As you may or may not know Revision3 had to make a tough decision today and cancelled Internet Superstar and Popsiren and let Epic Fu and Wine LibraryTV go. New Media is hard to finance and with the US economy tanking it was only a matter of time till the softer businesses such as media and entertainment started taking a direct financial hit. 

Internet Superstar and Popsiren were good (not great) shows - I’m not surprised by Popsiren’s cancellation, it was a fun show that had been going through a lot of changes. 

Some have likened Revision3’s layoffs to that of the TechTV/G4 layoffs that were the beginning of the Revision3 era. Yes both companies are making changes but Revision3’s case is likely different because of the economy. Unlike TechTV/G4 the company is completely reliant on sponsors and investors.

The problem is that the content is On Demand and not shipped into the home via Cable or Satellite. The advertising model for IPTV and Terrestrial TV is completely different. 

Terrestrial TV relies on people watching shows on a constant basis (nearly 24/7) and looks to reach channel flippers, people who leave tv’s on etc.

IPTV relies on a very specified niche downloading AND viewing the content - with the advertising at the very beginning and end of the content a majority of the time. The potential reach and ROI are extremely low (albeit the cost is also lower than that of Traditional Media).

So in the end Revision3 had to opt to scale back shows and production costs. As a result Wine Library and Epic Fu are going to continue but independently from Revision3. Revision3 Beta is also a low cost breeding ground for new shows and will allow Revision3 to see the financial potential of a show before it starts investing in a show. 

This current economy is not good for New Media and Technology - the major companies will make it through the stormy weather (with layoffs likely as well) and startups are now pretty much left to fend for themselves. Today Jason Calacanis wrote in his email:

“Bottom line: there is zero chance of a short or medium term-rebound. Zero. As a startup, you are now, officially, on your own. You can’t count onyour VCs saving you or some magical offer from Yahoo or Google showingup to bail you out. Chances are Yahoo and Google are going to be shutting down and/or selling off companies they’ve already bought—like EBAY and AOL have started doing. Parents don’t adopt while they’re putting their kids up for adoption. What you do in the next 30 days will probably make or break your company. The storm is upon us and the death spiral has started. Once that happens, you can’t stop it—you can only ride it out”

If you are a startup or even an independent employee the economy is not conductive to long-term sustainment. You have to start making major decisions about your company and personal financial goals. The market will continue to get tighter and tighter - historically November is a very tough month for all aspects of the economy. Revision3 had to make very tough decisions that may anger some fans but its necessary for the rest of the company to stay afloat.

Read More:

Kent Nichols: Add Rev3 To The Deadpool

Kevin Rose on the Rev3 Layoffs

We at Generation Tech wish everyone at Revision3 the best of luck in these tough economic times.

CommentsArticles digg, economy, epic fu, internet superstar, jason calacanis, layoffs, popsiren, revision3, techtv, wine library tv, winelibrary