Last May the United States Supreme Court ruled that legislation preventing out-of-state wineries from shipping directly to customers was unconstitutional.

Now, according to an editorial in The Wall Street Journal (December 24-25, 2005) Alan Wiseman of Ohio State University and Jerry Ellis of George Mason University concluded that "while average bricks-and-mortar prices still exceeded average online prices in 2004, the size of the price difference decreased by nearly 40% compared to 2002."

Once again we have evidence of how the Internet is constantly changing pricing and industries. I am sure that the above referenced price differential will continue to favor the consumer for several years to come.

Our company announced the acquisition of Animation Factory today. This acquisition culminates an acquisition quest for Animation Factory that begain in early 2003. We were rebuffed in our acquisition efforts back then and this led us instead to our purchase of Arttoday.com (which inluded photos.com and clipart.com)in June 2003. This acquisition in turn ultimately led us to many more image company acquisitions so that today our Jupiterimages division is the largest part of Jupitermedia Corporation.

The acquisition of Animation Factory makes Jupitermedia the largest owner of lower resolution digitized images of all types worldwide. We now own close to 7 million of these types of images (and we also own over 600,000 royalty free digitized images). I am not aware of any company in the world that owns more than a few hundred thousand of such lower resolution images?

I have long believed that owning content leads to many other business opportunities including spin out products as well as OEM and licensing deals. And this is what is happening in the Jupitermedia march to being a very significant player in both the use of lower resolution images for Web sites as well as for the highest level of marketing and creative usage with our top quality Royalty Free and Rights Managed images.

As we enter 2006 this strategy will be clearer and more powerful. In the meantime we continue to build and integrate our various image properties and brands into a worldwise model of efficency.

One indication that legalized online gambling is coming to the USA is seeing a front-page article in The New York Times on Sunday, December 25 entitled "Wall St. Bets On Gambling On the Web" by Matt Richtel.

In a fine report, Matt Richtel provides the lay of the land and history of online gambling around the world and in the USA.

Take a look at this article and you cannot walk away with any thought other than that the USA laws making online gambling illegal are ridiculous and about to crash.

Either online gambling becomes legal or many Wall Street firms appear to be breaking the law --- not to mention the millions of American citizens who might be breaking the law by participating in online gambling.

I am moving my residence in a few weeks after 25 years in the same New York City apartment. What better way to clean out some old stuff than using eBAY.

I came across a load of The New Yorker magazines from 1996 to 2005 and decided to sell those on eBAY along with some other magazine titles that were sitting around the apartment.

When I went to eBAY I found that my rating, which used to be about 99%, had dropped to 91% because another user claims that I did not follow through on a sale several months ago. The truth is that this claim is dead wrong. I believe that the complaint is a mistake. Unfortunately eBAY does not provide a means to get this mistake cleaned off of my record (if there is a method to do this, I would appreciate it if someone would let me know).

I understand that many prospective purchasers will not deal with someone who has a rating much below 97%.

I hope prospective buyers check out all of my comments because I have rated 100% with any buyer who has purchased from me. I will let you know how it goes as I could very well be "finished" as an eBAY seller now that a mistaken complaint is part of my record.

I was surprised to learn the other day that my son John has started blogging. If it is true that 80,000 plus blogs are created every week, then it was only a matter of time before one of my four children would create a Blog. John is a soon to be movie producer so it is natural that he is covering movies mixed in with stock market observations. He recently brought home a bulldog - perhaps he will cover that topic as well? I hope he keeps on blogging.

StockPhotoTalk has put together a list of Google Page Rankings and Alexa Traffic Rankings. It was fun for me to see how my blog compared to similarly focused resources - something I had never considered researching myself.

And while on the subject of rankings etc., I came across a Web site that put out its rankings of various stock photo Web sites. Jupiterimages does very well.

I am not sure how many readers of this Blog have been following the Carl Icahn attack on Time Warner. Icahn is a famous and wealthy corporate raider going back thirty years who is worth billions. Recently he has purchased about 3% of Time Warner's stock and is now demanding many management and operational changes at Time Warner. He has also indicated that he plans to attempt to gain seats on the Time Warner Board of Directors.

Perhaps Icahn has some good points about overall management and operational changes at Time Warner. But when it comes to his criticism of the AOL-Google alliance, Mr. Icahn is out of his depth and certainly out of his league. He stated yesterday that "...I am deeply concerned that the Time Warner Board may be on the verge of making a disastrous decision concerning an agreement with Google if this agreement would make it more difficult in any way or effectively preclude a merger or other type of transaction with companies such as IAC/Interactive, eBAY, Yahoo or Microsoft etc., etc...."

I of course do not know the details of the AOL-Google deal, but highly doubt there is a negative in it for any Time Warner stockholder. Also, if in fact Time Warner is only surrending 5% of its ownership position in AOL, clearly this deal shapes up as huge win for Time Warner stockholders and thereby Mr. Icahn.

Mr. Icahn may know how to assess most companies, but certainly he knows nothing about the Internet. I suggest that he pick on some other aspect of Time Warner. The AOL-Google deal appears to be a big win for Time Warner stockholders and should make Time Warner a much more valuable company in coming months and years.

I will not rehash the many articles and analyses of the AOL - Google deal announced over the weekend. However I will give you one angle that no writer has mentioned - Eric Schmidt.

I had the good fortune to meet Eric a few times when I ran Internet World and he keynoted while serving as Chief Technology Officer of Sun. I had another brief meeting with him a few years ago when he keynoted a JupiterResearch Advertising Conference in October 2002.

When it came to crunch time to make a deal, he knew that he had to bring home a Google victory. He knew (after 15 years of battling Microsoft at Sun, Novell and now at Google) that Google could not allow a Microsoft-AOL alliance and figured out a way to best Microsoft. He knew that a Microsoft victory would jumpstart Microsoft's efforts at selling ad words. He was willing to bend and allow AOL certain advertising placement advantages on Google in order to secure the deal.

Eric Schmidt was the difference on this deal - make no mistake about it. 15 years of battling Microsoft and a lot of Internet history, gave Eric the impetus to make the deal. Now Google and AOL will reap the benefits of this alliance.

The other day we announced our acquisition of the French Rights Managed distributor Agence Images. Agence Images' background in the Rights Managed area of stock photography will help Jupiterimages expand distribution throughout France of its Rights Managed portfolio (many of our RM brands were acquired through our PictureArts acquisition in July).

We recently also purchased PR Direct, a distributor that specializes in selling Royalty Free stock photos. We have now put together a solid distribution business in France that will help in distributing all of our Royalty Free and Rights Managed brands -- we will combine Agence Images with PR Direct and ultimately have one Jupiterimages distibution brand in France.

Jupiterimages now has operations in Germany, France and England and will be adding properties in these countries and elsewhere in Europe in the coming year. Europe is increasingly an important market for Royalty Free and Jupiterimages will now be a major player in the growth of this market place.

We all know that AOL has been contemplating an alliance with either Google or Microsoft for several months. We also know that AOL's parent, TimeWarner, has stated that AOL will not be sold nor would they consider selling control.

AOL is a solid asset. TimeWarner should be aggressive with its plans for the brand. I have suggested before and reiterate again that TW should be bold and fold its ISP business and allow all AOL email users to use their aol.com addresses on the aol.com Web site (for free).

If TimeWarner wants to be player in the Web search space, then they have to sacrifice the sure to die ISP business and take the bold long term strategy that I am suggesting. While painful to give up certain subscription revenue short term, making this move will give TimeWarner a more valuable Web presence that will be worth many more billions down the road. If they take this approach they can remain independent and reap the rewards of their monster traffic which will translate into greater stockholder value and a higher stock price.

HarperCollins today announced that it was embarking on a program to take control of its potential digitized assets. HarperCollins is going to digitize its backlist and and its new offerings to be in control of its "digital destiny."

This is a smart move. Publishers have been too docile in allowing Amazon, Google and other entities to take control of their digital assets.

This reminds me of the early days of the Internet when it was thought by many organizations that it would be too difficult and too costly to consider running their own Web sites. Owning servers was considered exotic. This is hard to believe, but in 1994 this was the standard operating concept about how to be involved with the Internet.

Today we have a similar situation with digital assets. Publishers are too ready to sit and watch. This is also reminds me of what book publishers did with audio books 25 years ago. Audio book publishing was considered exotic and not important back then. It was common to see a best seller sold off for a few hundred dollars and a future royalty. It took a while, but then book publishers got wise to the big money in audio book publishing and soon best sellers brought in very large advances.

The digital age is here and now. Get some backbone and start your own digital library pronto. Publishers can still work with Amazon and Google and others, but they can also sell digitally themselves.

Jupitermedia acquired a real sleeper company earlier this week - bigshotmedia.

Bigshot is the largest company in the field of producing and selling stock flash footage. Flash footage is an infant "industry" but such imagery is increasingly appearing on Web sites and this trend should enjoy rapid growth in the coming years.

There is more to the story than growth. Jupitermedia also owns the largest developer community Web site devoted to flash - flashkit. Flashkit has over 300,000 registered developers and designers and gets well over 1 million page views per day. Jupitermedia also is about to launch a site devoted to flashcomponents (late January).

Mix all these together with the other acquisition mentioned in the linked press release above - bbm.net (a small but powerful little site that is a leader in creating and delivering royalty free music via flash-now we can offer music with our photos and other images) and one can see that Jupitermedia uses community and content to gain a significant marketshare. This strategy is unfolding in a variety of ways with stock photos as we own two significant design and photo buyer-oriented magazines (Dynamic Graphics and Step Indside Design) as well as numerous community Web sites for topics such as digital cameras, clipart, stock photos and more.

Stay tuned as we build out this strategy over the remainder of this year and into next year.

NEW IMAGE COLLECTION LAUNCHED - (RE)VIEW

Our Picture Arts division this week launched a terrific new rights managed collection of "retro" images called (re)view. Right out of the box this is now one of the best in this niche area. Stock Asylum gave it a solid review. Watch for the launch and more niche collections from several of our division in the coming year.

"Mad Money" (the CNBC cable money show) hosted by hot dog Jim Cramer devoted much of his show yesterday to discussing the company Marchex (NASDAQ: MCHX). Jim went on to indicate that he thought Marchex was the "next" Google (I own some Google shares but I do not own shares in Marchex).

Best of all Jim extolled the virtues of Marchex CEO Russ Horowitz. Of course yours truly has been telling the world about Russ for several years in this Blog. Nice to see Jim getting on the bandwagon.

Om Malik wrote an interesting article in Business 2.0 about valuing eyeballs in some recent Internet deals (for example, Myspace.com, Weblogsinc.com). Malik also has a blog called gigaom.com.

Malik's article is interesting. He has related contemporary site sales with theories of the late 1990s and early 2000 when one could sell Web sites based on eyeballs (monthly unique visitors) and projections (interestingly Malik gives a backhanded compliment to our JupiterResearch division by suggesting that JupiterResearch was mocked for its "over the top" Internet advertising projections made in 2000 for 2005, but that now we can see thatJupiterResearch was just about on the mark!).

Malik has his own formula in the above referenced article showing the value of monthly unique visitors in relation to the purchase price of various properties. Jason Calacanis who recently sold his Weblogsinc.com to AOL, fires back at Malik stating that Malik's formula is not correct and that sites should only be valued on multiples of revenue and that valuation should have little do with pure traffic.

Let me digress a bit at this point in this post. In the mid-1990s, probably well before Om Malik was writing about the Internet, Steve Harmon of Mecklermedia was blazing a trail creating metrics much like what Malik has proposed. Harmon left Mecklermedia in 1998 and set up his own company and has had an up and down history since, but it is interesting to note that Malik is recycling much of what Harmon was doing 10 years ago.

My own two cents on all this: Calacanis is correct in that real value depends on eyeballs that produce revenue. Malik, however, is correct in suggesting that "eyeball" value is heating up again. Myspace.com is the perfect candidate for what Malik is questioning. Myspace is a rapidly growing site. It could well be the bluemountain.com site of today that Malik mentions in his article (ExciteAtHome paid $780 million for bluemountain.com many years ago. The site had no revenue. I have no idea what its value is today, but I am sure that that value is a mere sliver of $780 million).

David Hornik, quoted in Malik's article sums up my viewpoint on this matter --- "not all pageviews are created equal." This has been proved over and over again since 1996.

By the way, I must give credit for learning about the ideas behind this post from reading an article by Dan Mitchell in the December 3, 2005 issue of The New York Times entitled "Eyeballs Are Back, or Maybe Not." I would suggest that Dan Mitchell too was not writing about the Internet in 1995!

Jupitermedia gets asked to make many presentations to mutual fund and hedge fund managers and investors across the USA. In some ways this is flattering, but in reality it takes a lot of time to sift through the requests and meet the demand.

Therefore I wanted to mention that along with my Jupitermedia colleague Chris Cardell, I will be presenting our company live and on Webcast this Thursday, December 8, at the SG Cowen Internet Conference in New York City.

Feel free to "tune in" as we have much to talk about.