DivX, Inc. (Nasdaq: DIVX), which develops video applications, thought it could succeed in the topsy-turvey web business. So, in late 2006, the company launched Stage6.com.

Well, for the most part, it's not as easy as it looks and now DivX is closing down the site. Interestingly enough, DivX wasn't able to find a buyer for the property.

What happened? Well, I had a chance to interview Chase Norlin, who operates Pixsy (an online search engine). According to him:

"Stage6 likely needed a sugar-daddy to support operations going forward (e.g. acquirer with resources or large capital raise). Given the popularity of the service and the high quality of their streams, they probably had a significant bandwidth bill without the monetization to support that in the short term. Additionally, legal issues around copyrighted material may have added to the decision."

Google Inc. (NASDAQ: GOOG) certainly likes to experiment. In fact, it's tough to keep up with all the new-fangled ideas.

One example: online video rentals (which got its start about 19 months ago).

Well, after testing the market, Google is now bowing out (tomorrow is the final day). Funny enough, a problem has been free sites, such as Google's YouTube.

I had a chance to talk to Chase Norlin, who operates Pixsy (an online video aggregator). According to him:

"The closing of the Google video marketplace exposes two basic realities about the online download business: 1) Apple Inc.'s (NASDAQ: AAPL) iTunes ultimately dominates the market with most of that success coming from music and popular TV shows (not customer generated content or full length movies that no one wants to pay to watch on their computers), and 2) The pay-per-download market, as it pertains to non-music content, is suspect at best. Ultimately, it's the all-you-can-eat model that will win the day here for most non-premium content. The premium content download business (e.g. feature length movies) will be driven by new entrants like Comcast Corp.(NASDAQ: CMCSA) and Netflix (NASDAQ: NFLX)."

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

This week, a startup company -- adap.tv -- raised $10 million from Redpoint Ventures and Gemini Israel Funds.

The company is trying to get a piece of the growing ad market for video. Hey, with the huge success of Google's (NASDAQ: GOOG) YouTube, it seems like a pretty good idea, right?

The founder of the company, Amir Ashkenazi, does have a lot of credibility. After all, he's the former cofounder of Shopping.com, which sold out to eBay (NASDAQ: EBAY).

But does his new venture really have a chance? I talked to Chase Norlin, who is the CEO of Pixsy, which is a search engine for multimedia. According to him:

"Adap.tv looks a lot like ScanScout, and a variety of other startups looking to become the next 'Adsense for Video.' That space is starting to feel a little crowded to me, not to mention the fact that Google hasn't even entered this market yet. Also, expect the major ad networks and online advertising companies to offer competitive products here as well. I'm sure adap.tv's technology is interesting, but that's not what matters in the online ad space. What matters is publisher reach and a large pool of advertisers to provide solid monetization. That's why companies like ValueClick continue to get stronger despite their non-groundbreaking technology: their advertiser and publisher pool continues to grow and the bigger they get the harder they become to displace."

And, to see more recent venture capital deals, click here.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

In light of Google's $1.65 billion purchase of YouTube, investors are hunting for the next cash-out. Maybe it will be BitTorrent, which announced it has snagged $20 million in venture capital. The investors include Accel Partners and Doll Capital.

BitTorrent is super-sophisticated technology platform that allows for efficient transfers of data (this is accomplished with whiz-bang peer-to-peer technology). In other words, it is a great vehicle to deliver video. It also became a great place to file-share copyrighted content.

But, over the past year, BitTorrent has been clamping-down on this. Of course, that makes the site appealing to traditional content players. In fact, this week, BitTorrent signed licensing deals with a variety of Hollywood players, such as Paramount and MTV.

I interviewed Chase Norlin, who is the CEO of Pixsy, which is a search engine for multimedia content. According to him: "Bittorrent's deals with the studios is just another example of content owners requiring multiple avenues for distribution. Bittorrent seems to have a good start in being the platform for this, but I suspect that there will be multiple distribution channels. Actually, the company in this space that I believe will be a big player in a few years is Comcast."

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates DealProfiles.com.