According to a survey by the Boston Consulting Group, consumers are willing to spend small monthly fees to receive news on their personal computers and devices. In the survey of 5,000 individuals conducted in nine countries, BCG found that the average monthly amount that consumers would be prepared to pay ranges from $3 in the United States and Australia to $7 in Italy.

Their key findings include:

Yahoo! (YHOO) is scheduled to host an analyst day on Tuesday, October 27th, the first since 2006, when Panama took center stage. Since then Yahoo has gone through several growing pains and has reached a point where its future as an independent company rests on a turnaround in the display business and the stated benefits from the Microsoft (MSFT) deal. If both fail to be fruitful, the firm will likely be folded into the hands of Microsoft.

Investors will give Yahoo about two years to emerge from its desperate state so Bartz has a decent runway ahead and several tools at her disposal that if used wisely, will enhance shareholder value.

Expedia (EXPE) is scheduled to report 3Q09 results on Thursday October 29 prior to the market open. Consensus calls for revenues of $828 million and EPS of $0.43. My model is projecting revenues of $840 million and EPS of $0.47, four cents ahead of the Street. The shares are likely to rally after the print.

Traffic to the site in 3Q09 was robust, up in the double digits, and results should benefit from FX. In addition, search CPCs for travel terms have remained subdued, and that should help margins.

It is now precisely three years since Google (GOOG) announced the acquisition of YouTube for $1.65 billion in stock, and the debate has shifted from potential revenues to lack of profitability of the online video website. Google has publicly stated that YouTube will be become profitable in the near future without quantifying the timeframe.

Based on my own projections for YouTube’s revenues and using every piece of reliable information I was able to put together on costs to deliver online videos and display ads, I am estimating that Google will become EBITDA positive in the first quarter of 2011.

Sirius XM's (SIRI) shares cannot get love from Wall Street. The shares have been stuck at the 60 cents range since August and a recent survey from the Street.com voted SIRI as the company most likely to go bankrupt. I mentioned SIRI as one stock to consider in my write-up Stocks to Buy in a Cyclical Advertising Recovery, although a majority of their revenues are subscription based.

The $4 billion market cap company (including the Liberty preferred shares) has $3.3 billion in debt with three quarters of that coming due between 2011 and 2013. With only $550 million in cash on the books today, 2010 will be a show me year in terms of driving the model to profitability and avoiding bankruptcy.

In a filing late Friday, John Malone’s Liberty Media (LMDIA) indicted that it sold 2.3 million shares of Barry Diller’s IAC/InterActiveCorp (IACI) between September 25 and October 1, bringing its ownership stake to approximately 19%. Is that a bearish signal?

Fundamentally, I do not think so. Management of Liberty Media have stated their willingness to part ways with IAC’s shares either because there is no strategic reason to own the shares or due to the nasty spat with Diller over the spin-offs. It could be that Liberty needs to sell equity holdings to avoid being regulated as an investment company, which would increase their cost structure and reduce their ability to conduct tax efficient asset sales and swaps – investors in Liberty Media’s tracking stocks should keep an eye on that. Whatever the reason, the presence of an active seller is likely to keep a lid on the shares for sometime.

In 2Q09, advertising spending in the U.S. declined in the high teens according to most estimates, with all advertising media, except theater advertising, declining year-over-year. Yes, even Internet advertising declined y/y due to weak branded advertising and less than robust search growth. According to my calculations, Google’s (GOOG) domestic search business actually declined y/y by approximately 1-2%. Therefore, even overall search advertising declined y/y given that Google has a lion share of the domestic search market and exhibits the strongest search fundamentals.

At a series of conferences this past week, several companies reported that advertising is still challenging but is however firming, with month-over-month improvement in national and local advertising and improvements in auto advertising.

Sina (SINA) will report second quarter earnings on Monday, August 31st after the market close. Consensus expectations are for revenues of $88 million (-3% y/y and +20% q/q) and pro forma EPS of $0.30.

Display revenues are expected to decline 12% y/y due in part to tough comparisons to the Olympics ad spend in 2Q08, however, I expect a sequential improvement from 1Q09 as several advertising categories such as autos and real-estate have rebounded in China during the quarter. Mobile revenues is likely to be up in the high teens y/y.

First off, let me point out that the acquisition of Bankrate (RATE) was on my list of 12 2009 Predictions and I previously called for an acquisition in my write-up Final Option for Bankrate: Find a Buyer.

Consensus was estimating $55 million in EBITDA for Bankrate in 2009 but management stated that they would likely miss that estimate. RATE reported $22.5 million in EBITDA in the first half of 2009. I assume they could match that run rate and produce $45 million in EBITDA for the full year 2009. Assuming that EBITDA figure, the acquisition multiple is 12.7x.

Gauging the Financial Impact of Free Microsoft Office

Responding to Google’s (GOOG) competitive threat on its cash cow, Microsoft (MSFT) decided to offer free web versions of its MS Office, either through an online version similar to Google Apps, or a pc based edition pre-installed in PCs through the OEMs. The free offering is likely to be ad supported. Microsoft has already offered ad supported versions of Microsoft Works in certain countries and is likely to build off that practice with the free online versions.

The ad based version could be supported by display and search ads and should have ready access to Bing throughout the applications.

Google (GOOG) will report second quarter earnings on Thursday July 16th, 2009 after the market closes. Consensus Wall Street estimates has Google delivering $4.031 billion in revenues in 2Q09, up 3.5% YoY but down 1% QoQ, $2.48 billion in EBITDA (61.7% margin), and $5.03 in Adjusted EPS.

Some new observations since I wrote $30 EPS Possible in 2010.

Susquehanna Financial Group analyst Marianne Wolk had a great report on Bing, in which she summarized the opinions of several industry pundits on Microsoft's (MSFT) Bing search engine.

It looks like most are generally positive on Bing, and that should be of concern to Google's (GOOG) management. I have long thought Microsoft had a fighting chance at search. See my earlier write up, Closing the 3% to 65% Gap.

eMarketer is reporting that advertising on social networks will taper off this year. This is an additional negative for MySpace, which is currently struggling, but a new negative for the much loved Facebook, which I opined in a recent write-up CashBurn Book, is hemorrhaging cash. The report states that advertising on social networks will decline 3% to $1.1 billion in the U.S. versus the prior prediction made in December 2008 of a 10% increase to $1.3 billion.

The report further states that MySpace's U.S. advertising business will decline 15% year-over-year in 2009 to $495 million, representing half of the social networking dollars, down from 51% in 2008.

A study by Harris Interactive states that one-third of Americans find TV advertising to be more helpful in making purchase decisions than any other medium. According to the study, 37% favor TV ads, 17% favor newspaper ads, and 14% favor Internet search engine ads, while just 3% favor radio ads in making purchase decisions. Here is where radio gets competitive. In a response to the question, which type of ad do you tend to ignore the most, 46% said Internet banner ads are ignored while just 9% ignore radio ads.

Radio finally beats the Internet at something, even though most of radio's ad dollars have found their way online and the stock prices of the radio companies have been decimated as a result. Not sure what this means for the radio companies and I doubt that ad dollars will make their way back to radio.

In early January I listed 12 items that I thought will or will not happen in 2009 in my post 12 Predictions for 2009. Half way through I take at look at those predictions to evaluate where we are.

Here goes.

There is little the media companies can do to stop the havoc that the Internet is wreaking on their traditional business. They can slow the drain of profits for a while. But eventually, the companies will have to come up with new business models a little more adventurous than what was unveiled on Wednesday. - Wall Street Journal, Heard on The Street.

That to me was the most insightful section of the Wall Street Journal article discussing the Time Warner (TWX) / Comcast (CMCSA) TV Anywhere proposal announced on Wednesday. However, it was insightful not for only what it said but for what it left out. That is, the havoc the Internet is having on business models of what I refer to as the "traditional Internet companies" - Google (GOOG), Yahoo (YHOO), eBay (EBAY), Amazon (AMZN), MSN (MSFT), AOL, and IAC. Of the group of seven, Amazon's business model is the most exposed to massive disruption. That's a tease to an upcoming write up on what I foresee as a head-to-head competition by the Internet's two most stable companies with one coming up on the losing end.

Google (GOOG) should report 2Q09 earnings sometime in the second week of July, and although I would not aggressively chase the stock at these levels, the bar versus consensus, once again, appears easy to beat.

I aggressively accumulated shares in the stock around the $250-$275 levels late last year, when all was doom and gloom for the stock, but have taken profits along the way as the market rebounded and Google’s stock rebounded along with it. However, my work shows that the model has upside and we could see another 20%-plus appreciation in the shares from current trading levels. Further, if under the new cost conscious CFO, margins improve meaningfully, then we could see a clean $30 Adj. EPS figure in 2010, which would imply a $600 share price.

Much has been said about Bing getting a bump in search and impression usage since its launch. But Efficient Frontier has taken it further, claiming that paid clicks on Bing is up 8.1% since its launch versus the previous week.

Importantly, the company believes that if the paid clicks growth holds, then advertisers are likely to shift ad budgets to Microsoft (MSFT), the ultimate desired outcome.

With all the talk about Hulu edging towards Google (GOOG), I decided to take a look at the traffic stats, courtesy of Compete, to determine what's conjecture and what's reality.

In my analysis of the unique visitor data, I went back two years on a monthly basis. Instead of comparing growth rates, which are in the high tripple digits for Hulu, I decided to look at Hulu's (and Crackle) YouTube penetration, meaning Hulu's traffic divided into YouTube's traffic.

I was listening to NewsCorp's (NWS) dismal earnings report last week, in which operating income declined 47% YoY due to weakness at all divisions except Cable, and in which CEO Rupert Murdoch declared that the worst of the economic decline is over. FIM revenues, where MySpace's numbers are reported, declined 11% YoY due to 16% lower advertising revenues, due to a reduction of branded and performance based advertising at MySpace.

I have long held that social networking sites will be a challenge to monetize and then a greater challenge to drive to significant profitability. In my NewsCorp model, I have MySpace generating about $630 million in revenues for the year, about half of that comes from Google's (GOOG) disappointing search deal. Most reports have Facebook generating about $300 million in revenues in 2008. My quick slight of hand calculations, so to speak, has Facebook's revenues growing about 50% in 2009 to about $440 million.