VentureBeat

MySpace to launch free digital music service – MySpace Music sounds interesting, but it may not quite live up to Fortune’s declaration that it “promises to be the most significant roll-out of a digital music service since Apple’s iTunes.” Since you have to purchase songs from another service like iTunes if you want to download them, this doesn’t actually sound much more useful than existing service imeem. Meanwhile, the Los Angeles Times has some speculation about who will lead the new company, suggesting that the short list is down to two names: Owen Van Natta, Facebook’s former chief operating officer, and Andy Schuon, a longtime Universal Music executive.

Merrill Lynch agrees to sell itself to Bank of America — The nation’s largest brokerage firm has lost more than $45 billion in mortgage investments, and plans to sell itself for $50.3 billion stock, according to The New York Times. Meanwhile, another prominent Wall Street firm, Lehman Brothers, has filed for bankruptcy.

LinkedIn to launch its own ad network today — When users of the professional networking site visit partner sites, a cookie with some of their information will allow the sites to deliver targeted advertising. The program will have an “opt out” option.

AlleyCorp co-founder predicts $50M in revenue in 2008 — That’s up from $8 million last year. The Manhattan incubator’s network of companies (which it does not own) includes news site Silicon Alley Insider.

Hackers break into new Hadron Collider computer system — Talk of how the collider will bring about the end of the world is already running rampant, and this should only make it worse.


Did Spore copyright protections backfire on game publisher Electronic Arts? — Gamers’ anger at what they saw as overly restrictive copyright protection has led to a flood of negative reviews on Amazon, although it’s not clear whether that’s had a substantial effect on sales.

Intel worker accused of stealing confidential documents as he heads to job at AMD — The news comes as the competition between the two chip makers intensifies, with Intel set to announce a new chip today.

Yahoo sales exec David Karnstedt joins Redpoint Ventures — Joanne Bradford, a former Microsoft executive, has been named as Karnstedt’s replacement.

Here in Silicon Valley, it has become a sport to beat up on traditional media companies for doing things like enforcing content copyrights. The argument you hear in these parts goes something like this: The way of the future is for content to be completely free, so media companies have to adapt to that or die. End of story. Meanwhile, Wall Street analysts are increasingly thinking the same thing.

The latest: Today, an analyst at investment bank Lehman Brothers, Anthony DiClemente, says that “Content may no longer be king in the content business.” Digital content distribution, audience fragmentation and file-sharing are likely to irrevocably eat away at movie and television company profits.

Just like people stopped buying CDs and newspapers earlier this decade, so too will they stop buying DVDs — a not-new idea that seems to just be hitting public markets via DiClemente. Instead, as he and many others posit, everyone will soon get their videos on Google’s YouTube or on any number of smaller video sites, as well as through file-sharing services and on Apple’s iTunes.

Of course, YouTube and iTunes aren’t the only huge new means of distribution out there. Others include social networks like Facebook, News Corps’s MySpace and others — not to mention mobile distribution services like online video site mywaves.

Meanwhile, YouTube has yet to nail its own revenue model, iTunes’ revenue is under attack from old media companies that want larger portions of its revenue — and the social networks are widely believed to not be worth the billions of dollars they’re valued at. What about old media-owned video sites, like Hulu, which goes as far as to offer entire movies online for free? It doesn’t seem it will ever be a multi-billion dollar business, according to one recent piece of analysis.

So, in sum, nobody these days has figured out how to make anywhere near the amount of money that has formerly been made from content.

Here in Silicon Valley, we can mock traditional media companies all we want for not buying into the way of the future, and instead doing things like suing copyright infringers. But who really can blame them, considering what that future seems to be? Nobody wants to die.