Facebook, Inc. v. Studivz, Ltd et al

Filing 146

Declaration of Julio C. Avalos in Support of 145 Memorandum in Opposition filed byFacebook, Inc.. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F, # 7 Exhibit G, # 8 Exhibit H)(Related document(s) 145 ) (Gray, Thomas) (Filed on 4/6/2009)

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EXHIBIT H Multimillion Online Deal: Holtzbrinck Buys German Web Community StudiVZ - SPIEGEL ONLINE - News - International Page 1 of 6 RSS | Mobile | Newsletter INTERNATIONAL NACHRICHTEN VIDEO ENGLISH EINESTAGES FORUM SPIEGEL WISSEN ABO SHOP Front Page | World | Europe | Germany | Business | Zeitgeist | International Forum | Newsletter English Site > Under the Scope ADVERTISEMENT 01/04/2007 MULTIMILLION ONLINE DEAL Print | E-Mail | Share | Feedback Font: SEEKING A PARTNER? SEEKING A PARTNER? Find someone who really is right for you... We take relationships seriously - our service is for single people who are genuinely looking for a longterm commitment. Holtzbrinck Buys German Web Community StudiVZ By Christian Stöcker One of Germany's largest publishing houses has purchased the 1-million strong StudiVZ community, Germany's answer to Facebook. The deal marks the first megabucks Web 2.0 acquisition in Europe. The Web 2.0 phenomenon that has been all the rage in the United States has finally struck Europe. On Wednesday, Germany's largest online student network, StudiVZ, was acquired for as much as 100 million by one of the country's biggest publishing companies, Holtzbrinck Group, which publishes the venerated Handelsblatt and Die Zeit newspapers. After a bidding war waged against at least one other company, Stuttgartbased Holtzbrinck announced the deal on Wednesday. StudiVZ, which is Germany's answer to America's massively popular Facebook StudiVZ cofounder Ehssan Dariani's homepage STAFF EDITOR JOB Yes, We're Hiring: SPIEGEL International Is Looking for a Staff Editor ADVERTISING WITH SPIEGEL Find out How to Advertise on SPIEGEL ONLINE Or Place an Ad in DER SPIEGEL PICTURE THIS Picture This: Return of the Beach Baskets DPA TODAY'S STORIES http://www.spiegel.de/international/0,1518,457766,00.html 4/6/2009 Multimillion Online Deal: Holtzbrinck Buys German Web Community StudiVZ - SPIEGEL ONLINE - News - International Page 2 of 6 than a million members. Though the 100 million figure has been widely quoted in industry circles, StudiVZ spokesman Tilo Bonow told SPIEGEL ONLINE that the real price was "considerably below" that number. Holtzbrinck had previously been a minority investor in the firm. Wednesday's transaction is the first major Web 2.0-related acquisition in Europe. (Web 2.0 refers to the so-called second generation of Internet platforms, like web communities and videosharing sites, where anyone can post and participate.) For StudiVZ's young founders -- who pulled in money from investment capitalists to develop the student network -- it was the deal of a lifetime. Early investors, like the Samwer brothers -- who founded the German ring-tone company Jamba and sold it two years ago for 273 million -- will also be cashed out handsomely. In the United States, such mass capital transactions are Internet Start-Up Auf Deutsch: almost de rigeur for Web 2.0 StudiVZ Takes on Facebook companies. Last year Rupert (11/07/2006) Murdoch's News Corp doled out $580 million for the MySpace online community, but the record so far goes to Google, which paid 1.35 billion to acquire YouTube and its wildly popular service that has home Internet users by the hundreds of thousands posting their own quirky music videos and self-made TV shows to the Web. RELATED SPIEGEL ONLINE LINKS 'I Take Responsibility': Obama's G-20 Confession Dozens Killed: Powerful Earthquake Strikes Central Italy Diplomatic Barbs: EU Sharpens Tone Against New Israeli Government Obama's Visit to Ankara: Turkey Trip Offers Pitfalls and Opportunities Rescue Ideas from Europe: How Fiat's Marchionne Can Help Chrysler The Dirty Girl: Charlotte Roche Brings 'Wetlands' to the English-Speaking World Interview with GM Europe Chief: 'The Americans Ran Out of Cash' Agreement Reached on Rasmussen: Obama Saves NATO Governments from Summit Shame CRISIS SUMMIT IN LONDON A Summit at the Abyss: Can the G-20 Save the World? US Economist Adam Posen: 'Merkel Does Not Get Basic Economics' AFP Gearing Up for the G-20: London Braces for Massive Protests NATO TURNS 60 Agreement Reached on Rasmussen: Obama Saves NATO Governments from Summit Shame Violent Protests in Strasbourg: Demonstrators Set Fire to Hotel The Reluctant Globocop: What Is NATO's Role? Photo Gallery: NATO Turns 60 Germany's Foreign Minister on NATO: 'We Face New Threats and Challenges' Getty Images Plagiarism allegations and stalkers Prior to the sale, StudiVZ had come under heavy criticism in Germany for its similarity -- in both structure and functionality to its larger American cousin Facebook. Some even accused the firm of plagiarism. For a time, there were discussions between StudiVZ and Facebook over a possible merger. After Wednesday's sale, however, the company will remain in German hands. In addition to accusations that it had lifted Facebook's model, StudiVZ has also been plagued in recent months by growing pains -namely security flaws and server trouble. The server outages SPIEGEL ONLINE INTERNATIONAL SERVICES Get SPIEGEL ONLINE International everywhere you are http://www.spiegel.de/international/0,1518,457766,00.html 4/6/2009 Multimillion Online Deal: Holtzbrinck Buys German Web Community StudiVZ - SPIEGEL ONLINE - News - International Page 3 of 6 German bloggers even led a campaign against the company -pointing their fingers at uncomfortable content that had emerged within StudiVZ: neo-Nazi groups and even a men's club with over 700 male members who exchanged photos of attractive women on the service and worked together to try to pick them up. Internally, StudiVZ called it "flirtation" -- since many Facebook members use the site as an impromptu dating service -- but bloggers, female users and others saw it as no less than stalking and sexual harassment. The company responded by pledging to remove the profiles of users accused of cyberstalking. Rubbing people the wrong way? The company's 26-year-old founder, Ehssan Dariani, also came under fire for making videos of young women in subway trains and in toilets at parties, and for posting more or less unauthorized interviews on the Web. He rubbed both users and investors the wrong way with his overly self-promoting interviews and a birthday party invitation designed in the style of a Nazi newspaper. He later defended himself in an essay published online claiming that Germans have trouble dealing with their past. Another founder attracted negative headlines for requesting, on his own profile, to become a member of the so-called male stalking group. Despite PR disasters and public apologies, StudiVZ's founders are likely to continue to play a role after the acquisition. Konstantin Urban, CEO of Holtzbrinck Networks said the founders would "remain in management." The community's success is the result of the founders and their employees. "We're pleased that the proven team will remain on board." Under Holtzbrinck, the company plans to earn revenues primarily through online advertising. StudiVZ is uniquely suited to customtailored advertising because of the information stored on personal profiles -- about music interests and hobbies, for example. In a general turnaround following the dot-com Internet bust in Germany, advertisers are now thronging to online communities -- a fact that is also manifesting itself on capital markets. The most RSS-Feeds Become a Friend of SPIEGEL ONLINE International Follow SPIEGEL ONLINE International on Twitter SPIEGEL ONLINE International goes Mobile Subscribe to our daily e-mail newsletter SPIEGEL PUB QUIZ SPIEGEL Pub Quiz: Obama Finger Foods SPIEGEL Pub Quiz: Nazis UFOs and Carnal Carnivals Another Round? The SPIEGEL Pub Quiz Archive AP/MARY F. CALVERT AND THE WASHINGTON TIMES ECONOMIC DOWNTURN The European Economic Crisis in Numbers The European Economic Crisis in Numbers: SPIEGEL Online International partner site NRC Handelsblad has put together an interactive map that illustrates how the financial crisis is playing out in each European Union member state. http://www.spiegel.de/international/0,1518,457766,00.html 4/6/2009 Multimillion Online Deal: Holtzbrinck Buys German Web Community StudiVZ - SPIEGEL ONLINE - News - International Page 4 of 6 30. Today shares are selling at about a euro above the opening price and the company has a market capitalization of 160 million. RELATED SPIEGEL ONLINE LINKS Internet Start-Up Auf Deutsch: StudiVZ Takes on Facebook (11/07/2006) © SPIEGEL ONLINE 2007 All Rights Reserved Reproduction only allowed with the permission of SPIEGELnet GmbH NEWS FROM DENMARK Hej Danmark! SPIEGEL Launches Partnership with Politiken.Dk AP INTERNATIONAL PARTNERS NRC Handelsblad Report: 'Diploma democracy' replaces class divisions Big White Man walks onto an indian reservation Politiken Secret courts in terrorism cases Fogh: No apology http://www.spiegel.de/international/0,1518,457766,00.html 4/6/2009 Multimillion Online Deal: Holtzbrinck Buys German Web Community StudiVZ - SPIEGEL ONLINE - News - International Page 5 of 6 ABC News Exclusive: Tearful Allen Stanford Expects Indictment in Two Weeks Quake Survivors Now Hit by Rain, Hail International Herald Tribune Death Toll in Italian Quake Rises to 150 In Turkey, Obama Says U.S. `Never' at War With Islam BusinessWeek AIG's CDS Hoard: The Great Unraveling After IBM, What Now for Sun? New York Times Gates Budget Plan Reshapes Pentagon's Priorities In Turkey, Obama Says U.S. `Never' at War With Islam SPIEGEL TO GO SPIEGEL Mobile: The latest headlines at your fingertips SPIEGEL ONLINE SPIEGEL SPECIALS China Global Financial Crisis Kosovo Climate Change International Terrorism DPA http://www.spiegel.de/international/0,1518,457766,00.html 4/6/2009 Multimillion Online Deal: Holtzbrinck Buys German Web Community StudiVZ - SPIEGEL ONLINE - News - International Page 6 of 6 SEEN.BY The international gallery for fine art: Present, collect and rate the works of thousands of artists on Germany's largest independent Web site for photography. http://www.spiegel.de/international/0,1518,457766,00.html 4/6/2009

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