• by Gavin O'Malley  @mp_gavin, May 13, 2008

Publicly traded digital entertainment company Zvue is redoubling its efforts in the hot arena of ad networks with popsauce--a "pop culture" ad network of video sites targeting 18- to-34-year-old influencers.

The popsauce network, set to debut today, represents a mixture of user-generated-content and licensed professional media from SonyBMG, Showtime, Warner Music, National Lampoon, and Disney-ABC Television Group's Stage 9 Digital Media, among others, Zvue CEO Jeff Oscodar tells Online Media Daily.

"Popsauce delivers on a promise to reach the most valuable consumers online," Oscodar said.

Late last year, Zvue dropped its old name, HandHeld Entertainment, and launched an online video ad network to monetize its library of professional and CGM content.

In April, however, Zvue received a letter of warning from Nasdaq to get its stock price up. If, by October, Zvue fails to raise the bid price for its common stock--which had closed below $1 for 30 consecutive trading days--the company could be delisted from the exchange.

"It's a capital issue, not a business issue," Oscodar said. "We were given six months to show that the stock price can rise above a dollar, and I'm not worried about that."

The bulk of the San Francisco-based company's revenue still comes from the sale of MP3 players. Yet it has increasingly focused on the operation of its network of sites, including holylemon.com, dorks.com and funmansion.com.

With possession of the popular video-sharing network eBaum's World, Zvue Networks currently projects nearly 3.5 billion page views and video streams served annually.

The popsauce network also recently signed distribution agreements with Next New Networks--to feature some of its content, including the popular "Obama Girl" videos--and Stage 9, Disney-ABC Television Group's new digital studio.

The network offers advertisers pre- and post-roll video advertisements, in-stream flash overlay advertisements, and banner and other alternative rich media advertisements.

Zvue Networks also provides advertisers with access to specific psychographics and includes vertical categories such as music, entertainment, and video games.