CBS Corp. (NYSE:CBS) took another step into the internet world yesterday with its $280 million purchase of online social networking/music site last.fm. This follows last week's acquisition of the internet stock market show WallStrip.

Last.fm acts as both a music guide and internet radio/music distribution site. Members allow the site to track their PC/iPod listening habits, and the site customizes streamed content of new music matching their tastes. Last.fm also allows artists and labels to upload new music (with accompanying permissions), so they can (hopefully) build a following.

The UK-based site began five years ago, and now claims 15 million members.
CBS still owns the largest radio network in the U.S., and I'm interested to see if and how they might integrate last.fm into this business. The two seem to be, to some extent, competing technologies, one in decline (radio), one ascendant (internet). The sale came as a surprise to some pundits who had speculated Viacom (NYSE:VIA), until recently part of the CBS empire, was prepared to offer as much as $450 million for last.fm.

Last.fm could provide CBS with a valuable platform for distributing content and a channel to retain advertising flowing to the internet. However, at present, no one site clearly dominates the music networking world. While CBS now has a seat at the table, the fight for ears and eyeballs will continue to grow more interesting.

The cheeky, sassy internet show, Wallstrip, a favorite of Wall Street devotees, has been purchased by CBS Corp. (NYSE: CBS). The daily internet show features news and stories about market happenings, and has made a star out of host Lindsay Campbell. Today, she gave the best, imho, announcement of a deal evar. Check it out.

This deal is emblematic of the reversal of flow underway. Where once entertainment flowed from producer to vendor to consumer, much of the most widely-enjoyed now comes from downstream. CBS shows it has recognized this sea change, and bought a great product rather than attempting to develop its own. We can only hope they don't attempt to homogenize it in the process.

Wallstrip is our favorite online Wall Street video. There, I said it. Even though host Lindsay Campbell frequently featured interviews with competing blog personalities, I saw through my game theory grids to love her manner, her wit, her hair. She's just got great hair. So it was no surprise (and not even the slightest bit of jealousy) to see that Wallstrip was purchased for a rumored $5 million by CBS Corporation (NYSE: CBS).

Founder Howard Lindzon was giddy in his blog post that seemed to tend to the Emmy-acceptance-speech. While it may seem a bit grass-rootsy, it was altogether not -- the production was VC-backed, and $600k was invested into the project (a great return hmmm?). I don't know if I would have had the guts to invest so much in a long shot, but it's clear that in today's media world -- even though reality shows are beating more highly-crafted dramas at every turn -- content is indubitably still king. The kid with the freshest content (and the best hair) still wins.

According to a story in The Guardian [registration required], Google (NASDAQ: GOOG) is testing ways of incorporating ads (and bringing in ad revenues) into YouTube videos. The head of Google's European operations, Patrick Walker, said that the company was testing the concept of offering people and companies that post videos half of the ad revenues, if they agree to allow a 30-second spot to run before the video.

He said the company is looking for solutions that don't ruin the viewer's experience. IMHO, thirty seconds isn't much to tolerate for a half-hour show, but might be a major hurdle for a two-minute clip.

Howard Lindzon of Wallstrip earlier this week told Variety much the same thing, but suggested the program could be rolled out as early as next week. Apparently, Google has been testing the concept on their Google Video site.

Walker went on to say that Google expects the YouTube ad stream to start bringing in "real money" in 2008. He also expects that more professional content producers will be eager to post their product once a shared revenue stream is in place. Spanish, German, and English television networks have recently agreed to create branded YouTube promotional channels.