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Peter Thiel Invests (Again) In Xero’s $16.6M Round

admin — Sat, 04 Feb 2012 00:00:46 +0000

Online accounting software maker Xero has raised $16.6 million in new funding from existing investors — including PayPal co-founder Peter Thiel, whose most famous investment, Facebook, just filed for an IPO , Thiel first invested $3 million in New Zealand-founded Xero back in 2010, with the aim of fueling expansion in the United States. The company says that’s also the reason for the latest round. This time, Xero also notes that it recently doubled its US team, from three employees to six, and hired Jamie Sutherland (formerly vice president and general manager at Sage Software) as the president of US operations. Other investors in the round include Sam Morgan and MYOB co-founder Craig Winkler. The company says it has 60,000 paying customers and 240,000 users. It partners with Yodlee to bring automatic bank feeds into the service, with 5,000 feeds in the US. “Xero transforms the way small businesses handle their accounting,” Thiel said in the press release. “Where conventional accounting software is cluttered, slow, and anchored to a desktop, Xero’s cloud-based services and intuitive design simplify an impressive suite of financial tasks. We’re excited to see Xero grow throughout the U.S.”

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Peter Thiel Invests (Again) In Xero’s $16.6M Round

Keen On… Dane Jasper: Why High Speed Broadband Is The Key To US Innovation (TCTV)

Achilles — Fri, 03 Feb 2012 23:30:09 +0000

There are few more articulate supporters of high speed broadband access than Sonic.net CEO Dane Jasper . Not only does he think Americans should have the right to high quality broadband, but he also thinks that it is the key to innovation in the broader economy. Home video is, of course, increasingly dependent on broadband and so, Japser told me when he came into our San Francisco studio earlier this week, is innovation in our healthcare and education sectors. Jasper doesn’t see the actual cost of broadband as the problem. Internet access isn’t finite, like coal or water, he insists – and the cost of bandwidth is actually plummeting to zero. Indeed, a stunning 98% of his costs, he confessed to me, go on things outside the product. It’s staffing, he acknowledged, which suck up most of his costs – with investment in customer service being 20 times higher than his investment in product. For Jasper, innovation can solve all our problems. Even the seemingly endless issue of piracy, he told me, can be solved by rights-holders becoming more innovative in making their product readily available on the Internet. It’s that kind of innovation, Jaspers insists, rather than legislation such as SOPA, that will save the entertainment industry. This is the second of two interviews with the straight-talking Jasper. Yesterday, he told me why fiber is the future of wired connectivity.

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Keen On… Dane Jasper: Why High Speed Broadband Is The Key To US Innovation (TCTV)

The Peek Bites The Dust

ACMAir — Fri, 03 Feb 2012 02:33:27 +0000

You may remember the Peek , a device that showed up back in 2008 (so long ago, now!) offering nothing but email. That’s right, nothing but email in an age when smartphones were already becoming popular, and the iPhone was changing the way people thought about interacting with their data. In a way, it was genius: limiting the service and the device made it easy to explain and simple to use. It does email, period. An interesting tack, and one that kept them rolling for a few years, but alas, Peek is finally going to take the big sleep. Despite revising the hardware and switching up the pricing, the Peek couldn’t maintain relevance in the face of smartphones and tablets. There was always the question of whether it was a legitimate market at all, but I object to that objection. I think it’s a brilliant proposition, and one many people found useful. But you just can’t fight progress, and while phones and tablets got more capable, they also got easier to use. Ironically, it might have been trying to compete that made the Peek at last irrelevant. The people who liked it didn’t think of it as a less-capable smartphone, but as a single-purpose device, like a fork or a measuring tape. That value proposition, focus, is something we’re seeing in practice in single-purpose sites like Imgur and so on. But the philosophy of the mobile phone as Swiss army knife has taken over in the hardware field, so devices like the Peek got left behind. The Verge talked to the CEO , and he said that there are a few thousand devices lying around in warehouses, and he’d like to put them into the hands of interested hackers. The Peek 9 was a perfectly workable piece of hardware, though not particularly powerful, but perhaps it could be made into something interesting or useful by a little creative coding. Head over there for more info. Update : It should be noted that this isn’t the end for Peek the company , only Peek the service and line of devices. Peek Inc actually just closed a big funding round to fuel its work bringing smartphone-type software to low-cost mobile devices. We’ll report more on that as the story develops.

ConnecTV Prepares To Take On IntoNow With New Social TV Platform

user — Thu, 02 Feb 2012 18:00:39 +0000

Today, a company called ConnecTV is launching an ambitious new service for socializing the TV viewing experience using mobile and web-based applications. The new app, available first on the iPad , with Android tablet support in the works, is similar to competitor IntoNow in that it also seems to “hear” what’s on TV in order to load the appropriate content. But the way it’s processing the data on the backend is completely different. There’s no “Shazam-like” experience here – everything ConnecTV does is in real time. ConnecTV was founded a couple of years ago by the former TV Guide President Ian Aaron , the former founding head of technology at TiVo, Alan Moskowitz , and the original Chief Programming Officer at TiVo, Stacy Jolna . The proprietary technology underlying the service was developed over the course of the past two years, with no venture funding. Instead, the startup was self-funded and took in money from a few, undisclosed “high net worth” people. Partner broadcasters also made a small minority investment as a part of a long term agreement. The company plans to raise capital through strategic investments going forward, but does not plan to raise funding from the venture community. At launch, the service supports over 250 channels (compared with IntoNow’s 130) and has partnerships with 10 leading broadcast groups, including Barrington Broadcasting Group, Belo Corp., Cox Media Group, E.W. Scripps Co., Gannett Broadcasting, Hearst Television Inc., Media General Inc., Meredith Corp., Post-Newsweek Stations Inc. and Raycom Media. These broadcast groups represent 45 of the top 50 markets in the U.S., Aaron tells us, which provides the service with access to most of the regional channels. ConnecTV also supports premium cable channels (Discovery, TLC, etc.) and paid channels (HBO, Showtime, etc.). In addition, the company is planning to soon add support for over 200 local ABC, NBC, CBS, FOX, The CW and MyNetworkTV affiliate channels as well as the top 26 regional sports networks. In fact, sports is a high priority for the service, which has plans to support all the major and college sports including baseball, basketball, football, Formula 1, NASCAR, tennis and more. Another unique aspect to ConnecTV is its technology. Competitor IntoNow “ hears” what’s on TV by listening to the show’s audio signal and matches it to the program using closed captioning systems, but there’s a lag involved as the signal is identified. Although ConnecTV also uses audio recognition technology, instead of matching signals to closed captioning, it’s tracking the audio in real time across all its supported channels. “Most of the technologies built are not really designed for real-time use,” explains Aaron. With other technologies, “you have to hold [the device] up to something that was pre-processed, or was integrated through the production process, where you have to take the feed and process it before it airs on TV.” “Everything we do is in real-time,” he says. What that means is that if you’re watching a game, two seconds after every play, you’re seeing all the stats on the play, you can share the play with your friends, you can chat about it and you can invite friends to watch with you. Using a combination of proprietary audio and video recognition technology, ConnecTV can also match up what it “hears” up to a day after airing. That window may expand in time. In terms of the app’s social elements, ConnecTV isn’t all that different from other companion apps, not only IntoNow , but also the check-in based apps like GetGlue or Miso . You can see what your friends are watching, share your favorite TV moments with a touch or simply post what you’re viewing to Facebook and Twitter. As you change channels, you can also see the total number of your friends who “like” the show and invite those who are not watching to join you. Meanwhile, a “show chat” feature includes top fan Tweets and official Twitter feeds from players, leagues, cast members, producers and networks. Its overall user interface, however, feels a little more spartan. Personal opinion: IntoNow is the more attractive app. Your mileage may vary, of course. The new ConnecTV app (beta) is available as a native app for iPad or as a web-based app for desktop users with a modern browser. Android tablets will be supported in a later release.

Wahooly Launches Its Crowdfunding Experiment With First 3 Startups Ready For “Social Capital”

user — Thu, 02 Feb 2012 02:00:06 +0000

There’s an interesting experiment afoot in the startup community, which poses the following questions to entrepreneurs: Would you be willing to trade equity in your startup in return for social media buzz, and customer feedback? How much, if any, would you fork over? Minneapolis-based startup called Wahooly is both asking those questions — and proffering a few answers. Soft-launching in late September, Wahooly set out to create a platform on which socially-connected and early adopter-types, who are not accredited investors, can grab a small stake in up-and-coming startups by sharing their influence in exchange for a piece of the action. The goal: To help address one of the biggest obstacles encountered by early-stage companies — traction. Partnering with Klout and Cmp.ly, Wahooly has ammassed over 28,000 users, which Founder Dana Severson (a former business writer/blogger) says are all online infleuncers within the 90th percentile, according to Klout. Wahooly provides startups that need social media boosts and helping feedback with access to these “influencers,” allowing them to create testing groups of 5,000 to 8,000 people. Once formed, these groups take a share of between 4 to 6 percent in the startup. As to how it works, at a more granular level: Severson says that once users (a collection of bloggers, developers, and “web-lebrities”) join a startup, their share of the equity pool fluctuates based on a number of criteria, including feedback, which is tracked/rewarded in a point system. Users gain points based on three variables: The value of feedback (voted by the community), user activity (how often and to what extent they are using the service), and by influence (how many conversions their activity creates). Obviously, it’s in the interest of the user to focus on increasing the value of their startups, and the campaign continues until Wahooly exits, at which point users are paid based on their point total. In terms of what Wahooly provides to its startups, the founder says that the platform’s value proposition lies in delivering acceleration via advocates. “It’s a quality not quantity equation,” Severson says, “We’ve built our system to get what start-ups need most out of influencers, which is what most companies struggle with. We’re really focused on the power of combined influence, which is how trends begin.” While many startups are able to attract a decent amount of tweets, posts, mentions, and so on, the tipping point truly comes when this activity occurs concurrently and repetitively. But finding sustainability in brand advocacy is a difficult challenge, as user attention is fleeting, and most are wary of phoniness when it comes to repeat advocacy. That’s why Severson, who has also spent tim in advertising, wants to deliver a level of activity that will consist of 1,000 mentions over a single day — rather than over the course of a year — and then repeating that. A tricky feat, no doubt. Due to its unusual business model, Wahooly has been met with skepticism from some media, as the company plans to have quity stakeholders who take no action have their stake diluted (like a stock splitting), could potentially run afoul of the FTC and other regulators. Severson explains that part of the reason for this skepticism was due to the fact that the team hasn’t been willing to discuss how Wahooly is structured, holding off for competitive reasons. At this point, however, the founder is willing to share a bit more. Wahooly will always be the single shareholder in its startups, paying users based on its point system, with points being calculated against the net result of Wahooly’s success with its investments. It’s the same result for everyone, he says, while staying within the guidelines and allowing for the structure to be applied to international markets. In terms of the FTC’s potential interest, Wahooly’s users will be required to provide full disclosure. In other words, the affiliation/disclosure will appear on pages in which Wahooly users share. Because its users are influencers, the founder explains, they want to maintain their credibility and online reputations, and thus Wahooly wants to make it simple for the proper disclosures to be made. As to Wahooly’s progress: The company plans to introduce 200 startups to its users this year, and they’ve received over 300 applications thus far, and will be continuing to accept applicants going forward. Right now, Severson says, the focus is on consumer-based web applications. Today, Wahooly is officially introducing its first three companies: TweetTV.com, Cull.TV and ValuValu.com. The first, tweetTV is an Austin-based startup, building a web-based social TV Guide and Twitter-powered social TV platform that helps its users discover what to watch on TV and facilitates real tweet-based conversations around TV programs as they air. The second, Cull TV is attempting to reboot music television by leveraging leading recommendation and web data mining technology to helps anyone discover relevant, emerging talent through music videos. Currently experiencing a renaissance, music videos are the most popular way to distribute and consume music online, so Cull TV wants to give users a new and better way to discover artists. The third is Seattle-based startup Valu Valu , which calls itself “the hedge fund for everybody,” and aims to beat the stock market by combining momentum strategies with social sentiment analysis, sending “precise and easy trading instructions to its subscribers.” I’ve also just learned that a fourth startup, RAVN, which we wrote about in October, will be launching on Wahooly later this week. Check out the post for more here . Wahooly, which is walking the line between an accelerator and a crowdfunding platform, is definitely offering an unusual model, and could very well be a successful tool for startups looking to push past the early-adopter phase. But it could also be another sign that we’re on the doorstep/in the midst of another bubble. Whether or not Wahooly is successful depends on how influential its community truly is and whether they can really help startups get off the ground. Startups have to attract enough users or they will be overlooked, another challenge. It’s still early in the process to waylay judgement, but, as it scales, we’ll be able to get a better sense of how much real value Wahooly is adding to the ecosystem. It’s very likely that Wahooly will get early adopters feeling very tingly, but will the value be there? If it can deliver real acceleration in the market, Wahooly will no doubt race past the tipping point. The company is currently in the midst of raising its series A. For more on the model, check out Wahooly at home here .

Bebo Apologizes For Downtime: “We’re Not Going Anywhere”

kram412 — Thu, 02 Feb 2012 01:46:56 +0000

When social network Bebo went down on Monday, what seemed like a flood of distraught users concluded that the site must be shutting down, and they took to Twitter to commemorate it. Instead, the downtime turned out to be the result of technical problems. The site was down for about 20 hours, and now the company is about to post an apology, advertised site-wide through the banner ad above. We’ve obtained a copy — CEO Adam Levin explains that the team was working on some new features and accidentally crashed the site. He also assures users, “We’re not going anywhere.” Here’s the full post: Dear Bebo’ers, As you probably noticed we were out of commission for a while starting on Tuesday. We have been fortunate that in the nearly seven years that Bebo has been in operation, these glitches have been few and far between. Still, we work hard every day to keep the site constantly working and we heard from many of you — loud and clear — how much your lives were affected by the outage. We are both profoundly sorry and profoundly moved by the outpouring of comments on blogs, Twitter and elsewhere. Once we had everything back up in perfect order, we realized we needed to explain what happened so Nigel from Marketing went back into storage and pulled out the Big Book of Website Excuses (2012 Edition). Among the options considered: 1. “Occupy” protesters took over Bebo. 2. Another internet company was protesting against SOPA/PIPA. 3. Time to get a new server… That Amiga 500 has gone as far as it can go. 4. Huge spike in traffic exceeded our server capacity and brought the site down. 5. Time off for the staff to watch a Harry Potter Marathon on Blu-Ray. 6. Just a publicity stunt to get more attention. 7. Government-mandated program to get users to spend more time outdoors. 8. Too many cute cat photos causes our servers to run out of disk space. 9. New policy: turn the site off one day per week to reduce greenhouse emissions. 10. It was all just a dream. But in the end, we thought it best to just be honest and tell you the truth: we were working on some new features (pretty cool ones, I might add) and in the process we crashed the site. Embarrassing, but true. And we worked as hard as possible to restore everything as fast as we could. Unfortunately, on a site as complex as Bebo, with as many users, these things take time. We’re not going anywhere. (And even if we were, we wouldn’t just disappear into the night without even saying thanks, right?) The fact is: Bebo has a fantastic future ahead and we’ve been working on some new things that we’re truly excited about. We can’t wait to share them with you, but of course we’ll be a bit more careful as we roll these things out. In the meantime, if you haven’t already, check out these comments. Some are funny. Some are touching. Some are frankly kind of mean. But that’s Bebo users in a nutshell, isn’t it? Lots of luv! Adam (CEO)

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Bebo Apologizes For Downtime: “We’re Not Going Anywhere”

Mint.com Launches Android Tablet App

Achilles — Wed, 01 Feb 2012 19:14:35 +0000

Mint.com , the financial service we first mentioned at TechCrunch40 in 2007 (wow, that seems like a long time ago), announced that they have launched a new native app specifically for 9 and 10 inch Android tablets running Honeycomb and Ice Cream Sandwich. This new app, available in the Android Market, will join the previously available versions for iPhone, iPad and Android mobile phones. Curiously, there is no mobile web version (that I have been able to find). 7 inch tablets should work, but this new app is not specifically optimized for them. No word as of yet, when this new version will be available for the very popular Kindle Fire since there is already a version of Mint in the Amazon app store. For the unfamiliar, Mint is an app/web system for aggregating and managing all your disparate financial accounts and then graphically expressing that data for easy, “at a glance” understanding of your expenditures. With the exception of some slight usability tweaks (like reordering some modules) and a few subtle font changes, this latest version offers no new functionality. What it does do, however, is make the service available as a native app for the growing number of Android tablets out there. “In the next few months, Android tablets are expected to hold more than 40 percent of the market share,” said Aaron Forth, general manager of Intuit Inc.’s (Nasdaq: INTU) Personal Finance Group. “As tablet use rises, more mobile-savvy people will look for ways to manage their lives across multiple devices, so we developed our Android tablet app to bring simple money management tools to their fingertips.” Making the service available in as many emerging channels as possible is a credible strategy — a wise move for any financial service these days — but beyond those projections, Mint.com has some interesting statistics to back up this approach. Ken Sun, from Mint’s parent company Intuit, revealed as much to me by noting in a quick Q&A that 40% of Mint’s registrations are completed on mobile devices. Additionally, 30% of Mint’s user base are “mobile only” users, so it makes a lot of sense to distribute the functionality where user activity is increasing. In any event, the graphics and charts appear to look as nice as they do on other platforms. This is sure to make any XOOM or Galaxy Tab wielding Mint user a happy camper today.

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Mint.com Launches Android Tablet App

Log Data Management And Analytics Startup Sumo Logic Raises $15M From Greylock And Others

jos — Tue, 31 Jan 2012 17:30:34 +0000

Sumo Logic , a startup focused on enterprise log management and analytics, has raised $15 million in Series B funding round led by Sutter Hill Ventures, with participation from previous investors Greylock Partners and angel investor Shlomo Kramer. The new funding brings the startup’s total venture capital backing to $20.5 million. Today, Sumo Logic emerged from stealth to unveil its log management and analytics platform, aiming to help companies to uncover operational and security insights buried in enterprise log files. The startup was founded by ArcSight veterans Christian Beedgen and Kumar Saurabh in 2009, to provide a cloud based system for managing the massive amounts of enterprise log data. similar to other cloud based data management offerings, Sumo Logic wants to eliminate the need for expensive on premise-based log management applications. Using algorithms, the service provides enterprises with operational and security insights from their log data in real time, at a massive scale. We’re told the service can analyze petabytes of log-data a day. Sumo Logic’s architecture features an elastic petabyte scale platform that collects, manages and analyzes enterprise log data, reducing millions of log lines into valuable operational insights in real time. The cloud-based service is powered by Sumo Logic’s Elastic Log Processing, which is a scalable architecture that enables log analytics at a large scale; and LogReduce, which are a set of adaptive algorithms that reduce millions of logs into a small number of patterns. The platform also features real-time interactive forensics and push analytics to provide proactive detection and notification of trends, changes and anomalies in data. Sumo Logic’s service also mines global trends and anomalies across customer organizations. As Beedgen explains, there is a major opportunity behind providing a cloud-based alternative to log management because enterprises have real problems managing and analyzing log and machine data. He says existing products can suck in data but have poor analytics and data analyzation with too many false positives. Sumo Logic has an innovative approach, he says, because it provides a scalable elastic architecture, applied machine learning for IT intelligence, and the horsepower to process massive amounts of IT data. The new funding will be used towards expanding engineering and marketing. Sumo Logic faces competition from Splunk, which just filed for an IPO.

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Log Data Management And Analytics Startup Sumo Logic Raises $15M From Greylock And Others

The 5 Reasons Why Facebook Is Worth So Much Money

admin2 — Tue, 31 Jan 2012 03:25:12 +0000

How did Facebook become worth so much money that it could file for the biggest IPO in tech history ? By building a highly defensible product, platform, and advertising business on top of brilliant talent and valuable data. It now has several competitive advantages that protect it from disruption and could give it a long life as the primary online identity provider. Here are the 5 components that make Facebook a smart long-term bet for investors, regardless of its exact IPO pricing. Network Effect Displacing Facebook as the mainstream online social network would be next to impossible. It brought authenticated identity to the internet –a crucial utility that compelled users to join. No other service may be able to add on top of Facebook something as valuable as what Facebook added to Myspace, friendster, and other services where you didn’t have to be yourself. Facebook’s ingenius distribution strategy, detailed in The Facebook Effect by David Kirkpatrick , allowed the service to capitalize on this value-add and spread to the farthest reaches of the globe . Eventually the network effect took hold, with Facebook’s ever-growing user base making it ever-more valuable and attractive to new users. And now inertia has set in. Users have invested considerable time into Facebook building their profiles, walls, interest graphs, and most importantly, their social graphs. As Facebook handles a wide range of use cases and a critical mass of any person’s friends already using it, a competing social network can’t just be as good or better, it would need to be massive improvement to lead users astray. The insulation to competition provided by the network effect makes it a safe long-term bet for investors. The News Feed’s EdgeRank Algorithm For five years, Facebook has been collecting data and refining its EdgeRank algorithm , which determines what of all the content your friends share ends up in your news feed, and how prominently. By using Likes, comments, and shares to determine what’s most relevant, Facebook had developed arguably the best automated content curation engine in the world. The news feed also gets to draw on the web’s largest database of photos , and the friend tags they feature which helped Facebook go viral. For new users without tons of data points, Facebook can still predict what they might be interested in seeing. For existing users, especially veterans of the site that actively use its feedback mechanisms, the news feed consistently surfaces relevant content. EdgeRank creates that the highly addicting experience that drives Facebook’s enormous time on site, return visit rate, and engagement. Even if Twitter or Google+ had all the content of Facebook, it could take them years to develop an algorithm that produces such a relevant feed. Talent Mark Zuckerberg sees the future. His product vision allows Facebook to release features that users grow into rather than out of. Zuckerberg has integrated progressive home brewed ideas as well as those that couldn’t reach their full potential when launched elsewhere. He has pushed the service to constantly reinvent itself, allowing it to stay cool and relevant 8 years after launch. Zuck’s dedication to making the world a better place through interconnection and openness has also attracted other visionaries. COO Sheryl Sandberg ‘s efficiency has made the company very profitable, and her willingness to experiment means Facebook will continue to revolutionize advertising through behavioral targeting and social content-infused ads. VP of Product Chris Cox has led Facebook’s social design movement, where 1st and 3rd party products are made to leverage Facebook’s data and community from the start, rather than bolting them on. With the promise of changing the world and a lean, fun-loving company culture, Facebook has been pulling top engineering, product, and business talent away from larger companies like Google that are saddled with product bloat and bureaucracy. It’s also been aggressively acquiring disruptive startups such as Paul Bucheit and Brett Taylor’s FriendFeed , Blake Ross’ Parakey , Sam Lessin’s Drop.io , and Josh Williams’ Gowalla . The rockstar product designers and executives ensures innovation will continue to flow from within Facebook. The IPO will provide Facebook more cash for acquisitions and give its talent the liquidity they deserve . Though there’s always the chance they could cash out and leave, the ability to sell a little stock and upgrade their lifestyle might keep employees happy enough to stick around. The Apps and Games Platform Facebook has created a gaming platform proven to offer viral growth. While the service has curtailed some of loudest viral channels, organic growth opportunities remain and on-site advertising for games has produced high returns on investment for companies like Zynga. Facebook has fostered an enormous community of developers that pay while populating the site with engaging apps and content, and that won’t ever disappear overnight. Facebook games are often infinite building simulations or twitch puzzlers, have long session lengths, and let users make vanity purchases so they can show off while simultaneously hooking them deeper into a game. They readily produce “whales”, or people who spend orders of magnitude more than the average player. Mobile is emerging as a lucrative platform for Apple and Google, and Facebook is just getting started there, but it does have an enormous install base to work from . By attracting developers early with free growth , clamping down once they had invested, and then taxing them 30% through its virtual currency Credits, Facebook has turned its games platform into a consistent money maker . Now some developers are experimenting with digital media sales and rentals , pay-per-view , as well as offering virtual currency microincentives , showing potential for platform monetization beyond games. Ad Targeting Age, gender, current city, hometown, employers, education, friends, interests, and now in-app activity and ecommerce habits. When users share this data with friends, they’re also sharing with Facebook. This gives Facebook possibly the most accurate and robust set of ad targeting data in the world. With both an self-serve tool and ad reps handling premium accounts, Facebook can provide effective advertising solutions to both local business and international brands. Facebook has developed eye-catching ads by combining this targeting with social-content infused ad creative . Viewers see the names and faces of friends who Like an advertised brand. Interactions between their friends and brands, such as Likes, app usage, and checkins, can become the ads themselves through Sponsored Stories. These trump, and are increasingly pulling spend away from more cookie-cutter display and search ads targeted through cookies and keywords. Facebook has only begun to monetize through ads. The sidebars where ads primarily appear have been kept small and unobtrusive. Facebook is now mixing ads back into the web version of the news feed , where they’re sure to be seen between organic social content. Facebook has yet to show ads to its hundreds of millions of daily mobile users, but Sponsored Stories could show up there soon too. Finally, it could one day create an ad network that allows other sites to pay to show logged-in Facebook users the same highly targeted social ads they see on Facebook.com.

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The 5 Reasons Why Facebook Is Worth So Much Money

Google, Facebook, Privacy — And You

admin — Sun, 29 Jan 2012 06:22:37 +0000

Editor’s note : Guest author Keith Teare is General Partner at his incubator Archimedes Labs and CEO of newly funded just.me . He was a co-founder of TechCrunch. Like millions of other people, I got an email from Google this morning. It was entitled “Changes to Google Privacy Policy and Terms of Service”. The first sentence describes the intent of the changes as shortening 60 policies into one, and improving their readability. Then there is a longer explanation captured in the graphic above. The email goes on to assert that Google has not changed its privacy policy and will not sell our personal information to third parties – “Our privacy policies remain unchanged”. So what is going on here? Facebook is the shiny object that Larry is focused on. This is a week where Sheryl Sandberg – Chief Operating Officer at Facebook – spoke at Hubert Burda’s DLD conference in Munich and stated that we were in the middle of 3 trends. First, a trend “from anonymity to real identity”. Secondly, a trend from “wisdom of crowds to wisdom of friends” and third, a trend “from being receivers of information to broadcasters of information”. See the video below for the actual points she made. It was a thoughtful and at the same time a polemical speech, a speech with a strong point of view. In thinking about Google’s privacy policy changes it helps to listen to Sheryl’s remarks and reflect on the context. Facebook is saying that the Internet as a pure information retrieval mechanism is dead. That the “readwrite” web that began as long ago as cheap web site hosting in 1998, has entirely replaced the read-only web. That the identifiable author has replaced the anonymous one. We are broadcasting and we are identifiable. That reading what friends say is now dominant in that world. Facebook envisages a future in which we all broadcast almost everything to almost everybody. Google’s problem. In that world, Google’s PageRank algorithm is seriously out of date. It promotes pages based on the number of links to it. Today, pages are no longer the unit of publishing. Far smaller items than a page dominate our senses. And those smaller messages are produced in huge quantity and in real time. So the signals that make something relevant have now changed. Facebook (and Twitter) have oodles of such signals. Google, until recently, had none. Google’s solution. The changes in Google’s terms and conditions are primarily focused on providing the company with an integrated set of data capable of feeding it signals about what is and is not relevant to each of us as we search the vast amount of data produced by the second. In that sense it is not only the right strategic move, it is a question of life and death. Google is doing a pivot, in order to remain relevant. It’s hard to disagree that this is necessary. It also seems clear that neither company is being intentionally “evil”. However, there is a dilemma for both Google and Facebook as we go down the “we are all broadcasters now” path. How can they gather the signals that feed insight without making decisions for the user about what is private, selectively shared or public? We, the people! There is a discernible and growing reaction against both Facebook’s new sharing paradigm and Google’s policy changes. As implicit sharing, or as Sheryl Sandberg calls it, broadcasting, replaces conscious sharing, many are growing disillusioned with Facebook taking liberties with their behavior. The same instinct is making many people focus on the assumed bad intent behind Google’s modifications. Broadcasting our “real identity” is not something anybody wants as a default, and many don’t want under any circumstances. Privacy is becoming a product issue, not only a policy issue. In the past privacy advocates on the Internet were primarily focused on privacy as a policy issue, and the privacy lobby was mainly made up of policy professionals. In the period since Facebook’s 2011 F8 conference, we have seen consumers begin to have strong opinions about the use of their data. The past week has accelerated this trend. Product managers now need to think long and hard about the assumptions built into their products and ensure they are serving consumers not just in words but in fact. Consumers are at a tipping pointy in not tolerating all-inclusive policy decisions by service providers that impact who sees their stuff. Google and Facebook are between a rock and a hard place. There is a big structural problem for both Google and Facebook as they contemplate the product consequences of consumer reactions to their product roadmap. In a centralized platform it is incredibly hard to create easy-to-understand controls that give each user the ability to control, at a granular level, what they share and who with. Grand policy shifts, like that which came out of F8 and which we are now seeing from Google, tend to assume all users are the same and will want the same thing. In reality, users are more complex. I might want to save a private video to a personal storage space one moment, share something with a select group of friends another moment, and broadcast something to the world five minutes later. The web services infrastructure that both Facebook and Google are based on does not easily permit such fine grained control for users without also imposing serious effort. As we all know, that leads users to stick with the default settings most of the time. So, despite good intent by the teams at both companies, one-size-fits-all decisions are the norm. Mobile to the rescue? Structural problems usually require structural solutions. What it seems consumers are asking for is a world in which we all know what we are sharing and who with — but where we don’t have to do a huge amount of work to achieve that. Google Circles seems to be a nod in this direction as are Facebook’s groups. But neither is really easy enough or sufficiently integrated into the flow of the products to really solve the problem. Both require a huge management overhead. As I argued earlier this week in “ Google, Look Out Behind You! “, the spread of smartphones may be part of the solution here. Hundreds of millions of consumers are now carrying around connected still and video cameras with lists of contacts in the address book, often already organized into meaningful groups. Decentralized decision-making is very easy when there are decentralized software clients under the unique control of each user. The ability to be private one moment, selectively share the next and then publicly broadcast a few minutes later is easy to achieve in this decentralized software architecture. And service providers can never become bad actors — simply because they do not own our information or the full social graph. The cloud becomes a means of delivering messages to the phones and the place where we store our media. But it’s not the place we need to trust to make decisions about what gets shared and who with. Software can truly reflect the wishes of each human being in each moment in this world. It couldn’t be structurally more different from the past 10 years of centralized web services. What’s Next? Products will need to become increasingly more human as they become more mobile. Privacy can go away as an issue if that happens. All decisions about where data can travel will be able to be made by the individual, each time they produce data. We will all be able to be private, share selectively or choose to broadcast with relative ease. We are moving to a period where it will be considered intrusive and unwelcome if our service providers have any point of view about our sharing behavior. “Just trust us” will not be necessary and certainly won’t cut it. Capturing moments in one’s life, with the choice of whether to share, and as importantly, who to share it with, will be in the hands of each individual. The service provider will merely execute the user’s wishes. If you think about it, it’s kind of like what email service providers do today. I can’t wait.

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Google, Facebook, Privacy — And You