DigitalBeat

I’ve spent a lot of time writing about how a startup called Cooliris continues to build a fun experience for exploring video and other media with its 3D wall, but I’ve heard a lot less about the business side. Recently Shashi Seth, the Palo Alto, Calif., company’s chief revenue officer (formerly head of monetization at YouTube), told me that despite the broader downturn in online ads, Cooliris’ advertising remains very much in-demand, with inventory completely sold out until the end of next month.

Last week, Cooliris unveiled a new advertising option, the Cooliris Publisher Network, which brings ads out of the Cooliris service proper. See, Cooliris is mainly known as a browser extension that lets you jump into a 3D environment, where you can scroll through large photos and videos (and news articles, and video games in the Flash format …); the company is already delivering ads there. But Cooliris also offers a version of its wall that can be embedded on other websites, so publishers can show off their slick Cooliris content to all site visitors, not just those who have installed the extension.

And now Cooliris is turning those embedded walls into an ad network in and of themselves, where the company provides the technology to websites for free, then takes a cut of the ad revenue. Some of those ads will be sold to specific publishers, some will be bundled up by Cooliris’ salesforce. Seth says the idea came from advertisers themselves, specifically car manufacturer Infiniti.

“Their vision was grander than just advertising on Cooliris,” he says.

That’s why the Publisher Network holds promise — because it allows Cooliris to sell ads on popular, respected websites like the Wall Street Journal (presumably at a lucrative price), while at the same time offering a much better advertising experience than those publishers can deliver on their own. See, for example, these Infiniti ads, which have been mixed in with a slideshow of fashion photos on New York Magazine’s website, and which arguably validate the point Seth made a year ago, that Cooliris could eventually deliver the online equivalent of fancy magazine ads. (Other publisher partners include Yahoo! News, Golf.com, and Style.com.)

Not that advertising within Cooliris proper is doing badly, either. The company’s salesforce has been selling out that ad inventory since June, Seth says, so now the problem is finding a way to create more inventory, making for a “constant battle between the core product and monetization teams.” In terms of the bigger revenue picture, Seth says the Publisher Network could eventually become 30 or 40 percent of the total, though it will probably start out closer to 15 or 20 percent.

As for the Cooliris product itself, the company recently rolled out version 1.11, which has the advantage of opening in a separate browser tab, rather than taking over your entire screen. Similarly the embed wall allows Cooliris to fit more seamlessly into the browsing experience, rather than forcing users to choose between the browser and the 3D wall.

Cooliris has raised a total of $18 million in venture funding, primarily from Kleiner Perkins Caufield and Byers.

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Tags: co:Cooliris, people:Shashi Seth