Our portfolio company NetMediaEurope didn’t always see things this clearly. In the throes of the post-Lehman media recession, which witnessed plummeting banner ad revenues for B2B media websites globally, NME seriously considered extending its tentacles into the B2C content sector.

The idea seemed attractive to the board at the time. With its pan-European footprint of titles like ITEspresso, Silicon, and The Inquirer, the company found itself exposed on multiple fronts: first, B2B technology ad budgets had been slashed by all large tech companies; but moreover, NME’s core markets of France, Germany, Spain, and Italy were all entering recession.

On digital content’s B2C side, things weren’t nearly as dire. Although CPMs were experiencing downward pressure, the diversity of audience and thus advertising base enabled quality consumer-facing websites like CommentCaMarche.com to remain sheltered from the downturn in corporate ad spending. The siren’s call of relative ad revenue stability on the consumer side was challenging to resist, especially when financial investors become alarmed at the impact on the bottom line short-term. Something had to be done !

But to the management team’s credit, they held their ground. Actually, they doubled-down. At the 2009 low point for B2B digital media, NME opened a UK presence. Even more crucially at the time, the company began brainstorming on how to diversify its revenue base while best leveraging its valuable audience of corporate IT decison-makers, such as expanding into lead generation. I won’t elaborate on the details because the story is still being written. But in hindsight it looks as though those difficult decisions at the nadir of the global financial crisis proved genius.

Charlie McCurdy, CEO of Apprise Media reinforced some of these choices in his excellent presentation at American Business Media’s Advanced Leadership Program on The Future of B2B Media. “Marketers are probably not buying banners or sponsorships for the media exposure, they want to drive leads to their websites. If white papers or Google AdSense deliver, they’ll do that instead.” In terms of b-to-b marketing share, ABM attendees forecast that live events would grow from 45.1% in 2011 to 48.4% in 2016; digital would grow from 12.8% in 2011 to 18.2% in 2016; and print would fall from 29.2% in 2011 to 11.7% in 2016.

In late 2010, NME witnessed a return of the banner ad budgets from corporates, but makes no secret of its appreciation of the importance of a diverse offer for this core client base, nor of the importance of scale. The company recently acquired the German subsidiary of CBS Interactive, and is on the hunt for additional acquisitions in Britain and France.

Nowadays it’s very fashionable in startup parlance to talk about strategic ‘pivots’. Indeed, the accelerating pace of innovation in technology often creates an environment where only those startups capable of redirecting their strategy on a dime can avoid obsolesence. But if there’s a moral to this story, it’s that there are no easy answers. Sometimes a ‘pivot’ is needed. Sometimes it’s better to scrap everything and restart with a blank sheet of paper. And yet sometimes, the old-fashioned wisdom of ‘sticking to your knitting’ prevails.

Wednesday’s blackout by several websites in protest of SOPA undoubtedly pushed the pending SOPA legislation against the ropes.  As the NY Times reported, this was a case of grassroots new media beating the old guard.

On January 17, only 31 members of the U.S. House of Representatives opposed the legislation, with 80 in support.  The day after the Jan.18 blackout, the 31-member opposition had surged to 122-strong (see ProPublica).  Even this microscopic blog’s activism elicited a surprising number of reactions here in France, including even from an assistant to a U.S. Congressman that happened to be on vacation in Paris.

But this is only round 1.  The $63m-funded army of lobbyists defending the well-financed old guard media are still in the ring.  David Binetti offers an insightful op-ed in TechCrunch explaining how the lobbyists will most likely take the fight to the most powerful influencers of the opposition directly, i.e. venture capitalists and thought leaders of digital media giants.  Round 2 will prove interesting.

My question is what should we do about this in Europe.  Europe was largely silent in round 1 (heaven knows we have other problems right now).  A typical government policy, like that of the UK, is to not intervene in the domestic legislative debates of another sovereign nation.  This is understandable.  But nefarious ill-conceived copyright legislation like SOPA would affect citizens of Europe as well.  What is the appropriate level of response?  I submit that it has to start with netizens of European digital media as well, a grass-roots effort just like in the U.S.

Hopefully, as Binetti suggests, this incident of SOPA opposition will come to represent an inflection point in the disruption of the entire political industry.  What if a successful political campaign relied not on how well-financed it is, but rather on mastery of social media to communicate a platform of integrity?  Now that would be something.

This blog is admittedly a small fry, but principles matter.  And based on principle and in a show of solidarity with popular websites like Reddit, Minecraft, Craigslist, Wikipedia, and A VC, this blog will join them in going lights out tomorrow in protest of the SOPA legislation currently pending in congress.

For more rationale, see: Why SOPA must be stopped

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Today our portfolio company NetMediaEurope announced the acquisition of CBS Interactive’s German subsidiary. I am convinced that this transaction is a win/win arrangement for both buyer and seller.

The divestment allows CBSI to focus on its core markets of North America and Asia. For NME, it enables the company to shore up its previously modest presence in Germany with one of the top online IT media players. Now NME counts a truly pan-European footprint in France, Germany, the UK, Spain, and Italy. Notable online brands of CBSI Germany include ZDNet.de, CNET.de, and Silicon.de. NME combined will now attain close to 20 million monthly page impressions on its network of websites, all dedicated to B2B IT professionals, consistent with the company’s strategy to remain focused on high-value audiences. This acquisition also provides a significant bump in revenues to the profitable venture, which we carved out of the former VNU Group in 2007.

I commend the heroic efforts of Dominique Busso, Anilda Billon, Ruud Bakker, and the rest of NME’s leadership team in executing on this game-changing acquisition, and we welcome CBSI Germany into the NME family.

Here is a link to the announcement in TechWeekEurope.

I’m not feeling very patriotic today.

Part of my mood stems from the thought of today’s hearing by the U.S. House Judiciary Committee on the Stop Online Piracy Act. The SOPA legislation currently winding its way through the U.S. congress would allow the U.S. Department of Justice, as well as copyright holders, to seek court orders against websites accused of enabling or facilitating copyright infringement. The bill would also make unauthorized streaming of copyrighted content a felony.

In a typical vast overreaction to a threat of a limited group (remember the Patriot Act?), the SOPA bill risks enshrining Internet censorship and crippling the Internet. I recommend Fred Destin’s post on Five reasons why SOPA is luddite legislation to understand how braindead Texas congressman Lamar Smith’s sponsored bill is.

The other item chapping my hide is the fact that I just submitted my U.S. tax return for last year. As an American working in France, I am required to file two tax returns: one with the France fiscal authority and a second with the U.S. IRS. The U.S. is one of only two countries in the world that taxes its citizens globally, no matter where they live, work, and pay taxes. So every year I have the luxury of paying taxes on my French income, and then an additional chunk to Uncle Sam on my same French income. Granted, there is a limited foreign tax credit, but all in, I’m contributing between 60% and 70% of my gross income to both governments.

I don’t mind paying French taxes and social charges, even their elevated amount. It’s the U.S. IRS’ demand of its pint of blood for income that I earn and am already taxed on in France that I find particularly egregious. This is double-taxation without representation. Adding insult to injury are the myriad penalties on many French investment products (like IRAs and mutual funds), rendering such vehicles so costly as to be unpalatable. No wonder that many Americans living overseas refuse to play by the rules. I’d like to see the “tea party” take on this cause with as much fervor as their other ideas.

Worse yet, the threat of new tax legislation called FATCA will increase the obligation of Americans worldwide on all of their financial assets. Foreign banks in particular will bear a significant reporting burden. An officer of a large French retail bank mentioned to me that if FATCA is implemented, his bank will likely no longer accept American customers due to the associated costs.

Americans living overseas are the foot soliders in the U.S. government’s battle to win hearts and minds. We could represent the States’ ambassadors writ large, but sometimes it feels like we’re being treated as traitors.

We hear the repeated siren’s call of social / local / mobile.  As of matter of fact, this year’s LeWeb conference captures this three-part mantra as its very theme.  And you’d be hard-pressed to find a VC fund in Europe today not following this guiding light for its investment strategy.

Among the takeaways of LeWeb’11, we are led to appreciate the inevitability of ‘social’ and ‘mobile’, as testified by the success of companies like AirBnB, or the famous “cross-over” of Google Maps into permanent predominance of mobile usage.

But the verdict on ‘local’ is mixed.

Gabe Rivera, CEO of Techmeme, suggests that ‘local’ is over-rated, and would not launch a local offer.  Why ?  Quality of local content is spurious.  More significantly, local content is not sufficiently abundant.

AOL’s Patch service boasts 10 million unique visitors across its network, built over the past 18 months.  Is this significant ?

Is local content sufficiently interesting to advertisers ?  If not, how will local be monetized ?  Just as we witnessed the small-town newspaper as the first casualty of the digital media age, does local offer enough scale to make business economics work in a global world ?

To be continued…

Despite the macro-economic distraction, some of our startups are still growing wildly and seeking to recruit top talent.  Here are a couple open positions:

• A java back-end developer, to work closely with the Head of Technology and the Game Development team.
• A mobile games content manager, responsible for testing and selecting new mobile games that fit the audiences of the various gaming portals.

The above opportunities are based in the Netherlands.  Any interested candidates are welcome to contact me directly by email.