web 2.0

Thursday, June 17, 2010

The Latest from TechCrunch

The Latest from TechCrunch

Link to TechCrunch

Zoho Adds Workspaces, Access Controls, Widgets And More To Zoho Wiki

Posted: 17 Jun 2010 09:27 AM PDT

Zohi Wiki, which originally launched in 2006, is getting an upgrade today, with additional collaboration features, access controls and more. Zoho has added workspaces within Wiki to allow teams to have their own groups within organization wikis. Each workspace has its own administrative and customization options and can serve as a separate portal. Zoho has also added more in-depth access controls to wikis, which allows administrators to set permissions for Workspaces, multiple groups, individuals, domains, public, and for users within an organization. Admins can also assign separate permissions for edit, view, create and delete functions.

Droid X Lands In A Cornfield Near You

Posted: 17 Jun 2010 08:57 AM PDT

We know that Verizon is launching Droid X on the 23 – at least when it comes to press access – but it looks like they’re announcing to the rest of the world as well, right now, via a Flash-rich teaser site that allows you to pop in your email for more info.

Read more…

Apptera Raises Another $10 Million For Its Voice & Visual Mobile Advertising Network

Posted: 17 Jun 2010 08:28 AM PDT

Mobile advertising company Apptera has raised another $10 million in VC funding, we’ve learned via an SEC filing. The startup’s previous financing round dates back to November 2008, also totaled about $10 million and came from investors such as Alloy Ventures, Lightspeed Venture Partners and Walden International.

The company has yet to publicly disclose the new capital injection, but these types of follow-on rounds typically come from existing backers, with maybe one or two additional investors.

Founded in 2001 in Silicon Valley, Apptera operates what it refers to as a ‘Voice & Visual Mobile Advertising Network’, enabling the company to dynamically serve voice ads to callers and enhancing those calls with interactive visual engagements. Callers can opt in to voice ads and have special offers such as coupons and promotional codes, videos, even maps and directions sent direct to their phones, straight away or at a time scheduled in the future.

Publishers in its mobile advertising marketplace include movie ticketing services (such as Movietickets.com, Moviefone and Fandango), free-411 services (e.g. Jingle and AT&T), social voice services and blogs, and widgets on social networks like Facebook and MySpace.

At the help of Apptera we find Henry Vogel, the former eBay exec that was previously chief revenue officer of Quigo Technologies, the ad network company that was acquired by AOL in December of 2007. The rest of the members of the management team have a ton of experience from a variety of positions at companies like Yahoo, Overture, eBay, Meraki, Spot Runner, ESPN, Sony Pictures and iPass under their belts.

Google’s Commerce Search For Retailers Now Better And Cheaper

Posted: 17 Jun 2010 07:59 AM PDT

For any e-retailer, product search is the foundation of a commerce platform. Many times, a consumer goes directly to the search box to find the object they want. And the ability to easily find products on a retailers site affects the consumer interaction and experience with their site and produces higher conversion rates. Google began powering search platforms for retailers last year, with the launch of Commerce Search, a hosted enterprise search product to power online retail stores and e-commerce websites. Today, Google is launching the next iteration of Commerce Search which offers retailers a more powerful and less-expensive version of the product.

The first version of Google Commerce offered a variety of features that are optimized for retail and product search, such as parametric search, sorting of results, spell checker, stemming, and synonym suggestion. The newest version builds on these features, by offering a more in-depth search experience for users and merchants. As Commerce product manager Nitin Mangtani tells me, version 2.0 focuses on enhancing navigation and the user experience.

The Merchandising Dashboard: A new merchandising dashboard gives merchants more options within their search portals. Retailers can now rank products, so that certain products rank higher in search results than others. Additionally, retailers can feature promotions and sales within search portals within a given timeline. And retailers can add customized filters or ‘facets’ to search, and Google’s technology will present the appropriate results accordingly. All of these features can be implemented through a rules wizard that requires no custom code so a marketer or merchandiser could easily implement changes.

Search Improvements: Google is adding realtime query autocompletion, which is a necessary element of any retail site. And Google will customize auto suggestions for each site, depending on the product indexed. Google has also improved speed of search results in Commerce search, and claim that search results are returned to shoppers in less than a second.

Price Drop: Google is dropping the price of Commerce search to a pricing model that starts at $25,000 per year. Previously, Commerce search pricing started at $50,000 per year. Pricing is based on total volume of queries and items indexed.

Google Commerce search also integrates Google products like Google Analytics and Google Product Search. Using Commerce, retailers can measure clicks, conversion rates, number of transactions, average order value and other data via Google Analytics. And e-commerce vendors can provide a single feed of products and catelogue items that will power Commerce and indexing of their products on Google Product Search.

Retailers using Commerce search include Birkenstock, Smart Furniture and Coveroo. Google declined to release the exact number of retailers who are using the Commerce search product, but did say that Google is powered enterprise search for 30,000 sites currently. Google also offers a general hosted search product that is used by organizations that want to add customized Google search functionality to their websites.

I’m curious if Google dropped their price because of a lack of retailers adopting the search product. As the retail industry steadily climbs out of the hole caused by the recession, I still think $25K is a lot to pay for search for smaller retailers. But it’s good to see that Google is dropping the price to allow for more retailers to use the product. And Google is pushing its product as an easily deployable, user-friendly way to integrate powerful search into a retail site. Google faces competition from Omniture, IBM, Endeca and others.

Forrester Projects Tablets Will Outsell Netbooks By 2012, Desktops By 2013

Posted: 17 Jun 2010 07:04 AM PDT

The tablet era has just begun, but Forrester Research is already predicting tablet sales in the U.S. will overtake netbook sales by 2012, and desktop sales by 2015. At the Untethered conference today in New York City, Forrester analyst Sarah Rotman Epps laid out her projections comparing tablet sales to netbooks, laptops, and desktops. She expects 3.5 million tablets (including the iPad and other tablets) to be sold this year, growing to 20.4 million in 2015. Meanwhile, she expects desktop sales to drop from 18.7 million units in 2010 to 15.7 million units in 2015.

As a percentage of overall PC sales, tablets will grow from 6 percent this year to 18 percent in 2012 (when netbooks are estimated to account for 17 percent of sales. The next year, in 2013, tablet sales are projected to outstrip desktop unit sales, 21 percent to 20 percent. By 2015, tablets will make up 23 percent of PC sales in the U.S., while desktops will be 18 percent and netbooks will be 17 percent. Only laptops will sell more in the U.S., with a 42 percent market share.

The big question is how much of the tablet market can Apple capture? It has already sold 2 million iPads, and could easily blow past Forrester’s 3.5 million estimate for this year all by itself. It is not stretch for it to get to 20 million by 2015 either. So is there room in this market for other tablets, or will Forrester need to increase its estimates?

These projections are for unit sales, not total revenues, but still the expectation that there will be more tablets sold in five years than any other type of computer is stunning. By 2015, the cumulative number of people using tablets will be 59 million, according to Rotman, which will be larger than the installed base of netbooks (but still just a fraction of the installed base of desktops and laptops). On a global basis, IDC also sees tablets and e-readers driving more growth than netbooks. Looks like it is time to stick a fork in netbooks.

Internet TV Search Engine TVLinks Exits Stealth – Content Goes Missing

Posted: 17 Jun 2010 06:05 AM PDT

What's this, a European startup thinking global? TVLinks, an Internet TV guide and video search engine, exits stealth mode today, and says it wants to battle the big US search engines and TV listings sites. It currently houses a database of over 30,000 movies, and 2,000 TV shows consisting of 80,000 episodes. In total it indexes more than 2,000 content provider websites, some of which it has formal partnerships with - US-centric Amazon VOD, Netflix and Google - while others are, presumably, being scraped or spidered via open APIs. The result is that a lot of content that shows up in search results is likely to be housed on their respective video sharing sites with or without the permission of copyright holders and/or geo-blocked.

Pay What You Want for Kiddix OS

Posted: 17 Jun 2010 05:58 AM PDT

From Microsoft Bob to Edubuntu there have been a number of attempts at making computers of various sorts easier and more useful for young people. Another participant in this space is Kiddix, “a complete operating system and software environment for children, built from the ground up with your family’s needs and safety in mind.” Kiddix is built upon Linux, and aims to present things in a very “kid friendly” way. Through the end of June, Kiddix is running a “Pay What You Want” promotion, allowing you to pay any amount to buy their OS.

Read more…

Like.com And Glamour’s What To Wear Is The Quora For Fashion Advice

Posted: 17 Jun 2010 05:49 AM PDT

Digital shopping and fashion empire Like.com wants to solve a problem for anyone who has ever stood in front of their closet and wondered what they should wear. The startup that has brought us visual shopping engine Like.com, shopping personalization engine Covet.com; street style social network Weardrobe, and visual styling tool Couturious, launched its live personal stylist and wardrobe consultant in an iPhone, Ask A Stylist a few months ago. Now, the startup is expanding to the web, with fashion Q&A site, What To Wear, which takes on a model similar to Q&A site Quora.

Similar to Ask A Stylist, What To Wear gives anyone real fashion answers from fashion bloggers and celebrity and Glamour Magazine-trained stylists in real time. For example, you can pose the question; “What should I wear to the Lady Gaga concert tonight?” and a stylist will respond with visual answers of their suggestions. Stylists can explain their recommendations visually through pictures. Of course, these pictures are sometimes linked to products that a user can purchase, and Like will collect an affiliate fee from this transaction.

Users can remain anonymous on the site or can use Facebook Connect to sign in, in which case the site will surface questions from your friends as well as the anonymous questions. Certain sylists wWhat To Wear also has a content partnership. Glamour.com will feature guest blogs by What To Wear stylists, and will highlight the most popular and recently asked questions.

The site is part of Like.com’s CEO and founder Munjal Shah’s strategy of bringing interactive shopping tools to the online soft goods shopping experience. Couturious shows you how to wear styled looks on the web. Weardrobe helps you to be visually inspired with streetstyle looks; Covet helps you to visually personalize your shopping (using celebrity photos), Like.com helps you to visually shop for soft goods and What To Wear and Ask A Stylist add a personalized styling consultant to the mini-empire’s offerings.

Strategy aside, you have to wonder what these verticals are doing for Like.com. The site’s traffic, which according to ComScore, is stagnated. ComScore reports that Like saw 2.3 million unique visitors in April, and has flatlined in growth. And the other sites in the family don’t have nearly as much traffic as Like.com. But Like, which launched in 2006, says that it has generated $150 million of gross merchandise sales per year. And the startup raised $32 million in funding during the implosion of the financial industry, with a valuation just north of $100 million.

SafetyWeb Secures $8 Million So Parents Can Better Secure Their Kids Online

Posted: 17 Jun 2010 05:00 AM PDT

When we last wrote about SafetyWeb in November, they hadn’t launched yet. Still, that didn’t stop Battery Ventures from pumping in a $750,000 angel round of funding. Now they’re about three months post-launch and investors are clearly liking what they’re seeing as the service has just raised another $8 million.

SafetyWeb is a services that allows parents to monitor their children’s activity on social networks in realtime. They scan the web for a kid’s activity online and send alerts when something notable comes up — things as mild as negative comments being said, all the way up to a person convicted of a sex crime friending a child on a network. Initially, they’re scanning the major social networks (Facebook, Twitter, MySpace, etc), but eventually the plan is to scan all sorts of things — including the fast-growing geolocation services.

Obviously, child safety on the web is a big issue and it’s growing bigger every day as networks like Facebook approach 500 million users and consume kids’ time. Facebook in particular is interesting because as they continue to grow, they also continue to open up more user data to the public. And that’s right in SafetyWeb’s wheelhouse because they search the web for this public information (as opposed to logging in to kids’ accounts). For as little as $10 a month per child, SafetyWeb keeps parents up to date on all this stuff.

We generally believe that the whole security market is shifting away from protecting people, not machines.  We really are the first of a kind service that is not just people search posing as a product.  We are the only ones that do both discovery and retrieval of real-time activity without requiring your kid’s credentials,” co-founder Geoffrey Arone tells us.

He also hints at some “big deals” the service has recently signed, but won’t say what they are just yet. He will say that right now, there are over 1,000 affiliates distributing SafetyWeb.

This new funding round was led by Battery Ventures with First Round Capital also participating. With the funding, Roger Lee from Battery is joining the Board of Directors, and Satya Patel from Battery is being added as an observer. They’re also adding former MySpace Security Czar, Hemanshu Nigam, to the Board. For the past four years, Nigam has been the Chief Security Officer for all of News Corps’ online properties.

SafetyWeb is up to 12 full time employees now — some working out of their headquarters in Denver, and the rest in their offices in Menlo Park.

Confirmed: Criterion Capital Partners Acquires Bebo From AOL

Posted: 17 Jun 2010 04:25 AM PDT

The rumors are true: hedge fund Criterion Capital Partners is indeed the buyer of Bebo. As we reported yesterday, AOL is offloading the social networking service for less than $10 million (other media are reporting a purchase price of around $2.5 million).

To remind you: AOL paid $850 million for Bebo back in 2008. Ouch indeed.

In a press release that just went out, Criterion acknowledges that it has acquired the Bebo business from AOL and that it will “assume the rights and complete operating control over the global social platform business”.

The acquisition and financing was led by CCP partner Adam Levin in partnership with business strategist Paul Abramowitz and web entrepreneur Richard Hecker.

Criterion Capital Partners will take over Bebo's global operations immediately and retain its San Francisco-based headquarters.

Exact terms of the deal are not being disclosed by either party, but AOL CEO Tim Armstrong sent a note to all employees this morning that suggests our earlier reports that the ability to offset almost the whole sum it paid for Bebo as a tax loss played a big role are correct.

A couple of paragraphs from said note (emphasis ours):

In April we communicated the fact that Bebo was among the assets we
would be not be keeping as part of our main portfolio of businesses.
At that time, we indicated that we hoped to finish our strategic
evaluation by the end of May, which we did. Today we are announcing
that we completed the sale of substantially all of the assets of Bebo,
Inc. to Criterion Capital Partners, LLC.

This sale is important for Bebo's users and for AOL. The deal will
allow Bebo's users to remain within the social platform that they know
and love, while enabling a new owner to bring new possibilities and
experiences to bear. Criterion Capital Partners are specialists in
facilitating growth plans and turnarounds and are well placed to drive
Bebo's effort to strengthen its foothold within the highly competitive
social networking arena.

For AOL, the transaction will also create a meaningful tax deduction,
which should allow us to more effectively manage our tax strategy.

Huffington Post Buys Adaptive Semantics To Keep Up With 100,000 Comments A Day

Posted: 17 Jun 2010 04:00 AM PDT

The Huffington Post has acquired its first company in a small cash deal, and it is not another blog or media site, but a pure technology startup called Adaptive Semantics. The two-person startup provides a semantic analysis engine (aka JuLiA) already used by the Huffington Post to help moderate the 100,000 comments published on the blog every day.

Prior to the acquisition, the Huffington Post was already Adaptive Semantic’s largest and only outside investor, buying a 20 percent stake in April, 2009. Adaptive Semantic’s two co-founders, Elena Haliczer and Jeff Revesz, will join Huffington Post to oversee its social news and community technology R&D. The acquisition price was not disclosed

“Technology is very critical to us,” says CEO Eric Hippeau. “In this case, the technology has implications for our content. It makes moderation hyper-efficient.” With close to 3 million comments a month, the only way to moderate them is through automation tools (as well as a corp of about 30 professional human moderators).

Other companies that license Adaptive Semantic’s technology for online comment moderation include CNN, Newsweek, and Disqus. They might have to start looking for other solutions. “We will honor the contracts, but very likely will not renew them,” says Hippeau, who doesn’t want to be in the business of licensing technology to other news sites and services.

JuLiA uses “supervised machine learning,” according to Revesz, to flag inappropriate comments, spam, and abusive language. Humans manually tag a few hundred comments, which then get fed into the semantic analysis engine and applied across every comment. This is an ongoing process so that the system continually gets better and better. Not only can it detect abusive language or hate speech, but it can also help find commenters who may be topic experts.

Beyond comment moderation and making sure readers behave themselves on the site, the underlying semantic analysis technology can help bubble up the best contributions from readers. “I am very confident that we are going to find all kinds of ways to apply it,” says Hippeau.

The Huffington Post very much sees itself as a social news network, and its success is tied to engaging its readers in a variety of ways, from leaving comments to sharing posts across the Web via Twitter and Facebook. It recently started awarding readers badges. JuLiA could help to feature the best comments or to award specific badges. For instance, if a reader leaves a lot of comments on posts about Afghanistan, Iraq, and Hillary Clinton, they could get a Foreign Policy badge. That is just a hypothetical example, but the technology opens the door to those kinds of features.

It also could be applied to article recommendations. “The Huffington Post talks a lot about their social graph,” says Haliczer, “how people are connecting to each other and connecting to content. We can look at the content graph and recommend content to people.” Whatever the Huffington Post will end up doing with the technology, it is important enough that the company wants to own it in-house.

comScore Cans Former AOL Exec Eric Bosco After 5 Months On The Job

Posted: 17 Jun 2010 03:50 AM PDT

On January 13, we reported that former AOL SVP of Global Products and U.S. Operations Eric Bosco had departed the company after nearly 14 years to join the comScore management team as Chief Product Officer.

Five months later, he’s out the door, we’ve now learned.

Bosco, who was hired to oversee all of comScore's global product development efforts, will be departing the audience measurement company at the end of the month.

ComScore CEO Magid Abraham apparently sent a memo to staffers earlier this morning, announcing the “change in the senior leadership team, and resulting organizational structure”.

Full memo:

I would like to take the opportunity to communicate a change in the senior leadership team, and resulting organizational structure. By mutual agreement, Eric Bosco will be departing comScore at the end of the month.

While we greatly appreciate Eric's efforts and achievements thus far in 2010, we have decided the Product organization's immediate success depends on a decentralized organization structure. This will bring the Product teams closer to their internal partners, enabling more effective and efficient execution on Product strategy.

The following Product team alignments are therefore effective immediately:

AdEffx led by Joe Lahr, will report to Bridget O'Toole benefitting from tighter alignment with the ARS business

Core Audience Measurement Products, Media Metrix, Video Metrix and Ad Metrix led by Steve Dennen and his team, will report to Cameron Meierhoefer

The Product Design and Planning and Analytics Solutions teams led by Yon Nuta will report directly to me

Mobile Products will continue to be led by Mark Donovan reporting to Serge Matta

CMS products will continue to be led by their respective vertical teams within Erin Hunter and Serge Matta's organizations, with the exception of CPG which will now be led by Jeff Cox.

Please join me in wishing Eric continued success in his career endeavors. I also want to thank the Product team and their internal partners for their continued flexibility, adaptability, and laser focus on delivering the best products comScore has yet to bring to market.

- Magid

We have an email in with comScore to confirm the authenticity of the memo, but we have no reason to believe it isn’t legit. Update: authenticity confirmed by comScore.

Any comScore folks who know more about this care to fill us in?

To Bookmark This PCWorld Article On The Future Of Browsers, Just Lick Your Screen

Posted: 17 Jun 2010 03:15 AM PDT

Some people dislike April Fools Day. We do not. In fact, we think those who do are wrong. Not to mention a little weird, too.

It’s just damn funny when we post things like Google going nuclear and witness respectable industry blogs like Venturebeat break the news in quasi real time … only to realize we were just kidding later on. Good times. But you know what’s better than a good April Fools joke?

A good April Fools joke that keeps on giving long after April 1 has passed.

This morning, I picked up on a tweet from Opera Software, embedded above, pointing to a PCWorld article on the future of the Web browser. Titled ‘Your Browser in Five Years’, it’s an interesting read on how browsers are undergoing changes that could potentially alter our day-to-day computing lives in the coming years.

Writes PC World’s Jeff Bertolucci:

Meanwhile, Google is building voice recognition and text-to-speech functionality for browsers. And Opera Software’s free Opera browser–which pioneered voice and mouse-gesture browsing–also supports face gestures through your Webcam.

Face Gestures. To control your browser. Next time, better check that publication date, Jeff. :)

And I truly hope you didn’t watch that video without wondering if this was actually real.

Rakuten Buys PriceMinister, Enters The European E-Commerce Market With A $250M Bang

Posted: 17 Jun 2010 02:16 AM PDT

Japanese e-commerce giant Rakuten this morning announced that it is buying France's e-commerce website operator PriceMinister for about €200 million (roughly $250 million), reports the Wall Street Journal. The news comes less than a month after word got out that Rakuten moved to acquire US-based Buy.com for about the same price.

Forget The Mayor, Gowalla Focuses On Serendipitous Deals For All

Posted: 17 Jun 2010 12:50 AM PDT

We’ve all heard about mayor deals with Foursquare. That is, a person who is the “mayor ” of a venue (essentially, has checked-in there the most number of times) gets access to special deals, such free items or discounts. Gowalla goes about its deals a bit differently. Because there are no “mayors” in Gowalla, instead, they’re focusing on giving everyone an equal opportunity to earn special deals.

One such deal launching later today is with Eye-Fi, the makers of memory cards that give devices WiFi capabilities. Starting in a few hours, when a person checks in through Gowalla at any U.S.-based Best Buy or Apple Store, they’ll automatically have a chance to win a free 4 GB Eye-Fi card. A message will pop up on their screen about the card post check-in. And a simple click on the “Did I win?” button below that message will reveal if you’re a winner of the $75 card the spot. There will be 500 winners for this particular promotion.

But even if you don’t win, the check-in grants you access to a coupon code for one year’s worth of free hotspot access if you do choose to purchase an Eye-Fi card. Gowalla founder Josh Williams estimates Eye-Fi is giving away some $35,000 worth of value from this deal alone. “This represents a remarkable opportunity for a brand to promote a product directly to people who are visiting a location where that product is sold. It’s accessible to anyone who checks in on Gowalla, regardless of how many times they’ve checked in or whether or not they’ve been to that location previously,” Williams notes.

That last part is obviously a bit of a shot at Foursquare’s mayor deals — but it’s important to note that Foursquare also has some deals for anyone who simply checks-in to certain venues too. Still, Gowalla’s emphasis on equality is nice and doesn’t require people to compete with crazed location addicts who go to venues everyday simply to secure deals (believe me, in San Francisco, it happens a lot). It’s more about serendipity with Gowalla — you go to a place you’re already going, check-in, and you may earn a free prize.

InMobi Launches $2 Million Mobile Advertising Developer Fund

Posted: 17 Jun 2010 12:29 AM PDT

Yesterday I wrote about InMobi’s bold plan to grab mobile advertising market share while the getting is good. Apple and Google are distracted in an ugly turf war over iPhone/iPad advertising; meanwhile, InMobi, one of the largest international mobile advertising networks and backed with U.S. venture capital, is just starting to make inroads into the U.S. They soft launched in the U.S. earlier this year, and turned things on formally a couple of weeks ago.

Today they’re announcing a $2 million world developer fund to encourage application developers to use InMobi for in-app advertising. Developers on Android, iPhone and iPad are eligible.

Here’s how it works: first come first serve. Sign up for the program and add InMobi via their SDKs. InMobi usually keeps 40% of gross advertising revenue, and 60% goes to the developer. But during this program developers get to keep 100% of the advertising revenue, and InMobi’s 40% comes out from the $2 million. Once that $2 million is gone the normal split applies. See this video for more details.

This clearly encourages big names to sign up because they can grab a chunk of that $2 million fast. Of course total revenue depends on how much InMobi ads are selling for. If developers have feedback on their monetization rates v. AdMob and other ad networks, I’d love to hear it in the comments.

Ustream’s Live Mobilizer Gives Bands And Brands Live Streaming iPhone Apps

Posted: 17 Jun 2010 12:04 AM PDT

Popular live video platform Ustream is adding a new product to its repertoire today: an iPhone application platform called Ustream Live Mobilizer that offers brands, celebrities, and bands a customizable iPhone application that features Ustream’s live steaming capabilities.

Each Mobilizer app is branded to the artist’s specifications (in other words, they don’t look like generic cookie cutter apps). The biggest feature here is support for watching an artist’s live video feed through Ustream, but the app also includes support for sharing to sites like Facebook, Twitter, Flickr, and YouTube. It also has Ustream’s ‘Social Stream’ feature, which lets you submit questions to the artist during a live stream and syndicate it out to other social networks.

To monetize, artists can sell songs, tickets, and merchandise directly through the application (they can also elect to make the application itself a premium app on the App Store).

The first musician to take advantage of the new platform is Miley Cyrus, who will be hosting a “listening party” through her application that be streaming her upcoming album for five days before it’s released. We’re told this will be the only place fans will be able to listen to the album during this time frame, so it’s obviously going to get a lot of downloads quickly.

Ustream isn’t the first company to offer this kind of platform to brands, celebrities, and bands (though most of its competitors don’t offer live stream functionality) — Kyte launched its iPhone platform in early 2009, and Mobile Roadie launched one soon thereafter. iLike has one too.

TC Teardown: Pandora – The Tough Business of Webcasting

Posted: 16 Jun 2010 09:49 PM PDT

This is a guest post from Michael Robertson, a 12-year veteran of the digital music business. He is the founder and former CEO of digital music pioneer MP3.com. He is currently the CEO of music locker company MP3tunes. Until recently he was an adviser to Google Voice following the acquisition of Gizmo5.

Pandora is the widely popular web radio service. Publicly they have said that they turned the corner to profitability in the 4th quarter of 2009. Below I forecast the 2010 numbers for Pandora using information from Pandora, music royalty rates that all webcasters are obligated to pay, and standard expenses of running a California based technology start-up.

Pandora’s 2010

With tight management of operating estimates Pandora is going to be close to breakeven in 2010. If they can more than double revenues they could operate break-even or even very slightly in the black. The largest impact to their financial situation is music royalties which takes a majority of their revenues. In 2009, Pandora paid $30,000,000 in royalties or about 60% of their total revenue. This year the royalty obligation will be substantially higher because they are required to pay a fee every time they play a song to a user. It’s not just a flat percentage of their revenue or a preset amount. As their userbase grows their royalties obligation grow proportionally which is why in spite of doubling their revenue from 2009 to 2010 which is a notable accomplishment for a company with revenue of their size, they are not moving to clear profitability.

Beyond 2010

The per user royalty rates Pandora has agreed to pay will go up 10% per year for the next 4 years. This is the per song rate or what they must pay every time a song is played for an individual user. A highly illogical aspect of radio is that there exists a ‘spectrum bias’. Depending on the spectrum of the radio wave transmitting the song to the listener, the royalty payment can vary widely from zero to a huge number. If the song is transmitted over 30–300 MHz (FM radio) then the royalty rate is zero. For songs transmitted over 2,332.50-2,345.00 MHz (satellite radio like XM) operators are required to pay 15% of total revenues, but for those operating in internet frequencies 2.4 GHz or 5 GHz (wifi) or cellular phone the royalty structure can be 50-60% of total revenues as evident from Pandora’s analysis.

Astonishingly in spite of this enormous current inequity, SoundExchange (which represents record labels) has asked the Copyright Royalty Board to more than double the rates for 2011-2015 for webcasters over what Pandora is currently paying. This won’t immediately affect Pandora since they have locked in rates that rise 10% each year over that time period, but after that period they will be susceptible to future rate increases.

Most internet companies operate more efficiently as they grow. They take advantage of economies of scale (increased buying power) as they get large. Plus they benefit from cheaper computing, bandwidth and storage. Pandora should experience these benefits in their technology related costs. However those costs will not materially impact the economics of their business since the royalties are so substantial.

Pandora has savvy management. They’ve been in this business for about a decade and raised close to $100 million. I don’t believe the economic realities escape them. In fact, they have asked Congress to implement “rate parity”. This would mean old fashioned radio, satellite radio and web radio would all have to pay the same royalty rate. The intention in such a reassessment process would be to remove the spectrum bias and create parity radio over any spectrum would pay the same royalty.

From a business standpoint Pandora has many positive attributes. They have 50 million registered users. Their brand is well recognized and regarded. Their service is universally praised as easy to use, satisfying and they’re rewarded with significant usage. They will do billions of minutes of music in 2010. But for each minute the expense odometer turns. Pandora must devise a way to lower this royalty amount if they’re to build a long standing profitable company.

* Royalty calculation: Pandora must pay 0.097 cents in 2010 every time any portion of a song is played (even if you only listen to a short part of the song). See: michaelrobertson.com for an in depth analysis of rate structure. Pandora does not disclose the number of songs they transmit. However, in 2009, Pandora stated they paid $28 million in music royalties. In 2009 their per song royalty rate was .093 cents per song which imputes that Pandora transmitted 29.8 billions songs. If one assumes 70% year over year growth in 2010 Pandora will play 50.66 billion which would require them to pay a sound recording royalty of $49.1 million.

** Employee calculation: Pandora has 12 offices and 180 employee, 80 of which are sales people. An estimate of $100,000 per employee is intended to capture the fully loaded employee cost typical for a technology company that is tightly managed which includes healthcare, vacation, HR costs, office space, etc. It’s easy to go much higher than this with lack oversight. 80 of the employees are sales people who likely have a smaller base and are receive substantial compensation via sales commission.

If you liked this post, see our previous TC Teardown: Chegg Is A Money Machine.

Nadanu’s Fundraising Platform Streamlines E-Giving

Posted: 16 Jun 2010 08:00 PM PDT

Now more than ever, fundraising for charities, campaigns and causes is taking place online. A variety of startups offer simple ways to power fundraising campaigns online, including GoFundMe and Facebook app Causes. Nadanu is another contender in this space, with its Push-K giving solution, offering non-profits a way to power fundraising on the web and mobile devices as well as social networking sites.

Nadanu's Push-K platform allows register and “drop coins” into a custom receptacle. It is modeled after a traditional charity coin box, and donors can click to drop virtual coins into their eCharityBox and watch it fill up. Once the box reaches a predestinated amount the box is emptied, their credit card charged and an automated tax receipt is sent via email. Payment options include Authorize.net and PayPal.

The interface is sleek and easy to users. On the backend, Push-K allows organizations to deliver content such as video and audio and also serve text messages to users.

Launched a few months ago, Nadanu is already powering e-giving for over 400 charities. Nadanu also has mobile offerings available for the iPhone, iPad, Android and more. And the company has a web offering and Facebook app.

Still Really Want An iPhone 4? Find $5,000, Head To eBay

Posted: 16 Jun 2010 06:35 PM PDT

As you may have heard, Apple completely blew through its pre-order launch day iPhone 4s in less than a day (and that was despite major technical issues with the ordering process). It has now blown through the second wave (due in early July) as well. The current shipping estimate if you order right now is July 14. Ugh. But if you absolutely want one at or around launch day, the Internet, as always, provides an option.

Scanning eBay right now, there are roughly 400 iPhone 4s for sale (between the 16 GB and 32 GB models). Sure, the device isn’t out yet, but people are willing to part with the device as soon as they get it on June 24. The question is: how much do you have to pay to get them to part with it? Currently, the cheapest ones are going for $550 — and that’s the $199 16 GB model. The cheapest 32 GB model? $799 — a full $500 over the $299 retail price.

Both of those are bargains compared to what some people are selling them for. Want the iPhone 4 hand delivered to you by June 27? That will cost you $5,000. Yes, $5,000 for one iPhone. At least 50 other people are offering to sell theirs for $1,000 or more.

And this is just two days after the initial pre-sale. As the expected ship date continues to get pushed back, these prices are going to get much more ugly. By the time launch day hits and people have them in their hands, don’t be surprised if many of these new iPhones sell for thousands of dollars.

Disney/Pixar Buys The First Twitter Trending Topic Ad

Posted: 16 Jun 2010 05:42 PM PDT

Since April, Twitter users have grown accustomed to Twitter’s first ad revenue play: Promoted Tweets. Today, the second phase of that strategy is starting to be tested: Promoted Trending Topics. The first such topic? Toy Story 3, promoted by Disney/Pixar.

As you can see in the right hand toolbar of Twitter.com, at the bottom of the Trending Topics area there is now an 11th topic, “Toy Story 3.” Next to it is a big yellow box letting you know that it’s a promoted Trending Topic. Just as with Promoted Tweets, the functionality for these Promoted Trending Topics is the same as the regular Trending Topics — clicking on it takes you to a search results page to see what people are saying about Toy Story 3.

As we have always said, we plan to test different advertising and promotional models in these early stages of our monetization efforts for both user and brand value. As part of this effort, we are testing trends clearly marked as “promoted” for an undefined period of time,” a Twitter representative tells us.

And along with buying the Trending Topic, Disney/Pixar gets a Promoted Tweet at the top of the stream, Twitter confirms. Twitter also says that just as with Promoted Tweets, the Promoted Trending Topic “has to resonate” or it will disappear.

Two more things of note here. First, it’s interesting that Twitter is putting these at the bottom of Trending Topics rather than at the top. Still, the yellow badge draws your eye naturally to it. Second, the Promoted Trending Topic appears no matter which city or country you set your Trending Topics to. In the future, you can imagine these Promoted Tending Topics being even more highly targeted to just certain regions/cities.

50% Of Android Phones Now Running OS 2.1

Posted: 16 Jun 2010 05:22 PM PDT

Every few weeks, Google’s Android team updates their Platform Versions page that breaks down how many Android devices are running each version of the OS, based on data from the official Android Market.  Today’s it’s reached a big milestone: exactly 50% of Android phones are running 2.1, the latest officially released version of Android (2.2, or Froyo, went live for a small number of users last month, but has not officially been deployed on a wide scale).

This is a big change since early May, when only 32.4% of phones were running 2.1. Since then, a number of older phones have been upgraded, and the new Sprint Evo and some other newer devices run it as well.

So why does this matter? We’ve written pretty extensively about Android fragmentation, or the fact that there are many phones running older versions of the OS. The Android team contests the use of the word ‘fragmentation’, (one blog post actually calls the term useless because it has been used in so many ways).

But the fact remains that nearly 50% of phones are running older versions of the OS, and if a developer wants to make use of the latest Android features, they’ll leave a big chunk of the Android userbase behind.  Case in point: when the official Twitter application was released in April, it was only available to 27.3% of all Android users.

Still, the tide appears to be turning. OEMs are going to get faster with their updates, and Android upgrades will eventually start coming more slowly, which will hopefully result in fewer phones getting left behind.

The Playstation Move Is A Wii Clone – But It’s Awesome

Posted: 16 Jun 2010 05:15 PM PDT

The Playstation Move is just what it looks like: a Wii clone. It feels the same, looks the same, and works the same. That's a good thing, though. Everyone and their grandmother has played Wii bowling and knows how it works. Sony isn't reinventing motion control with the Move. They are, however, seriously improving it.

Hot Potato 2.0 Lets You “Check-In” While You’re Doing Anything

Posted: 16 Jun 2010 04:31 PM PDT

When Hot Potato launched at our Realtime Crunchup last November it was already a solid app. Then came a new version in March (just before SXSW), and it was even better. Today brings version 2.0 — and it’s the best yet. And it’s also different.

When it first launched, Hot Potato was basically an iPhone app that let you build a social stream around events happening at any given moment. Right before SXSW, the newer version of the app added killer Foursquare integration, and tied everything together with the service’s website. The update today shifts the focus away from events, and makes it about all kinds of activities. Really, anything in the world you may be doing, you can now “check-in” while you’re doing it on Hot Potato. It’s actually pretty cool.

When you load up the app, you’re taken to a screen with six default prompts for what you may be doing. Those six are: “I’m watching..”, “I’m listening to..”, “I’m attending..”, “I’m reading..”, “I’m thinking about..”, and “I’m playing..” After each, there’s a box to fill in the noun that should follow each of those. When you enter that, Hot Potato searches to see if it’s already in the system. So, for example, if you say, “I’m watching Lost”, Hot Potato finds the other people doing that as well and ties you altogether into one activity.

Within this activity page, people can comment and respond to comments about the activity, just as you previously could in Hot Potato. You can also add pictures to this stream.

There’s also a seventh activity option in which you choose your own verb. Hot Potato gives you a list of new options (such as “I’m eating”, “I’m drinking”, “I’m checking out”) — or you can add your own. This reminds me a bit of the service Plurk, which is a Twitter-like service that allows you to organize your status updates around verbs. But obviously, this is more robust.

Just as before, when you fill out what activity you’re doing, you can send it to Twitter, Facebook, or use it to check-in on Foursquare. The way Hot Potato has set this all up is quite seamless. And there is of course an activity stream front and center in the app to showcase all of your friends’ activities.

There’s also a new element: awards. Yes, just as with some of the other location-based services, you can now get badges for doing certain activities. For example, when you share your first activity, you earn the “You’re a Big Deal” award.

Hot Potato 2.0 also brings a revamped version of the website to match this new activity focus. And for the first time there’s an iPad app as well.

We’re already seeing a ton of Foursquare-like services that let you “check-in” when doing various things. For example, Miso lets you check-in around movie, television, and Internet video content. This new version of Hot Potato aims to let you check-in no matter what you’re doing. And it smartly ties in with Foursquare.

Find the new version of Hot Potato in the App Store here. It’s a free download.

Advocacy Groups Poke More Holes In Facebook Privacy, Facebook Responds

Posted: 16 Jun 2010 02:39 PM PDT

This morning, a number of major advocacy groups, including the ACLU, EFF, and CDT, sent Facebook an open letter detailing some of the outstanding issues with Facebook privacy. The groups’ letter acknowledged that Facebook has made strides recently on this front, especially with its launch of new, simpler privacy controls, but that it hasn’t addressed some major privacy issues, like the fact that the controversial Instant Personalization feature is automatically opt-in.Wasting no time, Facebook has just responded with an open letter of its own.

Along with Instant Personalization, other issues addressed in the advocacy letter include the fact that Facebook is able to track user browsing behavior through its ‘Like’ buttons and other widgets (these widgets are served up by Facebook to third-party sites, so it can see which sites you’re visiting). And the letter says that users should have more control over what information third-party applications should have access to. Finally, the letter asks Facebook to give  more control over what information mandatorily made public, and the ability to export data so that users can easily transition to social networks other than Facebook.

Facebook’s response addresses each issue point by point:

  • Regarding the so-called “app gap”, Facebook says that it is implementing a new data permission model that will be rolling out in the next few weeks. There’s also now an option to turn off Platform entirely.
  • Facebook’s response to the Instant Personalization is pretty weak — it says that the program has been “widely misunderstood” and that partners can only access users’ public information. I understand the program quite well, as do numerous other critics, and, I’m sure, the likes of the CDT and EFF. And it’s obvious that there are still issues with handing over “public” data, especially when some of that data was switched from private to public during Facebook’s privacy transition in December.
  • Regarding Facebook’s ability to track users through its widgets, Facebook says that it does not use that information for targeting and that it is deleted after 90 days.
  • Addressing the point about giving users more control over what information they can hide, Facebook effectively says that it’s given users more control than they had, but that it finds that users have a “more meaningful experience” when they share more information. In other words, they’re still going to force some of this information to stay public.
  • Facebook says that it is currently testing SSL access to Facebook (a good move).
  • Regarding the ability to export data, Facebook says that users can already do this via its APIs. It then takes some shots at the advocacy organizations saying that it is “surprised that these groups would advocate for a tool that would enable one person to strip all privacy protections for any information that has been shared with them”. I’m pretty sure nobody is asking for that.

Here’s the full letter from the advocacy groups:

And Facebook’s response:


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