KATV-TV, Channel 7, is no longer offering streaming video of its newscasts on its Web site (www.katv.com) because its provider, Zatso of San Francisco, went belly up Oct. 20.
Zatso helped affiliates build Web sites featuring streaming video clips of local news stories. Zatso’s own journalists would also add links and other content to the site to complement the affiliates’ news content.
Allbritton Communications Co., which owns KATV, inked a deal in February to use Zatso for three of its stations. Other midsized media companies, such as Meredith Corp. of Des Moines, Iowa, United Television Inc. of Beverly Hills, Calif., and Waterman Broadcasting of Fort Meyers, Fla., partnered with Zatso.
“When it originally came up, I thought, ‘Well this is a grand idea,’” KATV general manager Dale Nicholson said. “But I guess it’s like so many of those dot-com businesses.”
Often that means big ideas, big investors and a big flop. Zatso’s investors included Silicon Valley venture capitalists Institutional Venture Partners and Brentwood Venture Capital and media companies E.W. Scripps and Media General Broadcast Group.
For all the bells and whistles, Zatso’s goal was nothing new: to sell advertising. Like competitors WorldNow and IBS, the idea was to make money splitting the sites’ ad revenues with the affiliates.
Nicholson said he never saw a split.
“They were selling some ads on their own and putting them on there, but it never got to a revenue split,” he said. “They had hopes that it would, but it never generated enough money even to pay their own staff.”
Of the three Allbritton stations that used Zatso, KATV’s site often received the most activity. KATV page views in September accounted for 57 percent of those on Allbritton’s Zatso sites. The week of Sept. 18, the site recorded 3,767 page views, and users watched 754 stories online, KATV said.
But KATV loses little in the deal. The partnership required no investment, except for promotion of the feature early on. All the news department spent was the time it took to send Zatso video clips. KATV didn’t even attempt to sell advertising for the site.
“They were pushing us to try to go sell it to the marketplace, and, frankly, nobody’s got a good handle on how to sell the Internet yet,” Nicholson said. “I don’t see anyone being terribly successful in doing that, and we just felt our bigger business was to sell ads on television and we would stick with that.”