Primarily through new ventures that not only go around the studios, but around traditional distribution entirely. While the networks and studios all have subsidiaries producing content strictly for online distribution, the talent contracts are still typical pay-as-you-go deals (and meager at that). Agencies have been most enthusiastic about new busines models — probably because they're already realizing efficiencies in terms of talent discovery using the Internet, which allows them to get around scouts and managers and reach new faces easily and cheaply.

A number of agencies have begun embracing new models. 60frames, an online video startup, took $3.5 million in venture funding and was incubated by the United Talent Agency. Creative Artists Agency is assembling a $200 million venture fund with partner Draper Fisher Jurvetson. International Creative Management is reportedly talking to Qualcomm about raising their own cash. And William Morris has helped back a $500 million SPAC to fund M&A deals, with Ashton Kutcher serving on the board. The draw for the agencies is the ability to own a piece of the company that distributes work from their own talent stables.

The only problem is, that gives them a conflict of interest when negotiating with the studios. Why pitch deals to the studio for the standard 10 percent cut when in-house deals would result in agency fees and back-end profits? And no one knows how this will shake out for talent. As LivePlanet producer Sean Bailey pointed out to reporter Laura M. Holson, "People in Silicon Valley too want their pound of flesh."

(Photo by Getty/Sharon Dominick)

1. Facebook stays independent and private, strikes a meaningful deal that legitimizes its business plan, and buys a startup.
2. Born out of the writers' strike, at least one "Funny or Die" style site gets big buzz and maybe even gets bought, but it fails to produce any videos near the quality of FoD or Super Deluxe.
3. Google releases some limited version of voice search beyond GOOG 411. During the year, the company's stock tops $800.
4. Digg sells to a major media company for at least $200 million, and founder Kevin Rose starts a non-web-based company.
5. YouTube announces it's adding HD video, but the feature doesn't arrive until 2009.
6. Gawker Media, publisher of this site, starts a men's site and a Web show.
7. Yahoo suffers major layoffs, leading the press to dub it the next AOL.
8. Yet AOL is spun off and reframes itself. At the end of 2008, the company's future is still uncertain.
9. Apple releases a second-generation iPhone, and at least one New York Times article tries to draw a "middle class/rich" line between those who upgrade and those who stick with the first generation.
10. A new videoblogger emerges as the go-to example for slick independent daily vlogging, following Amanda Congdon and Ze Frank.
11. Tumblr, the pared down blogging service, enjoys the popularity that 2007 brought Twitter.
12. Twitter remains independent and spins off a new service.
13. The Internet again fails to drive one presidential candidate to success. So does Chuck Norris.
14. Jason Calacanis, still running his online directory Mahalo, starts another project.
15. A new meme started in a geeky part of the web infiltrates the "normal" population even more deeply than LOLcats.
16. Yet another e-book reader comes out and no one cares.
17. Blog search engine Technorati collapses after failing to get enough funding to stay afloat.
18. The Wall Street Journal announces it will soon be free online.
19. Blog platform maker Six Apart, having spun off LiveJournal and rearranged its exec staff, gets bought.
20. Dell screws up the good will it won in 2007 with another customer-service or bad-parts scandal.
21. Net Neutrality takes another hit from a telco-friendly Congressional bill.
22. Second Life plods along.
23. The TechCrunch blog network lands a regular TV appearance, if not a show.
24. The country tires of the last round of famous-for-being-famous celebs, and gossip blogger Perez Hilton's TV show gets cancelled.
25. A minor medical incident renews the "can Apple survive without Steve Jobs" argument.

Problem is, despite attracting talent such as Bill Murray, Jenna Elfman, John C. Reilly, Jimmy Fallon, Jeremy Piven, John Mayer, and a writing staff of 30, "The Landlord" remains Funny Or Die's only real hit. This despite 16,000 subsequent efforts by the company and its users. In fact, the video's sequel and the site's second biggest hit, "Good Cop, Baby Cop," (see above) garnered just a tenth as many views.

"I kind of wish we'd released 'The Landlord' today and not last spring," Kvamme told Portfolio. "The site was nothing then, and now it's a robust thing."