Pop! Goes The Web Site

Pop.com Spielberg Howard Internet
Pop.com, the much-awaited Internet entertainment site backed by Hollywood powerhouses such as Steven Spielberg and Ron Howard, is calling it quits before ever opening for business.

Most of the company's 80 workers, based in Glendale, Calif., will be laid off by the end of the week. Executives at DreamWorks and Imagine Entertainment, partners in the site, decided over the weekend to cease operations after they failed to find a buyer.

Last week, it looked as if Pop.com would be sold to independent film portal IFILM, but those talks ended Friday.

"Although the Internet continues to represent an exciting, creative opportunity for us, the market has shifted dramatically since our original announcement resulting in this being a less viable business for us," said Vivian Mayer, a spokeswoman for DreamWorks.

She said a small staff will be retained "to support our creative endeavors." Executives have not decided what to do about distribution of the original content produced or acquired for the site, she said.

The demise of Pop.com could ripple through an Internet entertainment community already reeling from layoffs, stock market jitters over dot-com companies and the failure earlier this year of another high-profile contender, the Digital Entertainment Network.

"We're disappointed that things don't appear to be going well for Pop.com," said Bruce Forman, co-chief executive officer of The Romp, a Web site featuring original short programs. "We were rooting for their success."

Pop.com's failure could be especially problematic for small companies that are seeking financing for Internet entertainment sites but lack the star power of backers such as Spielberg or Howard.

"Despite the big names and the backing, the overall feeling was they never had a cohesive and decisive business plan," said Sanjay Malhotra, a partner at BrandWidth Capital, which describes itself as a "nurture" capital firm.

"It was put together in the heyday where the thought process was, 'If you put enough big names and big money together, things will work themselves out.' As the market caught up with the expectations of having a business plan and good management, those weaknesses became glaringly evident."

Imagine Entertainment head Ron Howard admitted as much in a recent interview with The Associated Press.

"The whole business climate changed," Howard said. "It used to be you staked a claim, went out with an IPO and the public would back you. That's not the case anymore."

Pop.com launched with great fanfare last October, promising a mix of live action and animation, video on demand and live Web events. The company solicited original work and bought others.

Despite agreements from Eddie Murphy, Steve Martin and others to create programs, nothing other than a few news releases ever appeared on the Web site.

Pop.com's failure comes as several Web entertainment sites are gearing up to delivr new programs. Some are cutting deals with television networks to produce original shows.

Sites such as Icebox, IFILM, AtomFilms and others say they are thriving and have no trouble attracting new funding for what are seen as solid business plans.

"The message is that traditional Hollywood media skills don't necessarily translate into building a great Internet business," said Eric Scheirer, a media and entertainment analyst at Forrester Research.

Scheirer said Pop.com failed in part because it flashed big names and big money at people without the kind of programs and Internet savvy displayed by more successful players.

"People can't be directed to a Web site solely on the names of the people involved with it," he said.

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