DigitalJournal.com has re-launched as a revenue-sharing social network website offering financial rewards to readers for posting news and comments.
The beta version site pays people to blog, post news, videos, comment on and rate stories, with greater frequency of community interaction leading to higher levels of remuneration from a monthly cash pot.
Readers are paid for their contribution by being given a share of advertising revenue as they create the aggregation and comment pages on which it is carried.
The new home page now carries user's news alongside more traditional editorial, similar to the recently redesigned Netscape home page.
The free subscription allows users to submit stories - a la Digg - by writing a headline, a brief explanation and a link to the host page.
"Our goal is to develop the strongest user-powered news site on the internet, and provide tools for users to exchange comments and ideas on news that matters to them," said Chris Hogg, editor-in-chief of DigitalJournal.com.
The site was founded in 1998 as an online technology/lifestyle publication. It spawned a quarterly magazine before taking its latest incarnation.
But it is not yet the retirement fund it seems - contributors have to work hard for their money.
October's cash pot was $1000 from which leading earner Wolfman2001 took home the princely sum of $349.38. If paid in Canadian dollars - it's not that clear - the amount equates to £162.
Since registering on 22 September, Wolfman2001 has blogged 645 times, added 1,437 comments and uploaded 358 images.
The developer's claim the more people sign up, the greater the revenue pot, from which they can draw, will become.
To prevent contributors going hungry in the meantime, other readers can also donate funds to them.
11.30.2006
Zune's social network
Zune - Social Networking Differentiates It From iPod Microsoft has released details of its upcoming Zune product, an iPod-like device that is squarely aimed at challenging Apple's dominance of the online music market. TechCrunch, Engadget and PaidContent have all the details, so I just want to focus on a couple of interesting Internet features of Zune.
1) Zune will have a social network (iPod/iTunes doesn't)
This is clearly going to wake Apple up, because a social networking aspect is the one glaring feature missing from its otherwise excellent iPod/iTunes online music combo. Zune's social networking will be based in Zune Marketplace, the equivalent of iTunes. Songs can also be shared via wireless technology on the Zune device.
It also seems that Zune will have as good a selection of music as iTunes, although details are sketchy at this stage.
2) Zune is centered on connectivity
This is what Microsoft truly believes is its advantage over Apple - ability to connect Zune across a network of devices. Zune will no doubt over time hook into the PC, Xbox, TV, etc. While Apple announced its own inter-connection plans with iTV this week, in this case Apple is the follower and not the leader.
Of course the big advantage Apple has is its brand and design, which a lot of people think is enough to continue its success. And given the early screenshots of Zune, with its brown(!?), black and white colors and its monolith-like shape - well, let's just say that Apple designers won't be feeling the heat any time soon!
Summary: Zune Experience
Microsoft's vision for this is summed up here: "Zune is Microsoft’s music and entertainment platform that provides an end-to-end solution for Connected Entertainment."
It's a social platform, as well as a music one. This currently differentiates it from Apple, so it's a good move by Microsoft. It also promises a very connected experience across devices, which plays to Microsoft's strengths. Whether all this is enough to challenge Apple, which has already won over the hearts of the mass market with the iPod and iTunes, will be interesting to see.
1) Zune will have a social network (iPod/iTunes doesn't)
This is clearly going to wake Apple up, because a social networking aspect is the one glaring feature missing from its otherwise excellent iPod/iTunes online music combo. Zune's social networking will be based in Zune Marketplace, the equivalent of iTunes. Songs can also be shared via wireless technology on the Zune device.
It also seems that Zune will have as good a selection of music as iTunes, although details are sketchy at this stage.
2) Zune is centered on connectivity
This is what Microsoft truly believes is its advantage over Apple - ability to connect Zune across a network of devices. Zune will no doubt over time hook into the PC, Xbox, TV, etc. While Apple announced its own inter-connection plans with iTV this week, in this case Apple is the follower and not the leader.
Of course the big advantage Apple has is its brand and design, which a lot of people think is enough to continue its success. And given the early screenshots of Zune, with its brown(!?), black and white colors and its monolith-like shape - well, let's just say that Apple designers won't be feeling the heat any time soon!
Summary: Zune Experience
Microsoft's vision for this is summed up here: "Zune is Microsoft’s music and entertainment platform that provides an end-to-end solution for Connected Entertainment."
It's a social platform, as well as a music one. This currently differentiates it from Apple, so it's a good move by Microsoft. It also promises a very connected experience across devices, which plays to Microsoft's strengths. Whether all this is enough to challenge Apple, which has already won over the hearts of the mass market with the iPod and iTunes, will be interesting to see.
Wink Social Search, now with people search
Wink calls itself a social search engine. It is that and more. Wink is also a community where you register to get access to bookmarking and tagging search results and adding them to thematic collections. Last week Wink added people search. They crawl Bebo, MySpace and LinkedIn, allowing you to search for name, username, location, interests and more.
What is Wink Social Search?
Wink’s web search option searches Google and rank the search results according to their own People Rank algorithm. Registered Wink members can re-rank search results, bookmark and tag sites they like and block results they don’t like. Wink’s PeopleRank uses this information along with tags from Digg, del.icio.us and Yahoo MyWeb and other similar services to refine the ranking according to the input from the users.
Wink also lets you create collections, grouping the best links for a topic all in one place. You can subscribe to other people’s collections, you can make them public and let other people add to your collections, or you can make them private so that only you can see them. Public collections will show up in the Wink search results. When testing Wink, we made a collection of sites that we consider to be among the most important sources of search engine news.
If you come across other users who have the same opinions on results as you do, you can add them to your friends list and/or subscribe to any collections they have made.
So in addition to the PeopleRank, which may or may not be an improvement on Google’s ranking, you can benefit from seeing the collections, tags and recommendations of other Wink members.
Wink relies on lots of user interaction to make the site a useful tool and really improve the search results. It seems that in it’s first year in business, they have not quite reached critical mass. But Wink could still attract a lot of users.
Wink People Search
The new people search feature may attract a large number of potential users from Bebo, MySpace and LinkedIn.
It appears under the People tab on the homepage. Wink crawls Bebo, MySpace and LinkedIn, so when you use Wink’s people search, you search an index of more than 100 million profiles from these three social networking sites.
You can search for name, username, location, interests and more, and you can narrow your search by network, gender, age and whether they’re single or taken. You can even search specific areas of a profile page. The advanced search options can be found behind the link “More ways to search” to the right of the search button under the People tab.
In the search results, a little icon identifies in which network Wink found a person. Depending on which information a person has in her profile, Wink includes name, photo, location, interests and more
If you find someone who shares your interests or come across an old friend, you can “Wink” them to add them to your your wink page for later.
The new people search feature can prove to be useful for people who spend a lot of time on networks like MySpace. But for this tool to mature, Wink needs to add more networks and to become more visible to the people who use them.
What is Wink Social Search?
Wink’s web search option searches Google and rank the search results according to their own People Rank algorithm. Registered Wink members can re-rank search results, bookmark and tag sites they like and block results they don’t like. Wink’s PeopleRank uses this information along with tags from Digg, del.icio.us and Yahoo MyWeb and other similar services to refine the ranking according to the input from the users.
Wink also lets you create collections, grouping the best links for a topic all in one place. You can subscribe to other people’s collections, you can make them public and let other people add to your collections, or you can make them private so that only you can see them. Public collections will show up in the Wink search results. When testing Wink, we made a collection of sites that we consider to be among the most important sources of search engine news.
If you come across other users who have the same opinions on results as you do, you can add them to your friends list and/or subscribe to any collections they have made.
So in addition to the PeopleRank, which may or may not be an improvement on Google’s ranking, you can benefit from seeing the collections, tags and recommendations of other Wink members.
Wink relies on lots of user interaction to make the site a useful tool and really improve the search results. It seems that in it’s first year in business, they have not quite reached critical mass. But Wink could still attract a lot of users.
Wink People Search
The new people search feature may attract a large number of potential users from Bebo, MySpace and LinkedIn.
It appears under the People tab on the homepage. Wink crawls Bebo, MySpace and LinkedIn, so when you use Wink’s people search, you search an index of more than 100 million profiles from these three social networking sites.
You can search for name, username, location, interests and more, and you can narrow your search by network, gender, age and whether they’re single or taken. You can even search specific areas of a profile page. The advanced search options can be found behind the link “More ways to search” to the right of the search button under the People tab.
In the search results, a little icon identifies in which network Wink found a person. Depending on which information a person has in her profile, Wink includes name, photo, location, interests and more
If you find someone who shares your interests or come across an old friend, you can “Wink” them to add them to your your wink page for later.
The new people search feature can prove to be useful for people who spend a lot of time on networks like MySpace. But for this tool to mature, Wink needs to add more networks and to become more visible to the people who use them.
Norwest invests $10 mln in Indian social network
A top Silicon Valley venture capital firm has invested $10 million in Indian Internet community Sulekha.com on a bet the social network site can become a much bigger player in the fast-growing market.
Norwest Venture Partners, led by Indian-born managing director Promod Haque, said the $10 million in Series A financing would fund the expansion of Sulekha's focus beyond India's top eight cities and into new business segments.
"Suffice it to say that the goal is to go into smaller Indian cities," he said in an interview on Tuesday, adding the English-language site may eventually offer regional dialects.
Sulekha encourages social networking and local commerce in 25 cities in India and around the world. Beyond self-published blogs and online directories, users can buy and sell classified advertising, as on Craigslist.com, or do other transactions.
Founded in 1998 in Austin, Texas, by electrical engineer Satya Prabhakar, Sulekha first targeted non-resident Indians, before spreading to Indian cities. It had funding from Indian early-stage Internet and mobile investor Indigo Monsoon Group.
Haque, who ranks among Silicon Valley's top deal makers, is joining Sulekha's board.
Already this year, Norwest, a $2.5 billion venture capital firm based in Palo Alto, California, helped fund the formation of Indian travel services site Yatra Online.
"We are very bullish about the macro trends driving consumer Internet businesses in India," Haque said, citing explosive broadband Internet and mobile phone use and vibrant consumer spending by Indian's growing urban middle class.
Ninety-five percent of Sulekha's 10 million pages are user-generated material from hundreds of thousands of member contributors. It counts 1.5 million members, Sulekha said.
Sulekha, which has spent little on marketing, ranks behind Rediff.com (REDF.O: Quote, Profile, Research) and global names like Yahoo, Google and MSN in Web page-views, a key metric for advertisers, but outpaces any site in India in classified ads and yellow pages look-ups.
It has offline partnerships with book publisher Penguin and newspaper companies DNA and Indian Express to distribute the work of tens of thousands of bloggers, and plans to spend more on marketing with partners such as mobile carriers.
Norwest Venture Partners, led by Indian-born managing director Promod Haque, said the $10 million in Series A financing would fund the expansion of Sulekha's focus beyond India's top eight cities and into new business segments.
"Suffice it to say that the goal is to go into smaller Indian cities," he said in an interview on Tuesday, adding the English-language site may eventually offer regional dialects.
Sulekha encourages social networking and local commerce in 25 cities in India and around the world. Beyond self-published blogs and online directories, users can buy and sell classified advertising, as on Craigslist.com, or do other transactions.
Founded in 1998 in Austin, Texas, by electrical engineer Satya Prabhakar, Sulekha first targeted non-resident Indians, before spreading to Indian cities. It had funding from Indian early-stage Internet and mobile investor Indigo Monsoon Group.
Haque, who ranks among Silicon Valley's top deal makers, is joining Sulekha's board.
Already this year, Norwest, a $2.5 billion venture capital firm based in Palo Alto, California, helped fund the formation of Indian travel services site Yatra Online.
"We are very bullish about the macro trends driving consumer Internet businesses in India," Haque said, citing explosive broadband Internet and mobile phone use and vibrant consumer spending by Indian's growing urban middle class.
Ninety-five percent of Sulekha's 10 million pages are user-generated material from hundreds of thousands of member contributors. It counts 1.5 million members, Sulekha said.
Sulekha, which has spent little on marketing, ranks behind Rediff.com (REDF.O: Quote, Profile, Research) and global names like Yahoo, Google and MSN in Web page-views, a key metric for advertisers, but outpaces any site in India in classified ads and yellow pages look-ups.
It has offline partnerships with book publisher Penguin and newspaper companies DNA and Indian Express to distribute the work of tens of thousands of bloggers, and plans to spend more on marketing with partners such as mobile carriers.
MySpace founder backs SaySwap, social network for gamers
One of the founders of MySpace has backed an interactive online video gaming community allowing users to trade games, swap cheats and share tips and thoughts via blogs.
Los Angeles-based SaySwap, which claims to be the first social network for gamers, uses a virtual currency based on trading tokens to exchange games.
MySpace founder Brad Greenspan is backing the new venture through his LiveUniverse company established to nurture video, entertainment and social networking properties.
Mark Elfenbein, chief executive at SaySwap, said: "I had become frustrated with the lack of good titles at game rental stores and the steep $50+ cost of new games.
"This long-overdue service allows players to trade away their old games to acquire the games they want to play."
Elfenbein has a track record in the business. He co-founded SkillJam Technologies, a pay-for-play gaming site with over 12 million registered users, which was sold to Liberty Media in March 2006.
SaySwap registration is free, and users are allocated an initial 30 purchase points.
"Players of practically any console or device can interact with peers from around the globe to trade games for a mere fraction of the price they would pay at a traditional retailer," said Elfenbein.
SaySwap is also entering into a white label partnership with CheatCodes.com, a one million strong cheat code sharing community.
Los Angeles-based SaySwap, which claims to be the first social network for gamers, uses a virtual currency based on trading tokens to exchange games.
MySpace founder Brad Greenspan is backing the new venture through his LiveUniverse company established to nurture video, entertainment and social networking properties.
Mark Elfenbein, chief executive at SaySwap, said: "I had become frustrated with the lack of good titles at game rental stores and the steep $50+ cost of new games.
"This long-overdue service allows players to trade away their old games to acquire the games they want to play."
Elfenbein has a track record in the business. He co-founded SkillJam Technologies, a pay-for-play gaming site with over 12 million registered users, which was sold to Liberty Media in March 2006.
SaySwap registration is free, and users are allocated an initial 30 purchase points.
"Players of practically any console or device can interact with peers from around the globe to trade games for a mere fraction of the price they would pay at a traditional retailer," said Elfenbein.
SaySwap is also entering into a white label partnership with CheatCodes.com, a one million strong cheat code sharing community.
SuperSociety, announces technology that connects all online social communities under one log-in screen
SuperSociety, a social networking technology firm, announced today its plans for adoption of a new service that will target existing social networks and communities, like FaceBook, Myspace, and YouTube, and link them together using a single login platform. Members of different online communities will have the option to access their online communities under a single log-in screen; SuperSociety’s platform will serve as a mega ‘Mash-up’ — a website that seamlessly integrates content from more than one source.
SuperSociety will make this integration possible by its proprietary AI Aggregator Engine and Social Networking Protocol, patent-pending architecture technologies that will alter the way websites share information. The Aggregator Engine can automatically grab (scrape) user data from any other interactive site and contextualize it to fit the needs of SuperSociety. Using artificial intelligence, the engine can learn to adjust itself to grab different sets of data even if the data arrangement is manually altered.
“The technology we are currently developing will change the way online community users access their web pages. It will become much easier to share messages, photos, and videos with members, and will be able to transcend just one network,” said Kaz Moghim, co-core technology architect and co-founder of SuperSociety. “Users of SuperSociety will now be able to search for people in multiple social networks.”
The advanced Al Aggregator Engine will scrape, or read, user data from the screen and anonymously categorize users by demographic and interest. Potential SuperSociety advertisers will then be able to accurately market themselves within the SuperSociety webpage to users with similar interests.
With the tremendous growth in the online network communities, and its increasing disintegration and diversification, SuperSociety aims to provide a service that will consolidate the growing fragmentation by providing a single service log-in. The Company understands the value of integrating services and aims to become an all-in-one social network platform with the mission to spearhead a new phase of communication and connectivity in the virtual world.
SuperSociety will make this integration possible by its proprietary AI Aggregator Engine and Social Networking Protocol, patent-pending architecture technologies that will alter the way websites share information. The Aggregator Engine can automatically grab (scrape) user data from any other interactive site and contextualize it to fit the needs of SuperSociety. Using artificial intelligence, the engine can learn to adjust itself to grab different sets of data even if the data arrangement is manually altered.
“The technology we are currently developing will change the way online community users access their web pages. It will become much easier to share messages, photos, and videos with members, and will be able to transcend just one network,” said Kaz Moghim, co-core technology architect and co-founder of SuperSociety. “Users of SuperSociety will now be able to search for people in multiple social networks.”
The advanced Al Aggregator Engine will scrape, or read, user data from the screen and anonymously categorize users by demographic and interest. Potential SuperSociety advertisers will then be able to accurately market themselves within the SuperSociety webpage to users with similar interests.
With the tremendous growth in the online network communities, and its increasing disintegration and diversification, SuperSociety aims to provide a service that will consolidate the growing fragmentation by providing a single service log-in. The Company understands the value of integrating services and aims to become an all-in-one social network platform with the mission to spearhead a new phase of communication and connectivity in the virtual world.
Social Business Network for Entrepreneurs
I'm sure most of you have heard about Internet Marketers using social networks like MYSpace and others to tap into wallets of prospective buyers. Heck some of you may be using this technique now.
But what if I told you that there was a new Social Network that has recently been dubbed "The new MYSpace for business" A Social Network that is highly targeted only available to entrepreneurs where you can meet new friends, develop new business contacts, build relationships with them, get viral exposure to your business, and never be banned for including your business details, products/services or web link?
But what if I told you that this new social network would also pay you while you build your network and invite others! After all wouldn't it be fair that you get paid while your building the user base of the social network? You bet it is!
Rob Clark, Creator of BizFriendz had this to say- "I got tired of hearing about people trying to penetrate Myspace or other social networks to promote their products/services only to learn that they are getting banned or their profiles deleted because they violated their terms and conditions for "commercial use".
So my idea was to develop a social network where a user will never be banned because they included their business information, products/services, or website in their profiles but in a professionally controlled environment.
But I also wanted to offer more to the users. I wanted to put a "Spin" on it in a big way.
And that is why I also made my social network free to join but capable of paying the users a 50% commission when they invited others into their network who later chose to upgrade their accounts. An incentive that has been very motivating and is creating a buzz online evident by the hundreds that have signed up just within a few days.
Rob also says that you don't have to worry about getting spammed like in other social networks because each user can control how they are contacted within the network.
He also said that you can send announcements to your personal network about various events you can create within your account such as sales events, webinars, podcasts, teleseminars, viewing videos, etc. And guess what? You can actually earn money from the event ticket sales that you can create from your account! (If you choose to set event as fee and not free)
Think about the power of this for a minute?
You post your event in the BizFriendz Social network. Example: sales event of a product/service at your website that you offer for 50% off. You set the description, date and time, etc. of the sales event and post it live under "events" in the social network for everyone else in the entire BizFriendz network to see, attracting more people to your event. Then you also send out a bulletin or announcement to your BizFriendz network of people informing them of your sales events.
However if you choose to charge a small fee for the event tickets you created you then can eliminate the "tire kickers" and essentially pre-qualifying users as buyers. Increasing your conversions dramatically and making a few extra dollars in the process.
Of course there are too many scenarios of how selling tickets to your events can benefit you, but you get the picture.
Rob's social network does have many, many more features and other ways you can leverage the system to increase your exposure for your business. Features like personal urls, Word Press blogs, forums, instant messaging, personal mail center, groups that you can join-or create and moderate, events system, listings where you can sell things like- domain names,websites, computers, or post a job, etc., keyword Hyper link searching technology, JV matching system (coming soon) and much ,much, more.......
Evident by the scores of new profiles that are being listed every few minutes on the site, there's an obvious "viral frenzy" to sign up. Maybe it's because others are seeing people that they recognize and know already listed in the network, including well known marketing "gurus" (the flash audio player is pretty cool too!)
Well Rob's confirmation of a "viral frenzy" was with an astonishing number of sign-ups each day....
"The site has become extremely viral within about 2 weeks", said, Rob. "some days we have seen as many as 200 people join the network, the sign-ups have been climbing steadily each day."
Business owners are signing up in droves because there are no other social networks that have these powerful features or incentives to help you grow your business and drive your sales through the roof!
http://www.wendyshepherd.com/bizfriends.php
But what if I told you that there was a new Social Network that has recently been dubbed "The new MYSpace for business" A Social Network that is highly targeted only available to entrepreneurs where you can meet new friends, develop new business contacts, build relationships with them, get viral exposure to your business, and never be banned for including your business details, products/services or web link?
But what if I told you that this new social network would also pay you while you build your network and invite others! After all wouldn't it be fair that you get paid while your building the user base of the social network? You bet it is!
Rob Clark, Creator of BizFriendz had this to say- "I got tired of hearing about people trying to penetrate Myspace or other social networks to promote their products/services only to learn that they are getting banned or their profiles deleted because they violated their terms and conditions for "commercial use".
So my idea was to develop a social network where a user will never be banned because they included their business information, products/services, or website in their profiles but in a professionally controlled environment.
But I also wanted to offer more to the users. I wanted to put a "Spin" on it in a big way.
And that is why I also made my social network free to join but capable of paying the users a 50% commission when they invited others into their network who later chose to upgrade their accounts. An incentive that has been very motivating and is creating a buzz online evident by the hundreds that have signed up just within a few days.
Rob also says that you don't have to worry about getting spammed like in other social networks because each user can control how they are contacted within the network.
He also said that you can send announcements to your personal network about various events you can create within your account such as sales events, webinars, podcasts, teleseminars, viewing videos, etc. And guess what? You can actually earn money from the event ticket sales that you can create from your account! (If you choose to set event as fee and not free)
Think about the power of this for a minute?
You post your event in the BizFriendz Social network. Example: sales event of a product/service at your website that you offer for 50% off. You set the description, date and time, etc. of the sales event and post it live under "events" in the social network for everyone else in the entire BizFriendz network to see, attracting more people to your event. Then you also send out a bulletin or announcement to your BizFriendz network of people informing them of your sales events.
However if you choose to charge a small fee for the event tickets you created you then can eliminate the "tire kickers" and essentially pre-qualifying users as buyers. Increasing your conversions dramatically and making a few extra dollars in the process.
Of course there are too many scenarios of how selling tickets to your events can benefit you, but you get the picture.
Rob's social network does have many, many more features and other ways you can leverage the system to increase your exposure for your business. Features like personal urls, Word Press blogs, forums, instant messaging, personal mail center, groups that you can join-or create and moderate, events system, listings where you can sell things like- domain names,websites, computers, or post a job, etc., keyword Hyper link searching technology, JV matching system (coming soon) and much ,much, more.......
Evident by the scores of new profiles that are being listed every few minutes on the site, there's an obvious "viral frenzy" to sign up. Maybe it's because others are seeing people that they recognize and know already listed in the network, including well known marketing "gurus" (the flash audio player is pretty cool too!)
Well Rob's confirmation of a "viral frenzy" was with an astonishing number of sign-ups each day....
"The site has become extremely viral within about 2 weeks", said, Rob. "some days we have seen as many as 200 people join the network, the sign-ups have been climbing steadily each day."
Business owners are signing up in droves because there are no other social networks that have these powerful features or incentives to help you grow your business and drive your sales through the roof!
http://www.wendyshepherd.com/bizfriends.php
Boost Mobile launches loopt, GPS-enabled social network
Boost loopt is a new location aware social network service from Boost Mobile and loopt. Using the phone's built-in GPS, Boost loopt automatically updates your location for a private list of friends. Users can update their status and geo-tag locations with text and photos.
Competing carrier Helio recently launched a similar feature called Buddy Beacon. It's not quite as sophisticated, but is also built into their new Drift handset with no extra fees (GPS services will be built into all future Helio handsets).
The service will officially launch for Boost Mobile subscribers on November 20th. It costs $2.99 per month with the first month available for free as a trial. As a further promotion, Boost is allowing customers to use loopt for free through the end of the year.
Competing carrier Helio recently launched a similar feature called Buddy Beacon. It's not quite as sophisticated, but is also built into their new Drift handset with no extra fees (GPS services will be built into all future Helio handsets).
The service will officially launch for Boost Mobile subscribers on November 20th. It costs $2.99 per month with the first month available for free as a trial. As a further promotion, Boost is allowing customers to use loopt for free through the end of the year.
CityTools to launch as a 'social network for newspapers
U.S. CityTools will launch next month a platform that allows newspapers to share content and even use articles written by the public. According to the developers, several U.S. newspapers are already interested by the service.
"What we are trying to do is create a system where the barriers to a relevant flow of information are really removed while everyone still has their commercial interests intact," said president of CityTools Robert Cauthorn.
An audacious aim, considering both objectives of free-flowing information and sustained profitability have been the weights dragging the newspaper industry down.
The program’s publishers hope it can compete with dominant search engines because it rids itself of the “mass aggregation,” “shotgun approach” of Google-like engines. Instead it will provide “the same kind of mass but it’s all relevant to local readership,” Cauthorn said.
“Imagine this as a combination of a file-sharing network and a social network for newspapers (…) all for the benefit of the reader, the advertiser and the publisher – everybody wins,” Cauthorn.
It still sounds a hair too idealistic, but this networking platform could become a major factor in the conglomeration of news sources and media companies. The real losers could be small publishers, discouraged by the cost of the service – $650 flat per month – and slowly effaced by efficiently networked media giants.
Source: journalism.co.uk
"What we are trying to do is create a system where the barriers to a relevant flow of information are really removed while everyone still has their commercial interests intact," said president of CityTools Robert Cauthorn.
An audacious aim, considering both objectives of free-flowing information and sustained profitability have been the weights dragging the newspaper industry down.
The program’s publishers hope it can compete with dominant search engines because it rids itself of the “mass aggregation,” “shotgun approach” of Google-like engines. Instead it will provide “the same kind of mass but it’s all relevant to local readership,” Cauthorn said.
“Imagine this as a combination of a file-sharing network and a social network for newspapers (…) all for the benefit of the reader, the advertiser and the publisher – everybody wins,” Cauthorn.
It still sounds a hair too idealistic, but this networking platform could become a major factor in the conglomeration of news sources and media companies. The real losers could be small publishers, discouraged by the cost of the service – $650 flat per month – and slowly effaced by efficiently networked media giants.
Source: journalism.co.uk
AOL upgrades messenger, integrates social network
NEW YORK (Reuters) - AOL said on Wednesday it will launch an upgrade to its instant messenger software with new features that let users track some of the online activities of their friends.
The debut of AOL Instant Messenger, or AIM 6.0, lets users link to "Really Simple Syndication," or RSS, feeds of their friends that keeps track of friends who upload videos or posts pictures to sites such as Google Inc.'s YouTube or Yahoo Inc.'s Flickr.
The upgrade, which also provides easier-to-find links to AOL's own take on social networks, popularised by rival service MySpace, comes amid a restructuring of AOL announced this summer.
Eying the surge in online advertising sales growth, the online unit of the world's biggest media company Time Warner Inc. decided to give away most of its services for free. It continues to operate a dial-up Internet service, but no longer markets the service.
Early signs of progress came at the end of the third quarter when it reported a 46 percent growth in online ad revenue.
"This version (of AIM), and a lot of what we are doing in AIM Pages, is extending the user-generated communications platform on their terms with what people care about," AOL Vice President Marcien Jenckes said.
Other features of the upgrade include the ability to leave messages for friends even if they have logged off and a feature that lets users save text logs of their conversation.
AIM users can also add up to 1,000 friends on their buddy list.
More than 42 million messaging users are on the AOL Network. Over 30 million of these use AIM.
The debut of AOL Instant Messenger, or AIM 6.0, lets users link to "Really Simple Syndication," or RSS, feeds of their friends that keeps track of friends who upload videos or posts pictures to sites such as Google Inc.'s YouTube or Yahoo Inc.'s Flickr.
The upgrade, which also provides easier-to-find links to AOL's own take on social networks, popularised by rival service MySpace, comes amid a restructuring of AOL announced this summer.
Eying the surge in online advertising sales growth, the online unit of the world's biggest media company Time Warner Inc. decided to give away most of its services for free. It continues to operate a dial-up Internet service, but no longer markets the service.
Early signs of progress came at the end of the third quarter when it reported a 46 percent growth in online ad revenue.
"This version (of AIM), and a lot of what we are doing in AIM Pages, is extending the user-generated communications platform on their terms with what people care about," AOL Vice President Marcien Jenckes said.
Other features of the upgrade include the ability to leave messages for friends even if they have logged off and a feature that lets users save text logs of their conversation.
AIM users can also add up to 1,000 friends on their buddy list.
More than 42 million messaging users are on the AOL Network. Over 30 million of these use AIM.
Nokia Slips a Little Yahoo! Inside its Phones
Nokia Slips a Little Yahoo! Inside its Phones
We already know about the Verizon/YouTube match up, but now Nokia fans are getting some love too, albeit of a different kind. As of today, all of Nokia's Series 40 phones will include integrated versions of Yahoo! Mail and Messenger. The apps will be built right into the UI making it easy to get all those annoying fwds your friends send via e-mail while you're on the go. Add to that the ability to block them while logged onto Messenger and its like you never left your computer. The apps will roll out with the 6300, 5300, and 5200 phones.
BitTorrent Signs Licensing Deals With Viacom, News Corp
LOS ANGELES -- BitTorrent Inc., developer of a popular online file-sharing tool, said it has reached licensing deals that will boost the number of movies and TV shows it can offer as part of a video download service launching next year.
The closely held company said it signed agreements with Viacom Inc.'s Paramount Pictures, News Corp.'s 20th Century Fox, Lionsgate Entertainment Corp., Palm Pictures and Kadokawa Pictures USA.
The San Francisco-based BitTorrent also inked content deals with cable television networks G4 and Liberty Media Holding Corp.'s Starz Media along with several Viacom-owned networks, including MTV Networks, VH1, SpikeTV, Nickelodeon, Comedy Central and Logo.
Financial terms of the licensing agreements were not disclosed.
Added to BitTorrent's lineup were films such as "X-Men The Last Stand," "Saw III" and "Mission: Impossible III," and TV shows "Star Trek," "Laguna Beach" and "South Park."
Earlier this year, BitTorrent announced content deals with Time Warner Inc.'s Warner Bros. Home Entertainment, Egami Media, Hart Sharp, Koch Entertainment and The Orchard.
Unlike other video-on-demand services, which distribute movies stored on their own servers directly to computer users, BitTorrent uses a peer-to-peer technology that assembles files from separate bits of data downloaded from other computer users across the Internet. The technology makes the distribution of large files faster and less expensive.
BitTorrent plans to debut the commercial video service in February and expects to offer thousands of video titles in addition to music and software. The company has yet to disclose a pricing scheme but has said individual TV shows could be priced as low as $1, and movies will be sold for about the price of a DVD.
TV shows and most films can be purchased and burned on a backup DVD, although the copy will only play on the computer used to buy the original and not on standard DVD players. Some films will only be available for viewing a limited number of times.
Last year, BitTorrent agreed to remove links to pirated versions of movies from its Web site and eliminate online links leading to unauthorized content owned by the seven studios that are members of the Motion Picture Association of America.
The closely held company said it signed agreements with Viacom Inc.'s Paramount Pictures, News Corp.'s 20th Century Fox, Lionsgate Entertainment Corp., Palm Pictures and Kadokawa Pictures USA.
The San Francisco-based BitTorrent also inked content deals with cable television networks G4 and Liberty Media Holding Corp.'s Starz Media along with several Viacom-owned networks, including MTV Networks, VH1, SpikeTV, Nickelodeon, Comedy Central and Logo.
Financial terms of the licensing agreements were not disclosed.
Added to BitTorrent's lineup were films such as "X-Men The Last Stand," "Saw III" and "Mission: Impossible III," and TV shows "Star Trek," "Laguna Beach" and "South Park."
Earlier this year, BitTorrent announced content deals with Time Warner Inc.'s Warner Bros. Home Entertainment, Egami Media, Hart Sharp, Koch Entertainment and The Orchard.
Unlike other video-on-demand services, which distribute movies stored on their own servers directly to computer users, BitTorrent uses a peer-to-peer technology that assembles files from separate bits of data downloaded from other computer users across the Internet. The technology makes the distribution of large files faster and less expensive.
BitTorrent plans to debut the commercial video service in February and expects to offer thousands of video titles in addition to music and software. The company has yet to disclose a pricing scheme but has said individual TV shows could be priced as low as $1, and movies will be sold for about the price of a DVD.
TV shows and most films can be purchased and burned on a backup DVD, although the copy will only play on the computer used to buy the original and not on standard DVD players. Some films will only be available for viewing a limited number of times.
Last year, BitTorrent agreed to remove links to pirated versions of movies from its Web site and eliminate online links leading to unauthorized content owned by the seven studios that are members of the Motion Picture Association of America.
11.28.2006
YouTube Coming Soon to Cellphones
SAN FRANCISCO, Nov. 27 — YouTube is coming to mobile phones — or, to be more precise, a small slice of YouTube is coming to some Verizon Wireless phones.
While its explosively popular Web site is free, YouTube’s phone-based version will require a $15-a-month subscription to a Verizon Wireless service called VCast. And instead of choosing what to watch from a vast library of clips, VCast users will be limited to an unspecified number of videos selected and approved by the companies.
Still, the deal, which the companies plan to announce on Tuesday, marks the mobile-phone debut of YouTube, the video-sharing service owned by Google that many say is already changing the media landscape.
“Everybody carries a phone with them, but they may not have a computer,” said Steve Chen, chief technology officer and a co-founder of YouTube. People can “take the phone out of their pocket while waiting for the bus” and watch a video, he added.
Verizon Wireless and YouTube said the service would be available early next month. The companies would not discuss the financial terms of their deal but said Verizon would have the exclusive rights to distribute YouTube videos on mobile phones “for a limited period of time.”
“This marquee partnership is the first of many,” said Kelly Liang, senior director of business development for YouTube. Ms. Liang said the company planned to introduce other such deals within the coming year.
YouTube said its editors would select short videos from its library for the Verizon Wireless service. Verizon Wireless said it would vet the videos to make sure they met the company’s editorial and taste guidelines.
“We’ll select content that has the broadest appeal and the highest entertainment value,” Ms. Liang said.
One question is whether the limited selection of videos on the service will undermine the basic appeal of YouTube, which has grown popular in part because users decide what they want to watch.
But Allen Weiner, a Web publishing analyst with the consulting firm Gartner Inc., said he believed that the short bursts of escapism provided by YouTube would translate well to the mobile phone. That said, Mr. Weiner said he did not believe the deal alone would be enough of a selling point to attract new customers to Verizon.
“It’s not going to be a driver” of new subscribers, Mr. Weiner said. “But it will give people who are considering the video service component something to think about.”
While its explosively popular Web site is free, YouTube’s phone-based version will require a $15-a-month subscription to a Verizon Wireless service called VCast. And instead of choosing what to watch from a vast library of clips, VCast users will be limited to an unspecified number of videos selected and approved by the companies.
Still, the deal, which the companies plan to announce on Tuesday, marks the mobile-phone debut of YouTube, the video-sharing service owned by Google that many say is already changing the media landscape.
“Everybody carries a phone with them, but they may not have a computer,” said Steve Chen, chief technology officer and a co-founder of YouTube. People can “take the phone out of their pocket while waiting for the bus” and watch a video, he added.
Verizon Wireless and YouTube said the service would be available early next month. The companies would not discuss the financial terms of their deal but said Verizon would have the exclusive rights to distribute YouTube videos on mobile phones “for a limited period of time.”
“This marquee partnership is the first of many,” said Kelly Liang, senior director of business development for YouTube. Ms. Liang said the company planned to introduce other such deals within the coming year.
YouTube said its editors would select short videos from its library for the Verizon Wireless service. Verizon Wireless said it would vet the videos to make sure they met the company’s editorial and taste guidelines.
“We’ll select content that has the broadest appeal and the highest entertainment value,” Ms. Liang said.
One question is whether the limited selection of videos on the service will undermine the basic appeal of YouTube, which has grown popular in part because users decide what they want to watch.
But Allen Weiner, a Web publishing analyst with the consulting firm Gartner Inc., said he believed that the short bursts of escapism provided by YouTube would translate well to the mobile phone. That said, Mr. Weiner said he did not believe the deal alone would be enough of a selling point to attract new customers to Verizon.
“It’s not going to be a driver” of new subscribers, Mr. Weiner said. “But it will give people who are considering the video service component something to think about.”
TiVo to Insert Ads At End of Programs
TiVo Inc. announced a new service that will let marketers place ads at the end of recorded programs and track how many people watch them.
The company, which makes digital video recorders, said Tuesday it would insert the ads after a television show has played, when there is nothing left to fast-forward, offering a way for advertisers to reach audiences who record shows and are more likely to skip through traditional commercials.
Tivo, based in Alviso, Calif., said the new ad scheme, dubbed "Program Placement," will allow advertisers to purchase ads against specific shows, the way they do on traditional television. Companies that have already signed up for ads include Burger King Corp., General Motors Corp. and MasterCard Inc., TiVo said.
With the growth in popularity of DVRs, advertisers and television networks have become increasingly worried that most viewers skip through commercials. TiVo said it will give marketers in the new program access to its audience measurement data, so they'll be able to track how many viewers play the ads at the end of the program.
In other news, on Monday a federal judge in Texas rejected the request of EchoStar Communications Corp. for a new trial in its patent dispute with TiVo, which won an $89.6 million jury verdict earlier this year.
Last month, the U.S. Court of Appeals for the Federal Circuit gave EchoStar the go-ahead to continue providing its digital video recorder service while the appeal is pending. The court had said EchoStar showed it had a chance to win and would be hurt if it was forced to shut down the service during the appeal.
In his ruling, U.S. District Judge David Folsom said EchoStar failed to raise any new legal issues that would justify a new trial. In April, a jury determined that EchoStar violated a TiVo patent for technology that lets users record one TV program while watching another.
EchoStar spokeswoman Kathie Gonzalez said the ruling is another step in a lengthy legal process -- and the next step will be a federal appeals court in Washington D.C., that specializes in patent law.
The company, which makes digital video recorders, said Tuesday it would insert the ads after a television show has played, when there is nothing left to fast-forward, offering a way for advertisers to reach audiences who record shows and are more likely to skip through traditional commercials.
Tivo, based in Alviso, Calif., said the new ad scheme, dubbed "Program Placement," will allow advertisers to purchase ads against specific shows, the way they do on traditional television. Companies that have already signed up for ads include Burger King Corp., General Motors Corp. and MasterCard Inc., TiVo said.
With the growth in popularity of DVRs, advertisers and television networks have become increasingly worried that most viewers skip through commercials. TiVo said it will give marketers in the new program access to its audience measurement data, so they'll be able to track how many viewers play the ads at the end of the program.
In other news, on Monday a federal judge in Texas rejected the request of EchoStar Communications Corp. for a new trial in its patent dispute with TiVo, which won an $89.6 million jury verdict earlier this year.
Last month, the U.S. Court of Appeals for the Federal Circuit gave EchoStar the go-ahead to continue providing its digital video recorder service while the appeal is pending. The court had said EchoStar showed it had a chance to win and would be hurt if it was forced to shut down the service during the appeal.
In his ruling, U.S. District Judge David Folsom said EchoStar failed to raise any new legal issues that would justify a new trial. In April, a jury determined that EchoStar violated a TiVo patent for technology that lets users record one TV program while watching another.
EchoStar spokeswoman Kathie Gonzalez said the ruling is another step in a lengthy legal process -- and the next step will be a federal appeals court in Washington D.C., that specializes in patent law.
11.20.2006
TiVo taps the Internet for content
TiVo taps the Internet for content
TiVo enthusiasts will soon be able to use their devices to watch Internet video content on their TV set, the company announced Tuesday.
The company's expansion as a broadband video portal, as well as a manufacturer and television interface provider, includes three new software features and several content partnership agreements.
"These are features that are really changing what the TiVo service is," said Tara Maitra, general manager of programming at TiVo. "It's a creation that will make TiVo different from generic digital video recorders and opens up the content beyond what's available on digital cable and satellite."
Owners of TiVo's DVRs will be able to share home videos with other users. Through a partnership with One True Media, an online video and photo service, TiVo users can upload home video to the Web and share a channel code with other TiVo owners.
Special report
Me TV
An in-depth look at the revolutionary new technology
reshaping the TV industry.TiVo also announced Tuesday that it has expanded its TiVoCast offerings. TiVoCast is a service that offers broadband video content from companies via the TiVo box. TiVo said it signed a deal with CBS Interactive to provide content from CBS.com, CBSNews.com, CBS SportsLine.com and Innertube (CBS' broadband channel).
TiVo also signed deals for TiVoCast content with Reuters; Forbes; dLife, a health content network; Plum TV, a lifestyle network featuring vacation hot spots; and Nano Network, an independent film and theater outlet.
In addition to the One True Media partnership and the TiVoCast offerings, the company announced a broadband video service for watching Web videos on TV. That broadband video service requires TiVo Desktop Plus 2.4, which will be free for version 2.3 owners and $24.95 for TiVo subscribers. TiVo Desktop Plus 2.4 converts videos in QuickTime, WMV and MPEG-4 formats into a TV-viewable format and enables them to be imported to the TiVo box. The software must be downloaded to a PC running Windows XP that is connected to the TiVo box either directly or via a home network.
"The real question is whether this (addition of Internet video access) is going to sell more TiVo boxes, and I think the answer to that is no," said Josh Bernoff, a Forrester Research analyst.
"There is no way for TiVo to monitor the content in this situation, because it's the TiVo consumer who is downloading the content to their PC and then offloading it to the TiVo device."
--Tara Maitra, general manager of programming, TiVo "Internet video looks pretty crappy when you put it on a big TV set, and transcoding doesn't solve that," Bernoff said. "I am a lot more encouraged that (TiVo is) making relationships with content owners."
But TiVo owners may have the opportunity to download more than just crappy movies. Besides the technical parameters of the three formats the TiVo software can convert--QuickTime, WMV or MPEG-4 files free of digital rights management (DRM) protection--TiVo users will have complete control over the Web video content they choose to upload to TiVo via the Desktop Plus 2.4 software. That means that things like copyright movies that pirates manage to upload to peer-to-peer such as BitTorrent or social networks such as YouTube could potentially be illegally downloaded to a PC and then uploaded to a TiVo box.
TiVo does not plan to police the content that millions of device owners download to their own PC, according to Maitra.
"TiVo, basically, will be a receiving device, in the sense that the content that a subscriber pulls from the Web needs to be in a format that is not DRM-protected," Maitra said. "There is no way for TiVo to monitor the content in this situation, because it's the TiVo consumer who is downloading the content to their PC and then offloading it to the TiVo device."
TiVo has been struggling to gain new subscribers. In March, the company signed a partnership with cable provider Comcast to provide software to its DVR boxes. The deal will give TiVo access to Comcast's 23.3 million cable subscribers, though the product has been slow in reaching the market.
In rolling out the new video features, TiVo plans to keep the goodies to itself. TiVoCast, as well as the Web-to-Internet broadband video service and the One True Media home video-sharing feature, at this point, are going to be "strictly available through the TiVo standalone service," Maitra said.
As companions to all the new content available, TiVo said it will be offering a new search feature in 2007 for finding and recording content across "broadcast, cable and broadband content sources." An additional deal with International Creative Management will also offer TiVo owners new TV show and film recommendations from famous Hollywood actors and directors.
Now on News.com:
Vista security: What's in it for you?
Solar energy's hunger for silicon
Getting the blur out of LCD TVs
Extra: Silicon Valley sees hiring spree
Adding new features is usually a tool used to retain existing customers, Bernoff said. While retention is a problem for cable providers afraid of losing customers to satellite television, customer retention has not been a problem for TiVo. TiVo's challenge, Bernoff said, is to acquire new customers.
"You are about to see, starting in 2007, announcements from a bunch of new Internet-connected DVRs and, of course, TiVo's competition is and continues to be from the cable and satellite boxes available for free across the United States."
DVR owners are mainly interested in three things from their DVR: "to skip commercials easily, pause live TV, and record and view all episodes of a given show," Bernoff said, referring to a Forrester Research survey.
"All the new features...may make the TiVo box a whole lot more interesting to the TiVo owner, but it's very obscure stuff to be selling to a potential customer," Bernoff said. "They're not saying, 'Well, if only I could get access to Internet video, then I'd buy a TiVo box.'"
"I know we are hearing of DVRs with Internet video, but I have not heard of any service that is going to provide an all-encompassing service, combined with what has already been tested and proven as one of the easiest-to-use interfaces," Maitra said. "Having it all available in one location is going to be one differentiating factor. And it's all going to be made available in the easy-to-use TiVo interface."
TiVo enthusiasts will soon be able to use their devices to watch Internet video content on their TV set, the company announced Tuesday.
The company's expansion as a broadband video portal, as well as a manufacturer and television interface provider, includes three new software features and several content partnership agreements.
"These are features that are really changing what the TiVo service is," said Tara Maitra, general manager of programming at TiVo. "It's a creation that will make TiVo different from generic digital video recorders and opens up the content beyond what's available on digital cable and satellite."
Owners of TiVo's DVRs will be able to share home videos with other users. Through a partnership with One True Media, an online video and photo service, TiVo users can upload home video to the Web and share a channel code with other TiVo owners.
Special report
Me TV
An in-depth look at the revolutionary new technology
reshaping the TV industry.TiVo also announced Tuesday that it has expanded its TiVoCast offerings. TiVoCast is a service that offers broadband video content from companies via the TiVo box. TiVo said it signed a deal with CBS Interactive to provide content from CBS.com, CBSNews.com, CBS SportsLine.com and Innertube (CBS' broadband channel).
TiVo also signed deals for TiVoCast content with Reuters; Forbes; dLife, a health content network; Plum TV, a lifestyle network featuring vacation hot spots; and Nano Network, an independent film and theater outlet.
In addition to the One True Media partnership and the TiVoCast offerings, the company announced a broadband video service for watching Web videos on TV. That broadband video service requires TiVo Desktop Plus 2.4, which will be free for version 2.3 owners and $24.95 for TiVo subscribers. TiVo Desktop Plus 2.4 converts videos in QuickTime, WMV and MPEG-4 formats into a TV-viewable format and enables them to be imported to the TiVo box. The software must be downloaded to a PC running Windows XP that is connected to the TiVo box either directly or via a home network.
"The real question is whether this (addition of Internet video access) is going to sell more TiVo boxes, and I think the answer to that is no," said Josh Bernoff, a Forrester Research analyst.
"There is no way for TiVo to monitor the content in this situation, because it's the TiVo consumer who is downloading the content to their PC and then offloading it to the TiVo device."
--Tara Maitra, general manager of programming, TiVo "Internet video looks pretty crappy when you put it on a big TV set, and transcoding doesn't solve that," Bernoff said. "I am a lot more encouraged that (TiVo is) making relationships with content owners."
But TiVo owners may have the opportunity to download more than just crappy movies. Besides the technical parameters of the three formats the TiVo software can convert--QuickTime, WMV or MPEG-4 files free of digital rights management (DRM) protection--TiVo users will have complete control over the Web video content they choose to upload to TiVo via the Desktop Plus 2.4 software. That means that things like copyright movies that pirates manage to upload to peer-to-peer such as BitTorrent or social networks such as YouTube could potentially be illegally downloaded to a PC and then uploaded to a TiVo box.
TiVo does not plan to police the content that millions of device owners download to their own PC, according to Maitra.
"TiVo, basically, will be a receiving device, in the sense that the content that a subscriber pulls from the Web needs to be in a format that is not DRM-protected," Maitra said. "There is no way for TiVo to monitor the content in this situation, because it's the TiVo consumer who is downloading the content to their PC and then offloading it to the TiVo device."
TiVo has been struggling to gain new subscribers. In March, the company signed a partnership with cable provider Comcast to provide software to its DVR boxes. The deal will give TiVo access to Comcast's 23.3 million cable subscribers, though the product has been slow in reaching the market.
In rolling out the new video features, TiVo plans to keep the goodies to itself. TiVoCast, as well as the Web-to-Internet broadband video service and the One True Media home video-sharing feature, at this point, are going to be "strictly available through the TiVo standalone service," Maitra said.
As companions to all the new content available, TiVo said it will be offering a new search feature in 2007 for finding and recording content across "broadcast, cable and broadband content sources." An additional deal with International Creative Management will also offer TiVo owners new TV show and film recommendations from famous Hollywood actors and directors.
Now on News.com:
Vista security: What's in it for you?
Solar energy's hunger for silicon
Getting the blur out of LCD TVs
Extra: Silicon Valley sees hiring spree
Adding new features is usually a tool used to retain existing customers, Bernoff said. While retention is a problem for cable providers afraid of losing customers to satellite television, customer retention has not been a problem for TiVo. TiVo's challenge, Bernoff said, is to acquire new customers.
"You are about to see, starting in 2007, announcements from a bunch of new Internet-connected DVRs and, of course, TiVo's competition is and continues to be from the cable and satellite boxes available for free across the United States."
DVR owners are mainly interested in three things from their DVR: "to skip commercials easily, pause live TV, and record and view all episodes of a given show," Bernoff said, referring to a Forrester Research survey.
"All the new features...may make the TiVo box a whole lot more interesting to the TiVo owner, but it's very obscure stuff to be selling to a potential customer," Bernoff said. "They're not saying, 'Well, if only I could get access to Internet video, then I'd buy a TiVo box.'"
"I know we are hearing of DVRs with Internet video, but I have not heard of any service that is going to provide an all-encompassing service, combined with what has already been tested and proven as one of the easiest-to-use interfaces," Maitra said. "Having it all available in one location is going to be one differentiating factor. And it's all going to be made available in the easy-to-use TiVo interface."
Universal Music Sues MySpace
After its CEO said in September that YouTube and MySpace owe Universal Music Group “tens of millions of dollars,” the media giant has followed through with its threat and filed suit against MySpace for copyright infringement, according to the Wall St. Journal (subscription required). The most interesting part of the suit is that Universal is alleging that MySpace participated in the copyright violations by transcoding copyrighted video so that it can be replayed and sent to other users.
The Journal notes that today is also the day that MySpace is introducing a new tool that will allow copyright holders to flag unauthorized content on the site. That tool (our coverage) uses technology from Gracenote. MySpace said in a press release that the suit is “unnecessary and meritless.” That transcoding argument sounds like a serious one to me.
Weeks after threatening YouTube and MySpace both this fall, Universal signed a licensing agreement with YouTube the day before the Google acquisition was announced. It also sued Sony’s Grouper and Bolt for copyright infringement.
Is a fresh round of heavyweight copyright wars breaking out? Is there any possibility of an out of court settlement between the two companies? This week’s Craigslist court decision immediately comes to mind. The online directory was ruled on Wednesday to not be responsible for discriminatory housing postings on its site. The court found that Craigslist is a conduit and not a publisher. That ruling was complicated and fell under the Federal Communications Deceny Act. Universal’s lawsuits, against Grouper, Bolt and now MySpace appear headed for a direct test of the DMCA Safe Harbor provision, which is believed to protect parties to copyright infringement so long as they remove copyrighted content upon request. The argument about transcoding video may be the killer in this case.
The Journal notes that today is also the day that MySpace is introducing a new tool that will allow copyright holders to flag unauthorized content on the site. That tool (our coverage) uses technology from Gracenote. MySpace said in a press release that the suit is “unnecessary and meritless.” That transcoding argument sounds like a serious one to me.
Weeks after threatening YouTube and MySpace both this fall, Universal signed a licensing agreement with YouTube the day before the Google acquisition was announced. It also sued Sony’s Grouper and Bolt for copyright infringement.
Is a fresh round of heavyweight copyright wars breaking out? Is there any possibility of an out of court settlement between the two companies? This week’s Craigslist court decision immediately comes to mind. The online directory was ruled on Wednesday to not be responsible for discriminatory housing postings on its site. The court found that Craigslist is a conduit and not a publisher. That ruling was complicated and fell under the Federal Communications Deceny Act. Universal’s lawsuits, against Grouper, Bolt and now MySpace appear headed for a direct test of the DMCA Safe Harbor provision, which is believed to protect parties to copyright infringement so long as they remove copyrighted content upon request. The argument about transcoding video may be the killer in this case.
Music Companies Lose Suit Against Baidu.com in Beijing
Music Companies Lose Suit
Against Baidu.com in Beijing
By GEOFFREY A. FOWLER in Hong Kong and ANDREW BATSON in Beijing
November 18, 2006; Page A7
Leading Chinese Internet-search company Baidu.com Inc. won a lawsuit filed against it by a group of music companies over its MP3 search engine, the latest in the media industry's effort to win intellectual-property protection in China's courts.
The ruling, which was announced by the industry group and can still be appealed, wasn't available, so the judgment's exact basis wasn't clear. At issue was Baidu's practice of so-called deep linking to unlicensed songs stored on other Web sites. The music industry said that making music tracks available in this way, without the consent of owners, is a breach of copyright.
The International Federation of the Phonographic Industry filed the suit last year in Beijing on behalf of seven companies over the public-transmission rights of 195 recordings, which Baidu had made accessible to the public. A number of news reports have said the lawsuit sought damages of 1.67 million yuan, or about $212,000.
Both foreign and domestic copyright holders are increasingly turning to the Chinese court system for recourse against alleged infringements, including litigants who have gone after the landlords of DVD store owners. And while the physical piracy of goods like CDs and DVDs has long been the main concern of U.S. and European Union trade officials, online piracy is gaining increasing attention.
The IFPI said it plans to appeal the ruling. "I am amazed by this inexplicable judgment that is totally out of step with Chinese law and with court decisions made against similar services around the world," the IFPI's chairman and chief executive, John Kennedy, said.
The music industry has won similar cases against deep linking in the Netherlands, Norway and Australia.
A Baidu spokeswoman said the company won the case but declined to provide a copy of the ruling and had no further comment. The IFPI also didn't provide a copy of the judgment.
An attorney for Baidu, Li Decheng, said the company had won this round of the legal battle. "I agree with this first-instance judgment. But it's not the final judgment," he said. "If IFPI appeals, Baidu surely will respond."
Against Baidu.com in Beijing
By GEOFFREY A. FOWLER in Hong Kong and ANDREW BATSON in Beijing
November 18, 2006; Page A7
Leading Chinese Internet-search company Baidu.com Inc. won a lawsuit filed against it by a group of music companies over its MP3 search engine, the latest in the media industry's effort to win intellectual-property protection in China's courts.
The ruling, which was announced by the industry group and can still be appealed, wasn't available, so the judgment's exact basis wasn't clear. At issue was Baidu's practice of so-called deep linking to unlicensed songs stored on other Web sites. The music industry said that making music tracks available in this way, without the consent of owners, is a breach of copyright.
The International Federation of the Phonographic Industry filed the suit last year in Beijing on behalf of seven companies over the public-transmission rights of 195 recordings, which Baidu had made accessible to the public. A number of news reports have said the lawsuit sought damages of 1.67 million yuan, or about $212,000.
Both foreign and domestic copyright holders are increasingly turning to the Chinese court system for recourse against alleged infringements, including litigants who have gone after the landlords of DVD store owners. And while the physical piracy of goods like CDs and DVDs has long been the main concern of U.S. and European Union trade officials, online piracy is gaining increasing attention.
The IFPI said it plans to appeal the ruling. "I am amazed by this inexplicable judgment that is totally out of step with Chinese law and with court decisions made against similar services around the world," the IFPI's chairman and chief executive, John Kennedy, said.
The music industry has won similar cases against deep linking in the Netherlands, Norway and Australia.
A Baidu spokeswoman said the company won the case but declined to provide a copy of the ruling and had no further comment. The IFPI also didn't provide a copy of the judgment.
An attorney for Baidu, Li Decheng, said the company had won this round of the legal battle. "I agree with this first-instance judgment. But it's not the final judgment," he said. "If IFPI appeals, Baidu surely will respond."
Universal Music Sues MySpace Claiming Copyright Infringement
Universal Music Sues MySpace
Claiming Copyright Infringement
By ETHAN SMITH and JULIA ANGWIN
November 18, 2006; Page A3
Universal Music Group, the world's largest recorded-music company, sued News Corp.'s MySpace for copyright infringement, alleging that the social-networking giant traffics in "user-stolen" content, including music, videos and other material.
At issue is the widespread presence of copyright music and video content on MySpace. In the suit, filed in U.S. District Court for California's Central District, Vivendi SA's Universal dismisses the frequently used label "user-generated content" -- alleging that much of the material on MySpace is stolen from copyright holders.
The move signals that content companies remain sensitive to how their intellectual property is deployed on the Internet. Universal Music particularly has been among the most-aggressive content creators in sabre-rattling against potential copyright violators.
MySpace and Universal have been negotiating toward a deal in which News Corp. would pay a licensing fee for Universal content. However, News Corp. balked at Universal's demand that News Corp. pay restitution for content that had previously appeared on MySpace, according to a person close to the situation.
The suit also comes less than three weeks after MySpace, owned by News Corp., announced it was testing a system from Gracenote Inc. of Emeryville, Calif., to filter Universal Music content from its site. People familiar with talks between the two companies characterized that test as the final step before a putative licensing deal.
A Universal spokeswoman declined to comment on the filtering system. But the music company's court filing cited recent widespread leaks on MySpace of superstar rapper Jay-Z's forthcoming "Kingdom Come" album as a factor.
Universal executives have been outraged by the leak. In a recent interview, Antonio Reid, chairman of Universal's Island Def Jam Music Group, said next week's debut of the Jay-Z album would likely be "devastated" by the leaks. "I'm sure it's cut into our sales, and not by a small amount," Mr. Reid said. "Even if it [sells] a million units it's not what it should have been."
So-called user-generated content sites have been an increasingly hot issue for music companies and other copyright holders. Universal and two other big music companies recently reached blanket licensing deals with YouTube Inc., shortly before it was acquired by Google Inc. Universal sued two smaller sites, Sony Corp.'s Grouper Networks Inc. and Bolt Inc., over copyright infringement.
In September, Universal Chairman Doug Morris made public statements that were widely interpreted as threats to sue MySpace and YouTube. Since then MySpace has been taking steps to take copyright material off its Web site. In addition to last month's test of the Gracenote software, on Friday, hours before the lawsuit was filed, MySpace announced it had set up a system to make it easier for copyright holders to report infringements.
Universal said in a statement that its content has "created hundreds of millions of dollars of value for the owners of MySpace," and added that it was seeking to "ensure that our rights and those of our artists are recognized."
A statement released by MySpace said in part that it had "no doubt we will prevail in court."
Claiming Copyright Infringement
By ETHAN SMITH and JULIA ANGWIN
November 18, 2006; Page A3
Universal Music Group, the world's largest recorded-music company, sued News Corp.'s MySpace for copyright infringement, alleging that the social-networking giant traffics in "user-stolen" content, including music, videos and other material.
At issue is the widespread presence of copyright music and video content on MySpace. In the suit, filed in U.S. District Court for California's Central District, Vivendi SA's Universal dismisses the frequently used label "user-generated content" -- alleging that much of the material on MySpace is stolen from copyright holders.
The move signals that content companies remain sensitive to how their intellectual property is deployed on the Internet. Universal Music particularly has been among the most-aggressive content creators in sabre-rattling against potential copyright violators.
MySpace and Universal have been negotiating toward a deal in which News Corp. would pay a licensing fee for Universal content. However, News Corp. balked at Universal's demand that News Corp. pay restitution for content that had previously appeared on MySpace, according to a person close to the situation.
The suit also comes less than three weeks after MySpace, owned by News Corp., announced it was testing a system from Gracenote Inc. of Emeryville, Calif., to filter Universal Music content from its site. People familiar with talks between the two companies characterized that test as the final step before a putative licensing deal.
A Universal spokeswoman declined to comment on the filtering system. But the music company's court filing cited recent widespread leaks on MySpace of superstar rapper Jay-Z's forthcoming "Kingdom Come" album as a factor.
Universal executives have been outraged by the leak. In a recent interview, Antonio Reid, chairman of Universal's Island Def Jam Music Group, said next week's debut of the Jay-Z album would likely be "devastated" by the leaks. "I'm sure it's cut into our sales, and not by a small amount," Mr. Reid said. "Even if it [sells] a million units it's not what it should have been."
So-called user-generated content sites have been an increasingly hot issue for music companies and other copyright holders. Universal and two other big music companies recently reached blanket licensing deals with YouTube Inc., shortly before it was acquired by Google Inc. Universal sued two smaller sites, Sony Corp.'s Grouper Networks Inc. and Bolt Inc., over copyright infringement.
In September, Universal Chairman Doug Morris made public statements that were widely interpreted as threats to sue MySpace and YouTube. Since then MySpace has been taking steps to take copyright material off its Web site. In addition to last month's test of the Gracenote software, on Friday, hours before the lawsuit was filed, MySpace announced it had set up a system to make it easier for copyright holders to report infringements.
Universal said in a statement that its content has "created hundreds of millions of dollars of value for the owners of MySpace," and added that it was seeking to "ensure that our rights and those of our artists are recognized."
A statement released by MySpace said in part that it had "no doubt we will prevail in court."
11.18.2006
New TiVo Feature Lets Families Share Videos On TV Via the Web
New TiVo Feature Lets
Families Share Videos
On TV Via the Web
By NICK WINGFIELD
November 14, 2006; Page D1
Watching television and watching Web video have been separate activities, usually occurring in different rooms of the house on different devices. Now the two are starting to blur together in ways that may ultimately make it hard to distinguish between them.
The latest push is by TiVo Inc., the company that pioneered the digital video recorder, or DVR, a device that made it easy to record "The Sopranos" and other programs from cable and other traditional sources of television. The Alviso, Calif., company today unveiled several new features designed to enhance the array of content available to TiVo users to download from the Internet for playback on television sets. The new options include a home movie service, through which users can create an Internet "channel" that automatically broadcasts clips of kids' birthday parties and other movies over the Internet to family and friends with TiVo recorder boxes.
The new TiVo capabilities are another step in the direction of the long ballyhooed convergence between television and the Internet. Cable giant Comcast Corp. recently launched a Web site called Ziddio where it solicits homemade videos, with the intention of putting the most popular on its cable video-on-demand service for television subscribers. Apple Computer Inc. in the first quarter of next year plans to begin selling a product tentatively called iTV that plays movies, TV shows and other content downloaded from the Internet on television sets in living rooms.
TiVo CEO Tom Rogers comments on the new features allowing users to download content from the Web for TV playback.TiVo is seeking to make its product more Internet-savvy as its faces stiff competition from cable and satellite companies in the market for DVRs. TiVo has been steadily losing share in that market to its much larger rivals, but it believes it can stay relevant if it keeps a technological edge on competitors. Helping users tap the huge growth in Internet video is one way it hopes to do that.
TiVo executives say its users over time won't be able to tell whether video recorded on the device has come from conventional TV or off the Internet. "My kids don't know the difference between broadcast and cable channels," says Tom Rogers, chief executive of TiVo.
For now at least, the content available to TiVo users is much thinner than what they can get on the airwaves and cable. TiVo today plans to announce a new batch of partners including CBS Corp., Reuters Group PLC, Forbes magazine and others, which will make news and entertainment programs available for downloading onto TiVos. The partners join New York Times Co., National Basketball Association and a handful of others that joined the company's Internet video downloading service, dubbed TiVoCast, earlier this year. The service doesn't cost users a fee beyond the $12.95 a month that TiVo already charges most customers to get updated television listings and other features.
TiVo has developed software that will let users download video from sites like Google Video for playback on TiVo recorders, though they will first have to download it to their PCs for translation into a video format that is compatible with the devices. The company also has cut a deal with the talent and literary agency International Creative Management through which the agency's roster of actors and directors will recommend films, television shows and Internet videos that users can then easily record onto their devices. TiVo said it wasn't ready yet to announce the names of celebrities that will create "guru guides" for TiVo.
In addition, TiVo is opening up its devices to amateur videos through a relationship with One True Media Inc., an Internet start-up that operates a Web service designed to help users easily edit their raw footage into slick home movies. Starting early next year, users of One True Media, which charges customers $3.99 a month to share their videos with others over the Internet, will be able to create their own online channels to which TiVo members can subscribe.
Anytime the creator of the channel on One True Media adds another video, the clip will be sent over the Internet to all of the subscribers. Mark Moore, chief executive of One True Media, says most of the video shot by its subscribers is high-enough quality to look good on televisions. Televisions, Mr. Moore says, are getting "closer and closer to the Internet."
Still, some analysts doubt Internet video will end up being compelling enough to draw significant numbers of users away from conventional television in the near term. Brian Wieser, director of industry analysis at Magna Global, says conventional television viewing still dwarfs the amount of time people spend watching Web video, and is likely to continue doing so for years even with the growth in content online.
Families Share Videos
On TV Via the Web
By NICK WINGFIELD
November 14, 2006; Page D1
Watching television and watching Web video have been separate activities, usually occurring in different rooms of the house on different devices. Now the two are starting to blur together in ways that may ultimately make it hard to distinguish between them.
The latest push is by TiVo Inc., the company that pioneered the digital video recorder, or DVR, a device that made it easy to record "The Sopranos" and other programs from cable and other traditional sources of television. The Alviso, Calif., company today unveiled several new features designed to enhance the array of content available to TiVo users to download from the Internet for playback on television sets. The new options include a home movie service, through which users can create an Internet "channel" that automatically broadcasts clips of kids' birthday parties and other movies over the Internet to family and friends with TiVo recorder boxes.
The new TiVo capabilities are another step in the direction of the long ballyhooed convergence between television and the Internet. Cable giant Comcast Corp. recently launched a Web site called Ziddio where it solicits homemade videos, with the intention of putting the most popular on its cable video-on-demand service for television subscribers. Apple Computer Inc. in the first quarter of next year plans to begin selling a product tentatively called iTV that plays movies, TV shows and other content downloaded from the Internet on television sets in living rooms.
TiVo CEO Tom Rogers comments on the new features allowing users to download content from the Web for TV playback.TiVo is seeking to make its product more Internet-savvy as its faces stiff competition from cable and satellite companies in the market for DVRs. TiVo has been steadily losing share in that market to its much larger rivals, but it believes it can stay relevant if it keeps a technological edge on competitors. Helping users tap the huge growth in Internet video is one way it hopes to do that.
TiVo executives say its users over time won't be able to tell whether video recorded on the device has come from conventional TV or off the Internet. "My kids don't know the difference between broadcast and cable channels," says Tom Rogers, chief executive of TiVo.
For now at least, the content available to TiVo users is much thinner than what they can get on the airwaves and cable. TiVo today plans to announce a new batch of partners including CBS Corp., Reuters Group PLC, Forbes magazine and others, which will make news and entertainment programs available for downloading onto TiVos. The partners join New York Times Co., National Basketball Association and a handful of others that joined the company's Internet video downloading service, dubbed TiVoCast, earlier this year. The service doesn't cost users a fee beyond the $12.95 a month that TiVo already charges most customers to get updated television listings and other features.
TiVo has developed software that will let users download video from sites like Google Video for playback on TiVo recorders, though they will first have to download it to their PCs for translation into a video format that is compatible with the devices. The company also has cut a deal with the talent and literary agency International Creative Management through which the agency's roster of actors and directors will recommend films, television shows and Internet videos that users can then easily record onto their devices. TiVo said it wasn't ready yet to announce the names of celebrities that will create "guru guides" for TiVo.
In addition, TiVo is opening up its devices to amateur videos through a relationship with One True Media Inc., an Internet start-up that operates a Web service designed to help users easily edit their raw footage into slick home movies. Starting early next year, users of One True Media, which charges customers $3.99 a month to share their videos with others over the Internet, will be able to create their own online channels to which TiVo members can subscribe.
Anytime the creator of the channel on One True Media adds another video, the clip will be sent over the Internet to all of the subscribers. Mark Moore, chief executive of One True Media, says most of the video shot by its subscribers is high-enough quality to look good on televisions. Televisions, Mr. Moore says, are getting "closer and closer to the Internet."
Still, some analysts doubt Internet video will end up being compelling enough to draw significant numbers of users away from conventional television in the near term. Brian Wieser, director of industry analysis at Magna Global, says conventional television viewing still dwarfs the amount of time people spend watching Web video, and is likely to continue doing so for years even with the growth in content online.
11.14.2006
Apple, Airlines Agree To Offer iPod Connection
Apple, Airlines Agree
To Offer iPod Connection
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
November 14, 2006 9:51 a.m.
Apple Computer Inc. struck deals with six airlines to integrate its iPod portable music and video players into in-flight entertainment systems.
Apple said Tuesday the airlines, which include Air France-KLM, Continental Airlines Inc., Delta Air Lines Inc., Emirates Airlines, and United Airlines, a unit of UAL Corp., will begin offering passengers seat connections that will power and charge iPods while allowing video content contained on the devices to be played on seat-back monitors. The connections will be available on planes by mid-2007, Apple said.
Apple's iPod has so far dominated the market for portable music and video players , but the popular device could face stiff competition in coming months from Microsoft Corp.'s Zune and other music players.
Strategic partnerships like Tuesday's airlines deal could help the Cupertino, Calif., company secure a place for the iPod with consumers. Apple also struck deals with auto makers over the summer, teaming up with Ford Motor Co., General Motors Corp. and Japanese Ford-affiliate Mazda Motors Corp. to offer iPod connectors in new models.
To Offer iPod Connection
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
November 14, 2006 9:51 a.m.
Apple Computer Inc. struck deals with six airlines to integrate its iPod portable music and video players into in-flight entertainment systems.
Apple said Tuesday the airlines, which include Air France-KLM, Continental Airlines Inc., Delta Air Lines Inc., Emirates Airlines, and United Airlines, a unit of UAL Corp., will begin offering passengers seat connections that will power and charge iPods while allowing video content contained on the devices to be played on seat-back monitors. The connections will be available on planes by mid-2007, Apple said.
Apple's iPod has so far dominated the market for portable music and video players , but the popular device could face stiff competition in coming months from Microsoft Corp.'s Zune and other music players.
Strategic partnerships like Tuesday's airlines deal could help the Cupertino, Calif., company secure a place for the iPod with consumers. Apple also struck deals with auto makers over the summer, teaming up with Ford Motor Co., General Motors Corp. and Japanese Ford-affiliate Mazda Motors Corp. to offer iPod connectors in new models.
11.09.2006
Microsoft Entertainment Domination Plan
Forget the fact that Microsoft is being overshadowed by Google and that Google is looking like the 800lb gorilla beating down Microsoft. Microsoft has other plans they’ve been working on — plans that have been really coming together the past few weeks and that quite frankly, I’m sitting here in amazement.
Earlier this week, Microsoft’s Xbox 360 division announced partnerships with CBS, MTV Networks, Paramount Pictures, Turner Broadcasting, UFC and Warner Bros. Home Entertainment to “Digitally Deliver TV Shows and Movies to Gamers.” This is Microsoft’s first move into digital movie and TV show sales — and is also another move towards turning their Xbox gaming system into a full-fledged digital entertainment system (note: they want to become the center of your living room). These digital movie and TV show partnerships for their Xbox 360 unit, will likely turn into sales through their future digital media sales service Zune.com and playback on their upcoming handheld Zune device. Xbox 360 up until this announcement has only let users download select music videos and movie trailers. Last week, Microsoft sent a major update to Xbox 360 consoles that now allows users to now stream video from a PC or portable device (note: their handheld Zune device has wireless capabilities built-in) — previously, only users with Windows XP Media Center Edition installed could stream video to the Xbox 360.
Last week, Microsoft launched the website for their handheld digital music/video player Zune, which comes out next week (November 14) — Microsoft is taking on Apple’s iPod with their Zune device. And less than 2 weeks ago, Microsoft launched the latest version of their Windows Media Player (WMP), version 11, which takes over for Windows Media Connect and allows users to manage connections for sharing media (between PC, Xbox 360, Zune) within the new WMP player. One shocker is that Zune is not using Microsoft’s own “PlaysForSure” framework that other digital music etailers and manufacturers embraced (Napster, Musicmatch, Wal-Mart, URGE, MSN, FYE, etc) since Apple has not let etailers sell to iPod owners (due to Apple’s proprietary DRM, which DVD Jon recently cracked) and Apple has not let other manufacturers make devices that can work with iTunes-purchased media. Zune will be proprietary as well (like the iPod) and won’t be allowing etailers to get their media on it — Zune will not support PlaysForSure.
Since September, Apple has been selling movies online via iTunes, which iTunes at the time had 40-60 million copies of their software installed on user machines. Less than a week after launch, Apple announced $1mm in digital movie sales (125k purchases).
What does all of this mean? Microsoft has a serious strategy to dominate digital entertainment. Microsoft already has a very successful gaming console (Xbox 360) that allows users to play games, watch movies, buy movies, buy TV shows, stream video from their computer, stream music from their computer, and I’m sure buying music from URGE is in the gameplan — not to mention the social networking features that allow Xbox 360 users (and maybe Zune users, considering the wi-fi built-in?) to chat with each other in games, send messages to each other, add users to their friends list, etc.
The other device that has entered millions of homes over the years is the DVR. Microsoft has already been using DVR-related technology in their Windows XP Media Center Edition 2005 operating system (OS). In fact, if you own this OS, you can login to Microsoft’s online TV listing guide and setup their MSN Remote Record service, which then allows you to browse TV listings from any computer and click a button that will set a TV program to record to your home PC. I’d guess that in the future, there will be an accessory for my Xbox 360 that plugs into one of the Xbox 360 USB ports, hooking my cable TV into my Xbox 360, and allowing me to easily record TV shows to my Xbox 360 (note to self: short TIVO).
Apple may have millions of users using iTunes and millions of owners of iPods, but they lack a gaming console (which PriceWaterhouseCoopers predicts the gaming market will be $54.6 billion by 2009), they lack a DVR unit, and they won’t let manufacturers and etailers sell to their users. Currently, Apple’s strategy for getting into your living room is the anticipated iTV, which is rumored to be a set-top box for your TV and will allow you to stream movies, TV shows, and music from your iTunes software. Apple is also planning to sell basic games through iTunes, which iPod owners will be able to play. Could there be a gaming console (Nintendo WII? Sony Playstation 3?) purchase or partnership in the future for Apple? Could there be an Apple purchase of TiVo? (note to self: long TIVO)
This strategy by Microsoft is impressive and we’ll begin seeing how it all plays out over the next couple months of the holiday season — as buyers put up their money for an Apple iPod or a Microsoft Zune and/or Xbox 360.
Earlier this week, Microsoft’s Xbox 360 division announced partnerships with CBS, MTV Networks, Paramount Pictures, Turner Broadcasting, UFC and Warner Bros. Home Entertainment to “Digitally Deliver TV Shows and Movies to Gamers.” This is Microsoft’s first move into digital movie and TV show sales — and is also another move towards turning their Xbox gaming system into a full-fledged digital entertainment system (note: they want to become the center of your living room). These digital movie and TV show partnerships for their Xbox 360 unit, will likely turn into sales through their future digital media sales service Zune.com and playback on their upcoming handheld Zune device. Xbox 360 up until this announcement has only let users download select music videos and movie trailers. Last week, Microsoft sent a major update to Xbox 360 consoles that now allows users to now stream video from a PC or portable device (note: their handheld Zune device has wireless capabilities built-in) — previously, only users with Windows XP Media Center Edition installed could stream video to the Xbox 360.
Last week, Microsoft launched the website for their handheld digital music/video player Zune, which comes out next week (November 14) — Microsoft is taking on Apple’s iPod with their Zune device. And less than 2 weeks ago, Microsoft launched the latest version of their Windows Media Player (WMP), version 11, which takes over for Windows Media Connect and allows users to manage connections for sharing media (between PC, Xbox 360, Zune) within the new WMP player. One shocker is that Zune is not using Microsoft’s own “PlaysForSure” framework that other digital music etailers and manufacturers embraced (Napster, Musicmatch, Wal-Mart, URGE, MSN, FYE, etc) since Apple has not let etailers sell to iPod owners (due to Apple’s proprietary DRM, which DVD Jon recently cracked) and Apple has not let other manufacturers make devices that can work with iTunes-purchased media. Zune will be proprietary as well (like the iPod) and won’t be allowing etailers to get their media on it — Zune will not support PlaysForSure.
Since September, Apple has been selling movies online via iTunes, which iTunes at the time had 40-60 million copies of their software installed on user machines. Less than a week after launch, Apple announced $1mm in digital movie sales (125k purchases).
What does all of this mean? Microsoft has a serious strategy to dominate digital entertainment. Microsoft already has a very successful gaming console (Xbox 360) that allows users to play games, watch movies, buy movies, buy TV shows, stream video from their computer, stream music from their computer, and I’m sure buying music from URGE is in the gameplan — not to mention the social networking features that allow Xbox 360 users (and maybe Zune users, considering the wi-fi built-in?) to chat with each other in games, send messages to each other, add users to their friends list, etc.
The other device that has entered millions of homes over the years is the DVR. Microsoft has already been using DVR-related technology in their Windows XP Media Center Edition 2005 operating system (OS). In fact, if you own this OS, you can login to Microsoft’s online TV listing guide and setup their MSN Remote Record service, which then allows you to browse TV listings from any computer and click a button that will set a TV program to record to your home PC. I’d guess that in the future, there will be an accessory for my Xbox 360 that plugs into one of the Xbox 360 USB ports, hooking my cable TV into my Xbox 360, and allowing me to easily record TV shows to my Xbox 360 (note to self: short TIVO).
Apple may have millions of users using iTunes and millions of owners of iPods, but they lack a gaming console (which PriceWaterhouseCoopers predicts the gaming market will be $54.6 billion by 2009), they lack a DVR unit, and they won’t let manufacturers and etailers sell to their users. Currently, Apple’s strategy for getting into your living room is the anticipated iTV, which is rumored to be a set-top box for your TV and will allow you to stream movies, TV shows, and music from your iTunes software. Apple is also planning to sell basic games through iTunes, which iPod owners will be able to play. Could there be a gaming console (Nintendo WII? Sony Playstation 3?) purchase or partnership in the future for Apple? Could there be an Apple purchase of TiVo? (note to self: long TIVO)
This strategy by Microsoft is impressive and we’ll begin seeing how it all plays out over the next couple months of the holiday season — as buyers put up their money for an Apple iPod or a Microsoft Zune and/or Xbox 360.
Verizon, YouTube Deal
Verizon, YouTube Aim
To Bring Web Videos
To Cellphones, TV
By AMOL SHARMA and KEVIN J. DELANEY
November 7, 2006; Page A1
Verizon Communications Inc. is in advanced talks with YouTube Inc. to bring the popular Web site's videos to cellphones and television sets, in what would be a landmark link-up between telecom and Internet video.
An agreement would allow Verizon's customers to view some of the most avidly watched entertainment on the Internet. That could advance the long-expected convergence of video and cellphones. It could also, at least temporarily, give Verizon a marketing edge over its rivals in the wireless and cable industries, furthering the company's efforts to expand into Internet and entertainment services.
Under the terms being discussed, customers of Verizon Wireless -- Verizon's joint venture with Vodafone Group PLC -- would be able to view some YouTube videos on their cellphones through the carrier's premium V Cast service, people familiar with the matter said. Verizon Wireless, like other cellular providers, has been adding video and data services to offset declining revenue from its calling plans.
Verizon also would offer YouTube videos as an on-demand feature of a TV service it is launching throughout the nation. The company paved the way for the launch with a massive upgrade of its network that is expected to cost $18 billion through 2010.
A deal with YouTube, which could be finalized within weeks, would give Verizon the chance to showcase its new network, which runs on fiber-optic lines all the way to subscribers' homes and has more capacity than the networks of competing cable operators. It could also give Verizon the exclusive right to carry YouTube videos for a limited period of time, one person with knowledge of the discussions said. The talks, however, could still fall through.
Though many cellphones provide Internet access, it is difficult for cellphone users to watch video on the Web, in part because it typically isn't formatted for cellphone screens. But cellular operators such as Verizon Wireless have the technology to bring video, music and other entertainment options to those screens. And their millions of subscribers make them attractive to digital-entertainment companies like YouTube, which are looking to extend their reach beyond personal computers.
YouTube, which has agreed to be acquired by Internet giant Google Inc. for $1.65 billion, is expected to seek similar deals with other big cellular operators -- such as Sprint Nextel Corp. and Cingular Wireless, a joint venture of AT&T Inc. and BellSouth Corp. -- to get the widest possible distribution for its content.
A spokeswoman for YouTube declined to comment on whether the company is in discussions with telecommunications carriers.
YouTube rose to Internet stardom by offering a wide variety of videos submitted by its users. They range from home videos to clips recorded from TV, such as music videos and soccer highlights. Users watch videos more than 100 million times daily on the site.
It remains to be seen whether YouTube's online success can translate to TV sets and cellphones. For one thing, the quality of the many homemade videos it carries is generally lower than what viewers expect on their TV sets. And consumers have yet to take to video on cellphones in large numbers.
Chad Hurley, YouTube's chief executive and co-founder, told an advertising conference last week that he sees a huge market in mobile services. The company has already launched a service that allows cellphone users to upload videos from some handsets to the YouTube site, but the clips can be watched only on a PC. The proposed Verizon deal would give cellphone customers an easy way to access YouTube videos while on the move.
The talks between Verizon and YouTube come at a time when a wide range of media and advertising companies are racing to figure out how to cash in on the skyrocketing popularity of Internet entertainment. Comcast Corp., the nation's largest cable operator, also has had talks with YouTube but has opted instead to create its own video-sharing site that will have ties to its video-on-demand service on TV.
Verizon Wireless, like other cellular carriers, is marketing new data services such as ringtones, songs, games and videos as its revenues from voice services decline. YouTube videos could give Verizon's business a boost by encouraging more subscribers to sign up for its V Cast service, which costs an additional $15 a month.
Verizon already offers video clips from major media companies and networks such as MTV, ESPN, and ABC News, but a YouTube deal would be its first with a company whose videos appear only on the Internet. Among the many clips Verizon was offering yesterday was a short CBS News piece on President Bush's last-minute campaigning before today's midterm elections. Rivals Sprint and Cingular have even broader offerings, including live TV.
Under the terms being discussed, Verizon Wireless cellphone users would be able to access about 50 to 100 of the most popular videos on the YouTube Web site at any given time, people familiar with the matter said. Initially, Verizon cellphone users wouldn't be able to post material of their own to the V Cast service but, by the end of the year, they would probably be able to upload video shot with a Verizon camera phone, a person with knowledge of the plan says.
As part of the proposed deal, Verizon, starting next year, would allow users to view YouTube videos on demand through its new TV service. Users would likely be able to buy access to the top YouTube videos of the day for a small fee, with the revenue shared between the two companies.
Verizon is offering TV as part of its effort to compete with cable companies in selling consumers bundles of home phone, Internet and television services. At the end of the third quarter, Verizon said it had 522,000 customers for its fiber-based Internet service and 118,000 TV customers.
Up until now, Verizon's TV service hasn't varied significantly from digital cable service, offering roughly the same slate of the most popular channels as well as movies and video on demand. A deal with YouTube would give the phone giant an opportunity to distinguish itself from cable, especially with viewers in their teens and twenties who are YouTube's biggest fans.
Verizon rival Comcast has decided to go it alone with its own video Web site, ziddio.com, which became accessible to the public in a trial phase yesterday. Ziddio solicits videos from users which, if they are deemed good enough, will show up on Comcast's video-on-demand service or traditional cable networks. Today, for example, the site is promoting contests for videos about Jedi warriors and messy houses. The best videos will be available on demand when Ziddio is officially launched, probably before the end of the year. Comcast also hasn't ruled out the possibility of doing a deal with an Internet company like YouTube or Revver Inc.
The Verizon discussions with YouTube suggest there are some areas where it makes sense for the large telecom carriers and Internet companies to work together. Until now, the giant cellular providers sometimes have been reluctant to cooperate with companies like Google and Yahoo Inc. Providers such as Verizon, Cingular, and T-Mobile USA generally have opted to work with small start-ups like Medio Systems Inc. and JumpTap Inc. when integrating search features into their handsets, rather than work with the Internet powerhouses, who have demanded a larger share of revenue from mobile search-based advertising.
Landline phone companies, meanwhile, have chafed at the fact that they get no slice of the massive profits that Google and other Internet companies generate on the Internet, despite the fact that their lines provide the Internet connections customers need to use those services. Telecom industry observers have mused for several months about the possibility that AT&T and Verizon might begin charging Internet companies and online video providers a special fee to guarantee priority treatment of their traffic on the Internet, an arrangement opponents say would violate principles of "net neutrality."
The dynamic of the Verizon deal would be very different, however: The carrier would be harnessing YouTube's Internet brand to promote its own FiOS TV services, treating the Web site as a partner rather than a competitor. If any money changes hands in the deal, it is likely Verizon will be paying YouTube, a person familiar with the matter said.
Verizon was hesitant about doing a deal because of legal concerns surrounding YouTube's content. In some cases, users of the video-sharing site have uploaded copyrighted material without the permission of the music labels and media companies that own the rights. The company already faces a copyright-infringement suit filed in July in U.S. District Court by Los Angeles News Service owner Robert Tur over several videos he alleges appeared on the site without his permission. YouTube has said Mr. Tur's suit is "without merit."
YouTube says it removes copyrighted videos when requested by their owners, which it says protects it from liability. At least partly to help insulate itself from lawsuits, the Web site has signed content licensing agreements with some media and entertainment companies, including Vivendi SA's Universal Music Group, Warner Music Group Corp., Sony BMG and CBS Corp.
To Bring Web Videos
To Cellphones, TV
By AMOL SHARMA and KEVIN J. DELANEY
November 7, 2006; Page A1
Verizon Communications Inc. is in advanced talks with YouTube Inc. to bring the popular Web site's videos to cellphones and television sets, in what would be a landmark link-up between telecom and Internet video.
An agreement would allow Verizon's customers to view some of the most avidly watched entertainment on the Internet. That could advance the long-expected convergence of video and cellphones. It could also, at least temporarily, give Verizon a marketing edge over its rivals in the wireless and cable industries, furthering the company's efforts to expand into Internet and entertainment services.
Under the terms being discussed, customers of Verizon Wireless -- Verizon's joint venture with Vodafone Group PLC -- would be able to view some YouTube videos on their cellphones through the carrier's premium V Cast service, people familiar with the matter said. Verizon Wireless, like other cellular providers, has been adding video and data services to offset declining revenue from its calling plans.
Verizon also would offer YouTube videos as an on-demand feature of a TV service it is launching throughout the nation. The company paved the way for the launch with a massive upgrade of its network that is expected to cost $18 billion through 2010.
A deal with YouTube, which could be finalized within weeks, would give Verizon the chance to showcase its new network, which runs on fiber-optic lines all the way to subscribers' homes and has more capacity than the networks of competing cable operators. It could also give Verizon the exclusive right to carry YouTube videos for a limited period of time, one person with knowledge of the discussions said. The talks, however, could still fall through.
Though many cellphones provide Internet access, it is difficult for cellphone users to watch video on the Web, in part because it typically isn't formatted for cellphone screens. But cellular operators such as Verizon Wireless have the technology to bring video, music and other entertainment options to those screens. And their millions of subscribers make them attractive to digital-entertainment companies like YouTube, which are looking to extend their reach beyond personal computers.
YouTube, which has agreed to be acquired by Internet giant Google Inc. for $1.65 billion, is expected to seek similar deals with other big cellular operators -- such as Sprint Nextel Corp. and Cingular Wireless, a joint venture of AT&T Inc. and BellSouth Corp. -- to get the widest possible distribution for its content.
A spokeswoman for YouTube declined to comment on whether the company is in discussions with telecommunications carriers.
YouTube rose to Internet stardom by offering a wide variety of videos submitted by its users. They range from home videos to clips recorded from TV, such as music videos and soccer highlights. Users watch videos more than 100 million times daily on the site.
It remains to be seen whether YouTube's online success can translate to TV sets and cellphones. For one thing, the quality of the many homemade videos it carries is generally lower than what viewers expect on their TV sets. And consumers have yet to take to video on cellphones in large numbers.
Chad Hurley, YouTube's chief executive and co-founder, told an advertising conference last week that he sees a huge market in mobile services. The company has already launched a service that allows cellphone users to upload videos from some handsets to the YouTube site, but the clips can be watched only on a PC. The proposed Verizon deal would give cellphone customers an easy way to access YouTube videos while on the move.
The talks between Verizon and YouTube come at a time when a wide range of media and advertising companies are racing to figure out how to cash in on the skyrocketing popularity of Internet entertainment. Comcast Corp., the nation's largest cable operator, also has had talks with YouTube but has opted instead to create its own video-sharing site that will have ties to its video-on-demand service on TV.
Verizon Wireless, like other cellular carriers, is marketing new data services such as ringtones, songs, games and videos as its revenues from voice services decline. YouTube videos could give Verizon's business a boost by encouraging more subscribers to sign up for its V Cast service, which costs an additional $15 a month.
Verizon already offers video clips from major media companies and networks such as MTV, ESPN, and ABC News, but a YouTube deal would be its first with a company whose videos appear only on the Internet. Among the many clips Verizon was offering yesterday was a short CBS News piece on President Bush's last-minute campaigning before today's midterm elections. Rivals Sprint and Cingular have even broader offerings, including live TV.
Under the terms being discussed, Verizon Wireless cellphone users would be able to access about 50 to 100 of the most popular videos on the YouTube Web site at any given time, people familiar with the matter said. Initially, Verizon cellphone users wouldn't be able to post material of their own to the V Cast service but, by the end of the year, they would probably be able to upload video shot with a Verizon camera phone, a person with knowledge of the plan says.
As part of the proposed deal, Verizon, starting next year, would allow users to view YouTube videos on demand through its new TV service. Users would likely be able to buy access to the top YouTube videos of the day for a small fee, with the revenue shared between the two companies.
Verizon is offering TV as part of its effort to compete with cable companies in selling consumers bundles of home phone, Internet and television services. At the end of the third quarter, Verizon said it had 522,000 customers for its fiber-based Internet service and 118,000 TV customers.
Up until now, Verizon's TV service hasn't varied significantly from digital cable service, offering roughly the same slate of the most popular channels as well as movies and video on demand. A deal with YouTube would give the phone giant an opportunity to distinguish itself from cable, especially with viewers in their teens and twenties who are YouTube's biggest fans.
Verizon rival Comcast has decided to go it alone with its own video Web site, ziddio.com, which became accessible to the public in a trial phase yesterday. Ziddio solicits videos from users which, if they are deemed good enough, will show up on Comcast's video-on-demand service or traditional cable networks. Today, for example, the site is promoting contests for videos about Jedi warriors and messy houses. The best videos will be available on demand when Ziddio is officially launched, probably before the end of the year. Comcast also hasn't ruled out the possibility of doing a deal with an Internet company like YouTube or Revver Inc.
The Verizon discussions with YouTube suggest there are some areas where it makes sense for the large telecom carriers and Internet companies to work together. Until now, the giant cellular providers sometimes have been reluctant to cooperate with companies like Google and Yahoo Inc. Providers such as Verizon, Cingular, and T-Mobile USA generally have opted to work with small start-ups like Medio Systems Inc. and JumpTap Inc. when integrating search features into their handsets, rather than work with the Internet powerhouses, who have demanded a larger share of revenue from mobile search-based advertising.
Landline phone companies, meanwhile, have chafed at the fact that they get no slice of the massive profits that Google and other Internet companies generate on the Internet, despite the fact that their lines provide the Internet connections customers need to use those services. Telecom industry observers have mused for several months about the possibility that AT&T and Verizon might begin charging Internet companies and online video providers a special fee to guarantee priority treatment of their traffic on the Internet, an arrangement opponents say would violate principles of "net neutrality."
The dynamic of the Verizon deal would be very different, however: The carrier would be harnessing YouTube's Internet brand to promote its own FiOS TV services, treating the Web site as a partner rather than a competitor. If any money changes hands in the deal, it is likely Verizon will be paying YouTube, a person familiar with the matter said.
Verizon was hesitant about doing a deal because of legal concerns surrounding YouTube's content. In some cases, users of the video-sharing site have uploaded copyrighted material without the permission of the music labels and media companies that own the rights. The company already faces a copyright-infringement suit filed in July in U.S. District Court by Los Angeles News Service owner Robert Tur over several videos he alleges appeared on the site without his permission. YouTube has said Mr. Tur's suit is "without merit."
YouTube says it removes copyrighted videos when requested by their owners, which it says protects it from liability. At least partly to help insulate itself from lawsuits, the Web site has signed content licensing agreements with some media and entertainment companies, including Vivendi SA's Universal Music Group, Warner Music Group Corp., Sony BMG and CBS Corp.
Microsoft, Universal Music Strike Licensing Deal for Zune Service
Microsoft, Universal Music Strike
Licensing Deal for Zune Service
Associated Press
November 9, 2006 10:35 a.m.
LOS ANGELES -- Microsoft Corp. and Universal Music Group say they have struck a licensing deal for the software company's new Zune portable music player and digital music store that calls for the recording company to get paid a cut of the sales of the device.
Executives at both companies declined to disclose the financial terms of the deal, which is expected to be officially announced early Thursday.
Redmond-based Microsoft is pursuing similar agreements with other major record labels, Chris Stephenson, general manager of global marketing for Microsoft Entertainment, said late Wednesday.
MOSSBERG REVIEWS THE ZUNE
Walt Mossberg says Zune, the upcoming MP3 player from Microsoft, has some attractive features but overall doesn't outshine Apple's iPod.
• Microsoft's Zune Challenges iPod
Zune, which is scheduled to be released Nov. 14, is Microsoft's attempt to compete with Apple Computer Inc.'s market-leading iPod player and iTunes music service. The device, which will sell for $249.99, lets people share songs, playlists or pictures over a wireless connection with nearby Zune users.
By paying record labels a portion of Zune player sales, Microsoft hopes to have more freedom to allow song-sharing or other promotions, Mr. Stephenson said. "There's certain marketing elements that we're looking at going forward, all based around the sharing and wireless scenarios," he said. He declined to provide specifics.
But in an interview late Wednesday, Universal Music Group Chairman and CEO Doug Morris said that the wireless song-sharing feature of the Zune player wasn't a major factor behind the company seeking a revenue sharing deal on the player.
"The only factor was that we feel that there's a great deal of music that's [stored] on these devices that was never legitimately obtained, and we wanted to get some sort of compensation for what we thought we're losing," Mr. Morris said. "I want our artists to be paid for the music that makes these devices popular."
While sales of digital tracks have increased in recent years amid lagging sales of CDs, record labels lament that much of the music that winds up on iPods and other digital players comes from either CDs fans already own or tracks culled from online file-sharing services. Apple does not give a cut of sales of iPods to music companies. It only pays labels for songs sold on its iTunes download store.
Earlier this year, Universal and other major recording companies settled a dispute with Sirius Satellite Radio Inc. over its Sirius S50 portable music player by reaching a deal that called for Sirius to pay the record companies a fee for every S50 it sells.
Universal sought a similar approach when Microsoft came calling the recording company to hash out a licensing deal for its Zune online music store. Absent a deal with Universal, Microsoft faced the prospect of unveiling Zune without content from the world's biggest recording company, home to artists such as U2, Eminem and Shania Twain.
Mr. Morris said the agreement with Microsoft marks a turning point in how the company will approach similar deals in the future. "I don't want any business built on our music without getting paid a part of the business," he said.
Mr. Morris declined to say what percentage of each Zune sold will be paid to Universal Music, but said "it's good." Under the terms of the deal, Universal will split the money it gets from Zune player sales with its artists. Mr. Morris declined to say how much artists will be paid.
Licensing Deal for Zune Service
Associated Press
November 9, 2006 10:35 a.m.
LOS ANGELES -- Microsoft Corp. and Universal Music Group say they have struck a licensing deal for the software company's new Zune portable music player and digital music store that calls for the recording company to get paid a cut of the sales of the device.
Executives at both companies declined to disclose the financial terms of the deal, which is expected to be officially announced early Thursday.
Redmond-based Microsoft is pursuing similar agreements with other major record labels, Chris Stephenson, general manager of global marketing for Microsoft Entertainment, said late Wednesday.
MOSSBERG REVIEWS THE ZUNE
Walt Mossberg says Zune, the upcoming MP3 player from Microsoft, has some attractive features but overall doesn't outshine Apple's iPod.
• Microsoft's Zune Challenges iPod
Zune, which is scheduled to be released Nov. 14, is Microsoft's attempt to compete with Apple Computer Inc.'s market-leading iPod player and iTunes music service. The device, which will sell for $249.99, lets people share songs, playlists or pictures over a wireless connection with nearby Zune users.
By paying record labels a portion of Zune player sales, Microsoft hopes to have more freedom to allow song-sharing or other promotions, Mr. Stephenson said. "There's certain marketing elements that we're looking at going forward, all based around the sharing and wireless scenarios," he said. He declined to provide specifics.
But in an interview late Wednesday, Universal Music Group Chairman and CEO Doug Morris said that the wireless song-sharing feature of the Zune player wasn't a major factor behind the company seeking a revenue sharing deal on the player.
"The only factor was that we feel that there's a great deal of music that's [stored] on these devices that was never legitimately obtained, and we wanted to get some sort of compensation for what we thought we're losing," Mr. Morris said. "I want our artists to be paid for the music that makes these devices popular."
While sales of digital tracks have increased in recent years amid lagging sales of CDs, record labels lament that much of the music that winds up on iPods and other digital players comes from either CDs fans already own or tracks culled from online file-sharing services. Apple does not give a cut of sales of iPods to music companies. It only pays labels for songs sold on its iTunes download store.
Earlier this year, Universal and other major recording companies settled a dispute with Sirius Satellite Radio Inc. over its Sirius S50 portable music player by reaching a deal that called for Sirius to pay the record companies a fee for every S50 it sells.
Universal sought a similar approach when Microsoft came calling the recording company to hash out a licensing deal for its Zune online music store. Absent a deal with Universal, Microsoft faced the prospect of unveiling Zune without content from the world's biggest recording company, home to artists such as U2, Eminem and Shania Twain.
Mr. Morris said the agreement with Microsoft marks a turning point in how the company will approach similar deals in the future. "I don't want any business built on our music without getting paid a part of the business," he said.
Mr. Morris declined to say what percentage of each Zune sold will be paid to Universal Music, but said "it's good." Under the terms of the deal, Universal will split the money it gets from Zune player sales with its artists. Mr. Morris declined to say how much artists will be paid.
10.11.2006
9.29.2006
Yahoo! and Terry Semel's long pause
While Google and small internet firms race ahead, Yahoo! seems to be standing still
“NOW let's just pause for a second.” It is the fourth pause for thought that Terry Semel, chairman and chief executive of Yahoo!, has requested in about ten minutes. He is trying to marshal various arguments to prove that his firm, the world's largest internet company by visitors to its website, has a coherent and winning strategy compared with Google, a phenomenally successful search engine. With only slightly bigger revenues, Google has three and a half times the market value of Yahoo!. Twice in three months Wall Street has dumped the shares of Yahoo! and widened the gap (see chart).
The first sell-off, in July, came after Mr Semel announced that Panama, an ambitious project to improve Yahoo!'s technology so that it can make more money on each of its users' searches, would be delayed until the end of this year. Yes, agrees Mr Semel, it was supposed to be released a quarter earlier, but this sort of market reaction was silly. Unlike Google, which has a habit of releasing sloppy brainstorms in test versions called “beta”, he says, Yahoo! wants to launch a fully functional product, and therefore had to be cautious—and since the financial benefits will come next year, why should the stockmarket get into such a tizzy?
The second sell-off happened last week, when Mr Semel warned investors at a conference hosted by Goldman Sachs that growth in online advertising was not quite what he had hoped. Quarterly earnings would be on the low side of his previous estimates. In particular, Mr Semel noted slower growth in demand from carmakers and banks—Yahoo!'s biggest customers—for graphical advertisements, the category in which it outsells all its rivals. “Let's pause for a second,” he says again. “We still expect to outgrow the segment in 2006. This is not about a tragedy or disaster; it's just pointing out something that we had seen.”
Part of the problem for Yahoo!, however, is that nobody else appears to be seeing a slowdown. This week the Interactive Advertising Bureau and PricewaterhouseCoopers, a consultancy, jointly released the latest industry numbers, which show that online advertising in America grew by 37% to $7.9 billion, a new record, in the first half of the year. Another firm that tracks online advertising, eMarketer, cut its forecasts, but that was in response to Mr Semel's statement. Jim Lanzone, the boss of Ask.com, the fourth-largest search engine after Google, Yahoo! and Microsoft's MSN, says that his firm is not seeing any similar easing of demand.
The deeper problem, says Henry Blodget, founder of Cherry Hill Research, a consultancy, is that Yahoo! is still suffering from a “colossal error” it made in the late 1990s. At that time, it already wanted to become a portal, or a gateway to content on the web, but thought that search would be at most a feature, not a business in its own right. This allowed Google to dominate the category. “By the time Yahoo! realised its mistake about three years ago it was too late,” says Mr Blodget. Google's share of search queries has been growing, and the enormous profits from this product allow Google to invest more than Yahoo! does.
Mr Semel counters that Google's gains in search have not come at the expense of Yahoo!, which has been a steady number two. MSN has been the primary loser. Panama will help. And there are differences between Yahoo! and Google which favour his company. For advertisers, the difference is supposed to be that Yahoo! is more of an all-round online media company, selling the full gamut of advertising, from pay-per-click text snippets on search pages to interactive banners, whereas Google sells almost exclusively pay-per-click advertisements. As such, Yahoo! benefits from its huge leads in web-mail and finance and general news, where Google is a tiny, niche competitor.
For consumers, the difference is supposed to be that Yahoo! is about human beings, whereas Google is about soulless machines and algorithms. So Yahoo! has bought several young firms such as Flickr, a photo-sharing site, and Del.icio.us, a bookmark-sharing site, which both allow users to “tag” the pictures and web pages they encounter, and pass them on to each other. There is Yahoo! Answers, where users can ask real questions and other users respond. Yahoo! started the service nine months ago, and it now has more than 50m users in 20 countries. Yahoo! has fared less well with its social-networking site, Yahoo! 360, and is now negotiating to buy Facebook, a networking site used by many American college students.
But none of these is a solid answer to Yahoo!'s woes. The “tagging” that Flickr and Del.icio.us offer is still far from the mainstream, and are mostly used by hard-core technology geeks. Yahoo! Answers is growing, but arguably full of rubbish. “What is the sexiest food?” is a typical recent question. Answers range from “bacon, mmmmm” to “a pickle” and “anything with a beautiful woman sitting across from it.”
And Yahoo!'s efforts to buy Facebook may illustrate the older firm's shortcomings as much as its market power. Yahoo! was originally interested in MySpace, the biggest social network, but lost it to News Corporation, a media conglomerate. It also wanted to buy AOL, a web portal owned by Time Warner, another media company, but Google swooped in. Yahoo! again lost to Google when the latter won a deal to supply the advertising on MySpace, and then to Microsoft when it struck a deal to deliver advertising on Facebook. Now Yahoo! looks rather desperate, and will have to pay an enormous price for Facebook, a fast-growing company which many big firms have considered buying.
“Days go by and deals go away,” says an outside adviser to Yahoo! who has sat in on executive meetings. The firm has a “relatively constipated process of reviewing anything,” he says. It is slow and cumbersome and “not an entrepreneurial culture” because Mr Semel is a “low-risk, non-confrontational guy”, says this adviser. He recalls a meeting at which an engineer asked: how long do we take from idea to execution? Several people scrawled on the whiteboard and agreed on an answer of eight months.
None of this means that Yahoo! is in dire trouble. If it turns out to be true that online advertising is growing more slowly as a whole, Google and all other internet firms will feel it sooner or later. Christopher Sherman, executive editor of SearchEngineWatch, an online newsletter, says he doesn't think that Yahoo! has lost its way. But “we're past the days of radical innovation where somebody is really going to blow past a competitor.” Yahoo! will have to content itself with a position as the internet's number two, at best.
“NOW let's just pause for a second.” It is the fourth pause for thought that Terry Semel, chairman and chief executive of Yahoo!, has requested in about ten minutes. He is trying to marshal various arguments to prove that his firm, the world's largest internet company by visitors to its website, has a coherent and winning strategy compared with Google, a phenomenally successful search engine. With only slightly bigger revenues, Google has three and a half times the market value of Yahoo!. Twice in three months Wall Street has dumped the shares of Yahoo! and widened the gap (see chart).
The first sell-off, in July, came after Mr Semel announced that Panama, an ambitious project to improve Yahoo!'s technology so that it can make more money on each of its users' searches, would be delayed until the end of this year. Yes, agrees Mr Semel, it was supposed to be released a quarter earlier, but this sort of market reaction was silly. Unlike Google, which has a habit of releasing sloppy brainstorms in test versions called “beta”, he says, Yahoo! wants to launch a fully functional product, and therefore had to be cautious—and since the financial benefits will come next year, why should the stockmarket get into such a tizzy?
The second sell-off happened last week, when Mr Semel warned investors at a conference hosted by Goldman Sachs that growth in online advertising was not quite what he had hoped. Quarterly earnings would be on the low side of his previous estimates. In particular, Mr Semel noted slower growth in demand from carmakers and banks—Yahoo!'s biggest customers—for graphical advertisements, the category in which it outsells all its rivals. “Let's pause for a second,” he says again. “We still expect to outgrow the segment in 2006. This is not about a tragedy or disaster; it's just pointing out something that we had seen.”
Part of the problem for Yahoo!, however, is that nobody else appears to be seeing a slowdown. This week the Interactive Advertising Bureau and PricewaterhouseCoopers, a consultancy, jointly released the latest industry numbers, which show that online advertising in America grew by 37% to $7.9 billion, a new record, in the first half of the year. Another firm that tracks online advertising, eMarketer, cut its forecasts, but that was in response to Mr Semel's statement. Jim Lanzone, the boss of Ask.com, the fourth-largest search engine after Google, Yahoo! and Microsoft's MSN, says that his firm is not seeing any similar easing of demand.
The deeper problem, says Henry Blodget, founder of Cherry Hill Research, a consultancy, is that Yahoo! is still suffering from a “colossal error” it made in the late 1990s. At that time, it already wanted to become a portal, or a gateway to content on the web, but thought that search would be at most a feature, not a business in its own right. This allowed Google to dominate the category. “By the time Yahoo! realised its mistake about three years ago it was too late,” says Mr Blodget. Google's share of search queries has been growing, and the enormous profits from this product allow Google to invest more than Yahoo! does.
Mr Semel counters that Google's gains in search have not come at the expense of Yahoo!, which has been a steady number two. MSN has been the primary loser. Panama will help. And there are differences between Yahoo! and Google which favour his company. For advertisers, the difference is supposed to be that Yahoo! is more of an all-round online media company, selling the full gamut of advertising, from pay-per-click text snippets on search pages to interactive banners, whereas Google sells almost exclusively pay-per-click advertisements. As such, Yahoo! benefits from its huge leads in web-mail and finance and general news, where Google is a tiny, niche competitor.
For consumers, the difference is supposed to be that Yahoo! is about human beings, whereas Google is about soulless machines and algorithms. So Yahoo! has bought several young firms such as Flickr, a photo-sharing site, and Del.icio.us, a bookmark-sharing site, which both allow users to “tag” the pictures and web pages they encounter, and pass them on to each other. There is Yahoo! Answers, where users can ask real questions and other users respond. Yahoo! started the service nine months ago, and it now has more than 50m users in 20 countries. Yahoo! has fared less well with its social-networking site, Yahoo! 360, and is now negotiating to buy Facebook, a networking site used by many American college students.
But none of these is a solid answer to Yahoo!'s woes. The “tagging” that Flickr and Del.icio.us offer is still far from the mainstream, and are mostly used by hard-core technology geeks. Yahoo! Answers is growing, but arguably full of rubbish. “What is the sexiest food?” is a typical recent question. Answers range from “bacon, mmmmm” to “a pickle” and “anything with a beautiful woman sitting across from it.”
And Yahoo!'s efforts to buy Facebook may illustrate the older firm's shortcomings as much as its market power. Yahoo! was originally interested in MySpace, the biggest social network, but lost it to News Corporation, a media conglomerate. It also wanted to buy AOL, a web portal owned by Time Warner, another media company, but Google swooped in. Yahoo! again lost to Google when the latter won a deal to supply the advertising on MySpace, and then to Microsoft when it struck a deal to deliver advertising on Facebook. Now Yahoo! looks rather desperate, and will have to pay an enormous price for Facebook, a fast-growing company which many big firms have considered buying.
“Days go by and deals go away,” says an outside adviser to Yahoo! who has sat in on executive meetings. The firm has a “relatively constipated process of reviewing anything,” he says. It is slow and cumbersome and “not an entrepreneurial culture” because Mr Semel is a “low-risk, non-confrontational guy”, says this adviser. He recalls a meeting at which an engineer asked: how long do we take from idea to execution? Several people scrawled on the whiteboard and agreed on an answer of eight months.
None of this means that Yahoo! is in dire trouble. If it turns out to be true that online advertising is growing more slowly as a whole, Google and all other internet firms will feel it sooner or later. Christopher Sherman, executive editor of SearchEngineWatch, an online newsletter, says he doesn't think that Yahoo! has lost its way. But “we're past the days of radical innovation where somebody is really going to blow past a competitor.” Yahoo! will have to content itself with a position as the internet's number two, at best.
Living a Second Life
Living a Second Life
A Californian firm has built a virtual online world like no other. Its population is growing and its economy is thriving. Now politicians and advertisers are visiting
PETER YELLOWLEES, a professor of psychiatry at the University of California, Davis, has been teaching about schizophrenia for 20 years, but says that he was never really able to explain to his students just how their patients suffer. So he went online, downloaded some free software and entered Second Life. This is a “metaverse” (ie, metaphysical universe), a three-dimensional world whose users, or “residents”, can create and be anything they want. Mr Yellowlees created hallucinations. A resident might walk through a virtual hospital ward, and a picture on the wall would suddenly flash the word “shitface”. The floor might fall away, leaving the person to walk on stepping stones above the clouds. An in-world television set would change from showing an actual speech by Bob Hawke, Australia's former prime minister, into Mr Hawke shouting, “Go and kill yourself, you wretch!” A reflection in a mirror might have bleeding eyes and die.
When Mr Yellowlees invited, as part of a trial, Second Life's public into the ward, 73% of the visitors said afterwards that it “improved [their] understanding of schizophrenia.” Mr Yellowlees then went further. For about $300 a month, he leases an island in Second Life, where he has built a clinic that looks exactly like the real one in Sacramento where many of his students practise. He gives his students “avatars”, or online personas, so they can attend his lectures inside Second Life and then experience hallucinations. “It's so powerful that some get quite upset,” says Mr Yellowlees.
Second Life, as Mr Yellowlees illustrates, is not a game. Admittedly, some residents—there were 747,263 as of late September, and the number is growing by about 20% every month—are there just for fun. They fly over islands, meander through castles and gawk at dragons. But increasing numbers use Second Life for things that are quite serious. They form support groups for cancer survivors. They rehearse responses to earthquakes and terrorist attacks. They build Buddhist retreats and meditate.
Many use it as an enhanced communications medium. Mark Warner, a former governor of Virginia who is considered a possible Democratic candidate for president in 2008, recently became the first politician to give an interview in Second Life. His avatar (also named Mark Warner) flew into a virtual town hall and sat down with Hamlet Au, a full-time reporter in Second Life. “This is my first virtual appearance,” Mr Warner joked, “I'm feeling a little disembodied.” They then proceeded to discuss Iraq and other issues as they would in real life, with 62 other avatars attending (some of them levitating), until Mr Warner disappeared in a cloud of pixels.
By emphasising creativity and communication, Second Life is different from other synthetic online worlds. Most “massively multi-player online role-playing games”, or MMORPGs (pronounced “morpegs”), offer players pre-fabricated or themed fantasy worlds. The biggest by far is “World of Warcraft”, by Blizzard Entertainment, a firm in California, which has more than 7m subscribers. These worlds are the modern, interactive, equivalents of Nordic myths and Tolkien fantasies, says Edward Castronova, a professor at Indiana University and the author of “Synthetic Worlds: The Business and Culture of Online Games”. They allow players to escape into their imaginations, and to take part by, say, joining with others to slay a monster.
Making, not slaying
Second Life, by contrast, was designed from inception for a much deeper level of participation. “Since I was a kid, I was into using computers to simulate reality,” says Philip Rosedale, the founder of Linden Lab, the San Francisco firm that launched Second Life commercially three years ago. So he set out to construct something that would allow people to “extend reality” by building a virtual version of it, a “second life” not unlike that envisioned by Neal Stephenson in “Snow Crash”, a science-fiction novel published in 1992.
Unlike other virtual worlds, which may allow players to combine artefacts found within them, Second Life provides its residents with the equivalent of atoms—small elements of virtual matter called “primitives”—so that they can build things from scratch. Cory Ondrejka, Linden Lab's product-development boss, gives the example of a piano. Using atomistic construction, a resident of Second Life might build one out of primitives, with all the colours and textures that he would like. He might add sound to the primitives representing the keys, so the piano could actually be played in Second Life. “Of course, since these are primitives, the piano could also fly or follow the resident around like a pet,” says Mr Ondrejka.
Because everything about Second Life is intended to make it an engine of creativity, Linden Lab early on decided that residents should own the intellectual property inherent in their creations. Second Life now allows creators to determine whether the stuff they conceive may be copied, modified or transferred. Thanks to these property rights, residents actively trade their creations. Of about 10m objects created, about 230,000 are bought and sold every month in the in-world currency, Linden dollars, which is exchangeable for hard currency. Linden Lab estimates that the total value (in “real” dollars) this year will be about $60m. Second Life already has about 7,000 profitable “businesses”, where avatars supplement or make their living from their in-world creativity. The top ten in-world entrepreneurs are making average profits of just over $200,000 a year.
By emphasising creativity and communication, Second Life is different from other synthetic online worldsSecond Life's total devotion to what is fashionably called “user-generated content” now places it, unlike other MMORPGs, at the centre of a trend called Web 2.0. This term usually refers to free online services delivered through a web browser—for example, social networks in which users blog and share photos. Second Life is not delivered through a web browser but through its own software, which users need to install on their computers. In other respects, however, it is now often held up as the best example of Web 2.0. “It celebrates individuality,” says Jaron Lanier, who pioneered the concept of “virtual reality” in the 1980s and is now “science adviser” at Linden Lab. And it connects people, he says, because “the act of creation is the act of being social.”
The Web 2.0 crowd also extols Second Life for its highly original business model. Most Web 2.0 firms try to build audiences around user-generated content in order to sell advertising to them. This assumes the availability of unlimited advertising dollars, a notion that is increasingly ridiculed.
Linden Lab does not sell advertising; instead it is a virtual property company. It makes money when residents lease property—an island, say—by charging an average of $20 per virtual “acre” per month. Only about 25,000 residents, or about 3% or the population, lease property, but that already amounts to 53,800 acres, which, in real life, would be bigger than Boston. This works out to monthly revenues of $1m, not counting the commissions that it takes on currency exchanges between Linden dollars and hard cash. As a private company, Linden Lab does not disclose its exact revenues, although Mr Rosedale says the firm is “close to profitability”.
A common reaction to such numbers is astonishment that anybody should pay anything at all for something that exists only in a metaphysical sense. But “there's actually no economic puzzle in this; all kinds of things derive their economic value only from the realm of the virtual,” says Indiana University's Mr Castronova. The American dollar, for instance, is virtual (aside from the value of the paper used for the bills) in that it requires consumers to have faith in its worth. In the context of online games, virtual economies much bigger than Second Life's have existed for years. Many people in poor countries, called “gold farmers”, play games such as “World of Warcraft” professionally to score weapons, points or lives to sell to lazier players in rich countries. But Second Life is unique in that residents conceive what they sell. As such, says Mr Lanier, it is “probably the only example of a self-sustained economy” on the internet.
For all these reasons—its ability to change the real lives of its residents, its innovations in technology and in its business model—Second Life has become a darling of Silicon Valley. It promises to be “disruptive”, says Mitch Kapor, the inventor of the Lotus spreadsheet that played a big role in the personal-computer revolution of the 1980s and 1990s. He is now chairman of Linden Lab. To him, Second Life is comparable to both the PC and the internet itself, which started as something “quirky” for geeks, and then entered and transformed mainstream society. “Spending part of your day in a virtual world will become commonplace” and “profoundly normal,” says Mr Kapor. Ultimately, he thinks, Second Life will “displace both desktop computing” and other two-dimensional “user interfaces”. As “a hothouse of innovation and experiment,” he says, Second Life may even “accelerate the social evolution of humanity.”
Back to this reality
It is bold and early to make such predictions. After all, Second Life is still a relatively small virtual world—only about 9,000 residents are usually logged in at any one time, for example. About two-thirds create content from scratch, but mostly they customise things that they find or browse passively. And a lot of the wares on offer are banal. Whereas a few residents choose very innovative bodies for their avatars, most have shapes, male and female, that hew to the default templates and look, predictably, like cosmetically enhanced porn stars. Among the artefacts, there is some genuine art but quite a bit of junk.
Endless possibilities: Donna Meyer, a grandmother from New York, and her avatarIs Second Life a nirvana where unknown talent can prove its creative mettle and make it in the real world? “You can create your own island and people come to it,” said Bill Joy, a co-founder of Sun Microsystems and now a prominent venture capitalist. But “I don't see any correlation between that and what it's going to take to be a designer and have a skill set to succeed in the world.”
Mr Castronova also cautions against overestimating the depth and breadth of Second Life's economy. Yes, people do create clothes and games and spacecraft in Second Life and then sell them. But most of the big money comes from the virtual equivalent of land speculation, as people lease islands, erect pretty buildings and then rent them to others at a premium. Tongue in cheek, Mr Castronova compares Second Life's in-world boom to America's house-price bubble. In artistic terms, there is not always much difference between building an in-world house and designing a personal web page.
There are also stirrings of discontent among some of the “older” (if one can use that term in a three-year-old metaverse) and more purist residents of Second Life about what they see as a menacing trend toward commercialism. One avatar, for example, has created “MetaAdverse”, a network of advertising billboards inside Second Life to which property developers can feed images of their creations. More controversially, Second Life is also attracting the attention of corporations and advertisers from the real world hoping to attract the metaverse's residents. Publishers now organise book launches and readings in Second Life. The BBC has rented an island, where it holds music festivals and parties. Sun Microsystems is preparing to hold in-world press conferences, featuring avatars of its top executives. Wells Fargo, an American bank, has built a branded “Stagecoach” island, where avatars can pull Linden dollars out of a virtual cash machine and learn about personal finance. Starwood, a hotel and resort chain, is unveiling one of its new hotels in the virtual world.
Toyota is the first carmaker to enter Second Life. It has been giving away free virtual vehicles of its Scion brand and, in October, will start selling all three Scion models. The price will be modest, says Adrian Si, the marketing manager at Toyota behind the project. Toyota really hopes that an “aftermarket” develops as avatars customise their cars and sell them on, thus spreading the brand “virally”. Toyota will be able to observe how avatars use the cars and might, conceivably, even get ideas for engineering modifications in the real world, he says.
Those Scion cars have “great driving performance for in-world physics,” says Reuben Steiger, the boss of Millions of Us, a company he founded this year to bring companies like Toyota into Second Life for marketing and brand-building. “How it corners and makes sounds when it changes gears is great.” So Toyota, which is a client of his, along with Sun Microsystems and even Mr Warner, shows that Second Life is “perfect for creating experiences around a brand,” says Mr Steiger. “We don't think that conventional advertising will be very prevalent,” he says, because it would “be badly received culturally”. Advertising in Second Life is not about “trapping people” but about captivating and stimulating them. A good campaign in Second Life costs about $200,000 dollars, he reckons, of which only a tiny part is property leases and most goes to paying the talented designers to create great virtual stuff.
Virtual strip mall?
Inevitably, this sort of thing turns some residents off. Will Second Life, that realm of individualism and pure creativity and spontaneity, get plastered over by the same mega-brands and mass culture that have, arguably, made the physical world such a homogenous place? In real life, many avatars argue, big business tends to push out small artisans. If the same happens in Second Life, the metaverse will lose its raison d'être.
Mr Rosedale, Linden Lab's founder, empathises with the concern, but thinks it is misplaced. “That is a fear which comes from the real world that is not likely to be borne out in Second Life,” he says. His arguments are all economic. In the physical world land is scarce, so big brands can buy up much of it; in Second Life, Linden Lab simply allocates more computer-processing power and makes even more islands available. The world is infinitely expandable, in other words. If one patch did become homogenous and drab, avatars would simply fly off to the next.
Another economic difference, says Mr Rosedale, is the lack of economies of scale in Second Life. In real life, a shoemaker, say, can reduce the average cost of making a pair by producing huge amounts, and the average cost of marketing by buying advertising in bulk. In Second Life, however, scale means nothing. There is no manufacturing cost to minimise. Gimmicks, such as giving away free shoes, are useless because nobody actually needs shoes at all. Nike, say, has no inherent competitive advantage over a hobbyist who likes to design shoes (or feet, paws, wings or claws) for fun. Thus, says Mr Rosedale, whereas the physical world has relatively few things that are sold in huge numbers, Second Life has huge numbers of things that are sold in relatively small quantities. In the statistical jargon, Second Life's economy trades in “the long tail” of things.
This is why, for the time being, Mr Rosedale prefers to rule Second Life with Adam Smith's “invisible hand” only. To him that means treating every resident the same, whether it happens to be Toyota or “an 80-year-old woman from India.” Both will pay the same price for their acres; what they do with it is up to them. If it ever became necessary, he adds, Linden Lab could “become a regulator and break up monopolies”, but this does not seem likely to come about.
How, then, is one to make sense of Second Life? For those new to it, it appears to be too mind-boggling to have much relevance to real life. For those who spend time inside, however, Second Life ironically tends to resemble the real world even as its obvious differences become clear. Mr Kapor, Linden Lab's chairman, is the first to agree. “People bring all their karma” into the world, he says. Alongside benevolence, there is harassment. If Second Life were ever to become truly mainstream, there is no guarantee that residents would not pollute it with racism and hatred. Perhaps crime too: residents had to reset their passwords after a recent hacking attempt.
These things may be a criticism of human nature, but it cannot be blamed on Second Life. Henry Jenkins, a professor of media studies at the Massachusetts Institute of Technology, thinks that Second Life deserves credit as “a world of hypotheticals and thought experiments.” From new approaches to corporate branding to education, Second Life is a petri dish for innovations that may help people in real life. Already, therapists are using Second Life to help autistic children, because it is a safe environment to practice giving signals to others and interpreting the ones coming back. Other organisations are using Second Life for long-distance learning. Overall, says Jaron Lanier, the veteran of virtual-reality experiments, Second Life “unquestionably has the potential to improve life outside.”
A Californian firm has built a virtual online world like no other. Its population is growing and its economy is thriving. Now politicians and advertisers are visiting
PETER YELLOWLEES, a professor of psychiatry at the University of California, Davis, has been teaching about schizophrenia for 20 years, but says that he was never really able to explain to his students just how their patients suffer. So he went online, downloaded some free software and entered Second Life. This is a “metaverse” (ie, metaphysical universe), a three-dimensional world whose users, or “residents”, can create and be anything they want. Mr Yellowlees created hallucinations. A resident might walk through a virtual hospital ward, and a picture on the wall would suddenly flash the word “shitface”. The floor might fall away, leaving the person to walk on stepping stones above the clouds. An in-world television set would change from showing an actual speech by Bob Hawke, Australia's former prime minister, into Mr Hawke shouting, “Go and kill yourself, you wretch!” A reflection in a mirror might have bleeding eyes and die.
When Mr Yellowlees invited, as part of a trial, Second Life's public into the ward, 73% of the visitors said afterwards that it “improved [their] understanding of schizophrenia.” Mr Yellowlees then went further. For about $300 a month, he leases an island in Second Life, where he has built a clinic that looks exactly like the real one in Sacramento where many of his students practise. He gives his students “avatars”, or online personas, so they can attend his lectures inside Second Life and then experience hallucinations. “It's so powerful that some get quite upset,” says Mr Yellowlees.
Second Life, as Mr Yellowlees illustrates, is not a game. Admittedly, some residents—there were 747,263 as of late September, and the number is growing by about 20% every month—are there just for fun. They fly over islands, meander through castles and gawk at dragons. But increasing numbers use Second Life for things that are quite serious. They form support groups for cancer survivors. They rehearse responses to earthquakes and terrorist attacks. They build Buddhist retreats and meditate.
Many use it as an enhanced communications medium. Mark Warner, a former governor of Virginia who is considered a possible Democratic candidate for president in 2008, recently became the first politician to give an interview in Second Life. His avatar (also named Mark Warner) flew into a virtual town hall and sat down with Hamlet Au, a full-time reporter in Second Life. “This is my first virtual appearance,” Mr Warner joked, “I'm feeling a little disembodied.” They then proceeded to discuss Iraq and other issues as they would in real life, with 62 other avatars attending (some of them levitating), until Mr Warner disappeared in a cloud of pixels.
By emphasising creativity and communication, Second Life is different from other synthetic online worlds. Most “massively multi-player online role-playing games”, or MMORPGs (pronounced “morpegs”), offer players pre-fabricated or themed fantasy worlds. The biggest by far is “World of Warcraft”, by Blizzard Entertainment, a firm in California, which has more than 7m subscribers. These worlds are the modern, interactive, equivalents of Nordic myths and Tolkien fantasies, says Edward Castronova, a professor at Indiana University and the author of “Synthetic Worlds: The Business and Culture of Online Games”. They allow players to escape into their imaginations, and to take part by, say, joining with others to slay a monster.
Making, not slaying
Second Life, by contrast, was designed from inception for a much deeper level of participation. “Since I was a kid, I was into using computers to simulate reality,” says Philip Rosedale, the founder of Linden Lab, the San Francisco firm that launched Second Life commercially three years ago. So he set out to construct something that would allow people to “extend reality” by building a virtual version of it, a “second life” not unlike that envisioned by Neal Stephenson in “Snow Crash”, a science-fiction novel published in 1992.
Unlike other virtual worlds, which may allow players to combine artefacts found within them, Second Life provides its residents with the equivalent of atoms—small elements of virtual matter called “primitives”—so that they can build things from scratch. Cory Ondrejka, Linden Lab's product-development boss, gives the example of a piano. Using atomistic construction, a resident of Second Life might build one out of primitives, with all the colours and textures that he would like. He might add sound to the primitives representing the keys, so the piano could actually be played in Second Life. “Of course, since these are primitives, the piano could also fly or follow the resident around like a pet,” says Mr Ondrejka.
Because everything about Second Life is intended to make it an engine of creativity, Linden Lab early on decided that residents should own the intellectual property inherent in their creations. Second Life now allows creators to determine whether the stuff they conceive may be copied, modified or transferred. Thanks to these property rights, residents actively trade their creations. Of about 10m objects created, about 230,000 are bought and sold every month in the in-world currency, Linden dollars, which is exchangeable for hard currency. Linden Lab estimates that the total value (in “real” dollars) this year will be about $60m. Second Life already has about 7,000 profitable “businesses”, where avatars supplement or make their living from their in-world creativity. The top ten in-world entrepreneurs are making average profits of just over $200,000 a year.
By emphasising creativity and communication, Second Life is different from other synthetic online worldsSecond Life's total devotion to what is fashionably called “user-generated content” now places it, unlike other MMORPGs, at the centre of a trend called Web 2.0. This term usually refers to free online services delivered through a web browser—for example, social networks in which users blog and share photos. Second Life is not delivered through a web browser but through its own software, which users need to install on their computers. In other respects, however, it is now often held up as the best example of Web 2.0. “It celebrates individuality,” says Jaron Lanier, who pioneered the concept of “virtual reality” in the 1980s and is now “science adviser” at Linden Lab. And it connects people, he says, because “the act of creation is the act of being social.”
The Web 2.0 crowd also extols Second Life for its highly original business model. Most Web 2.0 firms try to build audiences around user-generated content in order to sell advertising to them. This assumes the availability of unlimited advertising dollars, a notion that is increasingly ridiculed.
Linden Lab does not sell advertising; instead it is a virtual property company. It makes money when residents lease property—an island, say—by charging an average of $20 per virtual “acre” per month. Only about 25,000 residents, or about 3% or the population, lease property, but that already amounts to 53,800 acres, which, in real life, would be bigger than Boston. This works out to monthly revenues of $1m, not counting the commissions that it takes on currency exchanges between Linden dollars and hard cash. As a private company, Linden Lab does not disclose its exact revenues, although Mr Rosedale says the firm is “close to profitability”.
A common reaction to such numbers is astonishment that anybody should pay anything at all for something that exists only in a metaphysical sense. But “there's actually no economic puzzle in this; all kinds of things derive their economic value only from the realm of the virtual,” says Indiana University's Mr Castronova. The American dollar, for instance, is virtual (aside from the value of the paper used for the bills) in that it requires consumers to have faith in its worth. In the context of online games, virtual economies much bigger than Second Life's have existed for years. Many people in poor countries, called “gold farmers”, play games such as “World of Warcraft” professionally to score weapons, points or lives to sell to lazier players in rich countries. But Second Life is unique in that residents conceive what they sell. As such, says Mr Lanier, it is “probably the only example of a self-sustained economy” on the internet.
For all these reasons—its ability to change the real lives of its residents, its innovations in technology and in its business model—Second Life has become a darling of Silicon Valley. It promises to be “disruptive”, says Mitch Kapor, the inventor of the Lotus spreadsheet that played a big role in the personal-computer revolution of the 1980s and 1990s. He is now chairman of Linden Lab. To him, Second Life is comparable to both the PC and the internet itself, which started as something “quirky” for geeks, and then entered and transformed mainstream society. “Spending part of your day in a virtual world will become commonplace” and “profoundly normal,” says Mr Kapor. Ultimately, he thinks, Second Life will “displace both desktop computing” and other two-dimensional “user interfaces”. As “a hothouse of innovation and experiment,” he says, Second Life may even “accelerate the social evolution of humanity.”
Back to this reality
It is bold and early to make such predictions. After all, Second Life is still a relatively small virtual world—only about 9,000 residents are usually logged in at any one time, for example. About two-thirds create content from scratch, but mostly they customise things that they find or browse passively. And a lot of the wares on offer are banal. Whereas a few residents choose very innovative bodies for their avatars, most have shapes, male and female, that hew to the default templates and look, predictably, like cosmetically enhanced porn stars. Among the artefacts, there is some genuine art but quite a bit of junk.
Endless possibilities: Donna Meyer, a grandmother from New York, and her avatarIs Second Life a nirvana where unknown talent can prove its creative mettle and make it in the real world? “You can create your own island and people come to it,” said Bill Joy, a co-founder of Sun Microsystems and now a prominent venture capitalist. But “I don't see any correlation between that and what it's going to take to be a designer and have a skill set to succeed in the world.”
Mr Castronova also cautions against overestimating the depth and breadth of Second Life's economy. Yes, people do create clothes and games and spacecraft in Second Life and then sell them. But most of the big money comes from the virtual equivalent of land speculation, as people lease islands, erect pretty buildings and then rent them to others at a premium. Tongue in cheek, Mr Castronova compares Second Life's in-world boom to America's house-price bubble. In artistic terms, there is not always much difference between building an in-world house and designing a personal web page.
There are also stirrings of discontent among some of the “older” (if one can use that term in a three-year-old metaverse) and more purist residents of Second Life about what they see as a menacing trend toward commercialism. One avatar, for example, has created “MetaAdverse”, a network of advertising billboards inside Second Life to which property developers can feed images of their creations. More controversially, Second Life is also attracting the attention of corporations and advertisers from the real world hoping to attract the metaverse's residents. Publishers now organise book launches and readings in Second Life. The BBC has rented an island, where it holds music festivals and parties. Sun Microsystems is preparing to hold in-world press conferences, featuring avatars of its top executives. Wells Fargo, an American bank, has built a branded “Stagecoach” island, where avatars can pull Linden dollars out of a virtual cash machine and learn about personal finance. Starwood, a hotel and resort chain, is unveiling one of its new hotels in the virtual world.
Toyota is the first carmaker to enter Second Life. It has been giving away free virtual vehicles of its Scion brand and, in October, will start selling all three Scion models. The price will be modest, says Adrian Si, the marketing manager at Toyota behind the project. Toyota really hopes that an “aftermarket” develops as avatars customise their cars and sell them on, thus spreading the brand “virally”. Toyota will be able to observe how avatars use the cars and might, conceivably, even get ideas for engineering modifications in the real world, he says.
Those Scion cars have “great driving performance for in-world physics,” says Reuben Steiger, the boss of Millions of Us, a company he founded this year to bring companies like Toyota into Second Life for marketing and brand-building. “How it corners and makes sounds when it changes gears is great.” So Toyota, which is a client of his, along with Sun Microsystems and even Mr Warner, shows that Second Life is “perfect for creating experiences around a brand,” says Mr Steiger. “We don't think that conventional advertising will be very prevalent,” he says, because it would “be badly received culturally”. Advertising in Second Life is not about “trapping people” but about captivating and stimulating them. A good campaign in Second Life costs about $200,000 dollars, he reckons, of which only a tiny part is property leases and most goes to paying the talented designers to create great virtual stuff.
Virtual strip mall?
Inevitably, this sort of thing turns some residents off. Will Second Life, that realm of individualism and pure creativity and spontaneity, get plastered over by the same mega-brands and mass culture that have, arguably, made the physical world such a homogenous place? In real life, many avatars argue, big business tends to push out small artisans. If the same happens in Second Life, the metaverse will lose its raison d'être.
Mr Rosedale, Linden Lab's founder, empathises with the concern, but thinks it is misplaced. “That is a fear which comes from the real world that is not likely to be borne out in Second Life,” he says. His arguments are all economic. In the physical world land is scarce, so big brands can buy up much of it; in Second Life, Linden Lab simply allocates more computer-processing power and makes even more islands available. The world is infinitely expandable, in other words. If one patch did become homogenous and drab, avatars would simply fly off to the next.
Another economic difference, says Mr Rosedale, is the lack of economies of scale in Second Life. In real life, a shoemaker, say, can reduce the average cost of making a pair by producing huge amounts, and the average cost of marketing by buying advertising in bulk. In Second Life, however, scale means nothing. There is no manufacturing cost to minimise. Gimmicks, such as giving away free shoes, are useless because nobody actually needs shoes at all. Nike, say, has no inherent competitive advantage over a hobbyist who likes to design shoes (or feet, paws, wings or claws) for fun. Thus, says Mr Rosedale, whereas the physical world has relatively few things that are sold in huge numbers, Second Life has huge numbers of things that are sold in relatively small quantities. In the statistical jargon, Second Life's economy trades in “the long tail” of things.
This is why, for the time being, Mr Rosedale prefers to rule Second Life with Adam Smith's “invisible hand” only. To him that means treating every resident the same, whether it happens to be Toyota or “an 80-year-old woman from India.” Both will pay the same price for their acres; what they do with it is up to them. If it ever became necessary, he adds, Linden Lab could “become a regulator and break up monopolies”, but this does not seem likely to come about.
How, then, is one to make sense of Second Life? For those new to it, it appears to be too mind-boggling to have much relevance to real life. For those who spend time inside, however, Second Life ironically tends to resemble the real world even as its obvious differences become clear. Mr Kapor, Linden Lab's chairman, is the first to agree. “People bring all their karma” into the world, he says. Alongside benevolence, there is harassment. If Second Life were ever to become truly mainstream, there is no guarantee that residents would not pollute it with racism and hatred. Perhaps crime too: residents had to reset their passwords after a recent hacking attempt.
These things may be a criticism of human nature, but it cannot be blamed on Second Life. Henry Jenkins, a professor of media studies at the Massachusetts Institute of Technology, thinks that Second Life deserves credit as “a world of hypotheticals and thought experiments.” From new approaches to corporate branding to education, Second Life is a petri dish for innovations that may help people in real life. Already, therapists are using Second Life to help autistic children, because it is a safe environment to practice giving signals to others and interpreting the ones coming back. Other organisations are using Second Life for long-distance learning. Overall, says Jaron Lanier, the veteran of virtual-reality experiments, Second Life “unquestionably has the potential to improve life outside.”
6.29.2006
Video goes viral
Video on the net is nothing new. But with the arrival of YouTube and other video sharing sites, it's suddenly become a phenomenon. Video is finally easy to upload, easy to find, easy to share. So far it's free, and anyone can view it - regardless of operating system or web browsers. And it comes in quick-loading, bite-sized chunks.
Thursday, June 29 - 2006So what are these videos? Uploaded by users, the variety is infinite: from music videos, travel, sports, comedy, film clips, cult TV titles, science experiments and cute animals to random people sitting in front of a webcam giving their opinion on random topics. Adult content is usually banned, to keep sites off web-nanny blacklists. The brilliance of YouTube and its associates - Revver, MetaCafe, Yahoo Video and Google Video to name just a few - is that they allow people to embed their videos on other sites. A blogger, for example, can cut and paste a couple of lines of code and display their favourite music videos from YouTube on their blog. It greatly maximises the exposure for the videos and of course the video sharing sites. Popular videos go viral, with tens or hundreds of thousands of users viewing them, commenting on them, and re-linking to them.
Stunning figuresThe figures are spectacular. YouTube currently has a 63% market share, with 12.5 million visitors a month watching more than seventy million videos a day. There are around forty million different videos on YouTube, with sixty thousand new videos uploaded every day. It has become one of the Top 50 most visited websites. USA Today described it as the "beginning of the age of personal media". What inspired YouTube's founders was the difficulty of putting digital video on the web. With the explosion in camcorders and video-enabled digital cameras, people have millions of hours of footage but no easy to way to share it. It's too big to email. It's too difficult (and often too expensive) to put it on a personal website. Video sharing sites do all the work and bear all the cost.
The money modelBut this bandwidth is expensive. It's estimated that bandwidth costs YouTube US$1 million per month. But the investment - YouTube has raised US$11 million in venture capital - is money more than well-spent. YouTube estimates that it could already earn US$10 million a month by putting ads at the start of every video. So far, it hasn't, because it doesn't want to alienate viewers. Instead it's looking for new and creative ways to get advertisers on board. One of these is US TV network NBC, which has just signed a cross-promotional agreement with YouTube. This is despite a rockier early relationship, when NBC ordered YouTube to remove unlicensed copyright clips of Saturday Night Live. But NBC realised that the illegal video had actually created unprecedented hype for SNL. So it's now agreed to run TV and online ads for YouTube, in return for YouTube running legal promotional clips of NBC's autumn line-up.
A niche opportunityFor advertisers, the beauty of video sharing sites is being able to target highly niche audiences. All videos are tagged with different keywords, from the general "music" "sport" "comedy" to specifics such as "Britney" "golf" "kittens". Nearly a third of YouTube's visitors are aged 18-24, a key youth market that is getting harder for marketers to reach. YouTube's founders claim they don't want to replace TV or Hollywood, but act as a complementary service. But the boundaries are blurred. Videos on YouTube have a 10-minute length limit, but many users have split up entire TV programmes and feature films into numbered segments. Thousands of music videos are recorded off the TV and put up on YouTube, making it like a personalised MTV jukebox. It's also a showcase for users to promote themselves. Out-of-work actors and wannabes are known to have used YouTube to plug their talents. Some have picked up work. Other YouTube users have become cult names and been signed professionally. TUNG, a tongue-cleaning product manufacturer, are sponsoring one rising YouTube star because of his "huge obsession with licking things".
Lessons to be learntThere's a lot to learn from YouTube. The first lesson is that internet users are desperate for compelling, quirky and entertaining multimedia content. And they are happy to get it in small bites. They may not want to pay for it, but they'll probably put up with a short TVC or banner ad for the privilege of watching. The second is universality. Anyone, anywhere, on any system - even mobile devices - can watch YouTube's videos. There are no proprietary formats, no plug-ins to download, you don't need a particular browser or the latest version of Windows. This is going to be a harsh lesson for video sites that try to force users to specific (usually Windows-only) formats. Accessibility is the only way. The third - as NBC has learnt, but the RIAA still shuts its eyes to - is not to fear and resist the New Media Revolution, but to embrace it. The internet is here to stay and here to grow. It's impossible to try and control the machinations of millions of hungry bright minds. If people want to see a video, they'll find a way to rip it, copy it, encode it. Forget proprietary formats, forget copyright protection - the hackers and crackers will always be ten steps ahead.
Thursday, June 29 - 2006So what are these videos? Uploaded by users, the variety is infinite: from music videos, travel, sports, comedy, film clips, cult TV titles, science experiments and cute animals to random people sitting in front of a webcam giving their opinion on random topics. Adult content is usually banned, to keep sites off web-nanny blacklists. The brilliance of YouTube and its associates - Revver, MetaCafe, Yahoo Video and Google Video to name just a few - is that they allow people to embed their videos on other sites. A blogger, for example, can cut and paste a couple of lines of code and display their favourite music videos from YouTube on their blog. It greatly maximises the exposure for the videos and of course the video sharing sites. Popular videos go viral, with tens or hundreds of thousands of users viewing them, commenting on them, and re-linking to them.
Stunning figuresThe figures are spectacular. YouTube currently has a 63% market share, with 12.5 million visitors a month watching more than seventy million videos a day. There are around forty million different videos on YouTube, with sixty thousand new videos uploaded every day. It has become one of the Top 50 most visited websites. USA Today described it as the "beginning of the age of personal media". What inspired YouTube's founders was the difficulty of putting digital video on the web. With the explosion in camcorders and video-enabled digital cameras, people have millions of hours of footage but no easy to way to share it. It's too big to email. It's too difficult (and often too expensive) to put it on a personal website. Video sharing sites do all the work and bear all the cost.
The money modelBut this bandwidth is expensive. It's estimated that bandwidth costs YouTube US$1 million per month. But the investment - YouTube has raised US$11 million in venture capital - is money more than well-spent. YouTube estimates that it could already earn US$10 million a month by putting ads at the start of every video. So far, it hasn't, because it doesn't want to alienate viewers. Instead it's looking for new and creative ways to get advertisers on board. One of these is US TV network NBC, which has just signed a cross-promotional agreement with YouTube. This is despite a rockier early relationship, when NBC ordered YouTube to remove unlicensed copyright clips of Saturday Night Live. But NBC realised that the illegal video had actually created unprecedented hype for SNL. So it's now agreed to run TV and online ads for YouTube, in return for YouTube running legal promotional clips of NBC's autumn line-up.
A niche opportunityFor advertisers, the beauty of video sharing sites is being able to target highly niche audiences. All videos are tagged with different keywords, from the general "music" "sport" "comedy" to specifics such as "Britney" "golf" "kittens". Nearly a third of YouTube's visitors are aged 18-24, a key youth market that is getting harder for marketers to reach. YouTube's founders claim they don't want to replace TV or Hollywood, but act as a complementary service. But the boundaries are blurred. Videos on YouTube have a 10-minute length limit, but many users have split up entire TV programmes and feature films into numbered segments. Thousands of music videos are recorded off the TV and put up on YouTube, making it like a personalised MTV jukebox. It's also a showcase for users to promote themselves. Out-of-work actors and wannabes are known to have used YouTube to plug their talents. Some have picked up work. Other YouTube users have become cult names and been signed professionally. TUNG, a tongue-cleaning product manufacturer, are sponsoring one rising YouTube star because of his "huge obsession with licking things".
Lessons to be learntThere's a lot to learn from YouTube. The first lesson is that internet users are desperate for compelling, quirky and entertaining multimedia content. And they are happy to get it in small bites. They may not want to pay for it, but they'll probably put up with a short TVC or banner ad for the privilege of watching. The second is universality. Anyone, anywhere, on any system - even mobile devices - can watch YouTube's videos. There are no proprietary formats, no plug-ins to download, you don't need a particular browser or the latest version of Windows. This is going to be a harsh lesson for video sites that try to force users to specific (usually Windows-only) formats. Accessibility is the only way. The third - as NBC has learnt, but the RIAA still shuts its eyes to - is not to fear and resist the New Media Revolution, but to embrace it. The internet is here to stay and here to grow. It's impossible to try and control the machinations of millions of hungry bright minds. If people want to see a video, they'll find a way to rip it, copy it, encode it. Forget proprietary formats, forget copyright protection - the hackers and crackers will always be ten steps ahead.
6.27.2006
NBC on YouTube
NBC adverts on video-sharing site US broadcaster NBC has agreed a deal to promote its autumn schedule on video-sharing website Youtube.
NBC said the move, in which promos will air on a dedicated NBC channel on Youtube, would help reach people who might watch little TV in the summer.
The broadcaster has previously had to ask Youtube to remove unauthorised footage of its shows posted by users.
Meanwhile Warner Bros has begun selling films and TV on Guba.com. It already has a similar deal with Bittorrent.
Youtube allows professionals and amateurs to share video footage.
The NBC deal could see clips from new and old shows, behind-the-scenes footage, and other items exclusive to the internet airing on Youtube.
"The distinction between television and video is becoming murkier and murkier," said John Miller, chief marketing officer of NBC Universal Television Group.
"Rather than putting our heads in the sand and saying this doesn't exist, we're trying to jump in and embrace it."
Warner Bros' deal with Guba allows users to buy or rent films and TV shows, with new movies being made available on the same day that DVDs are released in stores.
New films will sell for $19.99 (£11), older ones for $9.99 (£5.50), while rental starting at $1.99 (£1.10) will allow unlimited viewing within a 24-hour period.
The studio is also planning to sell about 200 of its films and programmes on Bittorrent.com.
NBC said the move, in which promos will air on a dedicated NBC channel on Youtube, would help reach people who might watch little TV in the summer.
The broadcaster has previously had to ask Youtube to remove unauthorised footage of its shows posted by users.
Meanwhile Warner Bros has begun selling films and TV on Guba.com. It already has a similar deal with Bittorrent.
Youtube allows professionals and amateurs to share video footage.
The NBC deal could see clips from new and old shows, behind-the-scenes footage, and other items exclusive to the internet airing on Youtube.
"The distinction between television and video is becoming murkier and murkier," said John Miller, chief marketing officer of NBC Universal Television Group.
"Rather than putting our heads in the sand and saying this doesn't exist, we're trying to jump in and embrace it."
Warner Bros' deal with Guba allows users to buy or rent films and TV shows, with new movies being made available on the same day that DVDs are released in stores.
New films will sell for $19.99 (£11), older ones for $9.99 (£5.50), while rental starting at $1.99 (£1.10) will allow unlimited viewing within a 24-hour period.
The studio is also planning to sell about 200 of its films and programmes on Bittorrent.com.
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