And now it’s gone. At least temporarily.

Federated has taken down the site at the request of the National Collegiate Athletic Association and has put up a placeholder search page in its place. The problem? The college sports group, which keeps a tight grip on any and all trademarks related to its teams, games and tournaments, says the site infringed on its copyrights.

You’d think that might have crossed the minds of Twitter, Federated or at least the folks at AT&T (T), who already work with the NCAA. But no matter. Federated spokesguy Matthew DiPietro says the site will be back up with a new look, a lack of copyright violations and a different URL in time for the tournaments Final Four games this weekend.

Does this derail the great Twitter advertising strategy? Nope. But it does illustrate just how new and unformed this stuff is, both for Twitter and its ad partners. Which DiPietro is happy to admit. “These are first-of-their-kind executions,” he told me. “They’re very experimental… things will get worked out.”

Everything about the newest ad gambit is parallel to the earlier one: It’s run via Web ad agency/network Federated Media, and consists of a page that Twitter endorses and will promote on its site.

And just like the ExecTweet page, most Twitter users won’t see Twitter’s promotions since most Twitter usage happens away from Twitter.com. And just like ExecTweets, March Tweetness is a collection of themed Tweets that you could find on your own, using Twitter’s handy search function, which it paid $15 million for last year.

But this one looks marginally more useful to me: Unlike ExecTweets, there is a rhyme and reason to collecting Tweets tied to specific events–in this case, different games during college basketball’s March Madness tournament. One of Twitter’s most compelling features, after all, is its ability to deliver snippets of thoughts, in real time, so I could see people actually using this one.

CBS (CBS) says it logged more than 2.7 million uniques to the player in the first day of tournament; last year it logged 1.75 million during the same period. And it says it has streamed 2.8 million hours of live video and audio so far, up 65 percent from last year.

Bonus stat for the good people of Comcast (CMCSA), who are sponsoring the player’s “Boss Button”–users have clicked on the defraud-your-employer tool 1.5 million times. Last year’s figure was 2.5 million for the entire tournament. But no stats from CBS on the number of people who have used Microsoft’s (MSFT) Silverlight software to watch the games on HD.

Most important stat for CBS and its advertisers: Television viewing, which is still much more important than any Web metric, was up nine percent for the day. Another vote in favor of the “Web video is additive, not cannibalizing” argument.

Most sports/Web/mobile experiments have way too many caveats to make them really interesting–last month, when Time Warner’s (TWX) Turner let iPhone users stream the NBA All Star game, for instance, it wasn’t letting them watch the actual telecast of the game, just a series of alternate takes. But this is the real deal–you’ll see the actual CBS telecast, for all the games, commercials and all.

Of course, there are still asterisks with this one. It only works with WiFi, not a 3G wireless connection, which means you have to be fairly close to a computer to watch this on your phone. So why not watch it on that computer? Also, it’s not gratis: CBS (CBS) is selling the “NCAA March Madness on Demand” app for $4.99 on Apple’s (AAPL) iTunes store.

It’s an interesting inversion of the clichéd-but-true “analog dollars for digital pennies” phenomenon, whereby traditional content loses value as soon as it moves to the Web. In this case, CBS is asking you to pay money for something you could normally get for free.

But consumers, or at least early adopters who ingest content on their mobile phones, seem OK with this proposition. Presumably, that’s because they’re trading cash for convenience. I’m not quite sure how this will play out with college basketball, where those who really care about the games are going to get themselves in front of a big screen. But it’s cool to have it available, period.

CBS (CBS) says it has locked up AT&T (T) Coke (KO) and General Motors’ (GM) Pontiac as “presenting sponsors.” And Comcast (CMCSA) is paying to associate itself with the Webcast’s “boss button,” which you’re supposed to hit if one of your remaining superiors waddles by your cube while you’re watching the Duke game.

Chris Albrecht at NewTeeVee thinks CBS will need to take some of that extra dough and plow it right back into bandwidth bills, since the company is using a high-end player from Microsoft (MSFT) to stream the games this year. I’m not so sure about that–last I looked, Microsoft was still trying to persuade companies to use its player instead of Adobe’s (ADBE) Flash, and I have to believe it’d be willing to make it worth CBS’s while to do so.

That’s because the network will be delivering its March Madness coverage using Redmond’s Silverlight streaming media technology, which for some reason stirs apoplectic emotions among a subset of tech zealots. Supposedly these folks would rather look at a blank screen than use dreaded Microsoft (MSFT) tech.

Why? Got me. I downloaded Silverlight onto my MacBook to watch NBC’s Olympics Webcasts last summer. And whenever I could find the events I wanted to watch (much harder than it should have been), I got a really great picture on my laptop.

So did some 40 million other people, which was why Microsoft wanted so desperately to get the rights to the event–it is trying very hard to gain some ground on rival Adobe’s (ADBE) Flash technology, the de facto standard for Web video. So it spends a lot of time focusing on big Web video events where it can introduce its tech to consumers.

[UPDATE: CBS wants you to know -- see comment below -- that you don't have to use Silverlight to watch the games online.]

March Madness isn’t nearly as big as the Olympics, of course: Last year, some 4.8 million people watched the tournament via CBS’s Webcast. But it’s a very big deal for CBS (CBS), which generated more than $20 million in extra advertising revenue out of the event. No word on what Microsoft had to pony up in order to get the rights this year, but Les Moonves and company certainly didn’t give them away.

CBS paid $1.8 billion for CNET last summer, and today it is dealing with the consequences: A re-org and layoffs.

CBS execs won’t release specifics on the firings and won’t say how many people were let go altogether. So news will be coming out in piecemeal fashion for some time.

The best that I can tell, though, the cuts came throughout the company’s interactive group, from its London-based last.fm radio service through CBS (CBS) headquarters in New York to CNET’s homebase in San Francisco.

Based on the fact that CBS Interactive boss Quincy Smith flew to the west coast to quarterback the re-org this morning–and the fact that CNET was much, much bigger than the CBS Interactive group–I’m assuming that more CNET employees were let go than anyone else.

Quincy, if I’m wrong, please let me know. And CBS Interactive/CNET employees can reach me directly at peter@allthingsd.com.

In the meantime, here’s the new structure of Smith’s group, via an internal memo that comes from him and Neil Ashe, his CNET counterpart:

Team,

As we come to the end of 2008, we have a lot to be proud of. CBS Interactive is the best online content network for information and entertainment. Our properties are expanding, advertisers are capitalizing on our properties and their scale, and we are positioned well to continue to grow. As we prepare for 2009 and beyond, we’d like to update you on this progress, announce some organizational changes and comment on the broader market environment and how it impacts CBS Interactive.

Progress

CBS Interactive is the 8th largest Internet network in the world. Our combined traffic is up nearly 30% since we closed the merger this summer. CNET, CBSSports.com, BNET, GameSpot, TV.com, CBS.com, last.fm, and CHOW have each had record traffic within the past three months. Our commitment to our users is paying off.

Advertisers have noticed. We have recently signed and announced deals across several of our properties with Microsoft, AT&T, Intel, Bertolli, EA, and GM. In these challenging economic times, marketers are consolidating their efforts with their best partners. Our properties, our audiences, our ideas and our insights will continue to differentiate us in the marketplace.

Finally, we have contributed to and benefited from the TV and Radio divisions of CBS. We’ve done nearly 1,500 purpose-driven promotions to our properties on Broadcast TV, Radio and local TV Stations; CHOW and GameSpot content is running on the CBS Outernet; and CNET ran a major consumer campaign in markets like New York and San Francisco through CBS Outdoor. CBS Interactive is also a key partner to CBS Television Network for major broadcast events. In just the last week, we featured complementary content for events including The Victoria’s Secret Fashion Show, the Grammy Nominations and the SEC Championship.

Moving forward, we have a lot to look forward to. Events like CES, The Grammys, and March Madness on Demand are all just around the corner. Each represent huge cross-platform opportunities where CBS Interactive will again help complete the experience with coverage on air, online, and on mobile for our audiences.

Organizational Promotions and Changes

As we enter 2009, we are making some changes to our organizational structure to capitalize on audience and advertiser overlaps. We are also making some changes to key functions so that we can realize the benefits of our position in the marketplace. These changes mark another significant milestone in our integration, as we fine-tune our organization to best take advantage of the power of our entire network.

Sports, Games and Music

We are combining our Sports, Games and Music properties into a single group led by Steve Snyder. Steve has tremendous product and leadership experience and an enthusiasm for each of these categories. In addition, Tom Jones will be moving over from CNET to head-up the sales efforts for this group. Within the group, our talented senior leaders including Jason Kint, Rich Calacci, Jaci Hays, Kevin Menard, Felix Miller, Doug Schmidt and others will report to Steve and to Tom.

Entertainment & Lifestyle

We are also moving our Lifestyle properties, CHOW and UrbanBaby, to the Entertainment group (TV.com, CBS.com, The CBS Audience Network and TheInsider.com) to capitalize on the similarities in audience and advertisers. This group will continue to be led by Anthony Soohoo with sales led by Ken Lagana. We’re excited to see the innovation that will come from this group in 2009.

Technology & News

Under the continued leadership of Joe Gillespie, our Technology & News division will bring CBSNews.com and CNET News.com into a single CBS Interactive News Group. Each site will maintain its own brand identity, while benefiting from shared resources in design, product and engineering to deliver deeper and more comprehensive coverage of major stories and events. Led by Mark Larkin, with Dan Farber as Editor-in-Chief, CBS News.com and CNET News.com will also have the opportunity to share content and collaborate on stories for the benefit of their unique audiences.

CBS Interactive Marketing

We are bringing together our key marketing functions into a new group called CBS Interactive Marketing led by Mickey Wilson. The group brings together expertise from across the organization so that we can capitalize on our biggest opportunities, and elevate the company to be a strategic marketing partner whose products, consumer insights, and ad innovations are critical to our clients’ long-term success. They will establish the company as the standard for premium content online, and define and evolve brand strategies to capture the biggest opportunities for audience and revenue growth through market planning, insights and execution.

CBS Interactive Business Development

We are also bringing together all of our business development activities. This group will be led by Mike Marquez. Mike and his team will be responsible for the development of all new partnerships, investments, and acquisitions. They will be charged with taking advantage of knowledge sharing across the whole company to ensure that we are the strategic partner of choice for the industry.

Market Conditions

As you know the general economic environment continues to be a challenge. We have always been very aggressive about managing our costs, and that requirement is even more critical now than it has ever been. We believe this new, more efficient organizational structure will produce better results for CBS Interactive, and also result in lower operating costs. It is always very difficult to make these kinds of reductions, but they come after a thorough review of how we are organized and how we operate, and what best serves our many users, advertisers and employees.

CBS Interactive is a special place because of you, and we thank each of you for what you have done, are doing, and will do to exceed the expectations of the tens of millions of people who come to our properties every day.

Today, we sit in a great position. People seek out our brands because we provide them with the information and entertainment they want and need, and marketers seek us out because of the powerful audiences we attract. We are positioned to grow in 2009 and beyond.

Best,
-q, NA