERP rankings, rapid evolution of universal search algorithms makes it difficult.

"Our content syndication strategy and our profile pages have changed three times in the past two quarters to adapt to how Google and Yahoo read and establish authoritative documents for their algorithms," Espinosa said. "It's constantly evolving and our strategy has to constantly evolve along with it."

Optimizing How-To Videos

So far this year, we've already seen noticeable interest and investment levels around how-to video sites. These often have the informative and entertaining attributes that make them a natural fit for viral distribution.

New sites include HowCast, which launched earlier this month with $8 million from Tudor Investment Corp., as well as MonkeySee, and WonderHowTo, which both launched last month.

Like the local video ads outlined above, there's a great opportunity to use basic SEO tactics to make how-to videos surface in SERPs. This opportunity becomes even clearer if you consider that Hitwise reports 2.6 percent of all searches are how-to in nature; and 5 percent of the traffic from the top 10 how-to searches goes directly to video sites.

Hitwise's top how-to searches for the four weeks ending January 26th:

1. How to tie a tie
   
   
2. How to ...
   
   
3. How to have sex
   
   
4. How to get pregnant
   
   
5. How to write a resume
   
   
6. How to win the lottery
   
   
7. How to kiss
   
   
8. How to lose weight fast
   
   
9. How to lose weight
   
   
10. How to solve a Rubik's Cube

So what does this mean (besides the fact that the searchers for questions 3 and 4 should meet up)? For IYPs, local search sites like Citysearch, and anyone else dabbling in local video advertising, a nice opportunity exists. Using optimization techniques, video in certain categories (home improvement, travel, lawn and garden) can generate traffic from this giant base of how-to searches.

Universal Pictures Part II: Sizing up the Local Video Market

In my vertical search column last month, we looked at the opportunity for SMBs to use universal search to their advantage by producing and distributing online video. But what is the size of this local video market? There are lots of projections being thrown around for the overall video ad market, but what about local?

eMarketer, for one, predicts the overall online video ad pie to grow from $775 million in 2007 to $1.35 billion in 2008, and $4.3 billion by 2011. By comparison, today's U.S. television market is about $70 billion.

$1.35 billion is about 5 percent of the 27.7 billion projected for all US online ad spending in 2008. If the same were true on the local level, 5 percent of the total U.S. local online ad spend ($2.4 billion in 2008 according to Kelsey Group data) would be $120 million.

But First...

I think $1.35 billion is probably too bullish, and if so, video's percentage of overall online ad spending will be less than 5 percent this year. Furthermore, in local, video's percentage of the total online ad spend is less than the national figure. This is because online ad networks aren't as developed as the national market, where players such as BrightRoll and VideoEgg place video throughout quickly expanding content networks.

However, video's share of the local online ad spend will equal or surpass the corresponding national number over time. This will be driven by growing demand for video advertising at the local level, and the resulting development of local ad inventory throughout local search and IYP sites.

Some of the factors causing this video advertising demand include:

• Online distribution has lowered the barrier for SMBs to advertise with video (previously limited to cable spot advertising).
• Broadband penetration and killer apps such as YouTube have popularized online video almost to the point of an expectation in search – and by extension, local search.
• Video is traditionally a strong and valued branding medium.
• The "lean forward" mode of watching online video takes advantage of direct response capabilities of the Internet.
• The "vanity factor" that has traditionally driven a considerable degree of local advertising (in yellow pages) is present in video.
• Given increasingly "blended" SERPs, video can be a powerful differentiator among text links.

To further support this, a December SMB survey done by AT&T in 10 U.S. markets, showed that 53 percent expect to buy online video ads within the "next couple of years".

As the $15 billion U.S. Yellow Pages industry only penetrates about a third of the SMB marketplace, video could be one of the ways to combat declining revenue by appealing to a new breed of advertisers.

If publishers are to grow top-line revenue, a significant percentage of the overall revenue mix will have to come from places where new growth is happening, such as search and video. Some progressive Yellow Pages publishers have publicly stated that at least 30 percent of revenues should come from these and other non-print sources.

As publishers are driven by this to resell search advertising and online video in earnest, the needle will begin to move for aggregate local video ad growth. Many IYPs and local search sites are already moving in this direction, including Citysearch, Superpages and Yellowpages.com – each of which formed reseller relationships with local video vendors in the past year.

SEO for IYPs: Video is the Key

Back to SEO, video also has the ability to drive traffic for IYPs and local search players. As examined in the first part of this column, universal search enables well-optimized video to improve search rankings for IYP listings and drive incremental traffic back to them.

But despite IYPs' realization that video will be a valuable tool in their ongoing ad sales efforts, their video SEO strategies have a long way to go. SMB video clips in the IYP environment are mostly buried within listings.

The opportunity here comes down to the fact that search is a sizable front door to most online experiences (duh); and local search is no exception. Although some IYPs have valuable URLs and strong brands, they also benefit from significant upstream search traffic.



So if they can get on the video SEO train in a more concerted way, they can reap these same benefits to a greater degree, given the opportunities universal search will offer. At the intersection of video and SEO, local search sites and IYPs – as the traditional "owners" of local – have the most to gain, and the most to lose.

AOL to buy Bebo social network

Time Warner Inc's AOL Internet division is to buy social network Bebo
for $850 million in cash, bolstering its consumer Internet offerings
even as the media conglomerate mulls splitting off the business.

Bebo, which claims a global membership of about 40 million users, is
one of the top social networks in Britain and market leader in Ireland
and New Zealand, it said. It is No. 3 in the United States behind News
Corp's MySpace and Facebook.

"AOL, at its core, is a way for people to connect," AOL President Ron
Grant told Reuters in a phone interview on Thursday. "We need to get
back to our roots."

The two companies had spent the last six months hashing out the deal,
the executives said. Grant said Bebo's heavy focus on media and
international interest had made it particularly attractive.

It already has a service in Poland and is set to launch in France,
Germany, Italy, Spain and the Netherlands in the next five or six
months.

The purchase comes amid a wholesale transformation of AOL from a
dial-up Internet provider to an online advertising powerhouse.

It has spent nearly $1 billion to create one of the biggest
third-party display ad units, Platform-A. AOL aims to gird against the
prospect of bigger rivals as Microsoft Corp pursues a deal to buy
Yahoo Inc and following Google Inc's purchase of DoubleClick.

"This is a tremendous acquisition and one I think is game-changing for
AOL," AOL Chairman and CEO Randy Falco said on a conference call.

NETWORKING

"Bebo will be the cornerstone of our strategy to transform online
experiences for advertisers, media companies and consumers," Falco
said.

AOL said Bebo would help round out its personal communications
offerings, now comprised of AOL Instant Messenger and ICQ, two wildly
popular services that let users send quick text, video and audio
correspondence.

Despite its global popularity AOL has not had much success turning
that into a business.

AOL said its advertising system is well positioned to turn social
networks into a thriving business despite difficulties its rivals
face. Google, which is the search advertising provider for MySpace,
expressed difficulties in "monetizing" MySpace's traffic.

"The acquisition demonstrates again how important the social
networking sites are to major media and Internet brands, who are
looking for new means to advertising growth," said Paolo Pescatore, an
analyst with UK-based CCS Insight.

"They represent a powerful opportunity, with their access to
demographic data and ability to target specific audiences."

Bebo President Joanna Shields will continue to run Bebo and will
report to Grant after the transaction closes. Falco said he expected
the deal to close in "the normal time" -- within around 30 days.

Falco declined to comment on what multiple of sales or earnings AOL
may have paid but defended the price, comparing it with the $15
billion valuation of Facebook implied by the $240 million Microsoft
paid for its 1.6 percent stake.

Facebook has around 67 million unique users.

"We think it's an excellent asset at a great price and we, I think,
have a proven track record of spotting value," he said."

Banc of America Securities LLC and Deutsche Bank Securities Inc.
advised AOL. Allen & Co advised Bebo.