Costa Brava Partnership III SC 13D/A KIT digital / Costa Brava Partnership III ownership change

CUSIP No. 482470200

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 1)*

KIT digital, Inc.

(Name of Issuer)

Common Stock, $0.0001 par value

(Title of Class of Securities)

482470200

(CUSIP Number)

Seth W. Hamot

Costa Brava Partnership III L.P.

222 Berkeley Street

Boston, MA 02116

(617) 595-4400

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

with copies to:

Jeffrey R. Katz, Esq.

Ropes & Gray LLP

800 Boylston Street

Boston, Massachusetts 02199

(617) 951-7000

May 10, 2012

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.  ¨

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No. 482470200

1.	NAME OF REPORTING PERSON Costa Brava Partnership III L.P. I.R.S. IDENTIFICATION NO. OF ABOVE PERSON:  04-3387028
2.	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)  [ ]                   (b)  [ ]
3.	SEC USE ONLY
4.	SOURCE OF FUNDS WC
5.	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)    [ ]
6.	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7.	SOLE VOTING POWER	3,000,000
		8.	SHARED VOTING POWER	-0-
		9.	SOLE DISPOSITIVE POWER	3,000,000
		10.	SHARED DISPOSITIVE POWER	-0-
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON 3,000,000
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [ ]
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)			6.3%*
14.	TYPE OF REPORTING PERSON PN

*  Based on 47,400,099 shares outstanding as of March 28, 2012, as reported in the Issuer’s Amendment No. 1 to Form 10-K on Form 10-K/A for the period ended December 31, 2011 filed with the Securities and Exchange Commission on April 30, 2012.

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CUSIP No. 482470200

1.	NAME OF REPORTING PERSON Roark, Rearden & Hamot, LLC I.R.S. IDENTIFICATION NO. OF ABOVE PERSON:  10-0000708
2.	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)  [ ]                   (b)  [ ]
3.	SEC USE ONLY
4.	SOURCE OF FUNDS WC
5.	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)    [ ]
6.	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7.	SOLE VOTING POWER	3,000,000*
		8.	SHARED VOTING POWER	-0-
		9.	SOLE DISPOSITIVE POWER	3,000,000*
		10.	SHARED DISPOSITIVE POWER	-0-
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON 3,000,000*
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [ ]
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)			6.3%**
14.	TYPE OF REPORTING PERSON OO

* Represents shares directly held by Costa Brava Partnership III L.P.

** Based on 47,400,099 shares outstanding as of March 28, 2012, as reported in the Issuer’s Amendment No. 1 to Form 10-K on Form 10-K/A for the period ended December 31, 2011 filed with the Securities and Exchange Commission on April 30, 2012.

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CUSIP No. 482470200

1.	NAME OF REPORTING PERSON Seth W. Hamot
2.	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)  [ ]                   (b)  [ ]
3.	SEC USE ONLY
4.	SOURCE OF FUNDS WC
5.	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)    [ ]
6.	CITIZENSHIP OR PLACE OF ORGANIZATION United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7.	SOLE VOTING POWER	3,126,000*
		8.	SHARED VOTING POWER	-0-
		9.	SOLE DISPOSITIVE POWER	3,126,000*
		10.	SHARED DISPOSITIVE POWER	-0-
11.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON 3,126,000*
12.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES [  ]
13.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)			6.6%**
14.	TYPE OF REPORTING PERSON IN, HC

* Includes (i) 3,000,000 shares held by Costa Brava Partnership III L.P.; (ii) 74,000 shares held directly by Mr. Hamot in his IRA account; and (iii) 52,000 shares held in two trusts for the benefit of Mr. Hamot’s children.

**  Based on 47,400,099 shares outstanding as of March 28, 2012, as reported in the Issuer’s Amendment No. 1 to Form 10-K on Form 10-K/A for the period ended December 31, 2011 filed with the Securities and Exchange Commission on April 30, 2012.

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CUSIP No. 482470200

AMENDMENT  NO. 1 TO SCHEDULE 13D

Reference is hereby made to the statement on Schedule 13D filed with the Securities and Exchange Commission (the “Commission”) on April 27, 2012 (the “Schedule 13D”).  Terms defined in the Schedule 13D are used herein as so defined.

The following items of the Schedule 13D are hereby amended as follows:

Item 4. Purpose of Transaction

Item 4 is hereby amended to add the following:

On May 14, 2012 the Reporting Persons recommended to the Issuer’s Board of Directors (the “Board”) six candidates for consideration by the independent directors of the Board to fill current director vacancies and for nomination for election to the Board at the Issuer’s 2012 Annual Meeting of Stockholders.  Three of the six recommendations were previously conveyed to the Board on April 22, 2012.

Except as set forth in the Schedule 13D and above, as of the date of this filing none of the Reporting Persons has any plans or proposals which relate to or would result in any of the actions set forth in parts (a) through (j) of Item 4.

Item 5.		Interest in Securities of Issuer Item 5 is hereby amended as follows:
	(a)  The information requested by this paragraph is incorporated herein by reference to the information provided on the cover pages to this Amendment No. 1 to Schedule 13D. (c)  Since the last Schedule 13D filing on April 27, 2012, Costa Brava has purchased Common Stock in open market transactions as follows:

Date	Number of Shares	Price per Share
April 30, 2012	75,000	$6.72 *
May 3, 2012	380,000	$4.86
May 9, 2012	11,500	$4.65
May 10, 2012	125,000	$4.59 *
May 11, 2012	125,000	$4.71 *
May 15, 2012	38,500	$4.18

*weighted average price

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CUSIP No. 482470200

Signature

After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated:  May 16, 2012

COSTA BRAVA PARTNERSHIP III L.P.
By:	Roark, Rearden & Hamot, LLC, its General Partner
By:	/s/ Seth W. Hamot
	Name:  Seth W. Hamot Title:  President
ROARK, REARDEN & HAMOT, LLC
By:	/s/ Seth W. Hamot
	Name:  Seth W. Hamot Title:  President
SETH W. HAMOT
By:	/s/ Seth W. Hamot

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