21 December, 2011



Russia’s startup climate: 5 steps away from primetime

Posted: 21 Dec 2011 10:00 AM PST

Protests in Russia last week have dominated international news, and talking heads have been eager to explain how this is evidence of an increasingly divided and unstable Russia. Although the political response has not been as graceful as it could have been, the restraint the government has shown in regards to the protesters is encouraging, especially compared to how similar protests were met in Syria, Libya, or Egypt.

What is unfortunate, however, is that the protests have overshadowed Russia's entry into the World Trade Organization – an event 18 years in the making. Michael O'Flynn of UFG Asset Management has called WTO entry "unabashedly bullish in terms of market sentiment, expanded multiples, and general acceptance of Russia as a legitimate investment destination." There is no better time to reflect on Russia's status and potential as a center of innovation and entrepreneurship.

Russia has a lot going for it today. It is nowhere near problem-free: there are meaningful problems with corruption, terrorism, the rule of law, and demographics. However, you could also argue that it is the most financially and politically stable it has been in its history, thanks to the high price of oil and Vladimir Putin's leadership. (I say this with full knowledge that many people have a visceral, knee-jerk reaction to both extractive industries and Putin.) Under these circumstances, there is a potential for a real, meaningful technology culture to (re-)emerge.

Venture capital has become available in Russia. There is now a handful of firms that have done many deals in Russia, including Almaz Capital Partners, Fast Lane, Foresight Ventures, Mangrove Capital Partners, ru-Net, ABRT Venture Fund, Russia Partners, Runa Capital, and Baring Vostok.  In addition, global American and European firms, such as Accel Partners, Bessemer Ventures, and Index Ventures have done recent deals in Russia. A great article in the Wall Street Journal discusses Accel Partner's Jeremiah Daly's view of the opportunity in Russia.

Venture capitalists have been most active pursing a "business model arbitrage" (aka, cloning) strategy. The most prominent Russian clones include vKontakte (Facebook clone), Ozon.ru (Amazon.com clone), OdinOtvet.ru (Quora clone), VitaPortal (WebMD clone), RentHome.ru (HomeAway/AirBnb clone), AlterGeo (Foursquare/Yelp clone), Sapato.Ru (Zappos clone), Domgeo.ru (Trulia clone), Privat Trade Ltd. (Gilt Clone), Babyboom.ru (Zulily clone), and BigLion (Groupon clone). The clone strategy has no doubt been inspired at least in part by the success of Chinese clones (for example, Renren, Weibo, and Lashou) as well as the success of Yandex, "the Google of Russia," which IPO'd in May.

Apart from traditional venture capital firms, incubators, such as Digital October, InCube, and Finland-based Startup Sauna are contributing to the ecosystem, as are government-sponsored initiatives, such as Rusnano, a fund aimed at building Russia's nanotechnology industry, and Skolkovo, an innovation center in the suburbs of Moscow.

Skolkovo (pictured) deserves special attention. This "Russian Silicon Valley" is a science park located outside of Moscow. There is a "trailer" for it online. Skolkovo features a Western-style business school, Skolkovo Moscow School of Management, and an "Innovation City", an office space complex for science-based startups. The idea was to create a hub of innovation and technology in Russia, a single location that would benefit from many of the same synergies that Silicon Valley, Boston/Cambridge/Waltham, Herzliya/Tel Aviv, and Cambridge, UK enjoy: a critical mass of all of the raw materials for startups, including engineers, managers, lawyers, bankers, and venture capital.  So far, the plan to attract high tech companies seems to be working. As of November, Skolkovo is home to 200 startup companies, and there are plans for 10 corporate R&D centers, including those funded by Siemens, Nokia, IBM, GE, and Dow, and a corporate venture arm of Johnson & Johnson.

Microsoft and Skolkovo just reached an agreement, wherein select Microsoft seed investments will be matched by Skolkovo, and Cisco announced it will open an innovation center there. (For more on Skolkovo, see the great coverage by Knowledge@Wharton, Wharton's online business magazine, and The Atlantic Monthly).

These developments are a good sign, but there is still room for improvement. Five steps could improve the climate for business and innovation in Russia:

1. Reform the education system – When one looks at a list of Nobel Prize and Fields Medal winners, it becomes obvious that Russia has done an excellent job training generations of scientists, engineers, and mathematicians. However, the country has been less successful developing entrepreneurs and managers. Incorporating pedagogical techniques designed to encourage creative thinking and team work would be a good complement to rote memorization.

2. Focus startup/technology efforts on computer science/IT, rather than life science or cleantech – There are several reasons to do this: (1) Computer science/IT-based companies are less capital intensive and are easier to scale. (2) These companies have historically created the best economic returns for investors. (3) It is easier to avoid corruption in these industries, because there is less customer concentration and less government oversight. In cases where a few people can act as bottlenecks, there is the greatest threat of corruption; for example, an oil and gas exploration company is reliant upon cooperation with a pipeline company, whereas there is not one single company that has an equivalent amount of influence on software companies, such as IBM or Oracle.

3. Manage corruption and lack of respect for rule of law– Corruption and/or perceived corruption is the great bugbear of doing business in Russia.

The New Yorker chronicled Chatroulette creator Andrey Ternovsky's trip to America:

Andrey … feels that he doesn't need the country, and declares that he does not want to run a Russian company, which might be forced to pay "dirty," under-the-table salaries to avoid a crushing tax burden, or to deal with extortion from corrupt tax and fire-code inspectors. "My perfect plan is that I don't ever return to Moscow," he told me. He would figure out the permanent-visa thing once he got to New York; for now, he was just eager to get out. "I don't want to come back," he said. "I want to live in America."

There is no magic bullet for this problem. This is where a Skolkovo site could be valuable. It is easier to keep roaches out of a new house than it is to remove them from an old house. It would be tough for the federal government to end corruption everywhere, but a concentrated effort in a small geography could be possible.

4. Make Russia/Moscow/Skolkovo a pleasant place – Moscow has an image problem. About a year ago, a Reuters article had this to say about the city: "Glitzy and decadent, the non-stop Russian capital is famed for its exorbitant prices, extravagant nightlife and freezing winter temperatures."  The eXile, a paper founded by American expats, captured the zeitgeist with articles, such as the very offensive "Moscow Babylon: Decadence is Boring." Not exactly a cup of tea at University Coffee Café in Palo Alto.

Consider again The New Yorker feature on Andrey Ternovsky: "When he travelled to San Francisco, the following week, he found the America he had imagined for himself. The sunshine was 'heaven,' and he was able to work poolside at his hotel."

Las Vegas or Tijuana might be fun for a bachelor party, but most engineers and investors, don't want to live there. While not much can be done about the Russian Winter, at a minimum, Skolkovo should spend special attention to keep casinos, prostitution, and hard drugs out. It is also important to have simple things, such as dual-language, English-Russian signs, in order to make navigation easier. And it might be valuable to subsidize the cost of living. People may complain about how expensive Silicon Valley/San Francisco is, but a $100,000 salary in San Francisco is equivalent to an $81,893 salary in Moscow.

5. Pay people to come – Imagine the following: Take a list of the 100 best computer scientists/computer science professors/engineers in the world, offer them a salary of $1,000,000/year (adjusted for inflation each year) for 10 years with a matching $1,000,000/year stipend for research, etc. Let's assume they all agree — which is unlikely – but that would be only a small fraction of the $2.8B Russia has planned to invest in Skolkovo. Russia was able to attract Euler and the Bernoullis – no reason it can't attract the best today.

The main hurdle to such an endeavor would be excess nationalism. Unfortunately, there have been several high-profile cases of minorities being attacked and sometimes killed in major Russian cities.  A more subtle version of nationalism is a "not invented here" bias. "Why invite Western scientists, if the Russian scientists are the best in the world?" "Why put Russian signs in English? They should learn Russian!" Again, there is no magic bullet here, but making sure that Skolkovo is shielded from this mentality is crucial. It is hard to imagine a successful center of innovation that is not international, full of American, Israeli, Chinese, and Indian programmers and engineers.

Is a Hippy Culture Necessary?

Some people argue that Silicon Valley is so successful because of its counterculture, "hippie" heritage. Consider the much-cited anecdote of Steve Jobs' experimentation with LSD. This idea is explored in detail in John Markoff's What the Dormouse Said: How the 60s Counterculture Shaped the Personal Computer and Theodore Roszak's From Satori to Silicon Valley: San Francisco and the American Counterculture.

It is unlikely that Skolkovo is going to become Berkeley, but it is not clear to me that this is a prerequisite. It is hard separating the correlation from the causation. There are other centers of innovation that lack this culture (consider financial innovation in New York or London), and there have been other modernization efforts that lack this culture (consider the Meiji Restoration, Peter the Great's reforms, etc.) On the flipside, perhaps a bigger driver of technological innovation is military sponsorship. This was explored by Steve Blank in a lecture at Google, and Viktor Vekselberg, the Skolkovo Foundation's president, has also explicitly commented on Silicon Valley's military connection in The Atlantic Monthly.

Those of us who came of age after the end of the Cold War see Russia in a very different light than most Russians do. It is easy to see the turmoil of the early 90s, the economic crisis of the late 90s, and the dysfunction of the 2000s and forget how dominant Russia was simply 50 years ago.

Like many Americans, many Russians believe in Manifest Destiny. Russia's place in the world order is as a leader; not necessarily as the feared, unpredictable country from the Cold War, but as an indispensable country, as in Napoleonic Europe. Provided this national ambition manifests itself in a positive, economic manner, Russia can emerge as a top country for technology and entrepreneurship. The top VCs who have invested in Russia in the past year certainly believe this.

Mac Elatab (@Rollscritique) is a member of the investment team at TrueBridge Capital Partners, where he covers Russia and other Emerging Markets.

[Moscow image via Shutterstock.]

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Search underdog Blekko gets serious, makes major improvements (exclusive)

Posted: 21 Dec 2011 09:54 AM PST

With 1.5 million unique users and 70 to 80 million queries per month, search upstart Blekko isn’t big enough to sit at the adult search table with Google, Yahoo or Microsoft. But don’t tell that to Blekko.

Fed up with the prevalence of spam in search results, Blekko launched in late October 2010 as a search engine with an opinion. It takes a stance on good and bad sites and attempts to deliver only high quality results from the good sites. It does so with user-curated slashtags, a proprietary feature that restricts results to a set of editor-vetted sites.

A year later, the Silicon Valley-based upstart is ready to be taken seriously and has donned an adult look to show the world that it’s all grown up now. Blekko is releasing a number of dramatic improvements Wednesday to better compete with the big boys of search. Most noticeable is a complete overall of its user interface and the addition of more auto-firing slashtags for more spam-free results. Also significant is the new index technology and computing infrastructure powering the experience.

“We’re improving the engine under the hood … but coupling it with a shiny new upgrade to the [user interface] that really makes the site experience slick,” CEO Rich Skrenta said in an exclusive interview with VentureBeat.

The company has scrapped its former “kitchen sink UI” in favor of something more traditional, and added a fresh coat of paint.

“It’s just a clearer look,” founder Mike Markson said. “It’s a state of art type of UI that shows off our features, makes for a comfortable setting, saves time on search and is easy on the eyes.”

“There’s an expectation for a certain UI,” Skrenta said of Blekko’s more Google and Bing-like look. “If you come to Blekko and do a search, we want you to be happy with the result quality and not be distracted by the UI.”

To keep you happy, Blekko is now auto-firing slashtags for 500 categories, and working toward support for 1,000 categories. The auto-firing slashtags are automatically appended to your queries — no extra work required on your part — to filter out junk results.

The least noticeable but most marked improvement is the one that could keep you coming back to Blekko for all your queries. The startup has doubled the size of its index so that it covers even long-tail queries to satisfy the searcher who already knows what she’s looking for.

“It’s a fresher index, it’s a larger index,” Skrenta said, “with the addition of the new hardware, we were basically able to double the size of it.”

“For a search engine startup, you really can’t win at [long-tail] queries, but you can lose at them,” Skrenta explained. “We were not doing a fantastic job at long-tail queries previously, and this was partially a function of not having enough hardware to be able to crawl the web as deeply as we needed to. … We’ve made substantial operations investments, doubled our server count, and the relevance technology we’re using is basically best-of-breed at this point.”

Blekko believes the changes will finally make its service a viable search alternative that can stand tall next to Google and Bing and satisfy every searcher’s queries, whatever they may be.

It’s a true underdog story, to be sure, but with $30 million in funding from September, Blekko has bought itself time to turn unbelievers into converts.

“We’re the first search startup to actually be around a year after launch, having lived to tell about it,” Markson said.

[Image via dno1967b/Flickr]

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Cyber criminals attack U.S. Chamber of Commerce, China footing the blame

Posted: 21 Dec 2011 09:51 AM PST

chamber of commerce

The U.S. Chamber of Commerce recently uncovered an attack on its systems, and fingers are pointing toward China.

The Chamber represents over three million US businesses, 96 percent of which are small businesses with 100 employees or less. The agency, situated in Washington D.C., lobbies for free enterprise, competition between US companies and entrepreneurship. Some of its bigger members include Adobe, Microsoft, Visa, and Google.

According to the Wall Street Journal which first reported on the attack, which may have started as early as November 2009, nearly 300 internet protocol addresses (IP addresses) were compromised, with around 50 members directly affected. Chamber President Thomas Donohue first got word of the breach in May 2010. When the news arrived, the Chamber went to work scouring the e-mails of affected accounts to see what kind of information may have been uncovered. Meeting minutes, schedules, some trade policy documents and trip records are the only compromised items being reported.

In early November, the US government released a report titled The Foreign Economic and Industrial Espionage Report. In the document, the government stated that China and Russia have been spying on U.S. Internet systems to steal confidential information. The Office of the National Counterintelligence Executive, which created the report, said that an “onslaught” of attacks on US computer networks had IP addresses that could be traced back to China.

This prompted Chinese foreign ministry spokesperson Hong Lei to release a statement saying, “Online attacks are notable for spanning national borders and being anonymous. Identifying the attackers without carrying out a comprehensive investigation, and making inferences about the attackers, is both unprofessional and irresponsible.”

According to the Wall Street Journal, Geng Shuang, Washington DC’s Chinese Embassy spokesperson, also called today’s accusation “irresponsible” and admitted that China was subject to cyber attacks as well. This is a matter to consider. In the US, organizations working independently have compromised government websites of countries in the Middle East such as Syria and called for cyber attacks on Egypt. These Internet hacktivists, such as the group Anonymous, work on their own and attack the US government for what they see as injustices.

In August, China was also named as a potential perpetrator for a five-year long attack on 72 governments around the world.

When attacking computer systems, cyber criminals will often use what is called a “backdoor” to re-enter the system without having to hack or social engineer — manipulating employees into giving out sensitive information — their way into acquiring login credentials or other access. According to the Journal, the attackers set up dozens of these back doors, knowing that passwords would be changed, or missteps in erasing their tracks were found.

As a result of this attack, and the recent attacks linking Chinese attackers to US systems, Chamber employees are barred from taking devices that are often used for work to high-risk countries, among them China.

The Chamber told the Journal that it is still experiencing weird and suspicious activity and doesn’t see an end in the near future. Sometimes employees find a Chamber townhouse thermostat chatting with computers in China. Other times printers spill out Chinese characters without being given the command. In any case, the Chamber is keeping itself alert and revisiting its security tactics.

Photo via NCinDC/Flickr

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Dylan’s Desk: Meltwater aims to build a billion-dollar business without venture capital

Posted: 21 Dec 2011 09:30 AM PST

Jorn Lyseggen, CEO of Meltwater GroupCan you build a billion-dollar business without venture capital?

Jorn Lyseggen thinks he can. He’s the founder and CEO of Meltwater Group, a major player in marketing intelligence services.

I spoke at a Meltwater event recently, and got to know a bit about the company. I was intrigued by the company’s unusual strategy and its unique sense of corporate culture, so I decided to find out more.

Meltwater got its start with Meltwater News, a media monitoring service that scans hundreds of thousands of news sources and delivers summaries and alerts to its clients based on what they’re looking for. It has since added services for monitoring and engaging with customers on social networks, creating and managing PR lists, search engine optimization and others. The company delivers its products as a service, making it one of many SaaS (software-as-a-service) companies.

The company is 10 years old, and has been almost entirely self-funded. Lyseggen started the company in Oslo with $15,000 of his own money and has been growing it through revenues ever since. The company now employs 900 people, is headquartered in San Francisco and will post $114 million in revenues in 2011, Lyseggen told me recently.

Lyseggen himself is a bit of an unusual character: A Korean-born adoptee with a ready smile, he grew up on a farm in Norway and speaks with a Norwegian accent. He enjoys salmon fishing in his hometown fjords and reading Viking sagas, according to his company’s website, but he also knows how to work a crowd and has obviously inspired his workforce with a charismatic vision of what Meltwater’s culture is all about.

Meltwater has never taken venture capital. That makes it an anomaly among tech firms in Silicon Valley. If Lyseggen succeeds in reaching a billion dollars in revenues, he’ll have done something very few have accomplished. SAS Institute, HP and Best Buy appear to be the only modern tech companies to have reached this milestone unaided by VC investments.

Lyseggen has ignored other Silicon Valley maxims, such as the primacy of engineers and the desire to build a large, impressive headquarters. And the company hasn’t been as widely covered as rivals such as social media-monitoring service Radian6 (acquired by Salesforce.com earlier in 2011), recently-public Jive Software and Google News (whose “alerts” serve some of the same purposes).

“I think we’re a nonentity in many ways. We’ve just been doing what we’re doing,” said Lyseggen. “I believe in focus.”

For Lyseggen, that focus meant building a distribution network first. A veteran of three startups, he says his initial goal was to build software that could easily be sold, enabling him to keep his team super-small.

It didn’t work out. Lyseggen learned quickly that successful sales depended on having local sales operations, so he oriented his company around that mandate and started hiring local sales forces. The company now has 57 offices worldwide, each one with a relatively small number of people.

“Distribution at the end of the day trumps technology,” Lyseggen said.

The small local offices enable another key aspect of Meltwater’s culture: The emphasis on leadership. With small, relatively autonomous teams, there are plenty of opportunities for people in each location to learn how to make decisions and take charge, whether that’s deciding what color to paint the walls, which furniture to buy at Ikea, or what the best marketing strategy is for recruiting new customers in the area.

His conviction that leadership is important runs deep. Lyseggen said that most of what he spent the first five or six years doing was recruiting. For that period, he interviewed every single candidate. (So did many other Meltwater staffers, as the interview process is an intensive two-day audition that involves talking with lots of people and working on group projects with other candidates.) He estimates that he’s done about 3,000 face-to-face interviews. Only 5 to 10 percent made the cut.

Once the company built out its distribution network, Meltwater started developing or acquiring additional products for its portfolio.

But how can a small company whose major business is essentially a high-end clipping service aspire to a billion dollars in revenue? Lyseggen thinks it’s by following a larger trend: The imperative for companies to get savvy about collecting and analyzing data from the outside world.

Companies like Oracle, SAP, Microsoft and IBM have gotten huge by giving their customers tools to manage data “inside the firewall,” through databases and applications built on top of that data. Now, Lyseggen believes, it’s time to build a comparable stack of data and applications based on intelligence about the wider world.

“In the last 15 years there’s been an explosion of information outside the firewall,” Lyseggen said. The need to manage that data will give rise to many billion-dollar businesses.

Managing that data can be helpful for recruiting, marketing, sales development, but also for product development, by giving companies better information about what potential customers want. And it’s not just big companies that need this kind of information. Lyseggen likes to tell the story of a small Norwegian window installation company that is a customer of Meltwater, which it uses to monitor local news sources for news about robberies and break-ins. It then visits each location to see if they need any broken windows replaced.

Ultimately, Lyseggen told me, he thinks that in the next five years, CEOs of every company will demand dashboards that give them knowledge of their customers and potential customers, just as they now demand dashboards showing the state of their internal business processes. Building those tools will take a lot of time and effort, but will also create an enormous amount of opportunity.

“This is food for generations of scientists and engineers,” Lyseggen said.

Photo courtesy Meltwater Group.

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Nielsen and comScore reach settlement over online measurement patents

Posted: 21 Dec 2011 09:19 AM PST

Nielsen, comScore

Nielsen and comScore, two of the largest research/ratings firms, have settled a dispute over measurement patents, the companies announced today in a joint statement.

Nielsen is best known for its television program ratings, which measure the size and demographic of an audience for specific shows. More recently, the company has branched off to include online measurement of content, display advertising, social interaction and more. It faces competition from online research firm comScore. In March, Nielsen sued comScore for infringing on five of its patents related to measuring and displaying online content. comScore then counter-sued on the basis that Nielsen was violating some of its patents. The situation is very similar to the current patent disputes between Samsung and Apple over mobile devices.

The settlement is a good thing for both companies because patent disputes are costly and time-consuming.

As part of the settlement, both companies will enter into a cross-licensing agreement. For comScore, the settlement gives the firm ownership of four Nielsen patents that it was accused of violating in March. Nielsen will still have worldwide licenses on those patents, which means it can continue using them without fear of more patent infringement accusations. Both companies also agreed to defer any further patent disputes in court for the next three years.

The settlement also gives Nielsen $19 million in comScore restricted common stock with neutral voting requirements, which it can’t sell for at least one year. This is particularly interesting because it ties the two companies together. Any further patent litigation would be counterproductive for both Nielsen and comScore.

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HTC testing new phones to work around Apple patent violation

Posted: 21 Dec 2011 09:03 AM PST

After taking a major hit in court this week from an Apple patent lawsuit, HTC is already in the process of testing new devices and software that workaround the patent violations.

Two days ago, the U.S. International Trade Commission ruled that HTC violated two claims of an Apple patent, which will lead to a ban on infringing HTC devices in April 2012. The ruling only effects HTC-made Android phones at this point.

HTC CEO Peter Chou and Google senior VP of mobile Andy Rubin talked to media in Taiwan yesterday about HTC’s game plan to get around the ruling, according to Reuters. Chou said the company is working on new phone models to skirt around the broad violations the ITC indicated, but he did not get into specifics.

With Rubin on hand, Chou indicated the company would work closely with Google to find solutions and fight back companies (ahem, Apple) that want to stifle innovation. “This industry should not allow one company use [this] powerful weapon to stop other innovation and take it all…this is not fair,” Chou reportedly said.

The patent violation the ITC identified is actually so broad it could be applied to other phone interfaces as well. The patent claims cover clickable and actionable phone numbers, addresses and other data points. So the feature to tap on a phone number and have a box popping up asking if you want to call the number will have to be altered inside HTC’s skin of the Android OS if it wants to continue importing phones to the U.S.

What do you think of the impending import ban on HTC’s Android phones?

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Tactus Technology raises $6M for very cool dynamic touchscreen buttons

Posted: 21 Dec 2011 08:59 AM PST

Tactus Technology said today that it has raised $6 million to develop its next-generation touch interface components for all sorts of touch-enabled devices.

The interface enables buttons to morph out of the surface of an electronic device. The physical buttons rise from the surface on demand, as needed, and then recede back into the screen, leaving a flat, transparent surface when gone. These physical buttons help someone get oriented and then confirm the location that they need to press in order to make something happen.

“Imagine if buttons grew out of your smartphone, tablet or dashboard to improve the user experience. You could rest your fingers on them, type or play games, and then have the buttons disappear when you are done,” explained Craig Ciesla, chief executive of Fremont, Calif.-based Tactus.

It works by using a “tactile layer,” which can be integrated with touchscreen devices such as smartphones, tablets, personal navigation system and gaming devices. The layer replaces the cover glass of the touchscreen and is about the same thickness of the layer it replaces. The size can be scaled from a mobile phone screen to a TV screen, and it uses minimal power. Button layouts and sizes can be customized.

Thomvest Ventures, a $150 million fund capitalized by Peter J. Thomson, led the investment. The money will let Tactus expand product development and ratchet up its operations to handle larger customers.

“Tactus has a unique technology that will bring real touch to touchscreens,” said Jonathan Barker of Thomvest Ventures. “People experience the world through touch, and given a choice, we are confident that people will prefer a truly tactile experience.”

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Verizon suffers yet another nationwide data outage

Posted: 21 Dec 2011 08:51 AM PST

Losing network access seems to be a common occurrence for Verizon Wireless customers these days. They woke up to yet another nationwide data outage this morning.

The outage, which affected the carrier’s 3G and 4G LTE data networks, drove subscribers to Verizon’s technical support board and support Twitter account. Verizon hasn’t yet divulged the cause of the outage, but now it seems service is slowly being restored, Engadget reports. (Above, Verizon’s LTE network coverage in the North East.)

Verizon suffered a similar outage for its LTE network earlier this month, as well as back in April. Network outages are a fact of life for practically every service, but for Verizon they could severely tarnish the reputation of its LTE network.

The carrier was the first in the country to roll out LTE, and it has by far the most coverage. But since it’s a fairly young network, Verizon needs to make sure that any problems are fixed quickly — otherwise consumers will wonder if LTE is worth the extra cost.

The 4G technology is already causing issues with some consumers due to its heavy battery usage. Verizon certainly doesn’t need more problems with its LTE experience.

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StyleCaster to challenge Condé Nast with ‘Style as a Service’ ads (exclusive)

Posted: 21 Dec 2011 07:16 AM PST

stylecaster-screenshotFashion-focused media company StyleCaster will launch a proprietary ad platform in mid-January that will challenge Condé Nast, Glam Media and third-party ad networks, the company revealed today.

The new ad platform, dubbed Style as a Service, is a joint venture between StyleCaster and demand side platform (DSP) MediaMath and seeks to help fashion, beauty and consumer brands with ad advice and placement. MediaMath gives access to the inventory of publishers like Gawker Media, Rodale, and the New York Times, while StyleCaster uses its knowledge of branding to act as an advisor for where to place the ads.

“With Style as a Service, brands no longer have to sacrifice scale for highly-integrated, strategic media buys,” David Goldberg, president and co-founder of StyleCaster, told VentureBeat via e-mail. “We can give them both, using MediaMath as the pipeline to inventory across any publishing platform and property layered with proprietary user data for rich targeting.”

StyleCaster has done alpha testing on Style as a Service throughout 2011 with various fashion and beauty brands. One campaign StyleCaster likes to point to that shows off its expertise is the Diet Coke “Stay Extraordinary” campaign. The company also has worked with H&M on branded editorial content for the 2011 holiday season.

At present, StyleCaster.com and its sister site, BeautyHigh.com, attract more than 2 million unique visitors per month. Style as a Service will use user data from the StyleCaster network to find out which publishing properties will be most effective for the brand’s target audience.

“What makes SaaS unique is that we utilize our proprietary data to determine what inventory is most valuable to our brand partners and project which marketing assets spark more consumer engagement, all within an environment that is 100% brand safe,” Goldberg said.

The Style as a Service platform will compete with Condé Nast’s newly launched private ad exchange, which is powered by Google’s Admeld. Goldberg said StyleCaster’s solution is superior because it offers user data to better inform where ads should be placed.

New York-based StyleCaster was founded in 2009 and has raised a total of $5.5 million in funding. Its latest funding round came from the likes of Zynga chief mobile officer David Ko and former MySpace CEO Owen Van Natta.

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Android chief: We see 700K+ Android activations each day

Posted: 21 Dec 2011 07:01 AM PST

So, you just got a new Android phone, eh? Don’t feel so special — you’re not the only one.

According to Google’s Android chief, Andy Rubin, you’re one of a growing mob of people tuning in and turning on to the open-source mobile operating system.

“There are now over 700,000 Android devices activated every day,” Rubin stated late last night on his Google+ page.

This statistic has more than doubled since last year, when Rubin tweeted that 300,000 new devices were being activated daily.

And during the company’s July 2011 earnings call, Google CEO Larry Page noted that the company had reached the 550,000 activations per day milestone. Around that time, Rubin stated Android’s rate of growth was growing by 4.4 percent every single week.

All these activation stats add up to some serious domination. Earlier this month, we reported that Android devices accounted for half the total mobile market for smartphones in the United States. Apple came in a distant second at 27 percent.

Also (and this likely has an impact on both the OS’s growth and total market share), Android overtook iPhone as the most desired mobile platform earlier this year. According to numbers from Nielsen from January 2011 to March 2011, more than one third of consumers indicate Android as their preferred operating system. That number had leapt up from around one quarter just a few months before.

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Intel unveils Android tablet & smartphone line for 2012

Posted: 21 Dec 2011 06:45 AM PST

Intel is showing off prototypes for a line of smartphones and tablets set to come to market in 2012.

The devices will run on Android and will be powered by Intel’s new Medfield mobile chip, the latest and most power-efficient design in its Atom line and the most serious competitor to chips from ARM, which currently dominate the mobile landscape.

The Medfield chips are smaller, faster and more advanced than existing mobile chips, and they’re also specifically configured to play nicely with Android OS and apps.

“We expect products based on these to be announced in the first half of 2012,” Stephen Smith, vice president of Intel’s architecture group, told Technology Review, which itself received a couple of prototype devices to play with.

The phone prototype, which you can see above, is strikingly similar to an iPhone at first glance, but its noticeably lighter. It may ship with the most recent 2.X fork of Android rather than Android 4.0, a.k.a. Ice Cream Sandwich, the newest fork of Android, which was released this fall.

Intel’s reference tablet device, however, does run Ice Cream Sandwich and features a slightly larger (though not thicker) display than the iPad 2.

Spicing up its mobile side could do a lot to help Intel remain competitive in the overall market. The chip maker has had a rough year in 2011. Earlier this month, the company announced it had reduced its revenue outlook by $1 billion due to flooding in Asia and the resultant hard drive shortage.

In addition to its mobile offerings, Intel is also strongly pushing its chips for the ultrathin ultrabook category, even going so far as providing matchmaking services between small consumer electronics companies and manufacturers to get more of the ultrabook PCs on the market.

Intel celebrated the microprocessor’s fortieth anniversary last month. The company’s first chip, the 4004 microprocessor, was first announced on November 15, 1971.

Image via Technology Review

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Microsoft and Nokia considered a joint bid for ailing RIM

Posted: 21 Dec 2011 06:37 AM PST

blackberry-7-phonesAmazon wasn’t the only company interested in snapping up BlackBerry maker Research in Motion.

Microsoft and Nokia, now close partners thanks to Nokia’s adoption of Windows Phone 7, also considered a joint bid for RIM, the Wall Street Journal reports. It’s not clear if the discussions were anything more than a pipe dream, as the WSJ notes executives from all three companies often get together to discuss other partnerships.

With both Microsoft and Nokia struggling to turn the Windows Phone platform into a contender, it wouldn’t really make sense for them to snap up RIM, a former smartphone giant that’s now weighed down by an out-of-date mobile OS.

Last week, RIM’s co-CEOs, Mike Lazaridis and Jim Balsillie, announced that the company’s long-awaited BlackBerry 10 devices won’t appear until the end of 2012 due to chipset delays. BlackBerry 10 (formerly BBX) is RIM’s next-generation OS based on the QNX software that powers the BlackBerry PlayBook. It’s RIM’s best chance to take on iOS and Android, but come the end of 2012 it may arrive too late to make a difference.

News of the delay followed RIM’s third quarter earnings report, in which the company reported a massive revenue drop over last year.

The WSJ says RIM has also discussed licensing its software with Samsung and HTC — though that’s unlikely, since those manufacturers are already juggling multiple smartphone platforms. RIM may find some success licensing its OS to smaller manufacturers, though it’s going to have a hard time competing against Android’s free price tag.

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Amazon updates Kindle Fire software to fix performance & touchscreen

Posted: 21 Dec 2011 06:25 AM PST

Amazon has issued an over-the-air update to improve performance and resolve some touchscreen issues for the Kindle Fire.

Kindle Software Update Version 6.2.1 is available now and will be delivered automatically to connected devices.

If you don’t want to wait for the OTA update to come directly to you, you can also choose to download the update manually right now.

“This update enhances fluidity and performance, improves touch navigation responsiveness, gives you the option to choose which items display on the carousel and adds the ability to set a password lock on Wi-Fi access,” Amazon stated in a note on the new release.

Before the update, many Kindle Fire users had complained of issues with the touchscreen, browser and other features. Some reported that the screen was sensitive to accidental touches and even near-touches but that it would respond slowly to intentional touches.

Still, these types of reviews haven’t done anything to slow sales of the product. It’s quickly become Amazon’s best-selling product and is likely to continue its precipitous climb through the end of the year.

Currently, Amazon is selling one million Kindle units each week. The company has offered free shipping on the units until the end of today, December 21, in a bid to attract last-minute Christmas shoppers.

The tablet-e-reader hybrids, which retail for $200, are a welcome (if slightly downmarket competitor) to Apple’s iPad, and consumers have reacted positively to the cheaper Fire since its launch. After just two months of pre-sales and regular sales, Amazon had already shipped between 3 and 4 million units, making the Kindle Fire the second-most popular tablet behind the iPad.

Amazon stated last month that its Black Friday shopping numbers had quadrupled year over year for its full Kindle lineup.

"Kindle Fire is the most successful product we've ever launched -– it's the bestselling product across all of Amazon for 11 straight weeks, we've already sold millions of units, and we're building millions more to meet the high demand,” Dave Limp, Amazon’s Kindle-focused vice president, told Reuters recently.

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MoMinis launches PlayScape, a “Mega-Game” with 50 games in one Android app

Posted: 21 Dec 2011 06:00 AM PST

MoMinis, an Israeli mobile game firm, is launching PlayScape, its first “Mega-Game” with 50 games inside one free Android app.

The PlayScape Mega-Game offers a uniform cross-game experience and allows you to carry experience points and virtual currency accumulated in one game to another. It should make for convenient and frequent game playing, said Eyal Rabinovich, vice president of marketing and co-founder of MoMinis, in an interview.

The cross-game features will encourage players to try out more games, helping game developers with the critical problem of discovery. In the huge Android Market with hundreds of thousands of games, it isn’t easy to get noticed. So developers need something like the MoMinis PlayScape Mega-Game. The app is free, and so are the games, but users pay for virtual goods within the games.

“It provides a good starting point for new players and a real challenge for hardcore players,” Rabinovich said. “The idea behind this is that once you spend a lot of time playing one game, you’ll want to make use of what you have earned to play other games.”

The game is live in the Android Market now. MoMinis developed PlayScape based on an extensive three-year analysis of the 200-plus games that have been created with the MoMinis game development tools. The MoMinis Studio, as it is called, helped the company understand the broad range of player behavior and motivation. That in turn helped MoMinis craft the PlayScape Mega-Game with built-in incentives and a fun cross-game experience. It’s like a meta game layer above the individual games.

Rabinovich said the PlayScape gaming experience is engaging because it has cross-game missions that are constantly refreshed, encouraging players to achieve “experience points” that accumulate over time. Players also earn PlayScape Coins, a virtual currency that is redeemable for virtual goods, new games, and power ups.

It’s akin to the old arcades, where users bought tokens. They would play their favorite game, but then they would use the leftover tokens to try out something new.

“If you play a game for months, you’ll earn enough points to get more games,” Rabinovich said. “And once they spend money in a game, they will just keep on going. It’s a much better choice than starting from scratch without any points to spend. It’s a very natural transition to go to another MoMinis game.”

PlayScape is launching with 50 games in genres including arcade, casual, sports, puzzle, action, and brain. The titles include Bouncy Bill, an arcade game in the Android Market with 500,000 downloads ; Hoopz, a slam-dunk basketball game; Ninja Run, an action-adventure game, and Bubble Monkey, an arcade game for the family.

MoMinis says it provides developers and mobile operators with an end-to-end cross-platform mobile gaming solution, from development to distribution. MoMinis offers developers The Mobile Studio, a free development environment for making games in hours or days instead of weeks and months. MoMinis also distributes the games and earns a share of revenue generated. MoMinis provides games to mobile operators NTT DoCoMo and Turkcell.

In tests conducted by the company, it found that 5 to 12 percent of customers bought apps, significantly higher than the 1 to 3 percent industry average. Starting in the first quarter, developers will begin earning revenue from the monetization opportunities in PlayScape, including virtual currency purchases, advertising, alternative payments such as offers, and other paid services. Players can play for free if they complete enough missions and earn experience points.

MoMinis has raised $4.9 million to date from BRM Capital and Mitsui Ventures. The company was founded in 2008 and has 18 employees. Rivals include Gree, DeNA/Ngmoco, iSwifter and others making meta game layers. And it competes with GameSalad, Unity Technologies and others making game development tools.

Founders include Tzach Hadar, chief technology officer and a former member of an intelligence unit of the Israeli Defense Force. Rabinovich is a seasoned engineer who previous worked at Hegde-Tech Financial Engineering and Lipman Electronic Engineering. Zvi Rabinovich, co-founder, is vice president of research and development.

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Internet “douchebag” Allthis responds to controversy

Posted: 20 Dec 2011 07:37 PM PST

A privacy dust up that started Monday night has unintentionally given a little-known startup its 10 minutes in the spotlight.

Allthis, an online marketplace where users buy and sell 10-minute chunks of time, found itself on the defensive after front-end web developer Joel Housman accused it of “douchebaggery,” and popular publication Boing Boing called it a “shifty startup.”

“We have literally seen our traffic increase 100x,” Allthis founder Christoper Poseley told VentureBeat. “Our experience over the past 24 hours has been interesting and is highly relevant to the broader national discussion around online privacy.”

So what’s with all the hubbub?

Every individual who joins the site is assigned a single token that others, if they have enough time credits, can buy, using virtual currency, at the going market rate. The token represents 10 minutes of your time and, as a condition of the registration process, you pledge to honor and give the allotted time to the highest buyer. But, before today, because the startup’s mission is to allow anyone to get in touch with anyone else in the world, members could buy any person’s token, whether or not that person was a site user.

“In order to show what the potential value of anyone’s time is, we allowed our members to trade options on non-members,” Poseley explained.

Here’s how this works: You find Joel Housman so interesting that you’d like to pick his brain on iOS development, but Joel’s not a member of the site. You still want to express your interest, so you tell Allthis to create a non-member profile for him. Now you can “buy” his token, and others can purchase the token away from you at a higher price. The value of Joel’s time goes up with each purchase, and if Joel were to ever claim his profile, 10 minutes of his time would actually be up for “sale” — real money doesn’t ever change hands. Until then, the exchange would merely up the perceived value of his time.

But Joel doesn’t want to be a member of Allthis. He finds his “fake profile,” believes that the startup has stolen his identity and takes issue with the appearance of a profile he did not create on a site he does not endorse. He is furious. He accuses the startup of scraping data from Twitter, Facebook and LinkedIn to “seed the site with accounts that their users might want to buy the time of.”

Joel isn’t alone. Rob Beschizza, managing editor of Boing Boing, finds the profile he didn’t create and believes that Allthis is misleading folks into thinking they can buy his time. “You can’t. We haven’t signed up; it’s just created a sleazy opt-out system and thrown in everyone it can think of,” Beschizza says.

Scandalous? Hardly, but perception is everything.

“We are not scraping. Our users create profiles of people they want to speak with,” Poseley said. “It’s an important distinction that each of these non-member pages were created from our users … we were not going out and creating a database of profiles ourselves.”

The process worked like this: Users would search for a non-member by name or Twitter handle. “When our engine found the person they were searching for [on Twitter, LinkedIn or Facebook, the user] would import the information to the profile page,” Poseley said. “The method in which our users create non-member profiles is very similar to how users at Pinterest.com create pages,” he added.

No matter. The company has disabled the non-member pages in response to the uproar and is working to evaluate how best to rectify the misconceptions about its practices.

“The users on our site understood how the system worked,” he said. “Nonetheless, some changes must be made. Our goal is to create an efficient marketplace for people's attention, and we will continue to tweak the site as necessary to make our intentions clear.”

But with all the attention, Allthis has been presented with an opportunity to up its own public profile, and it’s a gift token the small angel-backed company should exchange for as much value as it can.

[Image via photographer padawan/Flickr]

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Sony acknowledges technical problems with PlayStation Vita

Posted: 20 Dec 2011 06:51 PM PST

Sony has acknowledged that it’s received a number of reports about technical problems with the PlayStation Vita, a  handheld gaming device that launched in Japan over the weekend.

The company said on its Japanese web site that Sony has gotten more inquiries than usual and it apologizes to customers for any inconvenience. The problems include the device randomly turning off, freezing or lagging during game play, and problems registering a PlayStation Network account.

Many new gaming systems have these types problems, but the statement from Sony suggests that they may be widespread for the Vita.

Cheap Ass Gamer founder David “CheapyD” Abrams uploaded a video explaining how he had to set up a temporary PlayStation Network account to download an update to fix a glitch that stopped him from using a pre-existing PSN account.

Sony sold about 321,000 units in its first two days of sales. But the positive reaction could very well be hurt by reports of technical problems.

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Apple adds ‘Season Pass’ discount for TV shows on iTunes

Posted: 20 Dec 2011 06:29 PM PST

iTunes, season pass

iTunes has always offered its customers a way to save a few bucks on digital music purchases if they buy the full album, and now Apple is extending that option to television shows.

This week Apple, added a “Season Pass” purchase option for most television series. Rather than spending $2 to $3 per episode, iTunes customers can now get a discount when they purchase all the episodes within a single season of a TV show. On average, the season pass option will save you $10 to $15 on a full season of TV. And like the album sales, you can choose to purchase the season at a discounted price if you’ve previously bought single episodes within that season.

While the new Season Pass option is nice, I’m not sure many people will really care. Both Hulu and Netflix streaming subscriptions are about $8 each per month. If you subscribe to both of them, it’s still cheaper than the majority of full seasons available on iTunes. Also, Hulu recently signed a deal to bring CW shows to the service, which means it has content from four of the five biggest TV networks. Since Hulu Plus subscribers have access to all the episodes in the current season, paying the $8 per month seems like a better option.

Arguably, the additional money you’re paying to iTunes does mean you technically own the shows, but I don’t know how big of a benefit that is either. Both Netflix and Hulu are available on a growing number of devices, provided you have a reliable Internet connection. (If, however, you plan on watching lots of TV shows on your iPad while flying on a plan every other week, then the season pass will certainly save you some cash.)

If you plan on purchasing more TV shows through iTunes because of the Season Pass deal, leave us a comment below.

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Keas wants to keep your employees healthy with games and social media

Posted: 20 Dec 2011 05:19 PM PST

Keas, a social game that promotes health and wellness within companies, received $6.5 million in funding on Tuesday. The second fundraising round was led by Atlas Venture and Ignition Partners.

Keas was developed by former Google Health leader Adam Bosworth to promote corporate wellness. It combines game play and socialization to motivate employees to adopt healthy lifestyles. Employees form teams and work together to complete three fitness and health goals each week. Goals range from taking the stairs and doing specific exercises to avoiding junk food and choosing nutritious lunches. Keas relies on peer accountability and rewards to keep people motivated: Employees keep each other in check to complete goals and they get prizes for their hard work.

"There are very basic, universal actions we can all take to turn things around: eat our vegetables, eat less, exercise more, and relieve stress,"  Bosworth said in a press release. "The real problem is motivation, and that's where Keas comes in. It's Facebook meets Farmville: social, playful and an experience that employees can actually have fun with. That's the secret sauce, and that's why it works."

Keas looks a lot like Facebook and acts like it, too. For instance, employees can post status updates, and they can comment on and "like" fellow employees’ statuses.

With this series B funding, Keas plans to grow the business, increase distribution and build up its sales and marketing departments. More than 60,000 employees from companies such as Pfizer and Salesforce have used Keas already, and the company want to keep those numbers growing.

Keas was founded in 2008 by Adam Bosworth and George Kassabgi and has raised $16.5 million in funding to date. The company is headquartered in San Francisco, Calif. and has around 30 employees.

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RIM said to have spurned Amazon’s acquisition advances

Posted: 20 Dec 2011 04:50 PM PST

Research in Motion, the mobile device company in desperate need of a hit, apparently shunned the summer acquisition advances of e-commerce and hardware behemoth Amazon.

Amazon, a lovely suitor if ever there was one, went so far as to hire an investment bank to advise on a potential deal, but it did not make a formal offer, Reuters is reporting. The reason? RIM just wasn’t that into them.

RIM, said people familiar with the matter, would prefer to have co-captains Mike Lazaridis and Jim Balsillie continue to man the helm and right the course of what appears to be a ship with a broken compass. The BlackBerry-maker is said to have also rejected advances from companies other than Amazon, and is not open to a sale or break-up of the company. AllThingsD is reporting that Microsoft and Nokia have toyed with the idea of a joint RIM take over.

“They have had approaches from folks who have wanted to have discussions,” a Wall Street banker told Reuters. “The issue is it is hard to find a value that makes sense with a falling knife.”

So RIM is in it to win it. Okay, that’s noble, and it’s a rally-time strategy we could get behind if the company would stop fumbling the ball. The PlayBook tablet has performed atrociously, for instance, and we learned last week that the release of BlackBerry 10 devices, RIM’s only real hail-mary opportunity, was pushed back. Now the new phones won’t see the light of day until late 2012 — an entire year away. Chances are we’ll see a new iPhone before then.

Things could get a lot worse before they get better. RIM reported profits of $265 million on $5.2 billion in revenue in the third quarter of 2011. For some perspective, that’s down $911 million from a year ago. And the co-CEO even admitted, “It may take some time to realize the benefits of these efforts and the platform transition that we are undertaking.”

Image via johncatral/Flickr

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DOJ launches probe into Verizon’s spectrum deal with big cable

Posted: 20 Dec 2011 04:36 PM PST


Perhaps Verizon was a bit hasty in its decision to stop growing its FiOS TV and broadband Internet business in favor of wireless partnerships with big cable companies. U.S. regulators have launched a probe into Verizon’s recent wireless spectrum agreements,which could leave the largest wireless carrier walking away empty-handed.

As VentureBeat previously reported, Verizon will pay Comcast, Time Warner and Bright House $3.6 billion to license a portion of wireless spectrum owned (but not in use) by the three cable companies. In return, the cable companies will cross-market Verizon's phone, video, Internet and cell-phone services to its customers. Verizon also decided to halt the build out of FiOS, which is a direct competitor to the primary services offered by those cable companies. For Verizon, building a broadband Internet infrastructure is most likely more expensive and less profitable than growing its wireless business.

However, Verizon’s deal with the cable companies is now under investigation by the U.S. Department of Justice, reports Bloomberg. The DOJ thinks the deal has the potential to hurt competition in the wireless and cable industries. Honestly, it’s hard to make a case against the DOJ’s statement.

The wireless spectrum Verizon is obtaining from the cable companies was licensed out by the government with the intention that it promote additional competition in the wireless service market. This agreement basically does the opposite of that — allowing Verizon to build out its high-speed LTE network and increase the visibility of its existing services. As for Comcast, Time Warner and Bright House, they don’t plan on launching their own wireless service businesses, which means that portion of the wireless spectrum is essentially going to waste.

Lately, U.S. regulators have decided to play hardball when it comes to competition in the wireless business. The DOJ’s push back on Deutsche Telekom’s proposed sale of T-Mobile USA to AT&T caused the deal to fall apart.

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Oracle stock drops 9% after weaker-than-expected earnings

Posted: 20 Dec 2011 04:18 PM PST

oracleSoftware titan Oracle reported underwhelming quarterly results this afternoon, leading the company’s stock to drop more than 9 percent in after-hours trading.

Oracle provides enterprises and governments with software and data-center hardware. Sales for the company’s fiscal second quarter disappointed Wall Street analysts. The company’s revenues were up just 2 percent to $8.8 billion, and profits amounted to 54 cents per share. Analysts had expected sales of $9.23 billion and a per-share profit of 57 cents

Digging into the specifics, it was hard to find good news. The company’s hardware sales were down 14 percent to $953 million versus the year-before quarter, and software sales rose a tepid 2 percent to $2 billion against the year-before quarter. On the bright side, revenue from software license updates and product support amounted to $4 billion, which is up 9 percent from the year-before quarter.

Oracle recently added a public cloud option for its customers after several years of CEO Larry Ellison dismissing the cloud. The company has doubled down further on cloud services with its planned acquisition of sales force automation company RightNow.

In the late afternoon Pacific time, Oracle’s stock on the Nasdaq exchange is trading at $26.54, which is nearly 9 percent lower than its close price today of $29.17.

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Mygola wants to bring back the travel agent, grabs $1M in funding

Posted: 20 Dec 2011 03:46 PM PST

Remember travel agents? Remember how the Internet gave everyone the power to plan their own trips, and then there weren’t any more travel agents? Mygola is a hoping the hassle of researching and booking a vacation online brings the trend full-circle.

The company just received $1 million in funding for its service that uses a combination of technology and real people to plan trips for clients. The round of funding was led by Blumberg Capital, 500 Startups and a few other angel investors.

Mygola uses trained freelance travel guides (yes, actual humans) to research and plan trips all over the world.  The company’s main goal is to combine technology and real humans to deliver helpful and personalized travel information. "We are trying to do two things simultaneously; at one end we are trying to aggregate tremendous amounts of data automatically from around the web and on the other side we trying to build this recruiting and training platform, where anyone in the world can sign up to become a guide." Mygola founder Anshuman Bapna said in an interview.

Just fill out a form on the Mygola website saying where you are going, when you’ll be there, what you need help with (hotels, places to see, restaurants) and what you are interested in doing. Within 24-hours, a team of guides will then return well-researched, unbiased information for your trip. Mygola can even book flights, hotels, and restaurant reservations for you. Beyond standard travel information, Mygola can research specific details such as where to rent a car, how to use your cell phone in a foreign country, or how to handle your kid's needs at a destination.

The company has an odd pay-as-you-wish structure. The first question is free, but to ask another you’ll have to pay, though the amount is up to you. Frequent travelers can sign up for a plan instead; they start at $30 for a trip, or $99 for a full year of all-you-can-ask questions.

This round of funding will be used to recruit and train more guides from all over the world, so Mygola can serve more travelers. In addition, Mygola plans to continue with product development and create mobile apps for its service.

"Our main focus has been for the past year to building the backend operation to a point where we could recruit and train guides very quickly and at high quality" Bapna said in an interview, "We are recruiting about 80 guides per week and we want to make that footprint much more global."

Mygola was founded by Anshuman Bapna in 2009 and the company currently has 14 employees. Mygola has been funded by Blumberg Capital, 500 Startups, Lewis Cheng, Mac Harman, Sandeep Bapna, Priyavrat Bhartia, Aldo Monteforte and Alvaro Gutierrez.

Airplane-on-a-mouse image via Shutterstock

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Playstation Vita and Nintendo 3DS batteries put through their paces – which was the winner?

Posted: 20 Dec 2011 03:36 PM PST

Handheld gaming can be great fun, but not so much when your console battery dies mid-flight. A dedicated gamer who goes by the name “kurekureyon” has put both the Nintendo 3DS and PS Vita to the test this week, comparing their battery life to the PSP-3000 handheld.

The three systems were set to their highest brightness and highest volume, then left to run mid-game. The resulting film of the test has been shared on YouTube, and while it has been speeded up 100 times, it still lasts a good nine minutes.

Thankfully, you don't have to watch the whole video to find out the results of the test. The Nintendo 3DS died first, after 2 hours and 35 minutes. The PS Vita was next to go, at 3 hours and 47 minutes. The PSP-3000 outlasted both of the new wave consoles, continuing to function on its 2200mAh battery for nine hours, before finally giving up the ghost.

The Nintendo 3DS and Playstation Vita are both supposed to provide between 3 and 5 hours of gaming time, something that the Vita just managed in this test. Obviously turning down brightness and sound settings would help both consoles to deliver better results. Reducing the 3D effect on the 3DS would also help to enhance its battery life.

The PSP-3000 that was used in this test is fitted with Sony's official extended life battery kit, which roughly doubles the performance of the original 1800mAh battery. In comparison, the 3DS is fitted with a standard 1300mAh battery, and the PS Vita has a standard 2210mAh battery inside.

Sony has already preempted concerns over PS Vita battery life, by announcing a separate battery pack, that can be plugged into the console. This will be sold separately, and it should provide enough power that “if you're flying from New York to San Francisco or vice versa, you'll have no concerns.”

Nintendo has not responded to the short battery life of the 3DS so far, but it is widely expected that a redesign of the console will appear at some point, given the previous path taken with the DS and DS Lite. A second generation 3DS might also include a second analogue stick built into it, to circumvent the need for the Circle Pad Pro peripheral that releases next month. In the meantime, it is possible to purchase a third party device to help double the battery life of your 3DS.

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Sony gets sued for its “no sue” clause for PlayStation Network

Posted: 20 Dec 2011 03:30 PM PST

Sony has been sued for adding a clause to the PlayStation Network’s terms-of-service that prohibits gamers from suing Sony whenever something goes wrong with the network.

Sony got the idea for this clause after it was sued by gamers earlier this year when the PlayStation Network (PSN) was hacked and went down for six weeks.

After Sony added the clause that prohibited gamers from suing to the PSN terms of service, Electronic Arts and Microsoft followed suit.

For Sony, the clause meant that if anything went wrong with the online services, the company couldn’t be held responsible. Gamers could opt out of the “don’t sue” clause, but they had only 30 days to do so.

An unnamed Northern California gamer has filed a class action suit against Sony for unfair business practices. Sony hasn’t commented yet.

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Twitter releases code for TextSecure to the open-source community

Posted: 20 Dec 2011 03:02 PM PST

Android text-message-encrypting application TextSecure is now open-source, thanks to Twitter. On Tuesday, Twitter announced on its developer's blog that it would be releasing the code from newly acquired Whisper Systems, starting with TextSecure.

In November, Twitter acquired Android-security startup Whisper Systems and added its co-founders, Moxie Marlinspike and Stuart Anderson, to the Twitter team. With the acquisition, Twitter also gained the code for Whisper System's products including TextSecure, WhisperCore, WhisperMonitor and Flashback, all applications that are meant to make Android more secure.

Twitter plans to open up all of the code over the next few months, once it confirms that the code meets legal requirements and is viable for the open source community.

The code for TextSecure is available now on Github for anyone to use as they like. Twitter said in its blog post that it hopes people will find the code useful and build upon it. Whisper Systems’ other applications will likely be made open-source in the coming months.

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Ge.tt gets $455,000 to transfer your files faster

Posted: 20 Dec 2011 02:14 PM PST

Ge.tt is a browser-based, file transfer service that today announced an investment of €350,000 ($455,000) from Atomico, the venture capital firm of Skype founder Niklas Zennström. The Copenhagen-based startup will use the cash to hire new staff.

“The space is very fragmented and there are a lot of competitors,” says CEO Tobias Baunbæk. ”They all have different qualities: Dropbox for file collaboration, Box.net for content collaboration and YouSendIt to send files over email.”

Let’s remind ourselves that DropBox closed a $250 million round of funding in mid-October and is valued at $5 billion. Box.net raised a recent $81 million extension round of funding and has been used by 77 percent of the Fortune 500. File transfer is a big business, but also a crowded and well-funded one, so Atomico must see something new in Ge.tt.

Ge.tt doesn’t require an account, and files can be uploaded and downloaded simultaneously. ”Imagine a photographer who wants to send 50 images to a client,” explains Baunbæk. “He drops them into Ge.tt, immediately gets a link and sends this to his client. The files are uploaded one by one. If the client requests a file which hasn’t been uploaded yet, this starts to upload and he never realizes that the file wasn’t on the Ge.tt servers.” The team claims to have developed a new technology to make transfer much faster than other services, making it popular with media companies, which need to transfer many large files.

Ge.tt currently has 430,000 users. Users get 250MB of free storage. By creating an account, users increase that to 2GB of free storage. $5 a month buys you 5GB, $10 40GB  and for $20 you get 100GB.

Ge.tt’s home base of Copenhagen, has an interestingly diverse startup scene for a small city. VentureBeat has covered Danish companies from concrete revolutionaries Abeo, wine recognition app Vivino and driving safety software Anti-sleep pilot to invoicing startup Tradeshift. It’s also the home of Sunstone Capital, the early investor in presentation software Prezi, which just landed $14 million from Accel Partners.

Copenhagen also has a noticeable number of that rare breed, the female startup founder, including Tine Thygesen  of Everplaces and Founder’s House, Mette Lykke of fitness app Endomondo and Camilla Ley Valentin of virtual queuing startup Queue-it.

Ge.tt was founded in 2010, has 4 employees and is based  in Founders House, an invitation-only working space in Copenhagen.

Filed under: cloud, deals, VentureBeat

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In AT&T breakup, T-Mobile gets 3G roaming deal and wireless spectrum

Posted: 20 Dec 2011 02:08 PM PST

t-mobile carlyThe dust is settling from yesterday’s news that AT&T has given up its T-Mobile acquisition plans, and it turns out even a failed merger is quite expensive.

Because its proposed $39 billion merger fell through, AT&T now has to give up piles of cash and benefits to T-Mobile. AT&T will enter into a 7-year 3G roaming agreement that will boost T-Mobile coverage, and it has to give up a valuable package of AWS (Advanced Wireless Solutions) mobile spectrum that covers 128 cellular market areas (CMAs), including 12 of the top 20 U.S. markets. Overall, the agreements will boost T-Mobile’s blanket coverage from 230 million to 280 million people in America.

On top of doling out valuable benefits that will help the competition, AT&T will also pay $3 billion in cash to T-Mobile parent Deutsche Telekom. That $3 billion amount is one of the highest break-up fees ever.

The new service agreements will be important to T-Mobile USA if it wants to stem the tide of customers leaving its service. At the very least, T-Mobile’s current customers will benefit from the company having more coverage and spectrum that can help deliver data on smartphones.

T-Mobile said early today that there was “no Plan B” and the company is scrambling to figure out what to do next. Because the company doesn’t officially offer the iPhone, it has a major disadvantage when going up against AT&T, Verizon and Sprint.

Filed under: deals, mobile

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Third-quarter digital game sales couldn’t offset big drop in retail video games

Posted: 20 Dec 2011 02:03 PM PST

The total amount that consumers spent on games in the third quarter was $4.2 billion, down 11 percent from the same period a year ago, according to market research NPD Group.

That number includes the money spent by consumers on hardware, content, and accessories. Sales of console and PC games purchased at retail stores amounted to $1.3 billion. Other game-related income categories  — including sales of used games, game rentals, online subscriptions, downloads of full digital games, social network games, downloadable add-on content and mobile games — added up to $1.64 billion.

“New physical retail sales had a rough third quarter,” said Anita Frazier, an analyst at NPD, in statement. “Increases in sales from some of these other monetization methods, and full game and add-on digital downloads in particular, only partially offset the decline seen in the new physical retail channel.”

She added, “We are already seeing some dynamic changes in the marketplace in Q4 and we are seeing interesting geographic differences from the expansion of our coverage in the UK, France and Germany. Q4 2012 results from both the U.S. and Europe will be issued in March, 2012.”

The quarterly report from NPD comes out later than its monthly U.S. game sales reports, but it has the added benefit of a fuller description of overall game sales because it includes digital game sales and used games and rentals. The third quarter was a particularly weak season for the release of new blockbuster video games for the consoles.

[image credit: ETF Trends]

Filed under: games, VentureBeat

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LivingSocial will be bought, and other daily deals predictions for 2012

Posted: 20 Dec 2011 01:46 PM PST

From delayed IPOs to buyouts and layoffs, 2011 proved to be a volatile year for daily deals companies. In the past 12 months, the industry was defined and legitimized, but had just as many mistakes as successes.

The biggest daily deal flaw in 2011 was that primary pioneers of the product created an unsustainably expensive infrastructure to deliver it. They tried to build new, enormous consumer brands just around deals; they spent too much on Super Bowl ads and sales forces to sell only one kind of marketing program. The “Groupon tax” is too high.

And, while many of the infinite small deal sites are now being weeded out and even some larger programs are shifting focus, I believe 2012 will usher in new programs that merge content with a seamless deal delivery experience. The focus will not be on deal sites and daily emails, it will be on matching the right customer with the right offer at the right time. With this in mind, here are few of my predictions of what's ahead for the daily deal industry.

1. LivingSocial will be purchased

The Amazon-funded daily deal site has patiently waited in the IPO shadow, and has learned a lesson or two from its rival's bumpy road to Wall Street. I predict that LivingSocial will not stay independent long, despite its IPO plans. Instead, the deal provider will jump to the head of the group-buying pack by combining assets with a major e-commerce player. By merging with a company backed by a large Rolodex and bank account, LivingSocial will be poised to successfully leapfrog Groupon and render it a mere also-ran in the daily deals landscape.

2. Two hundred "Groupon clones" will bite the dust as consolidation mode takes off

With more than 600 companies currently operating in the group buying space, industry consolidation is going to become a very real threat to many daily deal sites. According to Yipit.com, over 170 deal sites failed in 2011. Next year the trend will continue as large companies purchase smaller rivals and other generic deal brands go belly up. I think more than 200 of the 'me-too' deal sites will close their doors within the first six months of the New Year. Meanwhile, sites that have found a way to integrate daily deals into their existing content, rather than just photocopying Groupon's model, will not only survive but thrive.

3. Big branded sites' futures lie in instant, contextualized deals

I believe 2012 will be the year big brand sites, which source hundreds of deals to large audiences with diverse interests, establish a profitable business model. But profits will only follow the ability to tailor content, matching the right customer with the right merchant. Simply put, the daily space will be dominated by the players who understand how to effectively merge content and commerce into a seamless experience, allowing consumers access to relevant deals anywhere and at any time. In 2012, I think Groupon and LivingSocial will make massive investments in their mobile capabilities, while Google, Facebook and other major audience aggregators will extend their commitment to the integration of location, advertorial, mobile and contextual commerce.

4. Lacking loyalty, Groupon goods will come to a dreary demise

From the operational challenges associated with maintaining a physical inventory to heavyweight competition from highly efficient retailers like Amazon, Gilt and eBay, Groupon Goods has faced an uphill battle from its very beginning. I predict that the fatal flaw in Groupon's product arm will be the lack of loyalty and repeat customer opportunity. In fact, recent Forrester research already suggests that 51 percent of customers who buy the heavily discounted goods said they would've purchased those goods or services at full price anyway–but took the discount instead because it was available. Merchants, lacking the customer acquisition required to justify the steep discounts, will opt out of the site's partnerships.

Tippr Founder/CEO Martin Tobias is a veteran executive, serial entrepreneur, and a green energy and technology venture capitalist. Tobias has more than 30 years of experience creating and leading successful companies including Loudeye Technologies, Impreium Renewables and Kashless, Inc. From his beginnings as a programmer, Tobias has focused on applying technology to solve real world business problems.


Fortuneteller image via Shutterstock

Filed under: VentureBeat

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Venture capitalists focus on later stages, but Silicon Valley still rules

Posted: 20 Dec 2011 12:01 PM PST

Venture capital funding hasn’t hit the peaks it saw in early 2000, but it’s still going strong — particularly in Silicon Valley and for software companies.

Our analysis of venture funding from a variety of data sources revealed some interesting facts about last quarter’s deal flow.

Last quarter, venture capital firms invested $6.95 billion into 876 deals, averaging $7.9 million per deal, with the vast majority of funding funneling out of Silicon Valley in the form of expansion and later-stage investments in the software and biotech industries.

Since 1995, the most active quarters to date based on total funds invested were Q1 of 2000, which saw $27 billion invested into 2,171 deals. That was followed by Q2 of 2000, with $26 billion invested and 2,135 deals announced; and Q3 of 2000, with $25B invested into 1,951 deals, according to data reported by Thomson Reuters.

Compared to the late ’90s, when VCs were pouring funding into a wide range of dot-com startups before the bubble burst in 2000, last quarter saw more conservative investment numbers. When VCs did decide to invest, it was typically in the form of expansion and later-stage investments.

10 most active VCs of Q3

  1. New Enterprise Associates, Inc.: 27 deals, including CloudFlare, Inc. and GoodGuide, Inc.
  2. Kleiner Perkins Caufield & Byers: 23 deals, including FindTheBest, Flipboard and Square.
  3. First Found Capital: 22 deals, including Bitcasa and Turntable, fm.
  4. Sequoia Capital: 16 deals, including Tumblr and MeLLmo
  5. Intel Capital: 15 deals, including DynamicOps and Swrve New Media
  6. U.S. Venture Partners: 15 deals, including Blekko, Inc. and Yammer, Inc.
  7. Accel Partners: 14 deals, including Dropbox and Top10
  8. InterWest Partners: 14 deals, including Cloud9 Analytics, Inc. and Quantance, Inc.
  9. Google Ventures: 13 deals, including CustomMade and Ordr.in.
  10. Rho Capital Partners, Inc.: 13 deals, including Clean Urban Energy, Inc. and Dashlane

You can also view this list as an interactive chart comparing the top 10 most-active VCs.

Top 10 most funded industries

  1. Software $2B, 263 deals, 28.88% of total investments
  2. Biotechnology $1.08B, 96,15.52% of total investments
  3. Industrial/Energy $749M, 75, 10.77% of total investments
  4. Medical Devices and Equipment $728M, 74, 10.48% of total investments
  5. Media and Entertainment $682M, 112, 9.82% of total investments
  6. IT Services $547M, 79, 7.87% of total investments
  7. Consumer Products and Services $209M, 27 deals, 3.01% of total investments
  8. Semiconductors, $183M, 26, 2.63% of total investments
  9. Electronics/Instrumentation $152M, 20, 2.19% of total investments
  10. Healthcare Services $152M, 11 deals, 2.19% of total investments

Last quarter's investments were highly focused towards the software and biotech industries, though dollar investments into biotech companies actually fell 18 percent and the number of biotech deals fell by 20 percent as compared to the previous quarter.

Funding to software companies increased by 23 percent from the quarter prior, making it the most-funded industry with $2 billion invested. The software industry received nearly 29 percent of total investments, according to data provided by Thomson Reuters and reported by Price Waterhouse Coopers.

The biotech industry came in second, raking in $1.1 billion with 15.5 percent of total investments.

The most active VC regions

  1. Silicon Valley $2.7B, 273 deals, 38.38% of investments
  2. NY Metro $891M, 103, 12.82% of investments
  3. Texas $596M, 38, 8.57% of investments
  4. New England $586M, 108, 8.42% of investments
  5. LA/Orange County $401M, 51 deals, 5.77% of investments

The majority of funding, not surprisingly, came out of Silicon Valley, with the New York Metro area coming in second and Texas coming in third. But while investments coming out of Silicon Valley decreased by 13 percent last quarter, investments out of New York Metro and Texas saw increases of 33 percent and 113 percent respectively. You can view

New York Metro's growth comes as Mayor Bloomberg announced earlier his belief that NYC's Silicon Alley could soon replace California's Silicon Valley in terms of high-tech startups and VC funding.  Despite predictions, last quarter Silicon Valley invested more than three times the amount New York Metro did, and more than the second, third, fourth and fifth highest investing regions combined, with a total of $2.7 billion into 273 deals.

Investments by stage of development

  1. Expansion $2.5B, 260 deals, 35.92% of investments
  2. Later Stage $2.3B, 186 deals, 33.37% of investments
  3. Early Stage $2B, 341 deals, 28.14% of investments
  4. Startup/Seed $179M, 89 deals, 2.57% of investments

Finally, the majority of last quarter's deals were in the form of expansion and later stage investments, while startup funding made up only a fraction of total investments.

Companies looking for investors can find and compare venture capital firms based on location, industry focus, investment stage and investment range on FindTheBest's Venture Capital Firms comparison.

 Grace Nasri is the managing editor at FindTheBest.com, a data-driven comparison engine.

Filed under: deals

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