Filings Watch: Writes Off Brainboost Acquisition; Does Away With Direct Ad Sales


Last week, the troubled (NSDQ: ANSW) filed an S-3 with SEC. In it, it disclosed that it has written off its acquisition of Brainboost Technology, the developer of the Brainboost Answer Engine (BAE) that it bought in December 2005 for about $4.56 million, $4.0 million of which was in cash. The reason? It says that its WikiAnswers site of user-gen questions is growing much faster, and both BAE and WikiAnswers are effectively focused on similar areas, answering complex natural language questions. “Conversely, during that period, has generally declined each quarter….the success of user-generated questions and answers as compared to the technology-driven answers presented by the BAE, we made a strategic decision in the second quarter of 2008 to focus our efforts, in the realm of questions-and-answers, on user-generated questions and answers, and effectively abandoned our use of the BAE,” it says in the filing. As a result of abandoning its use of the BAE, the net book value of the BAE, as of May 25, 2008, in the amount of $3.138 million, was written off during the three months ended June 30, 2008, the company said.

Also, the company disclosed that during Q2 of this year, it decided to do away with direct ad sales (focusing on Google (NSDQ: GOOG) AdSense-type monetization instead), and is laying off all its sales staff. As a result, it recorded a charge of $90,000 in Q208. Now that was bought by *IAC*, who’s going to put out of its misery?

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