菠萝有话说

VCs are filling the pipeline because they know traditional companies fear their extinction in the new media age and are hungry for ideas. And, while venture investors' raison d'etre is to disrupt the status quo, in a twisted way, they're competing with the startups they embraced only a few years back. Google (US:GOOG), which was funded by Kleiner and Sequoia back in 1999, is trying to win in the video-sharing world with Google Video.

The cash is plentiful on both sides. Last year, venture capitalists raised $ 24.2 billion, which was spread across 199 new funds, according to Dow Jones VentureOne. It's the highest dollar amount raised since 2001.

Google Inc. (US:GOOG) (GOOG) , as of March 31, has $8.43 billion in cash and cash equivalents. Yahoo Inc. (US:YHOO) (YHOO) , which has $3.8 billion in cash and cash equivalents, is also considering launching its own user-generated video service. Microsoft (US:MSFT) (MSFT) , which owns MSN and has $34.8 billion in cash and short-term investments, plans to launch its own video sharing service, code-named "Warhol," that will integrate with its MSN Video and MSN Spaces services.

Video-sharing sites are just a manifestation of user-generated content exploding online. Consider this: Limelight Networks, which helps deliver video populating YouTube, is set to announce Wednesday that it's generated $10 million in sales in the first quarter, up 200% from last year.

But other user-generated content is also getting noticed.

NewsCorp's (NWS) Fox Interactive Media just bought kSolo -- a service that lets you record your songs and share them with friends or the world.

At the same time this user-gen world is cluttering the media landscape, there's another kind of digital content being created as well.

This time, it's from people who are already creating content for a living. They are those who have ties with traditional publishers and agents, but are now creating new content that can give them a greater piece of the pie. I call them free agents.

These are the interesting individual creators because they are dedicated to their craft and are motivated to build a following. That's where iAmplify.com comes in. Amid this clutter of user-generated content, iAmplify's service rises above the fray because it houses content that's recurring by creators who pride themselves on being experts in a particular area.

Last week, I caught up with Jack Hidary, who co-founded iAmplify with his brother Murray. Hidary -- who lives in Manhattan -- came to my neighborhood for a quick bite of sushi. IAmplify is essentially a site that has audio and video content from well-known experts, from physical trainers, weight-loss advisors, spiritual gurus, counselors, golf instructors and even pastors.

IAmplify just launched three months ago and now has 10,000 subscribers paying either $10 a month for a subscription service to their favorite guru, or paying a la carte for a certain series. For instance, if you're afraid of flying, you can buy audio courses on how to control your flight anxiety. The expert on this topic is United Airlines Captain Tom Bunn, who also happens to be a licensed therapist. He's selling courses for $170 for the entire package, or you can buy several downloads for $50 or so. Or, for $50, you can download six audio talks regarding "Objections to Christianity" from Tim Keller, who started Redeemer church in New York, and is one of the foremost theologians and thinkers in the country. Interested in poker? Phil Hellmuth, a world class poker champion, has videos for sale on iAmplify too.

Hidary tells me that iAmplify has some 1,200 experts -- or amplifiers as Hidary refers to them -- creating content. Hidary built the service so that iAmplify has exclusive rights to all the content being generated. Hidary also gets a 50% take on whatever is sold.

Now, what's the benefit of becoming an amplifier? Potentially, content owners can receive a larger portion of the pie. Hidary says his Internet distribution model enables him to give back more to the content owner. Indeed, in traditional models of video and audio tapes, there's always that cost of packaging that one can do away with on the Internet. Hidary says that typically, content owners receive about 7% of the profit that publishers generate on books. In the case of a DVD, Hidary says that content owners often receive an upfront check between $ 5,000 and $10,000. But the DVD producer gets future rights. "That's a bum rap," says Hidary. Indeed, if you're a fitness trainer or weight-loss expert selling your content on cassettes and video tapes, you're helping to build the $1.76 billion market for such products, according to Mindbranch. The market for self- improvement products is $7.87 billion. But content owners only see a sliver of that pie.

Importantly, iAmplify builds out a private-label video and audio-selling service for the content creators. If you're a content creator, you'd definitely want this. After all, content creators are in the business of creating content, and not in the business of writing code for new services.

By offering private-label services, iAmplify is essentially saying it doesn't have to be the destination, though it can be. "We're powering the author's own Web site," said Hidary. "What better place to sell the product than on the content owner's site?"

That power and control that Hidary is giving back to content creators will drive the popularity of the private-label offerings, in my opinion. Another company, with a similar private-label model is called Booyah Networks. This Boulder, Colo.-based startup is providing technology to private-label new Internet video channels.

IAmplify will also tap into vertical portals to get distribution for its artists. For instance, Airsafe.com -- a site all about air safety -- is distributing Captain Bunn's audio programs.

You might be thinking that iAmplify is similar to Audible Inc. (US:ADBL) (ADBL) , which sells content by subscription or a la carte. But iAmplify is a very different model from Audible because iAmplify owns the content and is not a store. Also, iAmplify's content is mostly short form rather than full-length novels.

For background, two years ago Hidary and his brother started to build the platform to make it easy for content creators to easily upload their audio and video. They spent the last year signing up exclusive deals with the content creators to create what Hidary calls "the largest storehouse of evergreen content."

All told, the brothers have spent $3 million out of their own pockets to build out the technology. The only reason they'd accept VC funding is to spread the risk. Otherwise, these two have done well with their past investments.

Last fall, Hidary sold Dice.com, a job site with 88,000 tech job postings, for $200 million to private equity firms General Atlantic Partners and Quadrangle. Dice.com came out of EarthWeb, which was split into the tech-job site and a content division. Dice was held onto by the Hidary brothers, while the content division was sold to Jupitermedia (US:JUPM) (JUPM) . Hidary and his brother, and Nova Spivack founded EarthWeb -- marketplace for IT professionals -- and took the company public back in 1998.

Hidary also started Vistaresearch, a service that hosted content for independent analysts. Hidary essentially housed the independent analysts and went out and got the investment banks and hedge funds to buy the research in bulk.

As you look at Hidary's history, you come to realize that he's a match maker for independent producers and an audience.

In my opinion, it's one of the best models on the Web.

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  (END) Dow Jones Newswires
  05-02-06 1031ET
  Copyright (c) 2006 Dow Jones & Company, Inc.