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Thursday, May 6, 2010

The Latest from TechCrunch

The Latest from TechCrunch

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Kayak Swoops On German Travel Engine Swoodoo

Posted: 06 May 2010 08:47 AM PDT

German travel search engine Swoodoo has been acquired by the leading U.S. flight search engine Kayak. Although Kayak has lots of cash in the bank and is a major player in the US, it is still not well known in Europe, hence its need to make an incursion here. Financial terms of the acquisition have not been disclosed. Swoodoo was founded in 2006 in Germany and since then has established its position as the self-proclaimed "market leader in online flight search in Germany" in a competitive market.

Translate That French Menu With Your Android Phone And Google Goggles

Posted: 06 May 2010 08:31 AM PDT

When Google first announced the Goggles feature last year, we thought the product could be huge leap forward in the field of visual search. Goggles allows you to you point your phone;s camera at something and Google figures out what it is. At the Mobile World Congress earlier this year, Google showed off the translation capabilities of the visual application in German. Today, the search giant is officially launching translation capabilities in the new version of of Google Goggles for the English, French, Italian, German and Spanish languages.

With the translation feature of Goggles, you can point your phone at a word or phrase and draw a box around specific words that you don’t understand. After pressing the shutter button, Goggles will give you the option of translating the text to the available languages. While the feature only includes five languages, Google’s goal is to eventually be able to to read all of the Latin languages and non-Latin languages (such as Chinese, Hindi and Arabic) as well.

In addition to translation, the new version of Goggles includes improved barcode recognition, recognition of many more products, artwork and logos, an improved user interface, and the ability to begin visual searches using images in your phone's photo gallery.

The feature seems like it would be useful for any traveler. But sorry iPhone and BlackBerry users, Google Goggles v1.1 is only available on devices running Android 1.6 and higher.

The Age Of Facebook: Excerpts From The New Book By David Kirkpatrick

Posted: 06 May 2010 04:55 AM PDT

The long awaited book about the first few years of Facebook is almost over. You can pre-order David Kirckpatrick’s The Facebook Effect: The Inside Story of the Company That Is Connecting the World for the Kindle here and in hardcover here.

In the meantime, Fortune has access to two excerpts from the book, and this stuff is solid gold. The first is here, the second is here. We’ve reprinted the excerpts below with permission.

I would summarize the best parts for you but, really, the whole thing is the best part. Kirkpatrick clearly got very deep access to Mark Zuckerberg and other Facebook execs, as well as relevant outsiders. He details Mark’s constant need to fend off venture capitalists and suitors, the raucous early days of the company (including a lawsuit by a very angry owner of a trashed house), and a whole lot more. Much of this has never been written about before.

I will be interviewing Kirkpatrick about the book at a Commonwealth Club event on June 23 in San Francisco. You can get tickets to that event here (they’re just $20).

Excerpt 1: The Early Days

In the first week of his sophomore year at Harvard, Mark Zuckerberg cobbled together an internet software program he called Course Match. The idea was to help students pick classes based on who else was taking them. If a cute girl sat next to you in Topology, you could look up next semester’s Differential Geometry course to see if she had enrolled in that as well. Hundreds of students immediately started using it.

His next project, in October, he called Facemash. Its purpose: figure out who was the hottest person on campus. He invited users to compare two different faces of the same sex and say which one was hotter. A journal he kept at the time, which for some reason he posted along with the software, suggests Zuckerberg got into this jag while upset about a girl. “______ is a bitch. I need to think of something to take my mind off her,” he wrote, adding, “I’m a little intoxicated, not gonna lie.” By the time the program launched, he had dropped the idea of also comparing students to farm animals. “Another Beck’s is in order,” Zuckerberg wrote as he continued his Facemash chronicles. By the time he returned to his room from a meeting the next day, his laptop was so bogged down with Facemash users that it was freezing up.

When he launched Facebook the following February (initially called thefacebook.com), it was a rudimentary site, but flirting on Facebook quickly became a sort of art form. One feature — the poke — made doing so absurdly easy. Poking was a particular fascination in those days, even among the supposedly sophisticated students of Harvard. What did a poke mean? Its indeterminate message was one of its appeals. Zuckerberg posted an insouciant answer on the site: “We thought it would be fun to make a feature that has no specific purpose… So mess around with it, because you’re not getting an explanation from us.”

At the end of the school year, Zuckerberg and his cohort moved their fledgling operation to a four-bedroom sublet house in Palo Alto, Calif., which became a combination home and office. Zuckerberg slept later than most — he seldom got to work in the equipment-jammed dining room before afternoon. His typical garb in the office was pajama bottoms and a T-shirt. When the software code-writing got intense, he was a taskmaster. If someone got hungry and wanted to go out for fast food, recalls a frequent visitor, “Mark would, like, pound the table and just say, ‘No! We’re in lockdown! No one leaves the table until we’re done with this thing.” Zuckerberg was determined to keep this ship moving forward, and he was more than happy to be the captain.

Not infrequently, he acted like he was captain of a pirate ship. Among the few possessions he had brought to Silicon Valley with him were his fencing paraphernalia, which he left lying in a pile. Often he’d grab his foil and start swinging it through the air. “Okay, we’ve got to talk about this,” he would declare, one hand held behind his back, lunging forward with this foil. Often the sword would get uncomfortably close to people’s faces. “I’m the personality type where that would get me sometimes,” says co-founder Dustin Moskovitz. “It was a pretty small room.” Later Moskovitz and the others banned fencing from the house.

The house at 819 La Jennifer Way, with a resident population of seven guys, felt like a dorm. Some people — female and male — stopped by for days and just hung around. Stanford University was only a mile away, so the housemates would announce parties using a Facebook feature that enabled them to target specific schools. They were mobbed by Stanford students and townies. Hanging out by the pool was a major activity, and broken glass would simply be swept into the water. One housemate strung a wire from the top of the chimney to a spot on a telephone pole beyond the pool. With a pulley, he turned it into a zip line, so partiers could ride down the wire and drop into the pool with a massive splash. (When the owners finally returned in the fall, they were shocked. In a later court case, the owners described the house as “in total disarray and very dirty.”)

The house’s cultural mascot was Tom Cruise, who had camp appeal because he was “not a very cool character,” recalls a housemate. Pretty soon the resident nerds were naming their computer servers after characters in Tom Cruise movies: “‘Where’s that script running?’ ‘It’s running on Maverick.’ ‘Well, run it instead on Iceman, I need Maverick to test this feature.’” Zuckerberg, who had loved studying the classics, had a way of punctuating a conversation by suddenly pronouncing, “Now you know who you’re fighting!” It was a quote from one of his favorite movies, Troy, which he had seen on his 20th birthday.

Incongruous movie quotes gave Zuckerberg, who could otherwise lapse into long periods of silence, tremendous pleasure. He also inserted them in the site. Whenever you searched for something in those days there was a little box below the results that had tiny type that said, “I don’t even know what a quail looks like.” It’s a throwaway line from The Wedding Crashers. Another quote that appeared there was a Tom Cruise line from Top Gun: “Too close for missiles. Switching to guns.” The quotes came to encapsulate, in the fashion of schoolboy in-jokes, the spirit of the company — playful, combative, and despite the technical sophistication, a bit juvenile. Students at colleges around the U.S. spent hours arguing about the significance of these inscrutable epigrams.

As the Facebook boys started dealing increasingly with real business professionals, a reputation for rambunctiousness spread throughout the valley. “It’s Lord of the Flies over there,” one executive told an executive recruiter. Zuckerberg had to be careful which business card he handed out at meetings. He had two sets. One simply identified him as “CEO.” The other: “I’m CEO…bitch!”

One of the crew’s edgiest pranks in those days was a presentation made to the blue-chip venture-capital firm Sequoia Capital, known in the Valley for a certain humorlessness. Sequoia √©minence grise and consummate power player Michael Moritz had been on Plaxo’s board. Parker saw him as having contributed to his downfall. “There was no way we were ever going to take money from Sequoia, given what they’d done to me,” says Parker. The firm wanted to invest in Facebook, so as a joke the boys offered to pitch the partners a Zuckerberg side project called Wirehog, a peer-to-peer file-sharing program.

Zuckerberg and another partner showed up deliberately late for an 8 a.m. meeting, in their pajamas. They didn’t even make a pitch for Wirehog. Zuckerberg showed a PowerPoint presentation David Letterman-style: “The Top Ten Reasons You Should Not Invest in Wirehog.” It started out almost seriously. “The number 10 reason not to invest in Wirehog: we have no revenue.” Number 9: “We will probably get sued by the music industry.” By the final few points it was unashamedly rude. Number 3: “We showed up at your office late in our pajamas.” Number 2: “Because Sean Parker is involved.” And the number one reason Sequoia should not invest in Wirehog: “We’re only here because [a Sequoia partner] told us to come.” The partners seemed to listen respectfully, recalls Zuckerberg, who says he now regrets the incident. “I assume we really offended them and now I feel really bad about that.”

Facebook’s final fling of sophomoric adventures came in late 2006, when the company was starting to get billion-dollar takeover offers from major corporations. For its holiday party that December, the entire company, now about 150 people, took buses to the Great America Theme Park in nearby Santa Clara. From the minute people got on the buses they started drinking. By the time they arrived at the park many were already drunk. Facebook’s employees celebrated a successful year on the park’s thrill rides that spun, dropped, twisted and inverted them. On the way home an employee threw up in an air vent of one of the buses. The company had to pay several thousand dollars to repair the damage.

It was, in a way, Facebook’s last gasp of amateurism. The company had 12 million active users. It had passed the point where it could be run like a dorm-room project.

Excerpt 2: The Early Days

The Viacom executive figured he’d impress the kid with a ride on the company jet, but clearly it was the youth who was in the driver’s seat. Of all the suitors courting Mark Zuckerberg in the fall of 2005, one of the most enterprising was Michael Wolf, president of Viacom’s MTV Networks. He had heard college students in MTV’s focus groups talking incessantly about the new site, and he was determined to snag it for his parent company. But first he had to “friend” Zuckerberg. Wolf had figured out that the best way to reach the Facebook leader was to instant-message him, so he IM’d Zuckerberg periodically to say he planned to be in Palo Alto — whether it was true or not — and suggest a dinner. If Zuckerberg agreed, Wolf would fly out. But as the end of the year approached, Wolf got in touch with a better offer. He was planning to be in San Francisco with the Viacom corporate jet, he claimed. Would Mark like a ride back to New York for the holidays?

Zuckerberg took Wolf’s bait. Since Viacom’s corporate planes were in fact unavailable, Wolf chartered a top-of-the-line Gulfstream V for the trip from the San Francisco airport to Westchester County Airport, near Zuckerberg’s parents’ home in Dobbs Ferry, N.Y. Wolf flew out that morning from New York on American Airlines. The MTV executive was waiting aboard the G5 as if it were the most normal thing in the world when Zuckerberg arrived, late, about 5:30 p.m. Then, as Wolf had shrewdly planned, they spent five uninterrupted hours together aboard the plane. He was resolved to find a way for Viacom to buy Facebook.

For much of the trip, however, the 21-year-old was in control of the conversation. He interrogated Wolf about MTV’s business. How did companies like Viacom make their money? How much did MTV charge for advertising? How do you build your audience?

During the trip Zuckerberg took to admiring the G5. “This plane is amazing,” he said.

“Maybe you should just sell a piece of the company to us,” Wolf replied. “Then you can have one for yourself.”

Wolf invited his guest to sit in the jump seat in the cockpit as the powerful jet landed at Westchester. When it pulled up to the private aviation terminal, two cars were waiting. One was Wolf’s corporate sedan to drive him into the city. The other was the Zuckerberg family minivan, from which Mark’s parents emerged. They beamed and gave their son a big hug. It was as if he were merely coming home from a semester at college.

The MTV president kept up his pursuit after the holidays, flying to Palo Alto in January with an elaborate PowerPoint presentation and again the next month with a more personal appeal. He and Zuckerberg were becoming chums. They took a long walk around the palmy, well-groomed streets and stopped by Zuckerberg’s one-bedroom apartment. The place was messy, with a mattress on the floor, piles of books, a bamboo mat, and a lamp. Then they headed for dinner at a nearby restaurant. Wolf popped the same question he’d asked on the plane. “Why don’t you just sell to us?” he asked. “You’d be very wealthy.”

“You just saw my apartment,” Zuckerberg replied. “I don’t really need any money. And anyway, I don’t think I’m ever going to have an idea this good again.” Viacom would try money nonetheless, with a cash offer of $800 million and provisions that could make it worth as much as $1.5 billion. But like many other suitors, the Viacom executives discovered they were dealing with a formidable character. If his invention’s early appeal was at a freshman level, exploiting the desire of college students to check each other out, his professed ambition was much higher: to change the world.

Zuckerberg’s financing needs were far from his mind when he launched the site on Feb. 4, 2004, from his dorm suite at Harvard. Zuckerberg, a code writer since middle school, had arrived at Harvard equipped with his own computer and a giant whiteboard, the geek’s consummate brainstorming tool. He built the site using free, open-source software like the MySQL database and fueled his late-night coding sessions with plenty of Beck’s and Red Bull. A month before the site launched, Zuckerberg paid $35 to register the web address thefacebook.com (the name was later shortened) and started paying $85 a month to a web-hosting company. But the infectious appeal of the service went beyond what anyone expected. At the end of the semester, when the user base had reached 100,000 students at 30 schools, a well-connected classmate took Zuckerberg around Manhattan to meet with potential investors. At one of those meetings a financier offered Zuckerberg $10 million on the spot for the company. Mark had just turned 20. His company was four months old. He didn’t for a minute think seriously about accepting.

Instead, Zuckerberg decided to relocate his company for the summer to the promised land of technology, Palo Alto. Searching Craigslist, he found a four-bedroom house to sublet as an office and bunkhouse, and persuaded roommate Dustin Moskovitz to give up a summer computer-lab job at Harvard to become essentially his chief operating officer. Keeping Facebook running, which meant constantly adding more servers, was starting to cost real money. Zuckerberg spent about $20,000 in the first few weeks in Palo Alto, using money he had saved from programming jobs. But clearly much more cash would soon be necessary.

A block away in Palo Alto, Internet wunderkind Sean Parker was stressed out. It was a hot afternoon, and the skinny blond 24-year-old hated doing physical work. But his lease was up and he was short on cash. So there he was in June 2004 on the sidewalk in front of his girlfriend’s family’s house, unloading boxes from the white BMW he had bought when times were flush. When he noticed a group of boys heading toward him, he stiffened. His boxes contained expensive computer gear. He didn’t like the look of these kids — all wearing sweatshirts with hoods up despite the heat. He thought they had a menacing air, but the shortest one walked right up.

“Sean,” the guy said. “It’s Mark, Mark Zuckerberg.” Suddenly it all snapped into place. This was the guy he had met at dinner in New York City two months earlier, the kid who had treated him like a legend for his role in helping Shawn Fanning launch Napster. Later Parker co-founded another Internet company, Plaxo, a contact-info-management venture that had raised millions of dollars from investors. Lately Parker had run into trouble with his backers, who found him brilliant but unreliable. Yet to these 20-year-olds, Parker was an industry sophisticate.

Over dinner in Palo Alto, Zuckerberg witnessed firsthand the denouement of Parker’s battle with his Plaxo backers. While Zuckerberg was introducing Parker more fully to his Harvard chums, Parker got a call from his lawyer. The news was bad. The Plaxo board was not only kicking him out of the company but also refusing to allow about half of his remaining shares in the company to vest. Parker was enraged. He was getting screwed. The Facebook boys listened in awe and dismay. “VCs sound scary,” Zuckerberg recalls thinking. It was a formative moment. Feeling for his friend, and thinking he might learn much from Parker, Zuckerberg invited him to move into the house with them. By September, Zuckerberg was calling him the company’s president. Besides his sage advice, Parker came in handy for one other corporate role: The boys relied on him to buy the alcohol for house parties, since he was the only one in the group over 21.

As the fall semester of 2004 loomed, the company was on the verge of a crisis. Over the summer membership had almost doubled, to 200,000. That was good and bad. “We were just lucky it wasn’t completely bringing down the architecture,” says Moskovitz. Zuckerberg and Moskovitz had decided not to return to Harvard that fall so that they could focus on the company. But now they needed money. At this point a Silicon Valley startup would typically solicit venture capitalists to make a cash infusion in return for a very big chunk of the company, as much as a third. Zuckerberg didn’t want to give up that much control.

Parker called his friend Reid Hoffman, the founder of LinkedIn and a key member of an important Silicon Valley subculture — the wealthy former leaders of PayPal. Hoffman arranged for Parker and Zuckerberg to meet with PayPal’s onetime CEO Peter Thiel, now a private investor. When the Facebook boys made their presentation (Zuckerberg in his usual Adidas flip-flops), Thiel was impressed, especially with what was happening at colleges where Facebook was newly introduced. Within days it typically captured almost the entire student body.

Thiel then made what may be one of the great investments of all time. He agreed to lend $500,000, which would convert into a 10.2% stake in the company, giving the company a valuation of $4.9 million. That was lower than other offers, but Zuckerberg was pleased to have found an investor who seemed to trust him. The extent of Thiel’s early advice to Zuckerberg: “Just don’t fuck it up.” Thiel sold a large amount of his stock in 2009; his remaining shares are worth several hundred million dollars.

During the fall, the originally static Facebook had already started evolving into the revolutionary medium it is today by adding new features like “the wall,” which allowed anyone to write on a friend’s profile. Membership reached 500,000 by October, and it was soon clear that even Thiel’s money wasn’t enough to pay for the company’s growing infrastructure. But Zuckerberg remained deeply wary of Silicon Valley moneymen. Their thinking was short-term, he felt. His was epic.

Through a classmate whose father worked at the Washington Post Co., Zuckerberg had struck up a friendship with CEO Donald Graham, a member of the family that has controlled the Washington Post since the 1930s. Graham, who was immersed in building the company’s own web businesses, recalls being immediately taken. “I thought it was a simply stunning business idea,” he says, and made Zuckerberg an investment offer more spontaneously than any he has made before or since. Zuckerberg was impressed with how different Graham was from a bloodthirsty VC. “I was just blown away by the difference in culture — that it’s just such a long-term focus there. I was just like, ‘Wow, I want to be more like this guy.’ And that’s when I seriously started thinking about doing another [investment] round.”

As soon as word got out that Facebook was contemplating an investment, the Silicon Valley greed machine kicked into high gear. By February, 12 venture capital firms, four major tech companies, and the Post company were pursuing an investing deal. Viacom suddenly expressed interest in buying the company outright for $75 million, which would have put about $35 million in Zuckerberg’s pocket for a year’s work. But he had no interest in selling. The Post offer came in at $6 million for 10% ownership, valuing the company at $60 million. Ron Conway, a veteran investor who was advising Parker, told him, “My God! Take it! Close that sucker!” After a bit more haggling, a deal seemed to be done. Until another party entered the picture.

The Accel Partners VC firm was looking for a bigger score. After making its mark in the 1990s with a series of software and telecom investments, the Palo Alto firm had missed out on social-media opportunities. Kevin Efrusy, a junior member of the Accel team, had heard about Facebook from a Stanford University grad student interning at Accel and started making overtures. Parker declined to return his phone calls at first, thinking the VC firm had lost its mojo. Finally, on April Fool’s Day, 2005, Efrusy decided to just walk over to Facebook’s office. The two executives he encountered, Moskovitz and Matt Cohler (a recruit from LinkedIn), were struggling to assemble office furniture from Ikea. Moskovitz’s head was bleeding from hitting a piece of furniture, and Cohler’s pants were torn after getting caught on a nail. But their presentation of the business was brilliant, Efrusy recalls. Four days later Efrusy again walked down University Avenue to Facebook’s office, barged into a meeting, and slapped a term sheet on the table. It topped the Washington Post terms by far, a $10 million investment valuing Facebook at $80 million. (The deal eventually reached $12.7 million and a valuation of just under $98 million.) After Efrusy left, the young entrepreneurs looked at one another in jubilation. Eighty million? Amazing! “But what about the Post?” Zuckerberg asked. Nobody had a good answer.

That night Accel’s co-managing partner, Jim Breyer, a Silicon Valley heavyweight who’s also a director of Wal-Mart, hosted a dinner for Facebook’s leaders at the elegant Village Pub near Palo Alto. The Pub is known for its wine list, and Breyer, a connoisseur, ordered a $400 bottle of Quilceda Creek Cabernet. Zuckerberg, still only 20, ordered a Sprite. Breyer was doing everything he could to loosen Zuckerberg up. But Zuckerberg remained uncomfortable about something. Then he started to tune out, Matt Cohler noticed.

Zuckerberg went to the bathroom and didn’t return for a surprisingly long time. Cohler got up to see if everything was okay. There, on the floor of the men’s room with his head down, was Zuckerberg. And he was crying. “Through his tears he was saying, ‘This is wrong. I can’t do this. I gave my word!’ ” recalls Cohler. “He was just crying his eyes out, bawling. So I said, ‘Why don’t you just call Don up and ask him what he thinks?’ ” Zuckerberg took a while to compose himself and returned to the table.

The next morning he did call Graham. “Don, I haven’t talked to you since we agreed on terms, and since then I’ve had a much higher offer from a venture capital firm out here. And I feel I have a moral dilemma,” Zuckerberg began.

Graham was disappointed, but he was also impressed. “I just thought to myself, ‘Wow, for 20 years old, that is impressive — he’s not calling to tell me he’s taking the other guy’s money. He’s calling me to talk it out.’ ” Graham knew that even his first offer was very high for a company so tiny and so young. “Mark, does the money matter to you?” Graham asked. Zuckerberg said it did. It could, he went on, be the one thing that could prevent Facebook from going into the red or having to borrow money. “Mark, I’ll release you from your moral dilemma,” said Graham. “Go ahead and take their money and develop the company, and all the best.” For Zuckerberg it was a huge relief. And it further increased his respect and admiration for Graham. (Zuckerberg eventually asked the publisher to take a seat on the Facebook board.)

Facebook entered a new kind of boom phase, hiring staff, adding new features like photo sharing, and attracting millions more users. But Facebook was not yet a real business, especially given Zuckerberg’s disdain for intrusive advertising, so it was burning quickly through its capital at the rate of about $6 million a year. That failed to discourage the delegates from corporate America, who continued to enhance their temptations. Zuckerberg kept huddling with the moguls, which gave rise to grumbling at Facebook, especially among the growing number of executives whom Silicon Valley recruiter Robin Reed was bringing onboard. What did all these meetings mean, they wondered? Zuckerberg wasn’t bothering to explain his thinking. He thought of these meetings as a learning process. Reed had become a close observer of all the unhappiness, partly because she had one of the only private offices at the company. Zuckerberg wouldn’t listen, Facebook staffers said. Zuckerberg should be replaced. Zuckerberg didn’t know what he wanted to do with the company.

Finally Reed reached the end of her rope. “The team was almost ready to mutiny,” says Reed. She arranged to meet with Zuckerberg on his way back from an East Coast meeting. But his plane was delayed, so when they finally met it was at 2:30 a.m. in the neon glow of a diner. Reed unleashed her frustration. “Mark, nobody knows what’s going on. If you want to sell your company, then stop dicking around and say you want a billion dollars. If it’s 2 billion, say that. If you don’t want to sell, then say that!”

“I don’t want to sell the company,” Zuckerberg answered.

“Then stop taking all these meetings! You’re sending the wrong message.” Then she unleashed her final barrage. “You’d better take CEO lessons or this isn’t going to work out for you!”

“So now you’re finally being straight with me,” Zuckerberg replied, turning more animated. “This is the first time I feel like you’re telling me what you really think.” Over the next few weeks Reed noticed a distinct change in Zuckerberg. For one thing, he did agree to start seeing an executive coach to get lessons on how to be an effective leader. The week after the confrontation he called the entire staff together for Facebook’s first all-hands meeting.

While the talks with Viacom eventually fell apart over the structure of the deals, other offers kept coming and reached numbers that Zuckerberg had trouble dismissing out of hand. In July 2006, Yahoo CEO Terry Semel offered to buy Facebook for $1 billion cash. Zuckerberg seemed more than relieved a few weeks later when Yahoo, its stock suffering, reduced its offer to $850 million. As soon as he heard, a grinning Zuckerberg strode over to Moskovitz’s desk a few feet away and gave a big high-five. The deal was off.

As all this was underway, executives at other media and tech firms were starting to ask if they ought to buy Facebook. Microsoft CEO Steve Ballmer had flown to Palo Alto to visit his young counterpart twice. As Zuckerberg is wont to do, he took Ballmer on a long walk. Zuckerberg told Ballmer that Facebook was raising money at a $15 billion valuation. But Ballmer had come with something more sweeping in mind. “Why don’t we just buy you for $15 billion?” he replied, according to a very knowledgeable source. Zuckerberg was unmoved even by this offer. “I don’t want to sell the company unless I can keep control,” said Zuckerberg, as he always did in such situations. Ballmer took this reply as a sort of challenge. He went back to Microsoft’s headquarters and concocted a plan intended to acquire Facebook in stages over a period of years to enable Zuckerberg to keep calling the shots. But Zuckerberg rejected all the overtures. What Ballmer finally agreed to instead was an advertising deal that included a provision for Microsoft to pay a huge amount, $240 million, for a sliver of Facebook, 1.6%. Microsoft’s investment gave Facebook an implied value of $15 billion.

Since then the company has reached another level of dominance, where the most passionate buyers are likely to be the public when the company eventually launches an IPO. Facebook expects to become profitable this year and bring in close to $2 billion in revenues. Zuckerberg owns about 24% of the stock, which puts his stake at almost $5 billion. But he seems in no rush for an IPO or the next big thing. After all, what would he do all day? “Unless I feel like I’m working on the most important problem I can help with, then I’m not going to feel good about how I’m spending my time,” he says. “And that’s what this company is.” The ultimate payday is not a priority. Changing the world is.

Now The Tiny Netherlands Will Get Spotify Before The US

Posted: 06 May 2010 04:50 AM PDT

It appears that hot streaming music startup Spotify will launch in the Netherlands on May 18, if Dutch news reports - and their own manager there - are to be believed. Currently Spotify operates in Britain, France, Spain, Sweden, Norway and Finland. But not yet the US, even though they have confirmed their CTO is over there right now looking into servers (see interview with Paul Brown, Spotify's go-between man with the music labels, below).

HelloWallet Nabs $3.6 Million From Steve Case And Grotech For Personal Finance Software

Posted: 06 May 2010 03:56 AM PDT

HelloWallet, personal finance software, has raised $3.6 million in Series A funding, from Grotech Ventures and AOL co-founder Steve Case and his wife Jean. The company, which launched in March of this year, aims to bring professional financial advisors to the masses through partnerships with companies and organizations. Currently, HelloWallet reaches more than 3.5 million people.

Similar to Mint, HelloWallet helps users track and proactively manage their personal finances. But HelloWallet aims to be a full-service financial advisor, and looks forward to proactively uncover savings opportunities and potential threats for its members. Additionally, HelloWallet does not allow banks to advertise or promote products, so its recommendations claim to be untouched by any business interests. The startup plans to use the fund to further product development and build out its businesses development team.

HelloWallet's team of consumer finance experts have developed a platform that helps users set and reach specific financial short- and long-term goals for important life milestones including buying a home, saving for retirement, reducing debt safely, and saving for college. For example, HelloWallet stores tuition information for nearly every college and university across the country, and models the tuition out to a users' expected enrollment date. The service is then able to make specific recommendations for the best approach to educational savings, on an individual basis.

HelloWallet partners with companies like Ernst & Young, to provide their users and clients with its online financial advisory. While HelloWallet costs around $5 per month, the startup is pledging to give a free subscription to one needy family for every five of the site's paying members. And the company has caught to attention of President Bill Clinton, The Rockefeller Foundation and others.

Apprupt, A Mobile App Affiliate Network, Closes Financing

Posted: 06 May 2010 02:03 AM PDT

Apprupt, an affiliate network for mobile apps aimed at developers and ublishers, has closed what we think is a large financing round with Deutsche Telekom's T-Venture arm, KfW and its existing investor Neuhaus Partners. The startup, based out of Hamburg Germany, will use the additional funding to accelerate growth and international expansion. Terms were undisclosed.

Seeker Nails Hacker Pr0n

Posted: 06 May 2010 12:42 AM PDT

Do SQL injections turn you on? How about double SQL injections? If the answer is ‘yes’, then

1): Good luck with your dating life
2) Boy are you in some luck!

A new of breed of security product called Seeker produces some vivid hacker pr0n in the form of a video (see above) of how it broke and exploited every nook and cranny of your unsecure code. Yes, I’m going to say it, Seeker might be the Seymore Butts of security products!

Kidding aside, Seeker seems be packing pretty fearsome application security technology. The company behind it is an Israeli white hat hacking shop called Hacktics. These guys do work for startups, banks, telcos, governments, and homeland security agencies. Their team members hold very high security clearances due to their prior and current service records in the IDF (Israeli Defense Force). It’s safe to say these guys know a thing or two about application security.

Seeker was designed for use by individuals that are part of the development organization which do not necessarily possess security knowledge, or even deep technical knowledge. These can range from developers, to QA staff, to team leaders. It’s for this reason that Seeker points to real business threats rather than just technical issues.

This is where a two particular product features stand out. Seeker produces screenshots (see below) that allow testers to see the vulnerabilities in the context of the actual application functionality they relate to, rather than getting just technical information based on URLs. The screenshots also contain screenshots showing how the application handled each attack.

The second stand-out feature is ‘Exploit Videos’. Seeker automatically creates a step-by-step exploit video for each vulnerability it identifies and exploits, making it easier for the developer to manually reproduce errors before and after fixing the code. Video is also quite an effective method for non-security users to understand the actual threats and potential exploits. Just imagine being able to show management or external developers such a video. Pretty effective stuff.

Seeker’s methodology is to perform runtime analysis of code executed in order to identify security flaws in the application. This is done by hooking into the process executing the application, and performing step-by-step analysis of the executed code. The attacks themselves are generated dynamically based on a ‘Smart Attack Tree,’ a long list of rules for mutating attacks based both on how the application reacts to them, and the actual application code.

The product supports an orgy of vulnerabilities, including: SQL injection, XML/XPath injection, directory traversal, cross-site scripting, parameter tampering, forceful browsing, malicious content upload, username/password enumeration, insecure redirects, source code disclosure, insecure storage of sensitive data (such as Credit cards, CVVs, SSNs), cookie poisoning and plenty more.

Currently supported are Java and .NET code analysis, using any database if no stored procedures are used. For stored procedures, Seeker supports Microsoft SQL and Oracle. PHP, as well as support for MySQL stored procedures, will be rolled out in a few months.

Seeker is currently headquartered in Israel, with $3M in funding under its belt.

Google Responds to Joe Hewitt: Your Argument Is Two Years Old

Posted: 06 May 2010 12:22 AM PDT

Last week, well-known web/iPhone developer Joe Hewitt decided to rant on Twitter. His target? The state of web development. In 25 or so tweets, Hewitt ripped apart the state of the industry. Obviously, his impassioned views caused some controversy. But more than a few people felt his views were right on the money as well. Today, at Web 2.0 Expo in San Francisco, a couple prominent sides in the industry addressed his comments.

During the “What to Expect from Browsers in the Next Five Years: A Perspective” session, panelists were asked directly about Hewitt’s thoughts. Google’s Alex Russell stepped forward to say that while he was a fan of Hewitt’s work, and feels his pain, he disagrees with his assessment that web development is moving too slowly. In his view, web development is moving faster now than it ever has. “I feel like a lot of his comments totally ring true to me about two years ago,” Russell said noting that back then he was working on a JavaScript toolkit (just as Hewitt used to do), “it was hell.”

But now, thanks to WebKit and specially, CSS-based animations, life is much easier, Russell concluded. And, as more browsers continue to support the type of advanced CSS that runs through the GPU, things will only get better. “It’s buttery-smooth,” Russell said noting that this support was coming to all browsers shortly.

Perhaps Hewitt’s best quote in his rant was: “I want desperately to be a web developer again, but if I have to wait until 2020 for browsers to do what Cocoa can do in 2010, I won't wait.

Russell said he understands that frustration, but again, believes that the rate of improvement is increasing rather than remains stagnant. “It’s not all better yet – but it’s getting better at a pace that in 5 years we’ll accept what’s bleeding edge right now,” he said. Meanwhile, Yahoo’s Douglas Crockford echoed some of Hewitt’s sentiments later in the panel. “We have a strong risk of losing openness,” Crockford said noting that the web is based on standards, and standards have to move slowly or “they’re crap.” So who will they lose this openness to? The app stores.

Find the rest of the notes about the panel here. What’s interesting is just how much those that no longer have a stake in the game (Hewitt) are at odds with those who do have a stake in the game (Google, etc). While web development is no doubt better than it was 5 years ago, I can’t help but think that a lot of what Hewitt says is true. After all, this lack of innovation is at least partially to blame for the rise of the app stores.

Kwedit Has Legs – Repayment Rate above 33%

Posted: 06 May 2010 12:10 AM PDT

Kwedit is one of the more promising alternate payment methods for social gaming and other virtual good sellers online. If you don’t have a credit card and don’t want to get into the offers/scamville stuff, you don’t have a lot of options. Kwedit allows you to make a promise to pay later – by dropping by a 7-11 and paying cash, or just mailing cash in. If you don’t pay the money back there’s no enforcement against you other than being kicked out of the system.

It first launched in February – see our post describing it as the “first completely unreliable payment network.”

At launch time the company told me they had absolutely no idea what percentage of people would pay back Kwedit promises because they hadn’t tested the product yet. Since virtual goods are free to create and sell, though, there wasn’t much downside for the seller. The only problem would be around cannibalism where a user chooses Kwedit instead of paying directly even though they have a credit card.

In March the company released early repayment data – 26% of promises were being repaid. Tomorrow the company will release additional data as well. Highlights include:

  • 1/3 of the dollar amount of promises to date have been repaid.
  • The rate is increasing because “good” users are kept in the system, non-payers are blocked. Just less than 20% of initial promises are repaid. Second promises are repaid at a 72% rate. Subsequent promises repayment rates are even higher.
  • Of promises that are repaid, 22% are repaid in the first 24 hours. 66% are repaid within the first week.
  • Kwedit says that almost all Kwedit users were not previously using other payment methods.
  • Overall, publishers using the system are seeing a 5% jump in revenue, and Kwedit says they think that will get to 10%.

What all this means: The Kwedit experiment seems to be working and is a viable additional payment option for game publishers. Turning away an additional 5%-10% in revenue just isn’t going to happen. Look for more publishers to add Kwedit in the near future.

Booyah Hits 2 Million, Stealing Foursquare’s Thunder

Posted: 05 May 2010 09:05 PM PDT

Just a quick update on yesterday’s post on Booyah:
While we were busy trying to guess the number of jellybeans in Foursquare’s jar, Booyah was quietly, but swiftly, amassing new users. Guess what, it just hit the 2 million mark. As I mentioned previously, the company was on track to gain roughly 500,000 users a month.

MyTown reached the landmark on Monday night, a 100% gain from less than three months ago. 2010 has been a great year for the iPhone app: hitting half a million in January, 1 million in February, and now 2 million in May. For comparison, Foursquare has roughly 1.1 million users, Gowalla is sitting near 250,000.

Booyah is aggressively tweaking the app’s functionality, it released version 3.1 on Tuesday and plans to release the next version later this month. The company also says it’s working on letting users add locations on top of the current database to address one of the major complaints about the service.

FCC Action: Necessary Or The “9/11 For The Internet”? Experts Debate (Video)

Posted: 05 May 2010 07:07 PM PDT

After news broke earlier that the FCC will move to regulate Internet lines, we assembled five experts on net neutrality to spar on the topic. There was blood, tears (I may be exaggerating slightly) and frank discourse on the FCC’s jurisdiction and the possible fallout for Internet competition, access and the FCC’s much ballyhooed National Broadband plan.

Andrew Keen, author of The Cult Of The Amateur, led the discussion which included Richard Bennett (research fellow at the Information Technology & Innovation Foundation), Larry Downes (fellow of the Stanford Law School Center For Internet & Society), Michael Masnick (CEO and Founder of Techdirt) and Gigi Sohn (CEO and Founder of Public Knowledge, who came in on Skype).

This is of course a major issue for the Internet community and all its stakeholders, from the cable providers to the consumers. According to reports, the FCC will try to regulate internet lines under Title 2 of the Communications Act, which is currently used to oversee the traditional telecom industry. It’s a workaround for the FCC, which was handed a defeat last month when a federal court decided that the regulatory agency did not have the power to enforce net neutrality (in a case against Comcast). It’s a been a divisive issue, pitting providers against consumer groups and Internet companies.

The lines were clearly marked in this debate, with Sohn arguing in favor of the FCC, calling the Communications Act a logical regulatory framework that the providers will be familiar with. Bennett – who, speaking to Keen after the shoot, called the FCC’s move the “9/11 for the Internet” – adamantly disagrees, saying the FCC never had the jurisdiction to regulate the Internet. Many of the panelists agreed that if the FCC follows through on this decision, it will trigger several lawsuits that will tie up our federal courts for years (Keen warns of the “invasion of the lawyers”). Full interview above.

Scoop: Apple Is Pushing A Secret “VIP” Ad Program For iPhone Apps

Posted: 05 May 2010 05:02 PM PDT

For anyone still wondering whether Apple plans to give its new iAds a competitive advantage over other mobile ad networks on the iPhone and iPad, just take a look at the slide above. It was attached to an email sent to an app developer from a Quattro Wireless sales rep which I obtained (Quattro is Apple’s recently purchased mobile ad network). The email starts off:

We’re excited to announce a brand new program launching this month called ViP (Verification of iTunes Purchase).

The VIP program is aimed at app developers who use iPhone ads to drive downloads and purchases of their own apps. It will tie the ad directly into purchasing data from iTunes, letting app developers measure the conversion rate of ad impressions to downloads. As the slide indicates, this tracking is made possible with a “proprietary direct link from the ad to App Store” and once a “user downloads your app, they won’t ever see your ad again.”

Other mobile ad networks, such as AdMob, also try to measure conversion rates, but they don’t have access to the same iTunes data. So Apple is in a position to give advertisers much more detailed and accurate metrics. AdMob, for instance, requires developers to integrate their apps with AdMob’s SDK or APIs before they can deliver conversion tracking. To bring home the difference, the Quattro sales rep ends the email with this pitch:

No SDK or server-side integration—this cannot be duplicated by any of our competitors.

In other words, if Apple doesn’t shut out other ad networks completely from the iPhone by not allowing app developers to send tracking data to third parties, it might just use its control of the iPhone platform to give its own ad products certain advantages.

Apple’s push to create ad products that “cannot be duplicated by any” competitor is especially interesting, given that the FTC can’t seem to decide right now whether to go after Apple or block the Google-AdMob deal on antitrust grounds. Which one again has an unfair advantage in the mobile ad market? At this point, it’s way too hard to tell.

Web 2.0 Expo: A Look At The Future Of Web Browsers, From The Guys Who Build Them

Posted: 05 May 2010 04:41 PM PDT

The Web 2.0 Expo is in full swing in San Francisco, CA. One of the more interesting panels to take place earlier today was called What to Expect from Browsers in the Next Five Years. The panel’s roster included some of the biggest names in the browser industry, with representatives from Palm, Yahoo, Mozilla, Opera, Google, and Microsoft. Below are my notes from the talk (quotes are paraphrased).

The Panelists
Douglas Crockford (Yahoo) – Architect at Yahoo, discovered JSON
Brendan Eich (Mozilla) – Leads architecture, technical direction at Mozilla. Created JavaScript
Charles McCathieNevile (Opera) -Chief Standards Officer at Opera. Co-chair of the W3C WebApps working group
Alex Russell (Google) – Develops Chrome Frame plugin, Helped create Dojo Toolkit
Giorgio Sardo (Microsoft) – Web Technical Evangelist

Dion Almaer (Palm) — Director of developer relations at Palm. Co-founded Ajaxian.com with (fellow moderator) Ben Galbraith.
Ben Galbraith (Palm) — Director of developer relations at Palm, co-founded Ajaxian.com.

Q: How many people would like to see IE9 implement canvas?

*Everyone raises hand, including Sardo, who works for MS*

Sardo (Microsoft): We’re not done yet, we are investing a lot in HTML5. We believe in HTML5. We believe we need to have a professional grade HTMl5 implementation. We look at developer feedback, we look at the spec, we look to make sure it will be consistent, we look at performance. Everything will be hardware accelerated.

Almaer (Palm): In my opinion it’s tiny to do Canvas and SVG is huge..

Eich? — It’s true SVG is huge. Canvas is pretty small. We have implemented it for five years now, something like that. It’s easy.

Almaer  (Palm)- How do we stop what happened with IE6  from happening again where we get stuck in time?
Russell (Google) – I’m excited for IE9. I can’t wait — it has hardware accelerated SVG, hardware accelerated rendering. Competition is great. That’s the baseline — that’s where we want the competition to be. We want browsers to be looking to the future to see what users want and need. When the system is working, and browser vendors are shipping features quickly. In 2001 IE6 was fantastic. The problem is that things stopped getting better. We can get stuck in a generation. Plugins are one way to get out of the hole, I don’t think they are a long term solution (Russell works on Chrome Frame, a plugin).

Q: As a browser vendor facing all these specs. How do you prioritize?
McCathieNevile (Opera) - You talk to developers. Look at what people are using. A little bit of it is opportunistic — you’ve got a guy who wants to do it, he just does it.

Eich (on how Mozilla approaches this) - Mozilla has been open source for over 10 years. We have devs come to us and actually patch support for things. We’re seeing that now for things like Web Forms. We have a lot of HTML5 already implemented. What I most value are web devs who maybe can’t contribute to C++ code, but can tell us what’s missing.

Q: Doug, you’ve talked about things needing to change…

Crockford (Yahoo): The web was left for dead in 2000. Microsoft believed as many other did that the web was finished, just like Hypercard was finished and that we were going to go on to something else. There were several alternatives offered (Flash among them). Then the web in 2005 took off again with AJAX. The browser is the world’s most important app delivery system. Unfortunately because it was left for dead and WC3 abandoned its role as steward of web standards. We have the same web standards we had in 1999, which were not even state of the art then. Devs are trying to move forward with something that is clearly inadequate. We need to first solve the IE6 problem. A sig. portion of the world is on IE6 and it’s not changing. Five years ago I said it would, and it hasn’t. It hasn’t happened because web devs are doing such a good job supporting users on IE6! It’s worse internationally. In some markets , 40-60 percent on IE6.

The IE6 problem has to be solved by major website devs. One day all of us redirect to a page that says, hey, try  one of these browsers. We all have to do it on the same day, otherwise we get worried that we’re sending them to our competitor. I propose that day is 30 days after all modern browsers fully implement ES5.

? – A lot of this is Active X customizations, if you can’t replace those, you  can’t replace IE6…

Crockford – Another big problem in China is a lot of people aren’t using licensed OS’s [they are using pirate copies of Windows]…

Sardo (Microsoft) – Windows update is our agent to update users. Most of what is updated is checked for proper licenses. IE is an exception — even if it’s pirated users can download the new update… IE9 will not be supported by Windows XP. We are building all of HTML5 with hardware acceleration. We need a modern OS to do this.

Russell (Google) – I recognize Opera and Mozilla and on Chrome we’re all doing hardware acceleration. And, all of us are doing it on XP. What you’re describing is a situation where people are less behind. The way is to not leave users behind. The question is, do we have a plan so that we can give devs a choice to use HTML5 across the board?

Crockford (Yahoo) – I recommend all users of XP migrate to something that isn’t IE.

McCathieNevile (Opera) - There’s a lot of hardware that isn’t modern hardware.. that’s why people aren’t moving away from XP. A lot of people don’t want to have to keep up with technology.

Q: I want to talk about browser competition. For a long time Mozilla used Firefox were positioned as the alternative to IE… now that other browsers innovating, is Mozilla’s goal to still drive FF’s share up?

Eich (Mozilla): We have a mission to preserve choice and innovation, and to make user king or queen over their experience. There’s more competition now. But… the problem is that those companies (Google, Apple, etc) have agendas. Apple makes great products but they want to control what SDK or API you can use. Google is more aligned with the open web, but they have to have an agenda because of search. With Mozilla we don’t care. We blind ourselves, we don’t see the data, we will never do behavior marketing. Look at what FB has done recently.. users need to have control over their data.

Q: What’s the state of JS?
Eich (Mozilla) – The committee is operating in a mode called harmony which means we are not fighting. We’re prototyping proposals for Harmony. We’re working pretty aggressively on things like the module system. Doing things to get rid of host objects. The DOM kinda sucks..

Russell (Google) – Interpreters are getting faster. It’ all getting faster. The bits that aren’t getting as fast as we would prefer is network behavior. Google has introduced a new protocol called SPDY. Fundamental latency isn’t getting as fast as local device capabilities are. Hopefully in process of making a better browser  we also upgrade the DOM itself.

Sardo – All browsers have pretty good JS performance (it has room for improvements).

Q: I think we should look at some comments made by Joe Hewitt this week.. He recently said over Twitter, “I love the web, but it sucks”. We see proprietary platforms and how fast they are evolving. Joe said this loosely coupled system the web uses to establish standards isn’t working.

Russell (Google)- Respectfully (I’m an enormous fan of Joe’s work). I feel his pain. I worked on a JS toolkit, that’s as bad as it gets. He’s done the same thing. He built iUI. I feel like a lot of his comments rung true about two years ago. Things are getting much better in webkit land. A lot of the things iUI did are solved. CSS animations. Those things are coming. Rate of improvement is increasing so much I think it’s easy to understand that things were stuck. It’s not all better yet, but it’s getting better at a faster pace..

Q: Seems real action is in mobile browsers/touch interfaces. Where do you see that going?
Eich (Mozilla) – We’re investing heavily in Firefox on mobile. I agree it’s going to make desktop worry. I have to say, multi-touch out of Apple is great, I think it should be rapidly standardized. A lot of the stuff that happened on the iPhone was because (even though I believe Apple wants Cocoa to be first)  they’ve done work to support the web. That’s been helpful. What Joe is talking about — there’s a problem where you get a lot of people in a room, it’s not a good place to design new things, to innovate. So you need to just do it, innovate…

Mobile there is a concern – power is driving multicore. Next gen you’re seeing multicore. It’s going to hit the web. We’re facing a future we’re not really ready for. Browsers will have it. We’ll surface it to Javascript… in 5 years that going to be a big issue.

Q: What was logic behind Opera’s mobile browser on iPhone (using Opera Mini vs the full fledged Opera mobile browser)
McCathieNevile (Opera) - We’ve shipped hundreds of millions of browsers on mobile. Opera Mini, which is what we put on the iPhone, was designed in part for markets where people haven’t got an iPhone, but where they have a crappy handset. They want to get on the Internet. It wasn’t an iPhone strategy. It was,  this is browser more people use than any other. It’s a strategy for the developing world.

Q: In the 90′s we only had to deal with 3 major browsers to make our sites compatible with. Now have to deal with half a dozen.
McCathieNevile (Opera): An important part of standardization is to write better standards. And handle backwards compatibility. In HTML5 we didn’t want to turn over web and start again, we wanted the stuff to keep working.

Crockford (Yahoo) – The thing I’m most worried about as we move into mobile, is that we have a strong risk of losing openness. Either proprietary app platforms win because the web can’t innovate fast enough. Or the web gets captured in a proprietary platform and someone else decides what you can run on devices you’ve paid for.

[Sardo (Microsoft) talks more about standards and the possibility of switching between rendering engines to maximize compatibility. He sort of ignored Crockford's statement, which was frustrating because it's a major issue]

Russell (Google) – There are economic costs to keeping old content working with new browsers. And orgs that act as mediators for old tech for users have costs, deciding what has to be left behind.. Switchable renderers one potential way where new stuff can be added to ecosystem faster.

Q: No one is talking about CSS feature detection.
McCathieNevile (Opera) - What you’re supposed to do is use CSS to take existing content that runs on anything and make it pretty. It’s nice. But you can do without it so maybe that’s why you can’t detect if this works, or at least that’s the logic for why there isn’t feature detection. But once you have people in shops actually coding it, it might be that was a dumbass idea.

Foursquare-Using BART Riders Sometimes Use Foursquare, And Love The Color Blue!

Posted: 05 May 2010 04:40 PM PDT

Between late January and early March of this year, BART riders were asked to take a survey about the partnership between BART and Foursquare. The results are interesting. Not really interesting in substance, but interesting in that they seem to mean almost nothing.

For example, the crown jewel of the survey is that 38% said it was “more fun to ride BART” using Foursquare. How exactly using Foursquare makes BART more “fun” isn’t clear from the survey. Most people use Foursquare simply to check-in to alert their friends where they are. Yes, there are some game elements like points and badges, but it’s not like you’re actively using the service while you’re riding BART in order to have fun.

Also, while they don’t point this out in the release, for the same question, “Has your use of Foursquare changed your experience on BART?,” 45% responded, “Not really.”

Also humorous, while BART says they created the survey for BART-riding Foursquare users, according to the results, 54% responded to question #1, “When did you first start using Foursquare?” with “I’ve never used Foursquare.” So basically, more than half of the people that saw the “Complete this short survey and have a chance to win a $50 BART ticket” header gave survey results that were unusable. That left BART with around 450 usable responses.

And of those usable responses, a full 31% said “No, I don’t check in at BART stations.” 400 people answered that question, so we’re already below 300 people taking the survey that actually use it.

To the question, “Do you recall using BART in the last three months because of a Foursquare tip/recommendation?,” a full 70% responded, “No.” Likewise to the question, “Overall would you say you’re riding BART more, less or about the same because of your interaction with Foursquare?” 82% responded, “Same.”

Still, it’s not all useless info for Foursquare. Of the limited number of people who did take the survey and use the service, 93% were “somewhat likely” or “very likely” to recommend it to a friend. And nearly 30% started using it in just the last 6 months. And the users tend to me more affluent, younger, and more male than other BART riders.

The best question may be the control question that the survey creators threw in to make sure people were paying attention: “What’s your favorite color?” 34% answered “Blue.” It almost beat out, “Why are you asking me this?” (36%)

You can find the full survey here in PDF form.

France Gets Yelp’s First Non-English Site, Long After Qype

Posted: 05 May 2010 03:38 PM PDT

Local reviews site Yelp has launched a site for France. Yelp France is the startup's first non-English speaking country. The site can be toggled through French or English. This will be of interest to European player Qype which is bigger than Yelp across Europe. Yelp has claimed one million unique visitors consulted for Yelp UK and Yelp Ireland last month 16 months after launch.

Scribd CTO: “We Are Scrapping Flash And Betting The Company On HTML5″ (Exclusive Screenshots)

Posted: 05 May 2010 03:01 PM PDT

Adobe’s much-beleaguered Flash is about to take another hit and online documents are finally going to join the Web on a more equal footing. Today, most documents (PDFs, Word docs, Powerpoint slides) can mostly be viewed only as boxed off curiosities in a Flash player, not as full Web pages. Tomorrow, online document sharing site Scribd will start to ditch Flash across its tens of millions of uploaded documents and convert them all to native HTML5 Web pages. Not only will these documents look great on the iPad’s no-Flash browser (see screenshots), but it will bring the richness of fonts and graphics from documents to native Web pages.

Scribd co-founder and chief technology officer Jared Friedman tells me: “We are scrapping three years of Flash development and betting the company on HTML5 because we believe HTML5 is a dramatically better reading experience than Flash. Now any document can become a Web page.”

Documents will simply become very long Web pages. A new bookmark feature will help you keep your place in especially long documents. Scribd’s documents will be especially iPad friendly. Instead of downloading a book from Apple’s iBooks store or Amazon’s Kindle app, you can see if an electronic version is on Scribd and read it in your browser. Pinch and zoom to make the text bigger. No download necessary. The books and other documents are stored on the Web. They can be shared via Facebook and Twitter, or sent to a mobile phone.

Scribd is joining a chorus of companies from Apple to Microsoft in siding with HTML5 over Flash. Tomorrow only 200,000 of the most popular documents will be available in HTML5, but eventually all of them will be switched over. When it’s done, Scribd alone will convert billions of document pages into Web pages.

Scribd’s currently uses a Flash player much like YouTube’s to allow people to upload and view documents on the Web. But with HTML5 standards now making their way through not browsers, there is little reason to do that. “Right now the document is in a box,” says Friedman, “a Youtube-type of experience. There is a bunch of content and a bunch of stuff around it. In the new experience we are taking the content out of the box.”

Friedman has ben working secretly on this project for the last six months. You can tell he’s excited about it. He believes the Web is finally ready to ditch Flash for documents. Unlike video players, the parts of the HTML5 standard that impact documents have to do with support for fonts, vector graphics, and rotating text. Friedman estimates that 97 percent of browsers will be able to read Scribd’s HTML5 documents because those parts of the standard are older and more widely adopted. HTML5 documents will still be embeddable in other sites using an iFrame.

Poor Adobe. Even as it too embraces HTML5, the Web is moving away from Flash.

The FCC Steps Up To Protect Net Neutrality. But Does It Go Far Enough?

Posted: 05 May 2010 02:25 PM PDT

The FCC will in fact be reregulating the ways we connect to the Internet in order to protect net neutrality, a report in The Wall Street Journal says today. Assuming this is true, it’s huge news, and potentially a huge win for consumers. But the big question will be: does it go far enough?

There isn’t much detail in the WSJ report, but the key part is that FCC Chairman Julius Genachowski’s staff has been briefing FCC commissioners on changes that will be made to the regulation of Internet lines. The companies in charge of such lines, such as phone and cable companies, have been arguing that new regulations would hurt their businesses. They fear that they may have to open these lines to competitors (God forbid!) or be forced to have rate limits (the horror!). According to the WSJ report, the FCC officials are saying that won’t be the case, and instead will mainly be concerned with ensuring net neutrality.

Last month, a federal court ruled that the FCC does not have the authority to enforce net neutrality. At the time, the FCC said, “Today's court decision invalidated the prior Commission's approach to preserving an open Internet. But the Court in no way disagreed with the importance of preserving a free and open Internet; nor did it close the door to other methods for achieving this important end.” So you have to imagine they’ll be using one of the “other methods” under this plan.

Much of this is centered around the FCC’s recently announced National Broadband Plan. That plan, while good in a number of ways, doesn’t go nearly far enough in ensuring that there’s competition in the market — the key factor that can make broadband truly flourish in this country. Harvard Law professor Yochai Benkler had a great op-ed in the New York Times back in March about this. At the time, we wrote that we may have to rely on companies like Google and their ambitious fiber plan to open up the market in a way that the government won’t. Sadly, few companies have the resources (or the will) of Google, and even that is limited, so the U.S. is still going to be largely under the control of the old guard ISPs.

Net neutrality is great, but the FCC needs to do exactly what the cable and phone companies don’t want them to do: create more competition in the market. If there’s true competition, net neutrality would be less of an issue because people would just switch to a different provider if the one they’re on tries to block certain sites, or throttles others. Unfortunately, right now, consumers can’t do that because ISPs have monopolies in many areas of the country.

The New Roku Netflix Experience Adds Search, Instant Queue Modification Features

Posted: 05 May 2010 01:44 PM PDT

Woot! Netflix for Roku's wee little box will be updated "soon" for Netflix subscribers, adding search functionality that the service badly needed. As you can see from this jaunty video, the entire UI has been improved and the standard "press left to see all of the other movies" is gone, giving you more movies per page and a considerably more streamlined experience. The best thing? You can now add movies to your queue from the box. Click through for a video and a bit more info.

Caffeine, Pizza And Glory: The TechCrunch Hack Day At Disrupt

Posted: 05 May 2010 12:52 PM PDT

Hack Days, for those of you not aware, are gatherings of hackers who work alone or in small teams and build software out of publicly available APIs. Or, in the case of Scrapyard Challenges, electronic devices out of discarded electronic “junk.” I’m an expert hardware hacker, myself, by the way.

We’re adding a Hack Day to our TechCrunch Disrupt conference in New York later this month. We’ve got pizza, Red Bull and everything else you’ll need to build your stuff. All we need now are 200 or so Hackers. This is both a software and Hardware hack event, and we’re partnering with Scrapyard Challenge for the hardware portion.

The event is free and is being held over the weekend before Disrupt, beginning Saturday afternoon. Projects will be shown on stage on late Sunday, and a variety of awards will be given. If you finish a project you’ll get into the main Disrupt conference for free, saving you $3,000. And at least two of the top projects from the Hack Day will be shown on stage in front of the entire Disrupt event audience of 2,000 or so people on Wednesday, May 26.

More details are here, and the application form is here. Both software and hardware hackers are welcome. This event is free for hackers.

The event is sponsored by Facebook (thank them for the free tickets and food). More sponsors will be announced shortly.

The TechCrunch Hack Day is being organized by four hard core hackers: Chad Dickerson (who held the first Hack Days at Yahoo, now CTO of Etsy), Daniel Raffel (Yahoo) and Tarikh Korula (Uncommon Projects) and Jonah Brucker-Cohen (Scrapyard Challenge). They’ll be organizing and attending the event to make sure everything is Hacker Shangri La all the way.

If you’re press and want to attend the Hack Day portion of the event, please contact us. You just have to promise not to get in their way. Highly caffeinated hackers under time pressure should not be pestered. Interested sponsors get in touch here.

Zencoder Wants To Be The Amazon Web Services Of Video Encoding

Posted: 05 May 2010 12:45 PM PDT

Transcoding videos, which changes the format, size and bit rate of a video file, is an arduous, yet necessary process for media content owners. Many sites outsource the transcoding technology to services like Encoding.com, which offer a SaaS application to format videos. Today, Y Combinator-backed Zencoder is entering the space, hoping to become the Amazon Web Services for encoding.

Before launching Zencoder, the startup’s founders talked to hundreds of customers and prospects who need video transcoding services, and found that they consistently care about the same three or four things: speed, input compatibility, video quality, and ease of integration. Thus, Zencoder promises fast encoding, claiming to be at least 30 percent faster than the current encoding technologies.

While the startup’s pricing is similar to competitors, Zencoder differs from sites like Encoding.com in that it charges clients per minute of video encoded vs per gigabyte. The startup also claims to handle 95% of the unusual or corrupt files that other services can’t tackle.

Other unique features include the ability to autorotate iPhone videos shot in landscape mode (which is important for any UGC site) and compelling developer tools, including a code generator for API calls.

Zencoder also has experience and talent in its favor. The founders originally developed encoding technology Flix Cloud, that was used by video compression startup On2 technologies, before On2 was eventually acquired by Google. Zencoder, which is independent of On2, is based on the next version of Flix Cloud with improvements in speed, quality, reliability, and ease of use.

Although the startup only recently launched, Zencoder has already signed up a number of companies including Posterous to use its encoding services. Posterous will be switching over to Zencoder for all of their video transcoding in the coming weeks.

Adobe As The Railroad Tycoon: Apple Needs To Change Its Gauge

Posted: 05 May 2010 11:00 AM PDT

Today at Web 2.0 Expo in San Francisco, Adobe CTO Kevin Lynch took the stage to talk with O’Reilly’s Brady Forrest. This was maybe the most heavily anticipated talk at the event due to the quickly evolving feud between Adobe and Apple. And Lynch didn’t dance around the topic — in fact, he brought it up (indirectly) before Forrest even asked. We have a full recap of the conversation here, but I wanted to focus on one thing in particular that Lynch said.

Why can't you do that with any phone? If you look at what's going on now, it's like railroads in the 1800′s,” Lynch said. “People were using different gauged rails. Your cars would literally not run on those rails,” he continued.

What he means by that, of course, is that Apple’s iPhone platform makes developers use their own native code (their “gauge,” as it were). This code doesn’t play nicely with the other mobile devices out there. Adobe came up with a solution that it thought would correct this — and Apple blocked it (or, more precisely, blocked the apps built using this tool). Obviously, Adobe isn’t too pleased with this.

But Lynch’s choice to compare this to the railroad is interesting. On one hand, the comparison argues for a unified system, which makes sense to a lot of people. From Wikipedia, “Originally, various gauges were used in the United States and Canada. Some railways, primarily in the northeast, used standard gauge; others used gauges ranging from 4 ft (1,219 mm) to 6 ft (1,829 mm). Problems began as soon as lines began to meet.”

On the other hand, mobile applications are hardly rail lines. They are not vital to transportation, and more importantly, shipping in this country. Lynch also conveniently leaves out one of the main reasons that the gauges were unified — because of the Pacific Railway Act of 1863. This specified that federally-funded railroads (the kinds being built to traverse the country) were to use standard gauge.

So by that rationale, a federally-funded App Store may be needed to get Apple in line. And supposedly, Adobe is asking the government to get involved.

The problem with this is that there are at least a dozen more pressing issues in the wireless industry that the government should be looking to first. For example, why do only a handful of companies control the cast majority of the spectrum in this country? (Yes, the “open” spectrum will supposedly address some of this, but that remains to be seen.) Why is it so hard for customers to switch between carriers? Why on Earth do these carriers charge $0.10 to $0.20 for text messages that cost them next to nothing. Why are certain phones (like the iPhone) restricted to certain carriers? The list goes on and on.

Adobe is comparing the iPhone to a railroad, but the problem is that there are many reasons that all of the “railroads” in this country aren’t unified. And it’s not exactly clear why they need to be when private companies are involved.

Further, having just come back from Japan, I realize the poor state of the rail system for transportation now in the U.S. In Japan, there are many types of rails, all privately-owned and operated since 1987. For the most part, they don’t interconnect. And you know what? They’re a hell of a lot better than what we have here. There would be no shinkansen (the so-called “bullet train”) if it had to run on the same lines that the other trains run on.

iPad Mania: 5 Free Tickets To Untethered Conference In New York #UNTETH

Posted: 05 May 2010 10:59 AM PDT

TheBigMoney (a Washington Post/Slate blog network) is holding a one day tablet computing conference in New York on June 17 called Untethered. You’ll have the chance to watch the big dead tree publishers fret over tablets and how they might use them to save their businesses, and see a few plucky startups show their stuff as well.

If you’d like to attend for free, we’re giving away five free tickets to the event. Just retweet this post with the #UNTETH hashtag and the winners will be picked randomly at noon EST on Friday, May 7. You can also get a 20% discount on tickets by entering in the code TC on the registration page.

TechCrunch is a media partner to the event and we’ll be covering it live as well. See you there!

Groupon Buys Mob.ly, Opens Silicon Valley Office

Posted: 05 May 2010 10:09 AM PDT

Groupon, the increasingly popular daily deal site, has purchased mobile development firm Mob.ly for an undisclosed amount and opened up an office in Palo Alto. The Chicago-based company (which recently snagged a round of funding led by DST with a $1.35 billion valuation) has also hired the former Netflix executive, Mark Johnson, as their new Chief Data Officer. Johnson and Mob.ly will both be based in the new Palo Alto office.

“Now there is no excuse to not work for us,” Groupon founder’s and CEO Andrew Mason said in a press release. “And Chicago is still super cool. Did you know that we have the largest water filtration plant in the continental United States? Great city, can’t understand why people wouldn’t want to move here, but whatever — now we’re in the Valley too.”

Mob.ly, formerly known as Goodrec, is a mobile application service that launched at Techcrunch 50 in 2008. The company, which works with clients to create mobile applications from top to bottom (from conception to design and testing), has built apps for clients like Comedy Central, NBC, Digg and Yahoo!

Groupon growth’s has been impressive (the company is expected to hit roughly $350 million this year in revenues), almost impressive as the evolution of its valuation. Back in December the company was valued at roughly $250 million, that’s just 18.5% of its current valuation. Beyond adding to its warchest, Groupon has been building out its company’s services this month. This week the company rolled out a new rewards program to create extra incentives for loyal followers, you get points for viewing and buying deals, those points can be used for discounts with partner business or to pay for future deals. With the acquisition of Mob.ly, Groupon will no doubt be expanding its mobile functionality. Currently, the iPhone app only allows users to find and purchase nearby deals, search for those in different cities and redeem coupons.

SlideShare Now Supports Business Videos On Professional Content Platform

Posted: 05 May 2010 09:57 AM PDT

SlideShare, the "YouTube for presentations," has been making a big push to become the go-to platform for professional and business content. Last year, the startup unveiled two premium services for businesses, LeadShare and AdShare. And earlier this year, SlideShare launched another business-friendly product, branded channels. Today, the startup is going multimedia by allowing users to upload and share business videos.

SlideShare lets anyone share presentations and also serves as a social discovery platform for users to find relevant content and connect with other members who share similar interests. On SlideShare now, professionals can now upload and share videos of their talks, promotional videos, screencasts, demos and webinars. At the moment, users are restricted to only five videos per month (with no limit to length of videos).

Videos on the site have same functionality as the slides and presentations, with the ability to share on Twitter and Facebook and embed on sites and blogs. Professionals can also use the SlideShare app on LinkedIn for sharing videos with their professional networks.

In terms of monetization, SlideShare video owners can integrate the LeadShare model that the startup launched last year. Currently, all videos will be ad-free but co-founder and CEO Rashmi Sinha says that the startup is still testing the business model for now.

Sinha says that SlideShare is not trying to compete with popular video sharing sites like YouTube or Vimeo and is limiting its focus on pure business content. Competitor DocStoc is also trying to make a push towards business and professional content as well.

Adobe CTO Kevin Lynch: We’re Going To Make The Best Tools In The World For HTML5

Posted: 05 May 2010 09:36 AM PDT

One of of today’s keynote speakers at the Web 2.0 Expo in San Francisco is Adobe exec Kevin Lynch, who serves as the company’s CTO and SVP, Experience & Technology Organization. The keynote talk is a timely one — Adobe has been in the headlines over the last few weeks as it engages in a very public battle with Apple. Lynch sat down with Web 2.0 Expo SF program chair Brady Forrest. My live notes about the conversation are below.

Q: How is Adobe going to react to HTML5?
A: I wouldn’t say reacting to HTML5. We see whatever people are using to express themselves. … We’re going to make great tooling for HTML5. We’re going to make the best tools in the world for HTML 5.

It’s not about HTML 5 vs Flash. They’re mutually beneficial. The more important question is the freedom of choice on the web.

We’re facing a time where there are some who want to wall off parts of the web and need to have approval. I don’t think that’s the role of a company. Apple is playing this strategy where they want to create a walled garden.

But look at the iPhone helicopter we just saw — why should I only be able to use an iPhone for that? Why can’t you do that with any phone? If you look at what’s going on now, it’s like railroads in the 1800′s. People were using different gauged rails. Your cars would literally not run on those rails. That’s counter to the web. The ‘rails’ now are companies forcing people to write for a particular OS, which has a high cost to switch.

The technology issue I think Apple has with us is not that it doesn’t work, but that it does work. We don’t want to play technology games when Apple is playing a legal game. We’re focusing on everybody else. There’s a huge wave of innovation, there’s going to be a wide range of devices. We’re working through the Open Screen Project. Have over 70 partners working with Adobe on that. There’s a lot of great devices coming out over the course of the second half of this year and next year, going forward. All the innovation coming from all those companies will dwarf what’s coming from that one company that isn’t participating.

Regarding the prototype tablet that has been shown off at Web 2.0, there are a bunch of manufacturers building devices with those guts.

Q: How is Omniture going to play out?
A: I think everyone agrees the experience matters. But you also have to optimize how effective it is — that’s what Omniture is about. Test&Target for multivariate testing. Test different colors, button locations.

We’re also going to further extend what we offer devs. As people build applications, we’re offering something that will let them integrate with social networks. We’re also developing a service to do transactions (Try&buy).


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