And Animoca couldn’t be happier about that.

Co-founder Yat Siu calls them “fast food apps.” His 150-person company, a conglomerate of 12 smaller studios, has developed and published more than 350 apps, he said, currently at the rate of about four every week. Its goal is to one day crank out a new app every day as it expands its reach further into Asia and beyond.

Siu, who is also the CEO of Animoca’s parent company, Outblaze Ventures, said as much in a recent interview with AllThingsD. But he also had a lot more to say about the advantages of working outside of Silicon Valley, the maturation of Google’s Android ecosystem and why quantity is sometimes better than quality.

AllThingsD: What’s the difference between being based in Hong Kong and being based in Silicon Valley?

Yat Siu: In terms of our [Android] ecosystem, it is the dominant marketplace, whereas in the Valley, there’s a lot of focus on Apple. We don’t have that much venture capital available to us, so we have to focus on profitability and the bottom line very, very quickly. Our games aren’t all profitable, but our business is. And we’re just a small island city, so we do not have a domestic market. It’s go global or die.

How do your games fare in different regions?

When we first started [in 2011], the U.S. was our biggest market, but just because it had a larger ecosystem. That’s changing today. North America as a continent is now in second place to Asia because Japan and Korea are driving a lot of the revenues. … The people who are buying iPhones or Android phones in the U.S. today are not the first movers, whereas in Asia, a lot of the marketplace still has way under 50 percent smartphone penetration rates. In Japan, at the start of this year, it was under 30 percent.

Is Android fragmentation a problem for you? Putting most of your eggs in that basket means you’re dealing with phones that range from the very low end to the very high end, right?

Two years ago, we had a testing rack of 600 devices. Now, Samsung is outselling basically everyone else, except in China and Japan. The second thing that’s different now is that “low end” is no longer really “low end.” You used to have really poor devices with poor resolution and processing power. Even the so-called “cheap” devices that are sold in China today are quad-core or dual-core devices; they just cost $100, is all. And they’re all standardizing around Jelly Bean (the most recent version of the Android OS). The whole Android philosophy was, “Here, take the operating system. Do what you want. Good luck!” We had weird memory issues because people would be coding stuff on top. Now, with Jelly Bean, most of the stuff that’s going on in the operating system is going on in the application side.

Pretty Pet Salon is one of the more popular games Animoca has published, and started a “Pretty Pet” franchise.

Tell me about your games and how they perform. How do you evaluate success?

We look at every product as a gateway to another product. The key driver is popularity. Monetization will come, we think, once people are in there, but the ability to cross-promote to other games becomes important. We want to make sure that the user always has at least a few of our games to play, because we don’t believe that there is such a thing as a person who can play a game for years and years and years. It’s “fast-food apps.” People just want to consume quickly, move quickly and go on to the next thing. It doesn’t mean that they won’t come back to it, but they’re not prepared to invest console-style, sitting down and playing for four hours.

And if you spent $60 on a game, you’re probably going to invest a lot more time than if you spent nothing or spent 99 cents.

That’s true, too, definitely. But also, with mobile, whether it’s in trains or one-handed game time, sometimes it’s just when you’re lying in bed, the behavior that we’re seeing now is that a person is playing a game, and then after five minutes, he wants to move on to another game. He’s not necessarily playing the same game for an hour. He’s like, “I feel like something else.” It’s no different than people switching TV channels every once in a while, except they’re switching games.

So it’s not as much of a “hits-driven” business for you as it might be for others?

It’s all relative. What is a hit? Because it’s a global audience, a niche segment is pretty large. And yet, if you have a five-million-user niche, is that a hit? It’s probably a hit for an indie studio, but it’s not a hit for us because of the scale we operate in. Typically, we call anything a hit if it has over 15 million downloads, but as a franchise, as a series. We might have one app, and then if it does well and has a few million downloads and reasonable revenues, then we put sequels and additions on top of it. Out of the series, we may wind up having something like 20 or 25 apps.

For those games that aren’t sequels to existing games, how do your studios come up with new things to publish?

We have studios that are as small as six people. The producer is empowered to have his own budget and his own creative vision. There’s a weekly meeting where all the producers come together and talk about what they’re doing, and then go off and do their own thing. The advantage for the business is, if you start off with a studio of six people and it bombs, who cares? It’s not great for them, but the business can afford to do it. If they do well, they have a platform.

The independence of our studio is also attractive to our staff. They have the chance to be a startup without the startup risk. They don’t have to worry about payroll or finance, they can focus on the product and build their own team. The additional unintended advantage is that, in Hong Kong, we’re unique. So, if you want to do games and you want to publish your games, then, frankly, there’s nowhere else to go. People come to us because the other option is banking or finance — which is a good career, just not if you don’t like it. If we were in the Valley, we might end up getting slaughtered by the amount of recruitment and loss of staff. Who knows?

But it’s worth noting that you do also maintain an office here in San Francisco for non-game development roles like partnerships and PR.

In the past, the meccas of the global gaming space used to be different. They used to be Sony, Nintendo and, at one point, Sega. But it was never centered around Silicon Valley. That changed with the smartphone. Now the new mecca is the Bay Area, because Google Play is here and Apple is here. We have an office here because we have to pay homage to the new temples. Even though we’re not in the Valley, it’s absolutely required for us to go in. Every other app company that’s international that wants to succeed must do the same.

Almost all of your revenue, about 95 percent, comes from in-app purchases. Are you looking at other business models?

Advertising will come, but it is not dominant yet. Primarily, the buyers for that now are other app companies, and we’ve got our own network. If we focus more on our cross-promotion, we get more out of that than necessarily opening up inventory to everyone else. Right now, ads are generally low-quality, and they’re also spammy, so it’s a bad user experience. But that will change. The experience is there already — think about how much time you’re spending on mobile versus PC — but [ads] have to deliver value to the user. Facebook has the right idea. People who like casual games, you should really only show them other casual games. Today, the targeting doesn’t exist.

What does your conversion rate of non-paying to paying players look like? The typical curve has a lot of people at the bottom paying nothing or almost nothing, then a long tail with a bump at the end, composed of a small number of players who pay a lot.

That is the hardcore type of model, where basically you have a very low conversion rate, something like 2 percent, and a very high consumable model where people can spend thousands of dollars. That’s not our model. If you look at games like Pretty Pet Salon, you’d be hard pressed to spend more than 20 bucks, just because of the game play. We are expecting to have more volume of titles with a larger frequency of players coming in from outside. So, for instance, Pretty Pet Salon has an 8 percent conversion rate. Now, when we start working with Forgame (Animoca recently accepted a “strategic minority investment” from the Chinese hard-core game maker), that is different. We will listen to their suggestions, and it does appear that that will be the strategy, because people are prepared to spend that kind of money. It’ll be a learning experience for us.

The real story here is mobile (as always). The company’s mobile ad revenue accounted for 30 percent of the overall ad biz — a whopping jump from the 23 percent of mobile ad revenue raked in last quarter.

A good thing for the social giant, considering the company’s entire user base is slowly trickling over to accessing the site via mobile device. Monthly active users viewing the site on mobile devices came in at 751 million, a 54 percent jump year over year.

Scary at first, perhaps, for the Web industry as a whole, with all the companies in the Valley scrambling to make the move to mobile effectively. Now, optimistic as ever, Facebook continues to position it as an opportunity, not a liability.

Check out my notes from the company’s quarterly conference call earlier on Wednesday, starring CEO Mark Zuckerberg, COO Sheryl Sandberg and CFO David Ebersman.

———————
1:55 pm PT: Gotta love the flute music. Holding patiently.

2:00 pm: About to start!

2:02 pm: Buncha standard legalese. Please hold for actual substance.

2:03 pm: First up, Mr. Zuckerberg.

2:04 pm: Zuck says he’s surprised how the growth keeps going even though there’s more than a billion people using the service.

Funny, considering the growth rate is slowing overall.

2:04 pm: FLASH — Zuck is super stoked on Facebook Home, the company’s recent mobile software release.

It’s great! Gonna be huge! Alas, we just released it and only a few phones can use it. So please hold for more awesomeness.

2:06 pm: Next up, Instagram. Zuckerberg also loving how great CEO Kevin Systrom is doing with the platform. 100 million users. Fantastic!

2:07 pm: Zuckerberg playing up how important Facebook Platform is to the company. Especially mobile apps from third parties.

“I think it’s clear now that we can create a lot of value for devs by providing identity,” he said. “We’re starting to see real revenue from mobile app installs.”

2:08 pm: Platform emphasis makes sense. Facebook really needs great content flowing through the news feed to keep you coming back and looking at it. That means cool-looking apps and stuff.

2:10 pm: Again, big emphasis on Home, Graph Search and the like as “long-term investments.”

In other words — THE MONEY FROM THESE PRODUCTS WILL COME LATER, Y’ALL.

2:11 pm: Time to Lean In! COO Sheryl Sandberg is on the call.

2:11 pm: Sandberg reiterating how awesome the shift to mobile is. We check our phones so often, that’s perfect for mobile ads!

Mobile ads biz doing great internationally — “particularly in Asia.”

2:12 pm: Sandberg, like Zuckerberg, is pushing the company’s mobile app install ads product. Basically a paid way to stick your app inside the mobile news feed. Click on it, and it’ll send you to the Google or Apple app store and have you download the app.

For what it’s worth, I’ve heard anecdotally that those ads do indeed drive significant downloads. Good ad product, it seems.

2:13 pm: Sandberg talking about the Atlas acquisition, which closed last week.

Big deal for ad measurement success. Basically it’ll be another way to show the ad folks that yes, your Facebook ads are worth it and no, don’t measure by clicks like you’re used to with your stuffy old Google ads!

2:15 pm: Sandberg, in a nutshell: FORGET CLICKS. We got way better ways to measure ad success.

2:18 pm: Sandberg feeling great on Q1, and still pushing the fact that it’s early days in the ads biz for Facebook. Keep on keepin’ on.

2:19 pm: Here comes CFO Ebersman.

2:19 pm: Mobile still huge in terms of who’s accessing the site. As we know.

2:20 pm: Crazy. Mobile-only users visiting Facebook on a monthly basis at 189 million users.

2:21 pm: Payments and fees revs were up year on year. Games in particular were up 12 percent.

Huh. Q1 saw a record number of people playing games on Facebook.

2:23 pm: Warning: Expenses are gonna swell. But we’ve been saying that for a while. Infrastructure, engineers, new campuses, new products — all of that costs money.

2:24 pm: So take note of that last thing Ebersman said.

Q1 had a record number of people playing games on Facebook, while Zynga’s contribution to that dropped by 37 percent. Other game developers are up 60 percent.

That’s a big deal. Larger diversification of the games and payments ecosystem.

2:29 pm: Growth and engagement geographically is up internationally, Ebersman says.

Mobile obviously responsible for that.

2:30 pm: A question about different screen form-factors.

2:32 pm: Zuckerberg: Sure, there will be more screens. Whether it be desktops, or phones, or “glasses … whatever the products are.”

“The big question for us is which platforms do we see growing the quickest?”

2:32 pm: “Ads during the first six or seven years of Facebook were just in the right-hand column.”

“Whatever the form-factors going forward…” we’ll get it right. –Zuck

2:35 pm: A question on Atlas: “As people are looking more holistically at all the ad spend they’re doing, they’re looking at everything leading up to that purchase — not just the last click.” –Sandberg

2:36 pm: So again, the Atlas buy is about more measurement than just the last click before buying a product. Offline influence, etc.

2:36 pm: Sandberg “increasingly encouraged” by SMBs around the world in their willingness to take up Facebook’s ad biz.

Hope so! That’s not really where the focus is right now, though.

2:38 pm: Sandberg really pushing the fact that tons of SMBs have Facebook Pages.

Still doesn’t help the little guys without massive followings break through to the news feed, though. We’ll see.

2:40 pm: Ooh, a video ads question!

Hope they don’t dodge it.

2:40 pm: Sandberg says video is a “really exciting area” — and advertisers can use Facebook’s existing embeddable video product in their ads.

Continuing to explore the area, Sandberg says, but nothing to announce today.

Shucks.

2:41 pm: Ah, a question about Instagram and monetization.

When you gonna slap ads on our pics, Sheryl?

2:41 pm: Zuck on Instagram: “They’re really doing well and growing quickly.”

Focus should be on community building. He’s optimistic on biz opportunity, but they aren’t slapping ads on anything just yet.

“They’re growing a lot faster now and were faster to get to 100 million than Facebook even was,” Zuckerberg says.

2:43 pm: Boring question, boring response.

Mobile mobile mobile.

2:44 pm: Two questions: Platform and Graph Search.

Zuckerberg is super happy with gaming ecosystem and how it’s doing, despite “Zynga,” whose growth ain’t great.

Ouch!

2:45 pm: Poor Zynga can’t catch a break.

2:45 pm: Zuck on platform (in my words): Please, dear god, developers. Give us your apps. Distribute them here.

2:46 pm: As far as Graph Search goes, repeat after me. Early. Days.

2:46 pm: “The launch wasn’t this point where we expected a ton of people to start using it. … real roll-out will start pretty soon.” –Zuckerberg on Graph Search

2:47 pm: Fun question from Mark Mahaney: Do the kids still like Facebook? I hear it’s not hip anymore.

2:47 pm: Ebersman: Facebook is awesome for everyone, regardless of age! And yes, kids still like Facebook.

Telling: Ebersman really emphasized Instagram’s influence with the young crowd.

2:49 pm: Funny. I asked my 12-year-old neighbor the other day which apps she used — she told me Twitter, Snapchat and Instagram. (No Facebook!)

2:50 pm: Lotsa mobile app install ad buyers are new advertisers to Facebook.

Makes sense why Zuckerberg keeps making his call to arms for developers.

2:55 pm: “Owning our own data centers removes another party from the mix.”

Also lets them “build them exactly how we want them to look.” Best for efficiency, Ebersman said.

This in light of a recent announcement that Facebook would be building another data center in Iowa.

2:56 pm: Hmm. Sandberg advocates promoted Pages product to SMBs rather than other larger ad spend products.

Sort of a “no duh.” But I’m still not convinced the little guys are getting good ROI there.

3:00 pm: So, 3 percent of the payments revenue bump came from user-promoted posts and, to a lesser extent, Facebook’s Gifts product.

Hmm.

3:01 pm: And that’s a wrap, folks.

SoftBank Capital and Yahoo Japan said they had created an unusual $20 million fund to help U.S. startups break into the Japanese market, while also upping a presence in the U.S.

The partnership between Japan’s largest Internet company — which is also a joint venture with Yahoo — and the venture arm of the giant SoftBank Corp. will invest in companies from early-stage funding to later-stage expansion and focus on mobile applications, social media, e-commerce, online advertising, gaming and cloud computing.

The new funds for that are being put into SoftBank Capital’s $100 million Technology Fund ’10. As part of the deal, Toshiaki Chiku will become head of U.S. operations in Manhattan. SoftBank Capital also recently announced a $250 million PrinceVille Fund, aimed at growth-stage startups in Asia.

Among the firm’s recent exits: Bluefin Labs went to Twitter, Buddy Media to Salesforce.com, Huffington Post to AOL, Hyperpublic to Groupon and OMGPOP to Zynga.

Now, it will be focusing even more on helping U.S. startups in Asia.

“Japan can be challenging for many U.S. companies, and given our scale and affiliation with SoftBank Corp., we’re in a great position to help them grow and succeed,” said Chiku in a statement.

SoftBank Capital and Yahoo Japan used performance display advertising company Criteo as an example of a successful investment, in which it also helped the company enter the Asian market (although, technically, Criteo is HQed in France).

The company plans initially to launch in select markets, such as Mexico, Singapore and Hong Kong, and will start making announcements on specific plans in coming weeks, the person said.

Read the rest of this post on the original site »

The world’s third-largest maker of PCs is looking to less-developed markets even as it faces buyout offers from founder Michael Dell and potential rival bidders. The efforts to take the technology giant private have cast uncertainty over its future direction, but a buyout shouldn’t affect the company’s plans to increase investment in Asia and other developing economies, said Peter Marrs, Dell’s executive director for Asia Pacific end-user computing sales.

Read the rest of this post on the original site »

If truth be told, Jerry Yang never really disappeared from the Silicon Valley scene, even though he did leave Yahoo rather suddenly just over a year ago — resigning from the board and all other positions at the iconic company he co-founded with David Filo in 1995, and then going very quiet.

When I met him last week at the airy and newish office space of Ame Cloud Ventures, off Camino Real, he politely declined to talk about that Yahoo tenure and departure, although Yahoo and he are inextricably linked in the history of tech.

That’s because the former Chief Yahoo has moved onto the next stage of his career, which perhaps could be called Jerry 2.0 — a term he’d hate (and give me a hard time for using).

Still, in many ways, Yang has launched a new digital life by focusing on what made him interested in tech in the first place: Entrepreneurs.

“I feel like the thing I missed the most is what really early entrepreneurs were doing,” he said of his latest efforts, which have been well known among techies, even if Yang has never been one to toot his own horn much in general. “I’m not sure at all that I’m any good at this mentoring/investing business — that’s why I’m using my own money, and that’s why it’s not a career.”

Yet. Yang is calling his nascent investment business — he’s more than an angel, but not quite a VC — a “work in progress” that might morph into something more.

“There are no LPs — just me, myself and I,” said Yang. “I invest in things for the long term and have a long horizon and the flexibility.”

That said, via Ame — which means rain (雨) in Japanese and happens to be the acronym of the names of his wife and kids — Yang has already invested in about two dozen startups in which he has typically puts in $100,000 to $500,000.

Explaining the name, Yang said: “Without rain, there is no life.”

And it’s clear that Yang has been very busy dousing the startup sector with a wide range of interesting investments, including:

• dotCloud, an application platform for developers
• AeroFS, a private file syncing and sharing service
• Impermium, an Internet security offering
• Jetpac, a travel app for the Apple iPad
• Lex Machina, IP litigation data and analytics
• Tomfoolery, which is aimed at improving mobile enterprise apps

Yang said what informs his investment choices centers on the activity around mobility, sensors, cloud and big data that is enabling the next generation of computing.

“The main investing premise is the idea that devices are more and more network connected,” said Yang, who noted that data that is being collected is now at another order of magnitude than ever before. “The cloud has become the next-generation supercomputer, and the smartphone has provided the revolution to spur its use.”

To select from the companies he sees, Yang has only one young associate, Nick Adams, who codes, helps on deal mechanics, interacts with entrepreneurs and also has had extensive experience in Asia.

That has been important, since Adams also leads business development for China’s Cloud Valley, which is run by Edward Tian, one of Yang’s strategic partners there. It was with Cloud Valley that Evernote, the hot productivity app in which Yang is also an investor, partnered to create a business there.

Still, Yang is not completely alone. He has weekly meetings with another former Yahoo, Ash Patel — who started the $10 million micro-venture fund Morado Ventures, which means “purple” in Spanish, and has a lot of ex-Yahoos as investors — as well as individual angel and former Yahoo CTO Farzad Nazem.

The trio trade ideas and deal flow, sometimes making bets together and sometimes not. Most of all, they leverage their time in the tech sector, both good and bad.

“I might not have better ideas, but I think my experience is unique and helpful [to entrepreneurs] and there is a value to my network,” said Yang. “I think what I have to contribute, besides money and a network, is that I am very candid about the experience I have had.”

That is indeed the case, because it is clear that Yang has a lot of wisdom to impart from his long and eventful history at Yahoo, as well as his stature as one of the Internet’s most important pioneers.

And, having covered the often circumspect Yang for much of that time, I would have to say that these days he looks about as energized, excited and enthusiastic as I have ever seen him.

“I’m truly humbled by the talent that’s out there, and at the same time recognize it’s a very crowded space,” said Yang. “It is not a career yet, but I’m having a lot of fun, and we’ll see.”

Several major Asia-based smartphone manufacturers are talking up their growth plans. South Korea’s LG Electronics says its smartphone shipments will jump 50% in year-on-year in 2013. China’s expects to post a 50% increase in shipments too. Huawei Technologies says it will ship 60 million smartphones this year, up 88% from 32 million in 2012.

The global market is certainly expanding quickly, but not that fast. Between 2010 and 2011, total global shipments increased 64%, according to research firm Strategy Analytics. In 2012, the pace of shipment growth slowed to 43% year-on-year. In 2013, growth is expected to slow down further to 36%, Strategy Analytics says.

With the overall market growing at a slower pace than what individual manufacturers are forecasting, something’s got to give.

Read the rest of this post on the original site »

Disney confirmed the acquisition, but would not disclose terms. However, Studio Ex has yet to officially launch any games, so this is pretty much a grab for the talent, which includes David Moon, the former director of game services at NHN, one of the largest gaming destinations in Asia.

“The Walt Disney Company has acquired Studio Ex, a games development studio in Korea that focuses on multiplayer, free-to-play online and mobile games,” Disney said, in a statement. “Through a stock purchase agreement, Studio Ex is now a wholly owned subsidiary of The Walt Disney Company reporting into Disney Interactive.”

The game studio will focus on developing free-to-play games for the Asian market based on new brands or existing Disney properties. The games will be developed for both online and mobile.

Prior to the acquisition, Disney announced a partnership with Korean firm Smilegate to develop a game based on Marvel’s iconic heroes, also targeting the Asian market. It also formed a  partnership with Korean game developer Zipi Studio, which, along with other partners, will launch Zipi Racing, a massively multiplayer online racing game featuring characters from “Toy Story” and “Cars.”

Much of Disney’s entrance into gaming has been through acquisitions. Over the past few years, it has purchased Club Penguin, the online multiplayer game aimed at children; Playdom, which is focused on making social games for Facebook; and Tapulous, the mobile game maker.

John Chen

Private equity firm Silver Lake has appointed former Sybase CEO John Chen as a senior adviser. Chen had a long tenure at the SAP-owned enterprise mobility and database software and services company, having served as chairman and CEO since 1998.

SAP acquired Sybase in 2010 for $5.8 billion, but Chen stayed on until he stepped down just last Friday.

Chen was widely credited with turning Sybase around, as well as spearheading its moves into the fast-growing mobile enterprise arena.

In an interview with Bloomberg, the 57-year-old tech exec said:

“It’s time for me to relinquish the ownership of this franchise. I always thought about this like marrying off your daughter. You know it’s the right thing to do, you just want to hold on a little more — but it’s time to move on to other challenges.”

Joining the powerful Silver Lake, which is a big tech investor, appears to be that very challenge.

“I am very pleased to join Silver Lake, which is a central player in the global technology industry and really the only firm that works at large scale with a true tech focus,” said Mr. Chen in a statement.

Before Sybase, Chen was CEO and president of Siemens Pyramid, a unit of Siemens Nixdorf. He currently is on the boards of Disney and Wells Fargo. He is a graduate of Brown University and the California Institute of Technology.

“John will play a critical role in evaluating potential new investments and driving operational improvements and other strategic initiatives across our portfolio companies,” said Silver Lake managing director Charles Giancarlo, also in a statement. “His deep roots in the technology sector, with more than three decades of operational experience, as well as expertise on a range of political and economic policy issues, especially in Asia, will be extremely valuable.”

Officials at some of Microsoft’s parts suppliers, who declined to be named, said the Redmond, Wash.-based company is testing a smartphone design but isn’t sure if a product will go into mass production.

Read the rest of this post on the original site »

“Our prediction that the Zynga IPO might have been the high water mark for Social Games 1.0 investment has been validated, with the VC market moving sharply away from that sector,” said Digi-Capital Managing Director Tim Merel.

A report conducted by Digi-Capital, an investment bank focused on gaming and companies in America, Europe and Asia, concluded that dollars are now being funneled toward tablet games, mobile games that are social, and cross-platform games, which work across all screens — mobile, social networks and the Web.

In December, Zynga raised $1 billion in a public offering, capping off a vibrant year of social investing that also included Nexon’s $1.2 billion public offering on the Tokyo Stock Exchange.

In 2011, social gaming represented 57 percent of the dollars invested and 45 percent of all acquisitions. But ever since the two IPOs, the smaller screen dominates, Digi-Capital reports. During the first nine months of the year, mobile and tablet games were the largest transaction group, receiving 42 percent of all fundings and 32 percent of all acquisitions. However, it should be noted that valuations are much lower today for mobile than social gaming last year, given that it is a much earlier stage market.

While Digi-Capital reports that social gaming is on the way out, the good news is that the broader games sector continues to see an accelerated level of interest. So far, in 2012, 71 transactions have been completed, totaling $3.6 billion, beating last year’s record level of activity. In 2011, 113 transactions generated $3.4 billion in transaction value.

Other trends to keep an eye out for:

• In addition to mobile, massively multiplayer online games (MMO) and middleware software continue to see investments and exits.
• Chinese, Japanese and South Korean companies are still looking to buy Western game companies, but are facing cultural hurdles.
• In the first nine months of the year, free-to-play MMO exits were a surprise, representing 42 percent of all M&A, by transaction value.
• Middleware software also performed well in the first three quarters of the year, receiving 39 percent of all private investments, driven, in part, by Visa’s $190 million acquisition of PlaySpan.

New York magazine just published what will doubtlessly be the first of many larger-scale profile pieces on new Yahoo CEO Marissa Mayer (Fortune’s at work on one, too).

Titled “Can Marissa Mayer Really Have It All?” New York’s version is a very solid and fair effort that raises a lot of pertinent questions about the Silicon Valley Internet giant’s latest leader.

That, of course, includes pondering the high-profile issues around her coping with a newborn (really new) and work; her carefully crafted public glamour-geek-girl persona that is at odds with her sometimes more tetchy private one; Mayer’s mostly-up-and-then-down-at-the-end career at Google as a key exec; and the myriad challenges she faces in turning around the long-troubled Yahoo.

Writes Lisa Miller quite astutely: “This newest version of Marissa, the mom-geek-CEO, will surely test Mayer’s iterative powers, for she’s playing to a tougher crowd, one that won’t be placated by tweets, Manolos, and rapturous praise for pineapple malts.”

Indeed not, which is why sources said Mayer is likely to begin to make postpartum appearances back at Yahoo as early as this week. She delivered her first child with husband Zach Bogue, whom she dubbed “Big Baby Boy Bogue,” on Sept. 30.

Among the initiatives she has been working on up to and after her son’s birth, said numerous sources, is the redo of Yahoo’s powerful home page, a reorganization of top management duties, and an announcement about whether it will buy back shares or give a dividend from its recent multibillion-dollar sale of part of its lucrative stake in China’s Alibaba Group.

In addition, said sources, Mayer is also putting into place her new methodology of keeping track of employee performance and rewards. There is an all-hands meeting scheduled today, in fact, apparently to go over the system, which Mayer spoke about in her last all-hands meeting.

The home page redo is also in the late-stage works for unveiling soon, said sources. Those who have seen it said it has a starker and simpler design ethos, and will stress user personalization, customization and more social elements. It will also have ample opportunity for third-party developers to offer a variety of services on it (maybe Mayer can save Zynga by copying a little bit from Facebook!).

The reorg will also be interesting. Mayer has made a number of top exec appointments, including adding a new CFO and head of HR. She will also be rejiggering other roles of existing management.

For example, expect tech and operations EVP David Dibble — who got a mess of new responsibilities right before Mayer was appointed — to have some of that dialed back.

The disposition of all $3.6 billion of Alibaba cash is perhaps the most immediate issue, especially for investors, who are largely hoping for a buyback of stock. Such a move will likely cause Yahoo shares to rise, as happened at AOL.

That would be nice, since Yahoo stock has stayed pretty flat since Mayer got to the company in July. (That compares, ironically, to a 31 percent rise at Google since she left.)

But Wall Street analysts and others have been making bullish calls on Yahoo recently, including CNBC’s screamy stock guru Jim Cramer of “Mad Money.”

Boosted by the growing value of its Asian assets — in China, as well as in Japan, which Yahoo is trying to sell — and also anticipating some kind of magic mojo from Mayer, price targets for Yahoo shares have been as high as $22.

That was from Goldman Sachs, which reinstated coverage of Yahoo with a “buy” rating recently. Analyst Heath Terry noted that “while user engagement continues to decline, the company lacks a mobile strategy and significant talent has left the company, Yahoo still has hundreds of millions of users, valuable Web properties, and the financial resources to fuel a potential turn around over time.”

Translated: Yahoo kinda stinks, but it still might be able to buy itself out of this mess with a $10.6 billion pile of dough from Asia.

All eyes will be on the actual business Yahoo operates itself in two weeks on Oct. 22, when the company announces third-quarter results. Sources said the quarter will come in as expected, but will still tell a story of lackluster growth in advertising, engagement and, well, every key part of its native offerings.

That said, Mayer is expected to be on the call — her first at Yahoo — to outline her grand vision in more detail, as a spokeswoman has noted.

That’s good, since shiny profiles of her can only do so much. It’ll be nice to finally hear her say something definitive in public about how she’s going to fix the company that has given the mediagenic exec even more press.

(And, let’s hope, without the tweets, Manolos and pineapple malts.)

Criteo, the performance display advertising company, just nabbed about $40 million in additional venture funding.

The Series D round, led by SoftBank Capital, gives the Paris-based company an $800 million valuation, according to sources, although Criteo declined to comment on the figure.

Previously, Criteo had raised just over $23 million from investors that include Bessemer Venture Partners and Index Ventures.

In an interview, CEO J.B. Rudelle said the money would be used for growing its footprint in the U.S., as well as Japan and Asia, more quickly.

The company has seen quick growth here and the market has already become profitable. But Rudelle said, “This funding is obviously a big step. We are going to use it to accelerate our efforts in key markets.”

Criteo now operates in 32 countries, he said, and it hopes to extend its global footprint as more companies are looking for better performance from online advertising.

“The need for performance to drive display advertising is enormous,” said Criteo president Greg Coleman, referring to “personalized retargeting,” which delivers highly targeted ads to consumers.

Ad tech such as Criteo has become a hot arena of late with larger companies such as Yahoo and Facebook interested in acquiring assets in the space.

For now, at least, it looks like Criteo filled its kitty to stay independent.

Here’s the official press release from Criteo:

Criteo completes €30 million Series D led by SoftBank Capital
Syndicate of investors includes Yahoo! JAPAN, SAP Ventures, Adams Street and Bessemer

NEW YORK — 26 SEPTEMBER 2012 – Criteo, the global leader in performance display advertising, today announced a €30 million round of financing led by SoftBank Capital to support the company’s hyper-growth trajectory.

Profitable since 2009, Criteo has continuously delivered growth, exceeding all forecasts since the company’s founding. The company now serves more than 3,000 advertisers worldwide, with the US being the number one revenue generating market. This new investment will help Criteo to continue reinventing the online display advertising market, with a goal of making it as efficient as search marketing.

JB Rudelle, CEO and Co-Founder of Criteo said: “In a period of high-growth for Criteo, this new financing enables us to invest substantially in innovation, technology and people. In addition, we are very excited to leverage the knowhow and footprint of SoftBank and Yahoo! JAPAN for our expansion in Asia, a very strategic region for us. Overall, the fact that such a sophisticated syndicate of investors has decided to join us is a powerful validation of our unique model.”

Matt Krna, Principal at SoftBank Capital added: “We are delighted to partner with Criteo and help the company extend its leadership in the cost-per-click performance display advertising sector, particularly in Japan and throughout Asia. In speaking with Criteo’s clients and partners, it became clear to us that the company’s analytical, performance-based model offers clear advantages to the entire online ad ecosystem, including consumers.” Mr. Krna will join Criteo’s board as an observer.

Recently Criteo announced an exclusive partnership with Yahoo! JAPAN — in terms of cost-per-click personalized display advertising, it is the first time that a third party technology company has had access to its inventory. To support its growth, Criteo has also recently invested in a state-of-the-art 100,000 square foot R&D centre in Paris, France.

And one of the top director candidates is well-regarded Hollywood exec Peter Chernin, said several sources.

He is an obvious choice, having been a top exec at News Corp. for many years. Since he left in mid-2009, Chernin has forged a successful film and television career, producing such hits as “Rise of the Planet of the Apes” and “New Girl.”

But, unlike many media execs, he has also focused on garnering much deeper digital experience.

Chernin was key to the formation of the Hulu premium online service, for example, and is also a board member of the Pandora streaming music service. He has also been making digital and media investments in Asia.

(And, interestingly, although apropos of nothing, Chernin’s former boss, Rupert Murdoch, has become an avid tweeter, too.)

Sources said Chernin has not decided if he even wants such a board seat, and Twitter management is still only in the early stages of its board effort, presumably to replace Flipboard’s Mike McCue.

The entrepreneur left the board earlier this year, after it was clear that his social media app and Twitter were on a collision course (or an acquisition one, depending how you looked at it).

But the addition of a media-savvy director — or even two — also makes sense in the context of the past year of Twitter’s evolution.

The brainchild of Jack Dorsey, Evan Williams and Biz Stone, Twitter first began as a microblogging social network.

While it did attract a lot of attention due to its celebrity tweeters — such as actor Ashton Kutcher and famebot Kim Kardashian — the management and board of Twitter is largely tech-centric in experience.

But, more recently, the service has taken its shape as a consumption-based media company, where some 40 percent of its user base read and consume content rather than create it. That is to say, they watch, but they don’t tweet.

Such a strategic direction is a natural extension for bringing in more advertising spending from outside partners, especially big media companies that have both the eyeballs and dollars that the company is hoping to attract.

Twitter is now commonly used throughout the media space in a variety of roles, from branding to audience-gauging, and also sometimes even as a plot device.

(That said, you won’t catch CEO Dick Costolo outright admitting Twitter’s media-company status; he still wants the Silicon Valley cred of being valued as a technology giant first.)

A Twitter spokesman declined to comment on any effort to bring in new directors; Chernin has not yet responded to a query for comment.

There are seven billion people in this world and only 1.2 billion computers — but close to six billion cellphones. That makes the commercialization ability and growth potential for the mobile Internet massively greater than that of the PC-based Internet. China, the world’s biggest Internet market, recently surpassed the U.S. in smartphone activation, and the mobile browser is once again coming to the forefront. Here’s why.

In emerging markets such as China and India, the world’s two most populous countries, the mobile browser is a critical channel that connects people to the Internet in ways that the PC browser never did. For many people, it is their only connection point to the Internet — take Indonesia, for example, where linking its thousands of islands by a fixed nationwide network was prohibitively expensive, so they prioritized the build-out of a mobile network.

Since cellphones are much cheaper than computers, and the mobile Internet is much more accessible than fixed-line Internet in emerging markets, users purchase their first cellphones much earlier than their first computers, which sets user habits to surf the Web through cellphones.

In fact, Internet traffic flow on mobile devices surpassed that of the PC in India in May of this year, and the number of mobile Internet users overtook that of the PC in China just a month later.

The graph above is slide 18 from Mary Meeker’s 2012 Internet Trends presentation

In addition to user habit, technological advancement has contributed to the widespread use of the mobile Internet. For example, cloud computing has made mobile browsing work where bandwidth and mobile devices’ computing power are lacking. Before, in many parts of the world, browsing the Web through a cellphone with its native browser was extremely inconvenient and slow. Opening a Web page took almost a minute — intolerable to most users, particularly those accustomed to surfing on a PC. It was also ridiculously expensive. For example, opening a 2MB Web page in China (the typical size of a homepage for popular Chinese Internet portals), would cost 60 RMB, or almost $10. With cloud computing, data can be compressed by 80 percent or more, offering much faster and affordable Web surfing.

With the bandwidth issue easing and mobile devices becoming more capable, the cloud computing technology approach makes mobile browsing accessible to a much larger worldwide population, and gives users an overall improved mobile Internet experience.

Mobile Apps vs. the Browser

People in the industry have made sweeping generalizations like “The Web is dead.” Yes, apps are important, but they will never replace browsers. Internet surfing has gone has through three stages: the first was browser-centered (Netscape), the second was client app-centered (Apple). With Web surfing on cellphones, particularly in emerging countries, the third stage is back to being browser-centered. Here’s why:

• Security. This is a serious issue on cellphones. Installing an app means opening up a myriad of ports, which is like punching holes in a wall. Cellphones are closely connected to a user’s identity and financial information, which attracts thieves. The browser has been created with a high level of security; the browser sandboxes the Web apps running on it, hence providing an extra level of security over apps.
• Service. What users really want is the functionality that an app provides — not the app itself. With the Internet browser becoming more capable, Flash-based games can run on a browser, as can videos. For a long time, people used dedicated video software, but with YouTube, people have become accustomed to watching videos on a browser — and may not need a video player at all. The apps are still there, of course, but they’re morphing into Web apps.
• Standardization. Today we need to develop for different platforms like Android, iOS and Symbian. This takes a tremendous amount of resources from developers, and users are reluctant and annoyed with having to update their apps all the time. But for a Web app, it’s “develop once, run on multiple platforms.”

What’s Next for the Browser

By nature, the browser is a user’s access point to the Internet. Software companies such as Netscape and Microsoft went against nature by developing products as isolated pieces of software. Both Apple and Google are innovation leaders in the Internet industry, and serve as great examples for newcomers. The lesson learned from Netscape and Microsoft is that we should not view the browser simply as a single software tool; instead, it should be treated as an Internet service platform. Google knows this with its platform, and tries to fulfill the needs of vastly different users by enabling them to customize their browsers with plugins and Web apps.

Users turn to the browser for three reasons: Information gathering, entertainment and daily life enhancement. The capabilities browser companies provide must match those service areas, like personalized navigation. Smart technologies can now adjust picture and text size, provide voice control, offer different reading modes or change delivery priorities based on the network environment.

Browser companies gain customers and market share with industry-leading performance, but that is far from enough to build a service platform. To build a global ecosystem of users, there also needs to be a strong business-building component, like account management and billing services, or platforms developed specifically for game use. Dedicated operations teams need to conduct research in market dynamics and actively monitor user feedback to drive timely updates that satisfy the ever-changing needs of users.

Only by focusing on the diverse needs of users wherever they reside can we fully realize the value of the Internet browser. The time is now for the tech industry to take more of a global view of what that means.

Yongfu Yu is the chairman and CEO of UCWeb, whose mission is to provide a better mobile Internet experience to billions of users around the world. Earlier in his career, he was a VP at Legend Capital. Yu graduated from Nankai University in 1999 with a bachelor’s degree in economics and minor in computer science.

Mohamed Elsayyed / Shutterstock.com

It is equally unsurprising, checking in a year later, that the momentum of entrepreneurship in Egypt, if anything, has increased amid the ups and downs of the macro economy and political uncertainty. “Generation Z” has come of age in Egypt like everywhere else, never knowing a time without access to information technology. They have at their fingertips communication and collaboration tools that allow them to innovate with friends from around the country, the region and the world. The cost of starting a business can be merely thousands of dollars in Egypt, and an ecosystem of angel and venture capital is rising in the region, as well as coming from Europe and the United States. Dozens of start-up competitions, hundreds of hackathons, thousands of new start-ups later, the entrepreneurs we have reconnected with believe there is no turning back.

No story is more encouraging than that of Amr Ramadan, whose company Vimov caught our attention last year. We were impressed that we were both users of Ramadan’s first consumer app, Weather HD, then the fastest and largest selling weather app in the Apple Store, with over 400,000 downloads at $.99 a pop — not knowing it had been built by him and three young guys in Alexandria, Egypt. Egypt-based venture capital firm Sawari Ventures — which has since launched one of the most successful incubators in the region, Flat6Labs — subsequently invested in Vimov in the midst of the turmoil of last spring without hesitation.

How are things today? “We are approaching our five millionth download,” Amr told us last week, “half of which are coming from the US. We also released Weather HD for the Mac, which stayed at the number two top-selling spot in the States during its week of launch.” They just released their most ambitious version on July 31 in the iTunes App Store, which is visually stunning and offers new features like “MultiForecast,” allowing users to see weather information from more than one weather provider. They have grown from three to 30 employees, all engineers from Amr’s home town in Alexandria, Egypt.

Navigating historic uncertainty was not easy, Ramadan notes. “We tried to take it slow in terms of growth after the protests of January 25, expecting the dust would settle in a few weeks. It quickly became apparent it wouldn’t settle down soon, and it wouldn’t be clear fast enough where the politics or economy would go.” Facing too many questions and scenarios, Vimov did what great entrepreneurs do around the globe: Hope for the best, plan for the globally competitive business they dreamed of, and execute. “Let me be clear,” he smiles, “[Revolution] causes tremendous pressure on top of that of simply being a start-up. One is always re-evaluating, guessing what could happen next, and building backup plans. But focus and execution is the only way; slow is not an option in the technology business.”

And execute they have. With growth rates that would be coveted by many in Silicon Valley, Ramadan has pushed his team to constantly redefine what a great weather application can be. Proud of their unique, graphic visual interface, they immediately improved navigation between the many cities their average viewers monitor. “We just launched Quickview, which shows weather animations of several locations all at once in a simple, elegant way,” he beams.

Weather HD’s Quickview

But can Egypt and the Middle East really play with the exciting innovation coming not only from the United States, but Europe, Israel, India, Asia and Latin America? For Ramadan, the now accepted precedent of innovation coming from all corners of the globe, even places once ignored, only suggests things could move faster in the Middle East. “Technology here is at its infancy, but that means there are opportunities around every corner,” he believes. “The reason why this huge market of some 400 million users has been under-served was that the young people were not encouraged to innovate, not from anyone around them, and they themselves had little hopes that a dream can come true.” He believes that this way of thinking has been forever shattered in the last year. “The number one motivator of great engineers is having great problems for them to solve,” he speaks as an engineer himself. “I have a world-class team at a fraction of the cost of what we could get in Silicon Valley — but we all love Alexandria, make great livings here, and are proud of building great products made in Egypt.” Thousands of other start-ups, he notes, have concluded the same all over the Middle East.

Neither Seth Goldstein nor Chris Schroeder are investors in Vimov.

Seth Goldstein @seth is a San Francisco-based angel investor and chairman of turntable.fm. Christopher M. Schroeder @cmschroed is a Washington, D.C.- and New York-based angel investor and former CEO of the online content and social platform start-up healthcentral.com, which he sold last January. He is writing a book on innovation and start-ups in the Middle East.

I have always meant to travel to Israel to visit its vibrant and energetic tech scene, sometimes dubbed Silicon Wadi. Happily, that will be happening when I take off this afternoon to visit Jerusalem, Tel Aviv and Haifa.

I am headed there to speak at an Israeli blog conference, called Blogo, which is being run by Saloona, the country’s women’s Web magazine, on the topic of the changes to media in the Internet age. (Though I suspect, given the fervor here, all I will be getting will be questions about new Yahoo CEO Marissa Mayer.)

While there, I am going to see a wide range of entrepreneurs and start-ups, which are too numerous to mention and which I am very excited to see.

Plus: It’s always a good idea to get out of the echo chamber of Silicon Valley — whether one finds it profoundly deluded or the spit-shiniest place ever (IMHO, it’s both) — and see the wider world. (Although the last time I took a big international trip, to Asia, it was a little dicey for me.)

Of course, while I’m there, I will be doing numerous reports for the site on the state of tech in Israel, so watch for them.

Until then, here is a really interesting report by “60 Minutes” on the thriving scene in Tel Aviv, including a chunk about the digital doings there:

Yahoo has confirmed that it hired Google ad exec Michael Barrett as its new chief of revenue.

As I reported earlier, Barrett will be in charge of advertising revenue and operations worldwide at the Silicon Valley Internet giant, including units in the U.S., Europe and Asia reporting in to him. Barrett will report directly to interim CEO Ross Levinsohn.

The move to hire the high-profile exec — who has been working at Google since it bought an ad tech company he ran a year ago — gives Yahoo a boost in its most critical area of business.

The search giant acquired supply-side advertising technology start-up AdMeld for $400 million a year ago. Before that, Barrett had previously worked at a range of digital and traditional media companies.

His hiring is also a clear signal that Yahoo is about to make major changes to its ad business going forward. According to numerous sources, Yahoo is again mulling a plan to abandon or sell large parts of its ad tech business and rely on third-party vendors, including Google.

Sources said Barrett was interested in the big opportunity Yahoo possessed and felt the ad market was still interested in helping it maintain its online ad business.

Here’s the official Yahoo press release on the Barrett appointment:

Yahoo! Appoints Michael Barrett as Executive Vice President and Chief Revenue Officer

SUNNYVALE, Calif., June 18, 2012 – Yahoo! Inc. (NASDAQ: YHOO) announced today that it has appointed Michael Barrett as Executive Vice President and Chief Revenue Officer. Barrett will be responsible for Yahoo’s advertising revenue and operations globally for the company, with Americas, EMEA and APAC regional leads reporting to him.

“Michael Barrett is regarded as one of the most successful and influential executives in media and technology, and I am thrilled to have him join Yahoo! in this critical role,” said Ross Levinsohn, Interim Chief Executive Officer. “I am confident that his deep industry experience and relationships will help us drive our strategic vision, taking Yahoo!’s industry-leading position to the next level.”

Barrett joins Yahoo! from Google where he led the integration efforts following Google’s acquisition of Admeld, Inc. in December 2011. Barrett joined Admeld as CEO in 2008, and under his leadership the company became the leading global supply side platform solution for premium publishers. Prior to Admeld, Barrett worked at Fox Interactive Media as Executive Vice President and Chief Revenue Officer, where he oversaw worldwide revenue for all properties including MySpace and FoxSports.com and worked closely with Levinsohn. Before that, Barrett served as Executive Vice President of Sales and Partnerships at AOL Media Networks and held senior sales positions at interactive leaders Yahoo!, GeoCities and Disney Online.

“Yahoo! is one of the largest and most iconic Internet companies in the world,” said Barrett. “I am grateful for this opportunity to work with Ross and a group of immensely talented and energized people, all focused on driving Yahoo’s leadership and strategic position on a global basis. I am looking forward to contributing everything I can to that effort.”

In his new role at Yahoo!, which he will assume in early July, Barrett will be part of the senior executive team, reporting directly to Levinsohn.

According to sources close to the situation, Yahoo has hired high-profile advertising exec Michael Barrett to be its chief of revenue.

Sources said Barrett will be in charge of ad revenue and operations worldwide, including units in the U.S., Europe and Asia reporting in to him. Barrett will report directly to interim CEO Ross Levinsohn when he starts in July.

(Update: Yahoo confirmed the hiring in a press release.)

The move to hire the experienced Barrett — who has been working at Google since it bought an ad tech company he ran a year ago — is a significant one, giving the company a boost in its most critical area of business.

It is also a clear signal that the Silicon Valley Internet giant is about to make major changes to its ad business going forward. According to numerous sources, Yahoo is again mulling a plan to abandon or sell its large parts of its ad tech business and rely on third-party vendors.

In fact, it has been in talks with Google about taking over its automated ad sales and ad network operations, while focusing instead on premium ad sales and sponsorships. Yahoo is also considering turning its entire search business over to Microsoft, with which it already has an ad partnership.

“Yahoo is going to be a media company again — in the digital ad sales business and not in the ad tech business,” said one person.

That impending change has already caused much debate within Yahoo already, with sides drawn between those who think Yahoo should not outsource its core ad technology and those who believe that the company lost the battle to others already — most especially Google — due to poor execution over the years.

While there have been a variety of multibillion-dollar plans drawn up by some to double down on Yahoo’s ad tech business, that effort has now been supplanted by a feeling that the company needs to quickly get out of businesses it cannot win in or see growth.

Barrett is one of the few obvious choices to usher in a new era, given his long experience in all aspects of both digital and traditional media.

He used to work with Levinsohn at Fox Interactive Media, but came to Google a year ago, when the search giant bought AdMeld for $400 million. Barrett was CEO of the supply-side advertising technology platform, which worked on behalf of publishers by trying to get the best prices for their inventory from a variety of ad networks.

Barrett has also worked in ad jobs at a range of companies, including AOL and Disney Online, as well as at Meredith Publishing and Newsweek. He even previously worked at Yahoo, when it bought GeoCities, back in the Web 1.0 era.

As part of the changes, sources said, current Americas sales head Rich Riley will be stepping down from the job he just got under ousted CEO Scott Thompson. He will remain at the company, but it is not clear in what position.

Earlier today, Yahoo’s persistent thorn, activist shareholder Dan Loeb of Third Point poison-penned another letter to the board of the Silicon Valley Internet company, demanding that Yahoo fire its new CEO Scott Thompson, as well as director Patti Hart, over bizarre inaccuracies related to their academic achievements.

“Permitting Mr. Thompson and Ms. Hart to stay with the Company after apparently violating the Code of Ethics sends a message to all Yahoo! employees that a different set of rules applies at the top,” Loeb wrote.”[Yahoo must] terminate Mr. Thompson for cause immediately given his demonstrable unsuitability to remain Chief Executive Officer and a director of Yahoo! and accept the resignation of Ms. Hart for similar reasons.”

And while many across the blogosphere — including some very clever tweets — called for his head tout de suite, that’s just not going to happen.

At least for now, at this early point in a controversy over Yahoo filing legal documents that misrepresented Thompson’s long-ago degree from Stonehill College.

In a nutshell: Thompson does not have a computer science degree, as he had maintained he did in public bios for almost a decade, a falsehood that mysteriously seeped into documents Yahoo filed with the Securities and Exchange Commission.

That’s bad news for Yahoo, for sure, on many levels, but moving against Thompson at this moment is not likely to be the answer — for the short term, at least.

That’s due to many reasons, that I like to think of it as three hopelessly complex puzzles that need solving pronto.

The What-Did-Yahoo-Know-and-When-Did-It-Know-It Question

There is no question the first thing Yahoo’s board needs to do is a thorough investigation to determine how a borked bio could proliferate so widely and for so long.

Most importantly, Yahoo will have to reveal if Thompson actually gave them this incorrect information, as he aggressively lobbied for the then-open CEO job.

As I had previously reported several times, Thompson cold-emailed a Yahoo director — Intuit CEO Brad Smith, as it turns out — despite not being on the list of potential candidates. Thompson was then shuttled over to Hart, who was running the vetting process with the help of headhunting firm Heidrick & Struggles, and hired within weeks.

Oddly, sources said Thompson never filled out the required informational papers for the job, nor did Heidrick conduct the normal background check on him. Instead, another forensic firm Yahoo hired did the work.

If it turns out Thompson gave any of them the bad bio info, it would be quick curtains for him.

But if Yahoo’s board members obtained his info on their own, the next key query would be how no one at Yahoo — especially its legal and compliance staffers, as well as outside help — managed to catch the problem during the vetting of Thompson.

Here are some good questions to start with:

Who put a faux computer science degree on Thompson’s bio in the first place, why and when did it happen?

Where did Yahoo get the inaccurate information?

Who was in charge of checking Thompson’s academic record for Yahoo?

And, who checked the work of the checkers?

The problem is made more complicated, because correct information was easily available in the SEC filings of eBay for years, since Thompson was head of its PayPal payments unit.

While the resume information was indeed wrong on eBay’s Web site and on numerous bios of Thompson for years, how did eBay legally get it right while Yahoo did not?

That calls into question the expertise of the company, its directors and those they hired to make sure execs were completely on the up and up, a task they clearly failed at.

If rank incompetence is the reason, which it looks like it might be, expect certain board members and other Yahoo staffers to go, along with anyone who helped in the Thompson vetting, or lack thereof.

Unless, of course, the gang-that-couldn’t-shoot-straight actually did shoot straight and some one at Yahoo found out about the educational discrepancy before the new CEO was announced, but declined to fix it.

While sinister, such a scenario is not entirely implausible, given how much pressure Yahoo was under at the time to hire a CEO quickly, due to Loeb and his looming proxy fight.

If any evidence were to surface that this was so, it is curtains all around, which would rain the kind of disaster down on Yahoo’s Sunnyvale HQ that would make Loeb’s attacks look like a Nerf battle. Instead, it would be “The Hunger Games” — except that no one survives.

The Chaos-in-Sunnyvale Conundrum

Which brings us to the profound implications of Yahoo jacking its second CEO within six months.

While it’s easy to yell “Fire the CEO” on a crowded Twitter, it’s simply not so easy in practice.

How long did it take Yahoo’s lugubrious board to figure out Carol Bartz needed to go? A … long … time. (And, she had a CS degree!)

More to the point, Thompson — and his not-so-merry band of consultants from Boston Consulting Group and, this week, McKinsey & Company — has only just completed a massive layoff of 2,000 employees and a jarring restructuring of management.

He’s also in the early stages of rolling out a new and decidedly still-squishy strategic plan to top execs (also just this week), along with working on some other key initiatives.

That includes renegotiating its search partnership with Microsoft; noodling around on a possible deal with Google; contemplating the sale of a variety of assets; and — oh, yes — trying to take on social networking Godzilla Facebook over patent infringement.

Busy much?

But, most importantly, Thompson is now the umpteenth Yahoo CEO to be working on the never-ending talks with its Asian partners over selling back a piece of the company’s lucrative stake to them.

While Yahoo CFO Tim Morse and head lawyer Mike Callahan are the point men on the deal, the lack of CEO would be an issue in the now-proceeding again talks.

This is a sale that must — and I underscore must — get done and soon, giving Yahoo much-needed breathing room and a whole lot of cash to fork over to increasingly disgruntled shareholders.

So, expect Yahoo to try to milk that deal for all it’s worth in the coming week, in order to give the appearance, at least, of positive forward momentum.

And, like it or not, Thompson has to play a key role in it getting done.

Thus, the likelihood of wait-and-see over point-and-shoot on Thompson is higher than you might think.

That’s especially true given four members of the board are leaving within six weeks and have either or are in the process of being replaced by new members.

Then, Thompson will be their problem to solve.

Again, no small thing, since the old crew — led by feckless Chairman Roy Bostock — is not likely to want to end its appalling tenure with yet another disaster.

Such a move would further tarnish the legacy of its outgoing directors, although I am not sure how it could be any more sullied, given their consistent record of one bad decision after the next.

What do I really think? I think this cursed board will maintain its 100 percent score of doing the wrong thing at the right time.

It could be a different case with the new directors, of course, who all seem pretty sharp and not as easily impressed by a record of failure.

They will surely be monitoring Thompson carefully, as will employees, who have taken to internal message boards with a rage not seen in a while over the resume debacle.

Their morale might be one uncertainty impacting Thompson’s fate. If a lot of key employees continue to bolt Yahoo or those remaining more loudly express their disdain for the bio antics, the new directors might listen.

The Whatever-Loeb-Says-We-Won’t-Do-Till-Later Head-Scratcher

Which brings us back to Loeb, whose noisy campaign to grab seats on the Yahoo board has certainly hit home this week.

And, though Yahoo likes to ding him a lot, since he started his campaign of terribly entertaining investor terror, a lot of what he’s been calling for has happened.

That includes a major flushing of the board — with five longtime members, including co-founder Jerry Yang, going, going and gone.

In addition, Loeb brought pressure to slow down some questionable deals, from Yahoo’s PIPE dream to a tax-free spinoff in Asia in a deal only an accountant could love.

He’s also — though they try to deny it — got the Yahoo directors in the dangerous habit of reacting to him, rather than playing their own game.

While the Yahoo board has resisted any deal with Loeb (pictured here), blaming him for rejecting their kind offers of settlement, it is he who is setting the tone more than Yahoo.

And that tone is of alarm and trouble and chaos at Yahoo.

That’s not going to work to convince other Yahoo investors to back his cause — in fact, Loeb has a decidedly uphill battle to win his proxy challenge — he has still scored a direct win with the bio relevations.

So far, though, Loeb has not sunk Yahoo’s battleship, so it is unlikely the board will acquiesce to his latest demand of Thompson being fired by noon on Monday.

Maybe it will eventually, or maybe it will just scold Thompson or maybe it will do nothing at all.

All that is an unknown — a riddle, wrapped in a mystery, inside an enigma, with a lot of managerial incompetence thrown in. And that, most of all, is the sad definition of today’s Yahoo.

RELATED POSTS:

• Yahoo’s Parting With Thompson Will Be for “Cause” (a.k.a. CSLie)
• Ross Levinsohn’s Yahoo Plan: Back to the Future
• Here’s New Yahoo CEO’s First Note to Troops! (The Leaking-Internal-Memos-to-ATD Policy Remains in Effect As Usual)
• Yahoo Officially Confirms ATD Report on CEO Changes and Proxy Settlement
• Meet the Man I Call “The Hair”: The Video Stylings of Yahoo’s Newest CEO Ross Levinsohn
• Will Thompson’s Ouster Mean a Yahoo-Facebook Patent Settlement Too?
• Exclusive: Yahoo’s Thompson Out; Levinsohn In; Board Settlement With Loeb Nears Completion
• Heidrick & Struggles Slaps Back at Thompson’s Yahoo in Blame Game Over ResuMess
• Is He In or Is He Out? Crunchtime for Scott Thompson at Yahoo.
• Not So Scott Free? Yahoo’s Other Big Shareholder — Cap Re — Leaning Toward Supporting Loeb Over Thompson ResuMess.
• Tech Nation’s Gunn Says She and Yahoo CEO Discussed Their CS Degrees Before 2009 Show (Video and Audio)
• Loeb Calls Again for Thompson Firing From Yahoo, as Former eBay Boss Supports Him
• Place Your Bets: Will Loeb Drop Another Bomb on Yahoo at Vegas Confab Later Today?
• Exclusive: Yahoo Director in Charge of Botched CEO Vetting to Step Down From Board
• CEO Says Sorry to Yahoos for Borked Bio “Distraction” — But Will Mea Culpa Work Without an Apology for Error? (Memo)
• Buffett Comments on Trust Issue in Yahoo CEO BioGate: “You’ve Got a Problem”
• Loeb Lobs Lawsuit, as Expected, at Yahoo’s Borked Bio Mess
• As Yahoo CEO Reaches Out to Top Staff, Board Meets to Weigh “Options” (I.E., Deciding Who Gets to Take the Borked Bio Blame)
• Yahoo Should Expect Incoming Lawsuit Lobbed by Loeb Tomorrow on CEO Hiring
• They Shoot Yahoo CEOs, Don’t They? But Not Without a Really Smoking Gun and a Much Stronger Board.
• Yahoo’s Thompson Asks Employees to “Stay Focused” — Except Not on Him
• In 2009 Interview, Yahoo CEO Does Not Deny He Has a CS Degree, and Calls Himself an “Engineer” (Audio)
• Yahoo’s Board Will “Review” Resume Discrepancy of CEO
• How Did a Phantom CS Degree Get on CEO’s Bio in SEC Filings? Yahoo’s Not Saying.
• Yahoo’s Response on CEO’s Computer Science ResumeGate: “Inadvertent Error”
• Dan Loeb Alleges “Discrepancies” on Yahoo CEO Scott Thompson’s Resume Related to Computer Science Degree

All day today, the top 120 execs at Yahoo are meeting at an offsite at the Marriott in San Jose, Calif., the first such gathering of the new world order at the Silicon Valley Internet giant in the wake of 2,000 layoffs last month.

It’ll be the first time that new CEO Scott Thompson starts to more specifically explain his vision of how he’s going to drag Yahoo out of its perpetual turnaround and into a brighter future.

The main message: Focus on where Yahoo is winning and dumping everything else — and actually doing it this time.

(For those just tuning in, previous Yahoo management has talked this talk before and, well, not walked this walk very much at all.)

Thompson thinks he’s the clean-up guy, though. And, since the layoffs, he has been one busy dude, flying to and fro, working on a variety of things.

That includes everything from figuring out how to sell a part of Yahoo’s lucrative Asian assets to working on the company’s fraught search advertising partnership with Microsoft, to chatting with Google about a new one, to planning more patent attacks against Facebook and others, to — perhaps most important of all — deciding what needs to stay and what needs to go in terms of products and properties at the company.

In Yahoo’s recent earnings call, Thompson noted that he would be “consolidating technology platforms and shutting down or transitioning roughly 50 properties that don’t contribute meaningfully to engagement or revenue.”

What precisely he was talking about has been the buzz inside the company since, because Yahoo has collected a lot of stuff over the years that is has shoved into its corporate closet and forgotten about, but that keeps on chugging away with little promise.

Ever heard of Korea Kids? It’s a site in Asia that attracts decent traffic and millions of dollars in revenue, but which many sources said costs much more to operate. Or another site called Sex Tips in the U.K. or Moments on Motherhood on its U.S. Shine women’s site.

There are lots of micro-sites like this all over Yahoo, which have been created over the years for a variety of reasons that seemed sensible at the time. In addition, there is much more — from scads of useless mobile apps to much bigger but troubled projects such as Connected TV and Livestand — all of which suck up staff, resources, attention, ad impressions and more.

It’s like a never-ending episode of “Hoarders,” but grosser in many way for Yahoo shareholders.

So, presumably, if you are not in the top three in any category, that means a spring cleaning all over the company to either toss these properties out or move them to one of Yahoo’s big publishing platforms, such as sports, finance or news.

This is not an easy task, as you might imagine, since each and every property on the potential chopping block has staunch defenders inside the company and ferreting them out and killing them is, as one person inside Yahoo noted, “like hunting gophers in the dark.”

The benefit to doing so? Cost savings, focus on many fewer things that Yahoo does best and a deployment of talent to where it will pay off.

That’s the idea anyway, but it is more complex than that, since simply having massive properties to sell to advertisers is not the game anymore, as both Google and Facebook sell a range of other attributes to advertisers from better engagement to direct sales conversions to social hooks.

Thus, it’s not simply enough to kill properties — Yahoo has to transform the ones it keeps, too, to meet a vastly different consumer mentality.

That is one of the main reasons that Thompson is also stressing new business arenas, most especially commerce, an area he knows well as the former president of eBay’s PayPal unit. Thompson has told his staff that by 2014, one-third of Yahoo’s revenues should come from e-commerce.

Besides hiring away some of his staff from PayPal, sources said he has also been eying payments technology to buy and even leveraging current Yahoo properties to grow the nascent business.

Recently, for example, he has been pushing an effort to get the accidental visitors to Yahoo’s still powerful home page — those that sign in an out of its email, for example — to engage in an e-commerce transaction.

Whether moves like this will work is still an open question, but I guess you have to start cleaning up the mess somewhere.

Instead, the company is focused on building games for smartphones.

“We are maintaining the old games, like Happy Aquarium, but we don’t build new Facebook PC games any more — we are 100 percent focused on mobile,” Relan said.

Last year, he said, 90 percent of the company’s revenues came from Facebook, but he predicts that this year 90 percent will come from mobile.

CrowdStar’s decision to leave Facebook is bad timing for the social network it as nears its public offering.

A platform must have both a lot of applications and a lot of users in order to be successful, but if the perception is that the platform can be profitable only for a few, developers will go elsewhere. Today, the reality is that Zynga dominates the charts and makes far and away more money than anyone else. Meanwhile, fledgling developers are seeking financial alternatives.

Founded in 2008, the Burlingame, Calif., company was one of the first to feed off of Facebook’s social graph, which allowed companies to endlessly post messages on players’ walls to get the word out about their games. Since those viral channels were shut down, Crowdstar has had a difficult time keeping up with social game leaders, such as Zynga, Electronic Arts, Wooga and King.

A year ago, the company raised its first round of funding totaling $23 million, but since then, its games have slipped in the rankings as its focus has shifted to mobile. Today, it attracts fewer than 8 million monthly users, down from 29 million a year ago, according to AppData.

Since then, said Relan, they have discovered an attractive audience on mobile, consisting of females age 13 to 30 who are not interested in sitting in front of a PC or a console to play games. “They are very mobile and communications-oriented,” he said.

For example, Crowdstar’s Girl franchise, including Top Girl, Social Girl and Modern Girl, has collectively hit 20 million downloads across both iPhone and Android. Modern Girl alone surpassed two million downloads within three weeks of its launch.

The Girl franchise includes role-playing games where users dress up avatars and are judged on their outfits as they walk the runway.

Relan said Zynga has done a good job serving the females, aged 35 and over, who grew up on PCs and enjoy playing games online. But the slightly younger demographic is looking for a different kind of game play on a different platform. Relan said they still will leverage the Facebook platform on mobile.

The decision to pull away from Facebook on the PC is new since the company announced a three-prong strategy in October that included Facebook games, mobile games and an emphasis on Asia.

Relan said that even if the company weren’t targeting a niche that gravitated toward mobile, he’d still be wary of developing games for Facebook. That’s because he believes the audience for Facebook games has plateaued or started to decrease.

“If I was going after an older audience, I might focus on tablets,” he said.

Meanwhile, the case — a rat’s nest of a dispute over just who owns the rights to the iPad trademark in China — drags on, Proview’s financial situation continues to worsen and Apple’s new iPad continues to be unavailable for purchase in mainland China.

Of course, Proview has said all along that it’s willing to negotiate a settlement. Problem is, Apple may not see the need for one. It contends that it reached an agreement with Proview years ago, when it first purchased the company’s worldwide rights to the iPad trademark in 10 different countries, and it has a fair bit of evidence to back it up.

Apple did not respond to requests for comment.

RELATED POSTS:

• Apple, Proview Will Try to Talk Out iPad Trademark Tussle
• Apple vs. Proview: We Lawyers Have a Word for Cases Like This, and It Starts With “Cluster”
• Proview’s New PR Attack: Apple Cheated Us Out of the iPad Trademark
• Proview Loses Bid to Ban iPad in Shanghai
• Surprise — Proview’s Ready to Talk Settlement With Apple
• Proview to Apple: You Owe Us $2 Billion
• Take a Look at Some of Apple’s Evidence in Proview iPad Dispute
• Here’s the Chinese Court Ruling Backing Apple in iPad Trademark Tiff
• Apple: China’s Proview Trying to Weasel Out of iPad Trademark Deal
• All Apple coverage

]]> http://allthingsd.com/20120420/apple-proview-will-try-to-talk-out-ipad-trademark-tussle/feed/ 0 http://allthingsd.com/20120417/liveblogging-yahoos-q1-earnings-im-so-excited-and-i-just-cant-hide-it/ http://allthingsd.com/20120417/liveblogging-yahoos-q1-earnings-im-so-excited-and-i-just-cant-hide-it/#comments Tue, 17 Apr 2012 21:06:33 +0000 Kara Swisher http://allthingsd.com/?p=197426

Yahoo turned in better-than-expected earnings today in its first quarter, and — as usual — I will be liveblogging the call with CEO Scott Thompson.

Yahoo beat Wall Street estimates in its first-quarter earnings report earlier today, with revenues of $1.08 billion and earnings of 23 cents. That’s a gain of 28 percent from a year ago in net earnings and 38 percent per diluted shares.

Earlier:
2:03 pm: We begin with a new investor relations dude, who has replaced Marta Nichols. She is now CEO Scott Thompson’s new chief of staff.

His name is Joon and he seems much more festive than Marta, who was very, very serious.

I could not be more thrilled.

Thompson comes on quickly enough and he is also pretty jaunty.

Yahoo has been “moving very fast” on a range of things. And how — this guy seems to eat Ritalin for breakfast.

But there is still a long way to go, he notes.

“I am not satisfied with the pace of top-line growth,” said Thompson, who added he would not be until Yahoo was keeping up with others like Google, which turned in a much stronger report last week.

He can’t get no satisfaction — but he will!

Thompson said one problem was still its ongoing search and advertising partnership with Microsoft. It’s still rocky in terms of monetization and more.

2:09 pm: But first, it is CFO Tim Morse’s turn to re-read the results that were just released.

I am not actually listening until he gets to the part about Thompson giving more deets soon.

Morse is teeing this up by noting that Yahoo is adding more to its bag of tricks beyond search and display, such as commerce.

This will take investments, which are core to success.

Thompson is back: “This business can and will grow going forward.”

I am holding him to that one!

He starts first by talking about Yahoo’s content business, which remains strong, but he points out the obvious: Engagement is off.

In other words, the kids love Facebook. Also Instagram. Also Tumblr.

That’s why Thompson says he told the staff of Yahoo to rethink it all when he arrived in January.

The conclusion:

“Yahoo has been doing way too much for too long and has only been doing a few thing well.”

As in, jack of all trades, master of none.

“We have to be clearer going forward about what we won’t do,” said Thompson.

2:22 pm: He goes over some specifics.

Shutting down 50 properties — Thompson does not say which, though.

Consolidating platforms.

Dedicating key teams to innovation.

Something else about being nimbler.

Data. Also data. Did I say data?

Research and development only for Yahoo-owned and -operated properties.

That is six points, which will be underscored by better execution.

Thompson has been talking about the “complex processes” that was once called peanut butter by one former exec.

Peanut butter is sticky and that’s the point.

2:26 pm: Oops, when talking about layoffs, Thompson says “PayPal” and not “people.” He used to run the eBay payments unit.

Thompson moves to the board changes — five new members and the jacking of five from previous year.

He then defends his decision to sue Facebook over patent infringement. “Facebook must do the same or change its practices,” he sad.

Thompson adds the company is in “active” talks with its Asian partners, Softbank of Japan and Alibaba of China.

And some news! Talks related to its Japanese assets have a gap in valuation, so Yahoo is focusing on the Chinese ones.

And in summation:

“We don’t have to reinvent who we are, but we do need to reinvent our experiences … We have to move and think like a growth company.”

That would be nice.

2:32 pm: Time for Q&A, in which I like to see exactly how wimpy Wall Street analysts can be in asking tough questions.

The first is asking about some strategery specifics, including whether it can get the cool $1 billion AOL just got from Microsoft.

Thompson talks about the new commerce unit, which will be co-led by someone who worked with him at PayPal. It’s not really new, since Yahoo is in that arena already.

Morse answers on intellectual property issues, noting Yahoo is happy to license its family jewels. Most tech companies use these patents as a defense, but no longer.

The next question is on morale of sales force. I can answer that! Not good!

But Morse says there is progress.

Bygones.

Morse also notes that Yahoo still has search revenue per share guarantee from Microsoft, but that he hopes it will get better before that deal runs out.

Back to Thompson. He wants better results to advertising customers.

He keeps saying “at or above the market rate.” Yahoo’s growth has been lackluster, so this would be a key victory if Thompson could pull it off.

2:39 pm: A question about mobile, which has been one of Yahoo’s most embarrassing holes of all.

Besides Facebook, the kids love those smartphones. You would not know it from Yahoo’s shoddy products.

“We need to get good real fast in mobile … and we’re not there today,” said Thompson. Actually, Yahoo was not there yesterday, either.

Note to Scott: Real fast is a good idea.

There is a question about its advertising platforms, a back-handed way of asking if it is for sale. It is.

Thompson notes that there has been a lot of evaluating, but that “we have not come to a conclusion.”

2:42 pm: A question about its revenues from its Asian assets. China’s Alibaba — which is not run by Yahoo — is doing great.

It’s kind of like being the dude who bought Apple some years ago and is now rich through no effort of his own.

Thompson addresses a question about dividends, which Apple just gave out. Yahoo will be sticking with stock buybacks, so everyone can put away those Porsche catalogs.

I am briefly distracted during some accounting questions by the new Apple ads with Zooey Deschanel. She is so adorkable, it makes me slightly queasy.

Back to Thompson, who is non-answering a question about possible acquisitions. He’s not talking, but I am sure he will be buying if he gets a transaction with Alibaba done finally.

Given the long and convoluted and always aborted deals over the years, this would be cause for much celebration if Thompson pulls it off.

(And, if he does, I pledge to buy him dinner in Boston at the restaurant of his choice!)

2:52 pm: A question of what the heck Thompson actually means when is he talking about using Yahoo’s data.

There are apparently three main places.

Personalization, which is uniquely related content, which gives him a chance to egregiously tout Boston sports teams.

Contextual advertising, which means ads you want.

And data and analysis to advertisers that will help them do a better targeting job. Oh, joy.

A search question, which I have decided to ignore, since I feel search is simply not Yahoo’s business any longer and should be sold off.

But what do I know?

Morse keeps yammering away on “better experiences for our users” by its search team.

Hey, it’s called Google. Then, Bing. And only then, Yahoo.

2:58 pm: Last question, which I missed while I was focusing on search ranting.

And with that, it’s back to the future for Yahoo. Hopefully.

]]> http://allthingsd.com/20120417/liveblogging-yahoos-q1-earnings-im-so-excited-and-i-just-cant-hide-it/feed/ 0