Category: Tech news

What makes TechCrunch a property that attracts some 10 million unique users a month is diversity. We cover tech single-mindedly but from a lot of different perspectives. So it’s from that stance that I’m writing this post.

I have a confession to make: With all due respect to my colleague Mr. Siegler—who I should say writes more posts, drives more page views and hence creates way more value for this site than I do—I am not a fanboy.

I have no problem championing a business – even an unsexy or unpopular one. When I was at BusinessWeek I was one of the first people to write about a lot of Silicon Valley companies like Facebook, Yelp, and Digg, and over the last two years I’ve written here about even more unknown companies from around the world that I think have a shot at building something big and making the world a better place. That’s what I love about my job, and why I’ve done it for more than ten years.

But that’s not being a fanboy. I just can’t get excited about a stunning product if it doesn’t solve a core problem or make some sort of business sense. Product for sheer product sake is writing about technology in a vacuum.

That’s why I’ve been one of the only reporters to consistently question Spotify’s promises of near-term US launches and profitability. (Yep, still haven’t launched here, if you’re keeping track. We’re almost a year after the first “guaranteed” date, FWIW.) And it’s why– despite whiling away most of my time on my recent 20-hour international flights playing on the iPad– as a business reporter I’ve never thought the device would be an immediate mass market hit for one simple reason: As of now, it is a beautiful solution to an unarticulated problem. The first person I knew who had one gasped and said, “This is a product everyone wants they just don’t know it yet.” Exactly.

Contrast that to other hits from the Steve Jobs, part two era: The original iMac. It didn’t start a new category but solved a core pain point of allowing people to easily connect to the Internet but plugging in just one wire. The iPod. There were dozens of MP3 players, but Apples hardware and the iTunes solution produced the first device where you could stylishly, easily and affordably carry around all your music with you, wherever you went. The iPhone. Again, plenty of smart phones on the market, but Apple fundamentally reworked the Web experience so that it was a new thing optimized to being a handheld device, not a shrunken computer.

The iPad is a beautiful toy and as a user, I’m glad I spent the money on it. But until developers do more than upload widescreen versions of iPhone apps and give this thing a reason people who don’t just love Apple have to buy it, it’s just a beautiful toy. It doesn’t solve world peace or even a basic problem like the earlier Apple devices did. I’d argue the closest to a killer app is Netflix, but I spend about half my time out of the US where it doesn’t work. Next to that the most killer app is the battery life. I appreciate the stance on HTML5 but the bottom line is, that means I can’t view a lot of sites right now, especially media sites. That’s frustrating for a Web-centric device.

Finally, some numbers actually back up this oh-so-controversial view that the iPad is merely a great product. A report was released yesterday from market research firm YouGov that showed that a whopping 98% of iPad buyers own another Apple device and 57% own two or more Apple devices. What’s more—79% of non-iPad owners the firm surveyed said they definitely or probably would not buy one and another 14% said they were unsure. From the release: “Most say they just don’t know what they would do with the device that they do not already do on another computer or mobile device.”

Unlike the other hits of the Jobs era—this is so far not a device that reaches across the aisle. Why didn’t I write about this yesterday when the report came out? Well, usually TechCrunch and every other blog over-cover anything Apple so I try to cover other stuff. But curiously, almost no one wrote about this. (Kudos to Eric Savitz of Barrons who is always willing to jump in front of fanboy fire, although he thinks numbers aside, YouGov underestimates the device’s appeal.)

Whether you think the conclusions from the research are right or wrong this is important from a technology business point of view because Apple is now the most highly valued tech company in the United States. It is priced at absolute perfection– from a business, not product point of view. There are huge ripple affects for developers who make their living coding for Apple products, not to mention people buying the stock at this price. It deserves at least discussion.

Being a fan of products is great. I totally agree that in today’s media world knowing how an author feels about a product is relevant. But when these things kill our ability as reporters even to consider independent research, we’re not doing anyone—readers, developers, investors, and even the companies we cover—any good whether we love the product as individuals or not. Embracing the fanboy mantle? Too much of a slippery slope for me.

Women’s network Sugar Inc. raised a whopping new $30 million round of financing from Sequoia Capital on June 9, says Goldman Sachs in their quarterly Internet/Digital Media report. That report is based on data they obtained from Dow Jones VentureSource. That has caused a flurry of attention around the fast growing company.

But there’s just one problem – it didn’t happen says an anonymous source close to the company. Sugar has raised a total of $31 million to date, but their last funding round was a year ago. The company is profitable and has no plans to raise more money, says our source.

“This is bizarre” says CFO Sean Macnew. “I wish everyone would stop calling us.”

So where did Dow Jones and Goldman Sachs get their original data? And why didn’t they just check CrunchBase, which has the most up to date information on startups on the planet?

Up next – confirmation that TechCrunch has not been acquired by Yahoo.

If there’s one area that Yahoo has been strong in over the past several years, it’s partnerships in mobile around the world. The company’s deals with OEMs (like the most recent one with Nokia), ensure the company has had a foothold in the quickly growing mobile space despite not having an actual phone like rival Google. Holger Luedorf was the Senior Director in charge of those types of deals. Now he’s left the company, and is joining Foursquare — a company which Yahoo just unsuccessfully tried to buy.

Luedorf is joining the Foursquare business development team as Vice President, Mobile and Partnerships, we’ve confirmed with the company. His focus will be on “creating awesome partnerships with mobile carriers and OEMs that get Foursquare apps distribution on handsets around the world,” Foursquare General Manager (Foursquare’s cute title for COO) Evan Cohen tells us. He’s already left his job and Yahoo and will start at Foursquare next week, we’re told.

This is a very smart hire for the location-based startup. While they’ve had success in the U.S. thanks to the rise of app stores by Apple and Google, OEM deals remain extremely important in the rest of the world for getting your service on mobile devices. Basically, it sounds like Luedorf’s job will be similar to the one Kevin Thau holds at Twitter. Thau has been vital in the company’s international growth, signing deals left and right to ensure Twitter is available through large portions of the world through SMS.

I also asked Foursquare how their funding is coming along — they avoided that question. But you can bet it’s coming along quite well (Andreessen Horowitz is the winner there, according to our sources) if they’re able to hire Luedorf, and the dozen or so other employees they’ve hired recently.

[photo via Luedorf’s Twitter]

Mobile search could grow from 9 percent of all queries this year to 20 percent by 2012, estimates RBC analyst Ross Sandler in a new report issued today. There is still a huge gap between mobile’s share of overall search queries and its share of search advertising. Sandler estimates that mobile will still represent less than 2 percent of search ad budgets this year, compared to the 9 percent overall share. But he thinks that gap can narrow and that mobile search advertising can be a $2 billion to $3 billion market in 2012.

His assumptions seem a bit aggressive on the ad revenue side. There might always be a gap between mobile search share and mobile search ad spending because of the relative effectiveness of search ads on PCs versus on mobile phones. But Sandler does a deep dive into mobile search advertising and comes up with some compelling reasons why that gap should at the very least begin to narrow just as mobile search starts to take off thanks to the growth of large touchscreen devices such as the iPhone, iPad, Android, and Blackberry.

One big advantage the new generation of smartphones have over PCs in terms of search advertising is that the screen real estate devoted to search ads is much bigger. A single search ad on a PC takes up about 4 percent of the screen real estate, whereas a single search ad on a smartphone takes up about 20 percent of the screen. The relatively larger size of the ads results in higher click-through rates on mobile (as much as 3 to 5 times as much).  On the iPhone, one search ad takes up 22 percent of the screen, and if two search ads are served up it takes up nearly half (48 percent).  For Android, those numbers are 18 percent and 38 percent for one and two search ads, respectively.

Sandler tested the same keywords across different devices (an iPhone, Android Nexus One, Blackberry, and aPC), and found that the average, for both the iPhone and the Nexus One, was 1.1 paid search results per query, compared to 9.2 search ads per query on a PC.  Searches on Blackberries showed hardly any paid results.

Another key driver for mobile search revenues should be the growth of local ads.  Sandler found that the ratio of localized or geo-targeted ads to non-local ads is still low and expects that to grow as advertisers learn how to geo-target their search ads.  Geo-targeted ads should also perform better, leading to higher mobile search ad revenues.

So how many people actually conduct searches on their smartphones? According to comScore, half of all smartphone owners conduct at least one search per month, 20 percent search once a week, and 11 percent search almost daily (which is about the same as the percentage of people who search on feature phones every month).

This year, Sandler estimates there will be 374 million people with smartphones, increasing to 766 million in 2012.  Consequently, the number of smartphone searches will grow from 157 billion to 586 billion (up from 35 billion two years ago).  The comparable number of searches on PCs this year will be 1.3 trillion, growing to 1.6 trillion in 2012.  Any way you look at it, mobile searches will become a significant portion of total searches within two years.  But how much will those searches be worth?  That is still a guessing game at this point.

Social email startup Xobni is channeling Microsoft today. The company is now selling the premium version of its product, called Xobni Plus, which the company rolled out last year, in a number of stores. The boxed software, which will be featured in stores right next to the newly released Microsoft Office 2010 software, will be sold at Office Max, Fry’s and a few other brick and mortar establishments, putting Xobni in 3,500 stores in total. Xobni Plus will also be sold on Amazon.

Xobni is hoping to capitalize on some of the foot traffic that Microsoft will be bringing to stores for the new version of Office. Office is carried in 35,000 brick and mortar stores, and Xobni says that its software is currently in 10% of those stores, and will be adding its offering to more stores soon. The price for the boxed set will be the same as it is online: a one time fee of $29.95.

So why is Xobni going old school with software in brick and mortar stores? The company claims that retail boxes improve conversion online (60% of customers that Xobni surveyed say they are more likely to buy software online if they saw the software in a retail store) And 80% of people surveyed (over 2000 respondents) said they were likely or very likely to buy software in a retail store in the next year. Xobni also says that retail boxed software has a higher perceived value/price point.

Xobni’s social email plugin essentially makes your e-mail smarter (Xobni is inbox spelled backwards) and integrates LinkedIn, Twitter Yahoo Mail, Facebook, Skype, Hoovers and more into your Outlook inbox. The Plus product improves search in this plugin, and includes an autosuggest feature, which can use linked Facebook and LinkedIn accounts to pair Email address with full names, as well as the ability to search within your Xobni ‘feeds’ in the sidebar.

Xobni, which just raised $16.2 million in new funding, has been looking for ways to make money over the past year. Plus is one of these revenue streams, and Xobni also offers a paid syncing service between devices and desktop clients called Xobni One.

Of course, the offering of Plus in retail stores is more than just a revenue opportunity for Xobni. It’s also a branding opportunity to associate its product with Microsoft to consumers. While this move doesn’t represent an established partnership with Microsoft, Xobni is clearly hoping to ride on Office 2010′s coattails.

AOL is close to selling Bebo to an investor group, we’ve confirmed from a source close to the company. The price? $10 million or less. Rumors of the acquisition first surfaced this morning, and the buyer may be Criterion Capital Partners.

That’s just a bit less than the $850 million AOL paid for the social network in 2008. And as decimated as Bebo is, it’s almost certainly worth more than $10 million.

But the deal will also give AOL the ability to write off the full purchase price of Bebo for tax purposes, which we wrote about in March:

Despite that value, Aol’s best financial option for Bebo will likely be to abandon it rather than sell it, say corporate tax experts we’ve spoken with.

Here’s why – complicated corporate tax rules will let Aol write off the full purchase price of Bebo if they declare it worthless and abandon the asset. With Aol’s effective tax rate of around 45%, that’s $380 million and change in their pocket in taxes that they’d be able to avoid.

A sale of Bebo would almost certainly be less attractive. If someone were to pay them $100 million for the service, which is optimistic, Aol could still offset the remaining $750 million as a tax loss. But it could only apply against long term capital gains, and Aol doesn’t have any to offset against. They’d have to carry that loss forward and hope for future gains to offset it against.

One corporate tax attorney we spoke with wouldn’t discuss Aol specifically, but did confirm the logic of the approach. Bryan Smith, a partner at Perkins Coie, says “Without getting into any specific facts or companies, it will often be more attractive for a U.S. corporation to simply shut down a subsidiary and claim a deduction for the worthlessness of the stock against ordinary income instead of selling the stock at a distressed price and taking a capital loss, which may only offset capital gains.”

In April AOL confirmed that they were going to sell or abandon Bebo. This sale, we’re hearing, still allows AOL to write off the purchase against ordinary income, meaning they may save hundreds of millions of dollars in corporate taxes.

We’ll update with more information as we get it.

The Electronic Entertainment Expo is the gaming industry’s equivalent of the Consumer Electronic Show and the North American International Auto Show. It’s a massive show filled with game demos, over-the-top booths, and scantly-claded booth babes. It’s heaven. Click through for a large photo gallery that will give you a taste of what you’re missing.

Plancast, the social planning service created by TechCrunch alum Mark Hendrickson, is rich with data. It knows not only what you’re planning to do in the foreseeable future, but what your friends are planning, and what their friends are planning. But all of this data has been trapped inside of Plancast. Not anymore.

Today, the service is announcing its API. This gives developers the ability to build new apps using Plancast’s data — or to add that data to their existing apps. And the API is both read and write-enabled, so other services will be able to feed their data back into Plancast as well. The importing of event data from Facebook (through Connect) has helped Plancast grow, so this full read/write API should be a continuation of that.

Actually, the API work started out of necessity for Plancast. They needed it in order to build their iPhone app in time for the SXSW conference back in March. Since then, the API has been rebuilt, Hendrickson tells us. And it’s already been tested with some third-party developers such as Exygy, which built a Plancast Andorid app (aptly named Plandroid).

Currently the API only support basic authentication (username/password), but that’s because Hendrickson wants to enable OAuth 2.0 as soon as it’s ready.

Alongside the API, Pancast is also launching its first widgets and buttons as yet another way to help seed its data around the web. The widgets look great — they use a simple JavaScript embed that allows you to display all of the upcoming plans you have on a website you control (such as a blog’s sidebar). There is also a full page profile widget which was created because people were porting their data to things like Google Calendar and then embedding those to show their Plancast events. This solution is much more seamless.

Then, of course, there are buttons for those who don’t want to embed their data but want a cutesy way to link to their Plancast profile. And yes, one of them has the cute penguin logo on it.

“These are the first pieces of our general platform strategy in which we want to power any and all plan-related listings on the web and do so with a thoroughly social context,” Hendrickson says about the new elements of Plancast. He notes that they have some other cool ideas in the works — particularly surrounding places, something which Twitter and Google are now targeting (not to mention Foursquare, Gowalla, Loopt, etc).

Again, you can read all about Plancast’s API here.

It’s been no secret that social network platform Ning has been going through a significant transition in both its leadership and business model in 2010. In March, longtime CEO Gina Bianchini was replaced by COO Jason Rosenthal. And in April, Ning’s bubble burst — the company laid off 40% of its staff and killed off its free service. In May, Ning rolled out the different paid models for its platform, Ning Pro, Ning Plus and Ning Mini. And June brings new revenue streams for Ning’s social networks, in an effort to help Ning users monetize their social networks.

Ning is announcing two partnerships, with branded product creator CafePress and social gaming startup Heyzap, to offer monetization options to Network Creators. Custom CafePress shops can now be integrated directly into Ning Networks, offering creators the opportunity to sell branded products, like mugs, t-shirts and more, to members and fans. With Heyzap, Ning creators can add Heyzap pay-to-play games onto their networks. Creators will earn 10% of all revenue from premium game purchases. Ning has also partnered with Chipin to allow non-profit creators to raise funds and collect donations from members. A number of networks have already been experimenting with the new channels, including The Veloist, Duke City Fix, and TuDiabetes.

Of course, Ning is taking a cut of any revenue made through these channels (with the exception of funds collected through Chipin), but Rosenthal assures us that this cut is small and the majority of the revenue goes to the network creator. These revenue channels join Ning’s Run Your Own Ads option that allows creators to collect revenue from running display advertisements in their sites.

Rosenthal adds that this is the beginning of a string of revenue channels that Ning plans to open up for network creators. While he declined to name any future channels, he did say they would be in the areas of e-commerce, gaming, group buying and more. Rosenthal added that they would be exploring any channels that are currently working on other similar platforms.

It seems safe to infer that he probably meant channels that were working on Facebook, which could mean that Ning may get into the offers game as well, considering its success in social games and applications on Facebook.

It’s clear that Rosenthal seems to have big plans for Ning when it comes to revenue for the network and its creators. He has told us in the past that the DIY social network arena focusing on subscription model could represent a $4 billion plus revenue stream. It should be interesting to see if Ning can capture a portion of this anticipated cash.

The Nintendo 3DS is real — we know that. The 3D works well — we know that, too. But that’s where our 3DS knowledge stops. Nintendo isn’t talking-up 3DS details right now and we have so many questions about the handheld 3D gaming.

Video distribution and monetization platform provider Joost, owned by Adconion Media Group since its assets were acquired in November 2009, is today announcing a global sales and technology partnership with online publishing powerhouse Demand Media.

Under the terms of the exclusive agreement, Demand Media will leverage Adconion’s video ad serving platform to deliver all premium video campaigns sold by the former’s sales force.

In addition, (15 sec) pre-roll inventory on Demand Media owned and operated websites, including eHow.com, Cracked.com, Mania.com and Airlines.net, will become part of the Joost Video Network (which claims a reach of 67 million unique viewers and some 500 million total streams per month as it is).

As a result of the cross-sales deal, the Joost Video Network will be able to present Demand Media’s worldwide audience to its premium brand partners through audience and vertical channel sales packages. Adconion specially touts its targeting abilities, saying it can target pre-roll ads by demographics (age, gender, etc.), location, various ways of retargeting and behavioral data provided by third parties like BlueKai and others.

Adconion will also – exclusively – provide its video technology platform to power all of Demand Media’s in-stream video advertising needs, including trafficking, optimization, and reporting.

Demand Media claims that, collectively, its seven media brands currently attract more than 88 million unique visitors each month – 61 million people alone visit eHow.com for ‘how to’ articles and video. The company adds that it currently counts about 150,000 videos in its library.

AT&T just issued a statement addressing the massive iPhone 4 pre-order sales yesterday. The company said that sales of the iPhone 4 were 10-times higher than the first day of pre-ordering for the iPhone 3G S last year.

AT&T also said that they are suspending pre-ordering today in order to fulfill the orders they’ve already received. At&T wil resume taking pre-orders when they get more inventory from Apple. Yesterday’s chaos also brought more than 13 million visits to AT&T’s website to determine if users were able to upgrade to the new phone, which was about 3-times higher than the previous record for eligibility upgrade checks in one day.

The Apple Online Store is out of the devices as well. They’ll still let you pre-order one, but you won’t be getting it on June 24 (launch day). Instead, Apple is saying the next batch of phones will ship by July 2.

This huge numbers of pre-orders and traffic also brought massive failures in Apple’s and AT&T’s system that prevented people from completing their orders. Both systems seem to be resolved now.

UPDATE – Apple apologized too, said they got 600,000 pre-orders.

At first glance, our Twitter account, @TechCrunch, doesn’t have much in common with @BarackObama‘s. He’s the President, we are a lowly tech blog. His staff Tweets out quotes from his speeches, we Tweet out links to our stories. He has 5.3 million followers, we have 1.4 million. But according to social media analytics firm Sysomos, both of our followers have the same average authority—2.4 on a scale of 0 to 10.

The average is so low because the law of large numbers starts to take hold with accounts above one million followers. The authority ranking is based on how many followers each person has compared to how many people they follow, as well as how active they are in terms of retweeting and other factors. Basically, if you are passive and have no followers, you get a score of 0 (these are the Twitter bots that bring down the average), but if you have a lot of followers, follow only a few people and retweet a lot, you get a higher score.

Sysomos looked at three different types of popular accounts (celebrities, news organizations, and “social media heavyweights”). Celebrities like Ashton Kutcher (@Aplusk) and Britney Spears have the highest number of followers (5 million and 4.8 million, respectively, but the lowest average authority scores (1.8 and 1.3, respectively). News organizations like the New York Times and TechCrunch have a slightly higher average, at 2.2 and 2.4, respectively. But the accounts with the highest authority followers belong to the “social media heavyweights” like @steverubel, @chrisbrogan, and @jowyang. These are all social media consultants and PR experts. They have fewer followers (42,000, 140,000, and 65,000, respectively) but those who do follow them, not surprisingly, tend to retweet more and have higher authority as measured by Sysomos. You can see the distribution of authority is bunched closer to the middle (see below).

Measuring authority by number of followers is flawed, but it is an easy number to track. A better measure is to find out how much each follower amplifies a message or set of messages. I’d like to see a similar study of follower authority from TunkRank or Klout, which measure influence in different ways..

If you have a wee one with an interest in science (face it, you’re reading CG and TC, your procreative material is pre-disposed to nerdity) then check out Allen Kurzweil’s latest project, a science kit in a potato chip bag.

Potato Chip Science, available now for pre-order and shipping in September, lets you learn science through the magic of bag chips, tubes, and even actual potato products. You can study acoustics, aeronautics, forensics, and as well as the psychology of shame when you realize that you’ve eaten far too many potato chips in your life.

Read more…

Klout, a startup that measures influence on Twitter, is expanding its horizons today with the launch of BirdBrain, a new feature that allows you to measure influence using data from both Facebook and Twitter.

BirdBrain uses Facebook connect to look at the interests listed on a user’s profile and then uses that data to search for the most influential people on Twitter, based on interests. Klout, which recently released a new API, evaluates Twitter users’ behavior with complex ranking algorithms and semantic analysis of content to measure the influence of individuals and topics around the web.

The premise for this specific development is based on Klout’s belief that Twitter’s suggested user list is flawed. The buckets they use, says Klout, are simply too big. BirdBrain uses Facebook Connect to evaluate your interests, and will mashup that data up with Tweets from Twitter users with terms associated with those interests. For example, if you list the TV show Lost as an interest on your Facebook profile, Klout will search for users Tweeting about the latest smoke, or polar bear conspiracies. And Klout breaks down the influencers onTwitter by the type of influencer they are. For example, a person might be a “chatterbox” which means they like chit chat about the topic on the network while another type of influencer might be a “curator,” who simply sends out the best content.

BirdBrain is part of Klout’s newly launched Labs section, which will experiment with products that assess influence based on the interaction within social networks, beyond just Twitter. Of course, BirdBrain represents Klout’s first data foray outside of the Twitter-sphere. Klout’s CEO Joe Fernandez says that this is a sneak-peak into the startup’s eventual movement to cross-platform influencer data. Considering that Twitter is looking to build its own powerful analytics platform, it’s probably wise for Klout, which just raised $1.5 million in funding, to look for ways to offer innovative technologies that combine both data from Facebook and Twitter.