Yahoo's new Panama advertising platform is paying dividends for the company and partners. Click through rates are rising, which should result in revenue growth for Yahoo between 15 and 45 percent, according to an estimate by finance firm UBS, as quoted by MediaPost.

If Yahoo can offer better click throughs than Google with less incidence of click fraud, then they could have advertisers running to them with wallets open.

Of course you need the eyeballs to sell, and Yahoo still has lots of work to do in that area. Yahoo is trying to increase traffic by hiring someone to "sing the news" as a strange look at humorous news across the land, according to Marketing Vox. That will take a unique talent and clever writing to not be a complete disaster.

Local.com put out a press release saying that Hearst has invested 8 million in the company. That's good news for a company that is challenging Yahoo, Google, CitySearch and countless regional publishers.

Local.com says it attracts 10 million visitors each month. The company has multiple advertising options including "subscription, pay per click, banner and pay per call ad products."

Unfortunately for small businesses they aren't being completely forthright, as the pay per call product isn't up and running just yet, according to a sales representative.

Pay-per-call is the best model for small service providers who can't afford to spend hundreds or thousands of dollars each month on a PPC campaign in the hopes that some of it will turn into traffic.

There is a huge opportunity for someone in the local search arena to sell on an auction-based pay per call basis. MSN, Yahoo and Google do not offer pay-per-call for local search but smaller companies Miva and CitySearch do. Plumbers, accountants, mechanics, etc. would gladly pay a few bucks per call, and using an auction structure would enhance the revenue possibilities for the publishers. If Yahoo wants to make a move on Google, offering more pay per action services could be the ticket.

Adams Media Research issued a report saying that while ad-supported video will continue to rule the roost for the next 2 years, pay-for downloads will eventually have more than double the revenue potential of videos with ads.

I have only 3 words to respond: wrong, wrong, and wrong.

According to the Financial Times, ad-supported video earned $409 million last year, nearly 4 time the $111 million in video download sales.

While Adams sees downloads amassing an incredible $4 billion in annual sales by 2011, by that time we'll have a real market for Internet TV as the telecommunications companies will do battle with cable in offering thousands of free channels online. Also, the TV networks and broadband startups will be bringing us hundreds of online programs to fill every niche for free or by subscription.

The pay-for video download market for TV content is never going to materialize in a meaningful way because the alternatives, including renting or buying an entire season on DVD, are too plentiful. The content by and large just isn't worth paying for. If you want to see Desperate Housewives or House, you'll watch it live or TiVo. Individual episodes aren't worth $2 a pop a month or a year after the fact, as the networks realized and quickly moved from iTunes to streaming programs on their own site. The advertising models including interactive content are slowly evolving.

If download video surpasses ad-supported video in revenue in 2009 as Adams projects, I promise to buy and watch an entire season of "The Nanny" in one sitting.

Major league baseball is trying very hard to chase away its fan base and make football the national pastime. The latest move is to shut out fans who would like to buy out of market games by signing an exclusive deal with DirecTV.

As detailed by Associated Press, baseball is close to signing a contract that would take away the "Extra Innings" package from cable and Dish Network customers, 230,000 of whom paid for the service last year.

So fans will have to switch to DirecTV, watch online, or give up on watching their favorite team that happens to play somewhere else.

Baseball's online package is less than half the cost of Extra Innings, so you could also pay for SlingMedia's SlingProjector, which sends web video to your TV. MLB is inadvertently promoting broadband TV by forcing people to go online to watch.

Fans have Senator John Kerry on their side as he is threatening Congressional action if the deal goes through, but we know how well he does at trying to win a majority.

Baseball owners every year offer even more ridiculous salaries, raise ticket prices, and move more games away from free to pay TV. If the sport were trying any harder to get fans to go elsewhere it would be hockey.

MLB has a great opportunity to attract fans by opening up its archives of games through ad-supported broadband, but they insist on trying to sell subscriptions and DVDs. While they will only sell a handful of DVDs per year of any game, they could get thousands of people to watch online and generate serious ad revenue. Huge opportunity lost.

Rest easy networks, while online video is growing, it will take years for video advertising to get even close to TV dollars.

Advertising Age has an insightful article about the many challenges facing online video including "fragmented audiences, limited inventory, a lack of video created specifically for the web and a still-evolving ad-buying model."

These are all legitimate issues, but the biggest challenge will be to create a new ad model that suits the medium and the consumers. The two fundamental things that are unique about online video are: syndication and niche publishing.

A smattering a video is available from many sites, but there isn't one website where you can browse video news and entertainment in any organized fashion. So content producers won't pitch a pilot to NBC.com, they'll syndicate programming to all relevant websites across their vertical niche. TV is already adjusting to the syndicated model, as you can watch this season's Heroes on the SciFi Channel.

Video ad buyers will have to get used to this new way of thinking, and video advertising networks will be the key to success. Instead of going to a TV network and buying 20 million impression for one program, they will work with one network to get the same volume across a variety websites.

The industry desperately needs someone (Blinkx, Yahoo, Google?) to step forward and create a kick-butt video search engine that serves as the TV Guide of web video using the latest Web 2.0 personalization features. This should focus on professional quality video, whereas so far user generated video content (YouTube) is getting all of the attention.

The Interactive Advertising Bureau has hired a full-time lobbyist to educate politicians on the Internet, and it's about time.

IAB couldn't have hired more of an insider -- Mike Zaneis is the former executive director of technology and e-commerce at the U.S. Chamber of Commerce.

First on his agenda should be a long heart-to-heart with Ted Stevens to help "Senator series of tubes" on understanding what the Internet is. Thankfully he is no longer chairing any committees that oversee Internet technologies.

Zanies will take on issues including taxes on e-commerce and legislation that would require Internet companies to retain consumer data. Net neutrality should also be high on the agenda. Something that should be pushed on Capitol Hill but probably won't is click fraud. It doesn't directly affect consumers, although marketers who lose money to click fraud ultimately incorporate their advertising costs onto consumers.

Their is a huge digital divide between the Web 2.0 innovations affecting commerce and the mostly elder audience of Congress who are passing laws that impact online marketing. We could use an influx of Internet-savvy politicians. Thank goodness for Maria Cantwell!

The NBA scores a triple-double by inviting fans to mash-up music with video highlights. In partnership with EyeSpot.com, the league is offering the NBA.com Highlight Mixer, which fans use to create highlight reels and add music from labels including Surfdog Records and Geffen.

As I've been saying, entertainment companies will generate loyalty and revenue by encouraging the YouTube generation to manipulate their content to create custom videos. The NBA is the first professional sports team to do so, and the other leagues should follow suit.

The same goes for the TV networks, which are slowly getting together with YouTube to allow fans to take clips from their shows and add background music. It gets fans to keep coming back and to compete with their friends for the best mixes.

The only thing missing from the NBA announcement was about embedding advertising or sponsorship of the videos. Fans will tolerate some ads for the free service, so selling the rights to a video player skin or pre- or post-roll advertising would generate considerable revenue.

Video sharing platform Joost scored its first in what will be a series of content deals by signing up Viacom. The peer-to-peer video service will get access to TV and film content from Viacom's MTV Networks, BET Networks and Paramount Pictures.

Viacom danced with YouTube before asking the Google property to pull more than 100,000 videos from its site and turning to Joost.

While YouTube may have more users for some time, Joost will make more money and is a better long term bet because of its video distribution technology and emphasis on making the online video experience interactive. Joost enables linking from within videos to more information or related websites based on the content and will offer plug-in applications, such as instant messaging, message boards, and news tickers that adds community.

Joost is ready to play the role of iTunes to YouTube's Napster. User-generated video is a tough sell to advertisers, while offering licensed and protected content from major media companies will boost Joost. The peer-to-peer enthusiasts will likely embrace a legitimate service and offer their bandwidth in exchange for access to quality programming.

I bet if Joost was around a year ago Google might have thought twice about buying YouTube.

StumbleUpon wants to replace web and video search with browsing by integrating some of the best features of social networking. It's a Frankenstein amalgamation that takes ideas from Digg, TiVo, MySpace and just about every other social networking service you can imagine, but it can sure do a lot to increase your traffic.

A StumbleUpon user must have discovered a website that I publish yesterday because I've received more traffic in one day than I usually get in about two weeks. StumbleUpon is a plug-in that automatically loads websites recommended by its users and based on categories that you select. The company uses tagging to define content, and lets users give a thumbs up or down to rate websites.

I received a huge influx of traffic for free, but the company also will herd readers to you if you are willing to pay a nickel a visitor. The downfall is that if big media companies start spending beaucoup bucks with StumbleUpon, the quality of the sites that you receive will likely go down.

The company has nearly 1.9 million users, and also has a video site (Stumble.tv) that will feed content directly to Nintendo's Wii. The categorization and tagging works well, so you only get what you ask for. Like YouTube you can also share videos.

By automatically sending web content instead of asking users to search or navigate, StumbleUpon is a better fit for watching on a TV. No typing needed, you just hit enter, and the content just keeps coming.

I expect more web content providers looking to tap into the TV market (or even broaden their reach online) might take a page from their book, just as StumbleUpon has taken some of the best web 2.0 ideas around.

Marketer Direct Revenue, which offered free content in exchange for software that delivered pop-ups and tracked users, paid the FTC to settle claims that it was distributing adware. Hopefully the FTC's investigations into adware (Zango settled in November) will greatly reduce the number of people duped into putting bogus software onto their computers.

The agreement requires Direct Revenue to give proper consent to users that adware was going to be installed and to stop deceptive distribution practices. The $1.5 million represented ill-gotten gains, but the penalty could have been much higher.

Direct Revenue put out a press release saying they were happy with the settlement because the "Agreement Containing Consent Order is a settlement that explicitly does not constitute an admission by Direct Revenue that the law has been violated."

Ah I love the legal-ese "wink-wink nudge-nudge" that allows alleged perpetrators to walk away without having to emblazon a red "A" (for adware) on all of their corporate attire and t-shirts. No harm no foul.