UGC Network to Acquire eBaum's World

EBaum’s World, a nine-year-old Web site for sharing viral videos and content, has agreed to be acquired by HandHeld Entertainment to be added to its ZVUE network of humor-based Web sites.

The acquisition, which is expected to be finalized in October for approximately $17.5 million, marks the coming together of two mid-tier User Generated Content companies in order to better compete with the top ranked video sharing sites, like YouTube, AOL Video, MySpace Video and others, in bringing in advertising dollars and viewers, said Jeff Oscodar, president and CEO of HandHeld Entertainment.

“EBaum’s is certainly mid-tier and top ten, they were bigger than our network was before we acquired them, and together we are up there with the largest sites on the Web,” said Oscodar. “Our network gets a tremendous amount of traffic with this site and the quality of the traffic is outstanding.”

EBaum’s World was founded in 1998 and has developed a consistent following of users. Over the past year the site served over 2.5 billion unique page views and video streams, with an average time on site per user visit of more than 10 minutes, according to Oscodar. He said the site is one of the few UGC businesses currently turning a profit, as it made approximately $5.2 million in revenues and $1.6 million in net income before income taxes in 2006.

The eBaum’s World site will be incorporated into HandHeld’s ZVUE Network of Web sites including Putfile.com, Holylemon.com, UnOriginal.co.uk, YourDailyMedia.com, Dorks.com, FunMansion.com and ZVUE.com. The network is particularly targeted to the 18- to 35-year-old demographic, and the addition of eBaum content should be attractive to advertisers, Oscodar said.

“We have lots of premium commercial content that should be very attractive to the same demographic that is coming to eBaum’s as well as other sites on our network,” he said. “This puts us up in the upper echelon of highly trafficked UGC Web sites. That should be attractive to advertisers because of the serious reach that our network can provide.”

The eBaum’s World name will be retained by HandHeld, and its 10 employees are expected to remain with the new parent company.