Walmart is set to make a play for your living room. The company has acquired online movie service Vudu, just over a month after rumors about a deal first surfaced.

According to The New York Times, “the two companies began informing Hollywood studios and television manufacturers of the deal on Monday.”

Those manufacturers include the likes of LG, Sanyo, Toshiba and Sharp, who have signed deals with Vudu to put its service on its television sets. Previously, Vudu (which we first covered in early 2007) required its own separate box, but the company has since shifted strategy as the trend towards Internet-enabled televisions (see our coverage of this year’s CES for many examples) continues to accelerate.

This is an interesting move for a couple of reasons. For one, as we said last month, it puts Walmart head-to-head with the likes of Netflix and Amazon. But also, Walmart is a huge retailer of televisions –- it has the ability to drive sales of Internet-connected TVs with Vudu on board. NYT speculates that one day this might enable Walmart to move further into the delivery of content and merchandise to consumers via television.

Update: Walmart has confirmed the acquisition of Vudu, writing in a statement that “”The real winner here is the customer. Combining VUDU’s unique digital technology and service with Walmart’s retail expertise and scale will provide customers with unprecedented access to home entertainment options as they migrate to a digital environment.”

They also note that Vudu will continue to develop its app platform, which already includes Facebook, Flickr, Twitter, The New York Times and The Associated Press.







[mashable]

Online video has largely succeeded at many of its goals: It is democratizing media and encouraging a culture of sharing and participation. It’s pushing the television industry to modernize and become more interactive. It’s freeing content from time schedules and repressive windows. It’s driving cable companies to at least consider the true value of the loyalty of their subscribers.

But let’s be honest, it’s done more displacing and destabilizing than it has created wealth. And with a few possible exceptions — say, Blip.tv and Brightcove — no company but YouTube has really been able to grow a ton of value. (YouTube, Google promises, will be profitable any day now!)

Today, on the eve of Veoh declaring bankruptcy (first reported by MediaMemo), we can look back and see an awful lot of venture dollars invested — many of them that have since gone down the drain.

Veoh was actually the first online video company I ever covered, back in the summer of 2005, and if you know anything about me it kicked off a long fascination with the topic, aka our spinoff site NewTeeVee, which I founded three years ago and edited until very recently. Let’s just say I had higher hopes that the startups we covered would go on to become the new giants. Not so much.

Here’s a chart I made a couple years ago (back when many of these companies had already been walking dead, at least in terms of innovation, for a long while). Not a ton has changed since then.




[gigaom]

Pros tell Bloomberg BusinessWeek which sectors could witness the most M&A activity in 2010

For the mergers-and-acquisitions market, there is no doubt 2009 is ending better than it began. The year is winding up with a "sigh of relief," says Morton Pierce, chairman of the M&A practice at law firm Dewey & LeBoeuf.

In the past month the M&A market has built up some momentum. According to Bloomberg, deals in North America were valued at $115.6 billion in November, the most since September 2008. Compare that with late 2008 and early 2009, when dealmaking either wasn't happening at all or was centered in areas where deals absolutely needed to happen, such as failing financial institutions that needed buyers at any price. Deal volume in November was five times February's volume of $22.5 billion.

Investors looking ahead to 2010 are wondering if this uptick in M&A can continue and where it will occur. Acquirers almost always buy at a premium, so traders can profit from correctly betting which industries will attract the most bidding activity.


Small Tech Deals

In 2009, Internet stocks, the investment and financial services industries, software, and oil and gas production were among the most active, according to Bloomberg data. Expect more dealmaking among technology stocks, say M&A experts. Oracle Corp. (ORCL) is battling European regulators to finish its $7.4 billion acquisition of Sun Microsystems (JAVA).

Such acquisitions, and especially much smaller deals, are a way of life for tech firms, says Daniel Mitz, a partner at law firm Jones Day who specializes in tech deals. "A lot of the innovation comes from smaller companies," Mitz says. Dealmaking in tech slowed but didn't stop during the downturn. There could be significant pent-up demand, Mitz says. "This is an industry that is ripe for M&A."

One driver of a rebound for M&A in tech will be the strong financial positions of many tech firms, says Nadia Damouni, editor of dealReporter Americas, which tracks the M&A market. Another "cash rich" sector is health care, she says, but here the prospects for an M&A rebound are harder to read. The reason: Uncertainty surrounding the federal overhaul of the U.S.health-care system proposed by President Barack Obama and under discussion in Congress. "They're at the whim of health-care reform," Damouni says of the many insurers and health-care services companies that could be M&A targets at some point.

In health care, the key ingredient for dealmaking is "stability," says Bob Filek, a partner at PricewaterhouseCoopers Transaction Services. If health-care reform passes—or even if it doesn't—acquirers will want some certainty about what federal policy will mean for health care before making bids. Filek envisions "a couple of scenarios where [the result could be] a lot of M&A activity."


Limited Activity

Other hot industries in 2010, where Damouni sees more deal discussions happening, could be defense and even consumer products.

But not all sectors will see a rosy 2010. And overall activity could still be constrained. "Activity will pick up," Mitz says. "But I don't think it's going to be a boom."

Companies are finding it easier to borrow to complete deals than in the depth of the financial crisis. But it's still not easy. Len Blum, managing partner for investment bank Westwood Capital, says some potential buyers can't make bids because of a lack of access to financing. Expect smaller deals to dominate in 2010, as acquirers, especially private equity buyers, find those easier to afford, Blum says. That would continue a prominent trend in 2009. Until an uptick last month, the average size of deals in 2009 was tiny by recent historical standards. The average deal in July 2009, for example, was just $125 million, down from $427 million in July 2008 and $437 million in July 2007.

The economy's worst industries are likely to continue to scare away dealmakers. Problem areas include gaming and casinos and the auto industry, Damouni says. Many companies in those industries are battling bankruptcy and dealing with creditors. Before those issues are resolved, she says, "It could be messy for a buyer to get involved."


Divestitures

Paul Schneir, managing director of M&A at KeyBanc Capital Markets (KEY), expects CEOs and boards to spend much of 2010 deciding which divisions to sell off. An example of a large deal of this type is General Electric's (GE) decision to sell its NBC Universal division to Comcast (CMCSA).

Corporations are "drawing a line between what's core and what's not core," Schneir says. "There's nothing like a deep recession to force people to have a much sharper focus on their strategy."

Most experts told Bloomberg BusinessWeek better conditions could lead to more M&A activity across a wide swath of the market. The biggest question, then, is whether those conditions—which include healthy debt markets, a stable stock market, and especially an improving economy—will continue in 2010.


[businessweek]

Optimists hoping that venture capital investing might be bouncing back will be disappointed by the latest numbers from Dow Jones VentureSource. After venture investments saw an encouraging uptick during the second quarter of 2009, they dipped again in the last three months.




Specifically, VCs invested $5.1 billion in 616 deals during Q3. That’s down 38 percent from the $8.2 billion invested during the same period last year, a drop you’d expect. But it’s also down 6 percent from Q2, when VCs invested $5.4 billion, so if there’s going to be a recovery, it isn’t here yet.

Looking closer at the numbers, you can see the continuation of several trends: Later-stage deals are becoming a larger piece of the pie, representing 40 percent of all deals this year compared to 33 percent last year. Deals are getting smaller, too, with a median deal size of $5 million, compared to $7 million last year.

In terms of which industries are attracting money, information technology (IT) reclaimed the top spot after being overshadowed by health care last year. Within that IT umbrella, it looks like Web 2.0 investments are continuing — in fact, they beat traditional software investments for the first time. VentureSource didn’t provide an exact number for Web 2.0 deals, but categorizes them as part of the information services sector, which actually improved 11 percent from last year, for a total of $627 million in 86 deals. On the other hand, investment into renewable energy, another industry that’s getting a lot of headlines in the tech world, fell 73 percent to $343 million.

None of this is terribly surprising, since venture firms themselves have been raising much less money and the liquidity of venture-backed companies is also down. Together, these numbers suggest we shouldn’t expect to a return to the startup and VC environment of 2007 and 2008 anytime soon. Indeed, they may back up speculation about a permanent industry contraction.






[venturebeat]