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Zatso shuts down

While most of the streaming-media dotcoms that have folded have had little effect on others, the same can't be said of Zatso, which ceased operations last Friday.

Personalized-news aggregator Zatso helped about 35 TV-station Web sites get their news content ready for streaming, with Zatso capturing the newscast, cutting up the stories, processing it for the Internet and hosting it on its servers.

"All they had to do was link to it, and now those station will have to find someone else to do that work," said Craig Marrs, vice president for development and affiliate relations.

Rik Bell, director of new media for Media General stations, says his stations will be able to get basic-streaming capability within two weeks. "But we're going to need to explore our options to offer aggregation, which was a key element to Zatso's service. We're dedicated to streaming and keeping the enhancements in front of the viewer, and we've had very positive response to them."

Scripps-Howard stations are in slightly better shape than the other station groups Zatso worked with because it already does its own streaming. "We just won't be able to offer the personalized aggregated content," says a spokesperson.

Although Zatso's editorial operations have ceased, its technical operations continue for at least the next three weeks as the company tries to help stations with video streaming minus the aggregator. Also, Zatso is trying to find a buyer for its technology, and Marrs says there is some market interest in that.

Zatso was unable to find additional funding needed to keep the company afloat (B & C, Oct. 16). The move follows on the heels of a downsizing move that cut the staff total to 38 only two weeks ago.

"Clearly, we're all disappointed that the market downturn hit our business the way it did," Marrs said, but he's hopeful about the tech end of Zatso.

"The merger folks are more interested in our technology, our technology team and our tools than they were in the other aspects of our business," he explained. "And because all of our best options are on the technical side, we can't afford to operate the newsroom.

"Clearly the pendulum has swung [with regards to raising capital], and, probably, like any trend, it's swung too far," he added. "For new-media companies associated with video and the Internet, the Internet is yesterday's news. The big thing now is wireless and interactive television, moving content onto mobile screens and the TV instead of the PC. All of those are what's in vogue in the investment community."