• by Ross Fadner , May 1, 2012

Hi folks,

The Digital Content NewFronts seem to have sparked a debate about whether -- and how fast -- TV dollars will flow to the Web. Today we’ll hear from one prominent Internet entrepreneur who believes Web dollars will actually flow into TV. After that, we’ll assess the aftermath of last week’s Senate Commerce Committee hearing on the future of video migration. Then, more unnamed sources weigh in on Hulu’s TV Everywhere talks, and finally: Revision3 is in talks to be acquired by a major media company.

Why Web Dollars May Actually Flow to TV

Forbes’ Rob Hof has an interview with Simulmedia CEO and MediaPost Online Spin writer Dave Morgan about where he thinks television dollars are headed in the future. Perhaps the most surprising claim made by Morgan, who co-founded 24/7 Real Media (bought by WPP Group) and Tacoda (bought by AOL), is that online advertising dollars will flow into television, and not vice versa, as companies like Google and Facebook have hoped.

Simulmedia, which is an ad network for television, is also announcing a $6 million round of funding from previous investors Avalon Ventures, Union Square Ventures and Time Warner Investments, which brings its funding total to over $27 million. Morgan reveals that the company didn’t need much money because it is already close to profitability.

How is that? Morgan explains: “Where online ad networks permitted a reduction in the pricing of impressions, because they made more impressions more accessible, we can increase the value of advertising for networks and operators by applying more data to an industry that has a finite and relatively controlled inventory volume.” Because of this, he says not only are TV dollars not going online -- digital dollars are headed for TV.

Next Steps Unclear Following Senate Hearing on Internet Video

What -- if anything -- did the Senate Commerce Committee hearing last week about video migration achieve, asks Multichannel News columnist Gary Arlen. While the notion that the 1996 Telecommunications Act needs to be updated is certainly true, there’s no way Congress is going to start the arduous task of reform so late in the term. Arlen adds that the hearing didn’t provide any definitive plans for next steps, either -- in fact, a Committee staffer said he was unsure about how the Committee plans to follow up.

Equally “perplexing” was the fact that a rather large constituency -- big media -- was uninvited to the Senate hearing. Media and telecom giants will obviously have a huge say in any eventual legislation, as will other government agencies like the DOJ, the Pentagon and the FTC and FCC.

Ultimately, Arlen says all that was really achieved by the hearing was to open an official record about the competitive value of Internet video, and to put a marker in the ground that says we’re in the midst of historic change. Thanks, Senate Commerce Committee -- we knew that already.

Source: Hulu's TV Everywhere Discussions are About Fox Content Only

As it turns out, TV Everywhere-style authentication may only be coming to Fox content on Hulu, Mashable reports, rather than to the entire online video service. Late Sunday, The New York Post cited unnamed sources who said that the joint video venture from News Corp., Disney and Comcast would be moving to a more authentication-heavy model, and that this was part of the reason Providence Equity Partners decided to sell its stake in Hulu back to the media owners. But now, Mashable sources claim that the talks only involve certain programming; one of the sources said the discussions were mainly about Fox signing more cable and satellite providers into its online system.

Of the three Hulu owners, News Corp-owned Fox has certainly been the most bullish when it comes to restricting content to cable and satellite providers. Last fall, the network began limiting next-day access to its programming to Fox.com, allowing Verizon and Dish Network subscribers to log in and view next-day content while others have to wait eight days. Fox’s current agreement with subscription-based Hulu Plus allows next-day access to most of its content -- although for some shows, such as "The Simpsons," Hulu users must authenticate a subscription service with either Verizon or Dish Network.

Sources: Discovery Channel to Buy Revision3

Citing multiple sources, TechCrunch is reporting that video content provider Revision3 is looking to sell itself to The Discovery Channel. One source puts the price tag at between $30 and $40 million, and said the deal would close as soon as this week.

Revision3 posted an ad revenue gain of 53 percent in 2011, although no numbers were disclosed -- and a video view increase of 359 percent, to 800 million views. It also reported a subscriber base of 4.5 million on YouTube.

The Discovery Channel, which touts itself as the #1 nonfiction media company in the world, hasn’t been able to translate its analog success to the Web. “So the match seems to make sense,” TechCrunch says.