AllThingsD » Bay Area

eBay's John Donahoe Literally Starts Hammering Out the Plan for Mobile Payments

Tricia Duryee — Thu, 19 Jan 2012 14:00:33 +0000

John Donahoe has a hammer, and he’s not afraid to use it.

The yellow-handled hammer, which the eBay CEO purchased at Home Depot using PayPal, signals that the company’s plans for entering the mobile payments business has entered the construction phase.

In an interview yesterday, Donahoe provided a few details about the company’s Home Depot trial and how it would expand from five to 51 stores across the country over the next week.

He also talked about his own experience of buying the tool earlier that morning. (Seen at right: Donahoe wielding his hammer.)

The company also announced fourth-quarter results yesterday, solidly beating both the company’s internal guidance and analyst expectations.

One of eBay’s big initiatives over the past year has been to find ways to work more closely with physical retailers by providing them with the technology they need to operate more efficiently online and offline. Over the past year, that has included buying 13 companies, for a total investment of $3.4 billion.

“We are right at the intersection of something that’s really cool,” Donahoe said. “This isn’t something that everyone sees, like social networking three years into it, when only the early people knew about it.”

What everyone is not seeing, he explains, is how retail and payments are two massive industries that are “at an inflection point where they will go through dramatic change.”

One major opportunity is payments being made at the cash register, and arguably many others see it, too, including Google, Visa, MasterCard and the wireless carriers, which are all working on their own solutions.

Interestingly, Donahoe was willing to put a price on it — and it’s huge.

If eBay is able to capture just 2 percent of the sales occurring at the point of sale, it will be able to double PayPal’s $70 billion business today. If they capture 4 percent, they’ll triple it.

Of course, that will take some time.

This year, eBay is focused on learning and testing out the technology in several trials; then, in 2013, it will begin to scale the business. In 2012, the company is not even factoring in a lift from point of sales in eBay’s revenue guidance.

The company’s big test will start later this week, when it expands its trial with Home Depot from five stores in the Bay Area to 51 stores in the Bay Area, Atlanta and Omaha.

Everything continues to be on track, despite the unexpected departure of PayPal President Scott Thompson. Thompson shocked Donahoe right after the New Year with the announcement that he was leaving to become CEO of Yahoo.

Donahoe declined to give an update on his plans to replace Thompson, saying that he was fine with serving the interim role in the meantime, and relying on the rest of the team PayPal has in place.

So far, Donahoe said, the mobile payments technology works flawlessly, based on his own experiences, but there’s still some additional scenarios they will have to consider.

Yesterday morning, he drove to a store in San Jose, where he consciously left his wallet and phone in the car.

He walked through the aisles to find a hammer and tape measure, and then went to check out, where the terminal gave him the option of checking out with PayPal. He entered his mobile phone number and PIN, and the transaction was completed, with the receipts sent to his phone and email.

“It was faster than swiping the card,” Donahoe said. “This is an advantage that PayPal has. No one else can do it with a mobile number and PIN. There was no fancy whiz-bang technology.”

Customers will also be given the option of paying with a PayPal credit card.

But not all the pieces are in place yet.

Coming soon: Users will be able to store their loyalty cards in their PayPal wallet, and will be able to receive personalized offers based on their shopping habits.

Also, it’s worth noting that while Donahoe checked out easily, there will be a learning curve for others. In advance of going to the store, users will have to associate a phone number and PIN with their account, and enable their account for in-store checkout.

Right now, there’s no contingency plans for if a person doesn’t have a PayPal account, or if it’s not set up. In fact, a very small percentage of the more than 100 million PayPal users have likely done that.

“That’s exactly why I say this is the year for trialing and learning,” Donahoe said, appropriately adjourning the interview with a bang of the hammer.

The New York Times Bits Blog Gets a Billboard

Liz Gannes — Wed, 18 Jan 2012 20:03:44 +0000

Competition in the technoblogoverse just got a little fiercer! The New York Times Bits technology blog now has its very own billboard on Highway 101.

Specifically, the billboard is on 101 southbound in South San Francisco, just north of SFO. It heralds, “Bits: Everything you need to know on the business of technology.”

A spokeswoman for the Times said she didn’t know when the billboard went up, but said it was part of a broader promotion effort after the relaunch of Bits late last year.

Other Web companies who’ve recently bought billboards on Highway 101 in the San Francisco Bay Area include Zynga, Groupon, Box.net and even the young travel search site Hipmunk.

Campaigns on 101 (warning: Locals frown at people who call it “the 101”!) cost an average of $10,000 to $20,000 per month, with some prominent spots costing more than $30,000 per month, said John Laramie, CEO of ADstruc, a DSP for outdoor advertising.

It should be noted that AllThingsD competes with Bits, obvi.

Also, please excuse the cellphone photo through my dirty windshield; I drove to L.A. this weekend and should really take the car in for a wash.

Potential Windfalls Loom for Some Top Executives

Pui-Wing Tam — Thu, 05 Jan 2012 19:16:17 +0000

For some Silicon Valley executives, 2012 is getting off to a rich start.

The first quarter is the most common period for new stock and options to be awarded and therefore for older equity grants to become vested, according to compensation-research firm Equilar Inc. And so some Bay Area executives will soon be able to cash in millions of dollars of restricted stock units and stock options granted over the past few years.

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Groupon Continues to Suck Silicon Valley Talent to Chicago–This Time From Google

Tricia Duryee — Fri, 04 Feb 2011 18:15:56 +0000

Groupon is close to hiring yet another top executive from the Bay Area, according to sources.

This time, the social buying site is targeting Jason Harinstein, who is Google’s director of corporate development. He would be the latest in a string of high-profile hires for the Chicago-based company.

Harinstein is expected to fill a similar role at the well-financed daily-deals site, including mergers and acquistions and other corporate deal-making. UPDATE: Groupon has officially announced it has hired Harinstein, who will serve as SVP of Corporate Development.

According to LinkedIn, he led several major transactions at Google, including the acquisitions of DoubleClick and ITA Software.

Groupon, which has been around only since 2008, has built a giant business in a short time by linking customers with mostly local merchants via heavily discounted daily deals.

It’s been trying to replicate that business around the globe, often times acquiring local providers to get up to speed quickly. Its latest moves have been in China, where it’s considering a combination of buying, building or a strategic investment.

The company continues to solidify its management team ahead of a potential public offering. Not too long ago, Groupon said it was undecided about its next step, but now we hear it is leaning toward Morgan Stanley as its banker.

Harinstein, who has worked at Google for nearly six years, would closely follow other execs willing to make the move to the Midwest company. He is currently located in New York.

Late last month, Mobilized’s Ina Fried reported that Yahoo Mobile VP Michael Shim was headed to Groupon; Yahoo also lost Lee Brown to Groupon to head national sales, according to a post by BoomTown’s Kara Swisher; and from a little farther north, Groupon scooped up Amazon vet Jason Child as CFO.

If this hire materializes, it would be yet another a blow to Google’s ego, which failed to acquire Groupon for $6 billion late last year. It’s not clear if Harinstein worked on the deal or not, which would have given Groupon execs some insight to his talent. Google has not yet responded.

Keeping with Groupon’s humorous style, as part of Harinstein’s announcement, it also said it has hired Rob Grabowski, who will be in charge of supplies, such as “stocking Diet Coke, Vitamin Water and tiny flannel shirts in kitchens across four floors of Groupon headquarters.” He most recently worked as an office assistant at a comedy club in Chicago.

Nokia, Silicon Valley Giant?

Ina Fried — Fri, 17 Dec 2010 13:20:35 +0000

When one thinks of Silicon Valley tech companies, Nokia is hardly a name that comes to mind. But the company has amassed a decent presence in the Valley, with about 500 people working on everything from research to inking deals with Web giants to building the features that the company hopes will someday soon return it to the forefront of the smartphone market.

In fact, the Bay Area unit was one of the first parts of Nokia that CEO Stephen Elop visited when he took the job earlier this year–in part because the company’s board had already scheduled to have its meeting in the area.

Silicon Valley has slowly become an important spot for the company, despite the fact that Nokia doesn’t sell all that many smartphones in the U.S.

Earlier this month, the company’s area employees got a new home as Nokia consolidated nearly all of its Bay Area workers in new offices in Sunnyvale (see picture above). Each floor of the Finnish-style interior has self-standing structures that from the outside look like saunas, but are actually “privacy huts” used for small group meetings or just some alone time pondering the ins and outs of the cellphone business. Nokia kept its research labs in Palo Alto and Berkeley so they could stay close to the area’s top two universities.

The local staff is doing a range of different things. About 50 of Nokia’s Silicon Valley employees come from the company’s 2008 purchase of a Norweigian company called Trolltech, which makes an application platform called QT that is used to control everything from phones to trains and more.

There are also a variety of individuals and small groups working on various product and research efforts. Kari Pulli is a Nokia Fellow who focuses on camera technology. He helped develop a panorama photo feature that is part of the latest Nokia cellphones. His team also developed an HDR photography capability–a feature Pulli reminds people was added to Nokia’s phones before Apple included it in the iPhone. He said his team is currently working on techniques to improve cellphone pictures taken in low-light conditions.

Typically, such photos are either noisy or blurry, depending on what step is taken to compensate for the lack of light. But by taking two pictures–one picture that aims to be sharp, though noisy, and another that will be a bit blurry, but have low noise–he said that a better composite image can be created.

Pulli, who was born in Finland but has spent the past four years in Palo Alto, said he is not too worried that the new Nokia chief is not Finnish. “At least he’s Canadian,” Pulli said, pointing out it’s another cold, dark place that loves hockey. (Elop does love hockey.)

While some of Nokia’s workforce is building new features, others are working on making sure that the company has partnerships with all the important companies in the valley–especially the Facebooks and Twitters of the world.

As for the research projects, they vary widely, and many are only tangentially related to Nokia’s core phone-making business.

Tico Ballagas is a user experience researcher working on how to make technology a better tool for family communications. So he’s been spending a lot of time with Elmo as part of a Family Story Play project to see if distant relatives can better connect with young relatives by reading a story to them over videoconferencing gear.

Meanwhile, Jorg Brakensiek is working with a number of German carmakers to develop a framework known as Terminal Mode, which would allow all manner of smartphones to be usable within cars without users having to stare down at a screen to make use features like maps, email and more.

What many at the offices lament, though, is the fact that so few of the people in the U.S. get a chance to appreciate their work. While Nokia certainly has its challenges globally, it is all but invisible at the cutting edge of the U.S. market. that’s because none of the major carriers here sell a subsidized model of the company’s high-end phones.

What’s worse, the phones that the carriers do sell tend to be the most basic and boring of cellular designs. The company has plans to change that next year, when it hopes the introduction of Meego-based phones will finally sway U.S. carriers to offer subsidized Nokia smartphones, ideally by next summer.

Music Video For Database Start-Up? That's How CouchOne Rolls

Deborah Gage — Mon, 15 Nov 2010 08:08:31 +0000

How does a small Bay Area start-up whose business revolves around arcane coding compete for developers with the likes of Facebook and Google?

By making a rap video, of course.

CouchOne Inc., an Oakland, Calif-based company that makes a database built on open source software called CouchDB, produced the video partially on a whim and partially to bring attention to the start-up, which raised a $2 million Series A round last year from Redpoint Ventures and is in the process of raising a Series B.

The video, “I Use CouchDB,” stars CouchOne co-founder Chris Anderson and the company’s office manager, Claire McCabe, as a cool-looking pair whose stresses melt away when they replace their clunky SQL database with CouchDB. The video intersperses shots of the company’s product in use with scenes of Chris and Claire rolling through the streets of Oakland, Claire at one point riding on a car hood.

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Intern Becomes Real Live Blog Dude–ATD Hires Drake Martinet

Kara Swisher — Tue, 09 Nov 2010 18:29:51 +0000

It is always nice when an intern makes good, and that is entirely the case with Drake Martinet (pictured here), who joins All Things Digital–as of yesterday, in fact.

We could not be happier. Plus, we knew he was our kind of geek after he agreed to spend the night in a tent next to Robert Scoble, to cover last year’s Apple iPad release.

That was when Drake was an ATD intern, until he headed to the New York Times this past summer to work on social media efforts in the newsroom.

And that’s one of the many things he will be working on here, making ATD more Facebook-worthy, Twittified and YouTubed within an inch of our lives.

Drake will also be working on upgrading our multimedia efforts–which is to say, figuring out a more sophisticated strategy for us than BoomTown’s Flip video camera assaults, helping mesh up business development efforts with our editorial integrity, analyzing our analytics and even making sure our new interns are up to snuff.

And, for his next trick, he will also be doing posts on interesting early start-ups and emerging ideas, much in the same way he did a bang-up job with a feature called “Almost Famous” when he was an intern.

Whew! Then again, he is young!

Still, Drake has done a lot so far.

After receiving his masters degree from Stanford University’s graduate program in journalism this year, and spending time in the school’s design program (the d.school), Drake moved to Brooklyn to work for the Times.

In addition to his weekly start-up column for ATD, his written, photographic and video work has appeared in the New York Times, The Wall Street Journal, the San Francisco Chronicle and numerous Web sites and blogs.

A native of San Diego, Drake first moved to Northern California to attend the University of California at Davis. He has lived in the greater Bay Area for the last eight years, excepting short stays in Louisiana, Washington D.C., New York and Chile.

When not working on a story or doing a little Web development, Drake can be found at his workbench building all manner of things physical and electronic, like the solar-powered Timbuk2 backpack that accompanies him almost everywhere.

He also loves to twist through the Peninsula hills on his classic Triumph motorcycle. (And, now that he is our employee again, perhaps we’ll make him do it with Scoble in tow.)

Drake joins a spate of recent hires at ATD, including: Liz Gannes on social (now appearing here in her new blog, NetworkEffect); Tricia Duryee on e-commerce; Ina Fried on mobile; and, last but not least, Arik Hesseldahl on enterprise.

And, as usual, much more to come….

The Bay Citizen's Jon Weber–Editor of Web 1.0–Talks About Journalism 2.0

Kara Swisher — Mon, 20 Sep 2010 13:19:39 +0000

It’s been less than a year since the former top editor of the Industry Standard–the once high-flying (and then not so much) magazine of the Web 1.0 era–Jonathan Weber got back to the Bay Area from his stint away in Montana.

His latest job: Editor in chief of the Bay Area News Project, funded with $5 million from the foundation of San Francisco businessman Warren Hellman.

Like ProPublica’s investigative bent in New York, it’s a wealthy-donor-backed, nonprofit endeavor to focus on local news coverage, even as mainstream media outlets founder.

The Bay Citizen also has an agreement to share content with the New York Times (NYT).

The online site’s big stories of late, for example, have focused on the problems at PG&E (PCG), the powerful utility, in the aftermath of the San Bruno explosion.

Here’s Weber–who once chronicled the ups and then downs of the first rash of dot-com fever, and then founded another online news effort, New West–talking about the Bay Citizen, as well as where journalism is going online:

[ See post to watch video ]

Google Donates Cash, Blood for San Bruno Inferno Victims

Voices — Fri, 10 Sep 2010 19:24:18 +0000

Google often pulls together some special online resources in cases of disaster, but today it’s joining the rest of the Bay Area in marshaling tangible help for some of its neighbors–victims of the gas-fueled inferno that destroyed almost 40 homes in San Bruno last night, leaving at least four people dead and more than 50 injured. Noting that the initial blast was just two miles from its YouTube offices, Google said it was donating an initial $50,000 to the local Red Cross for relief efforts, directing employees to local blood drives and planning several of its own blood drives for next week. An annotated map of the neighborhood has also been posted and is open for collaboration.

A Patch of Its Own: Yahoo Builds a San Francisco Newspaper

Peter Kafka — Thu, 26 Aug 2010 20:37:57 +0000

Patch, AOL’s network of Web-only local newspapers, is open in 100 towns. And AOL (AOL) says it will have 500 by the end of the year. Now it looks like Yahoo is planning its own local Webpaper venture, in San Francisco.

Yahoo will use its Associated Content content farm/factory/mill (pick your favorite phrase!), acquired earlier this year for $90 million, to build out the site. Alan Mutter, the plugged-in newspaper blogger, has the details:

In a breathless email blast to registered contributors at Associated Content, Yahoo said it is “looking for writers living in or near the San Francisco area (like you!) to write compelling, local content–ranging from highlights of your favorite neighborhood destinations to metro-wide, first-person reporting assignments covering the stories and topics not typically found in mainstream news media.”

A questionnaire soliciting personal interests and writing samples from potential contributors indicates that the site will cover crime, local news, politics, weather, traffic, transit, sports, business, local celebrities, personal-interest stories, events and things to do, nightlife, restaurants, social calendar, real estate and development, education.

Those responding to the questionnaire were promised “a $10 assignment to write on any topic about San Francisco!” In the future, Yahoo said “select contributors” will receive “weekly, paid assignments to write articles on SF and their own neighborhoods.”

I’ve asked Yahoo (YHOO) for comment on the venture, but I’ve heard nothing but chirping crickets in response. (UPDATE: See new Yahoo comment below.) Which is too bad, because I had some questions for Carol Bartz and company. For instance:

Is this a one-off, or should we expect to see more AC-powered local sites?
If we’re going to see more of these, what should the local newspapers that Yahoo does business with think?
Or are we looking at this the wrong way? For instance, maybe this really isn’t a foray into local news, but a high-profile demonstration project for Associated Content? Is that plausible?
Well, how did I get here?

Okay, okay. I know the answer to that last one. If I hear back from the Yahoos, I’ll update. Until, then, enjoy:

UPDATE: Just after I hit “publish,” this statement from Yahoo popped up in my in-box:

Associated Content is an important platform for generating content across Yahoo!’s content verticals, and local is one of many areas on Yahoo! that will benefit from our ability to generate high quality content on specific topics. We are moving quickly to integrate Associated Content into Yahoo!’s media properties and explore new ways to leverage the contributor community, including local.

Meanwhile, PaidContent’s Joe Tartakoff puts Yahoo’s Bay Area efforts in the context of its larger local ambitions. A good read.

Digg CEO Jay Adelson Steps Out

Peter Kafka — Mon, 05 Apr 2010 18:00:58 +0000

Digg CEO Jay Adelson has left the company he has run for the past five years, leaving founder Kevin Rose to run the social news site in the interim.

Statements from Adelson and Rose (below) do not shed light on what happened, though I imagine the picture will start coming together in the near future.

But I can start by noting that Adelson has long been said to be restless at Digg and that he and the company’s board of directors have reportedly butted heads several times. Adelson, who commuted for years between Digg’s San Francisco offices and his home in suburban New York, finally moved his family to the Bay Area last fall.

Digg used to be best known as a company that was always going to be acquired but never got acquired. Google (GOOG) got close to buying it in the summer of 2008, and then backed away from the deal during due diligence.

Meanwhile, Digg’s growth has flat-lined for a while. Here via comScore (SCOR) is what it has looked since October 2009 (click to enlarge):

Here’s the official word from Jay Adelson, followed by Kevin Rose.

Hey all,

Got some news. After five years, forty million users, and an amazing ride, I’ve decided to step down as CEO of Digg. With the new Digg getting ready to launch, Digg Ads doing well, our sales force growing, our hiring ramping, and the company maturing well beyond its startup phase, I feel that now is the right time.

The entrepreneurial calling is strong, and I am ready to incubate some new business ideas over the next twelve months. As the economy exits a very deep recession, I believe that it is an excellent time for new companies to develop. Of course, I will continue to serve as an
adviser to Digg. In the interim, Kevin has agreed to step in as Chairman and CEO.

I’d like to thank Kevin, the Digg staff and the Digg community for their support, insight and, most of all, their loyalty in turning Digg into the force that it is today.

–Jay

Update from Kevin:

I want to be the first to thank Jay for the last five years of amazing work. You’ve been a great friend and mentor, we wouldn’t be where we are today if it wasn’t for you.

While I’ll miss working with Jay day-to-day I am excited to be taking on the role of Chairman and acting CEO, driving Digg forward on our promise to enable social curation of the world’s content and the conversation around it. We’ve been super busy on the product side getting ready for the upcoming Digg redesign and delivering our mobile apps for the iPhone and Android.

Thank you very much for your on-going support of Digg, I’m truly excited about the next five years, big things coming!

-Kevin

AT&T Tops 3G Performance Study. No, I’m Not Kidding.

John Paczkowski — Tue, 23 Feb 2010 21:10:30 +0000

Looks like AT&T is delivering on its promise to improve its network, particularly in coastal cities like New York and San Francisco. A 13-city mobile data speed test conducted by PC World shows the carrier with download speeds 67 percent faster than those of its rivals (spit take!) and greatly improved reliability and performance (see table below; click to enlarge). Seems Apple’s (AAPL) iPhone isn’t nearly the challenge to AT&T’s (T) data network resources that it once was.

“The AT&T and iPhone combo turned in the fastest average speeds–downstream and upstream–of the four carrier/smartphone combinations we tested, outperforming its rivals in more than three-fourths of the cities we sampled,” PC World explained it its study.

“AT&T connected the iPhone at an average download speed of 1259 kbps, and an average upload speed of 215 kbps over the 13 testing cities,” the study notes. “The iPhone clocked download speeds of at least 1000 kbps in more than 60 percent of our testing locations, with burst rates often exceeding 3000 kbps, and we managed to obtain a reliable connection in 91 percent of our AT&T/iPhone tests.”

The PC World study confirms results of a similar 12-city 3G performance study by Gizmodo last year.

A remarkable improvement, although it should be noted that San Francisco is still plagued by reliability issues. PC World found just 55 percent of connections made on AT&T’s network in the city to be successful. Bay Area users can only hope that the additional cell towers, cell site upgrades and increased back-haul capacity the carrier is said to be rolling out will improve this metric in short order.

PREVIOUSLY:

AT&T: “We’re Closing the Gap” in New York and San Francisco

Apple COO: Leave AT&T Alone

If You Think AT&T Has Network Problems Now, Just You Wait

AT&T 3G Improving–If You Can Get a Signal

Admitting You Have a Problem Is the First Step, AT&T

Usage-Based Data Pricing: The Solution to AT&T’s iPhone Problems?

AT&T Ranked Last in Consumer Reports’ Best Cellphone Service Survey

Apple Joins AT&T/Verizon Spat With New iPhone Ads

AT&T Awarded Hug and a Box of Tissues in Verizon Ad Case

Time to Cut AT&T Some Slack, iPhone Users?

Thanks, iPhone: 2,000 Percent Increase in Bay Area Data Traffic Since 2008, Says AT&T

Verizon to AT&T: Do Yourself a Favor and Shut Up

Frosty’s Winter Litigation Wonderland: AT&T Demands Verizon Pull Holiday iPhone Ads

Verizon Banishes iPhone to Island of Misfit Toys

Verizon on AT&T Suit: There’s a Word for That. “Junk

Verizon to iPhone Users: “Want Five Times More 3G Coverage? There’s a Map for That.”

iPhone Owners Would Like to Replace Battery, AT&T

AT&T: "We're Closing the Gap" in New York and San Francisco

John Paczkowski — Thu, 28 Jan 2010 20:09:59 +0000

AT&T’s overtaxed network has been the subject of considerable negative attention recently. No surprise, then, that the network figured prominently during the company’s earnings call this morning. The carrier everyone loves to hate would like us all to know that it’s making progress in New York City and San Francisco, two high-volume markets with equally high-volume complaints about AT&T’s (T) wireless service.

“Given our high smartphone numbers, double our closest peer, in both markets, we have large population centers, very sophisticated users with high expectations, and very high volumes,” John Stankey, president and CEO, AT&T Operations said during the call.

“For example, in the dense areas of New York City, there are periods during the week when nearly 70% of the devices active on the network are data-intensive handsets. So, raising performance levels in these two markets is the organization’s top priority. We’re putting all the resources available against the issue and we’re closing the gap.”

Okay, great. What does that mean? Between $18 billion and $19 billion in 2010 capital expenditures–approximately $2 billion of it for additional wireless network and back-haul investment, for one thing. For another, 2,000 new cell sites. Finally, the company is upgrading existing cell sites with fiber for better 3G speeds.

Now, a few more NYC-SF specifics from Stankey:

We’re adding third and fourth radio network carriers to maximize capacity on available spectrum. In Manhattan specifically, now that we have scalable cell site controllers in place throughout most of the island, we’re intensely focused on putting more radio capacity on the street. We’ll increase the amount of 3G spectrum and radio capacity by one-third in high volume areas of the island by the end of the first quarter.

While we are through the majority of our zoning challenges in the Bay area, we’ll continue to work the remaining issues we have in parts of the Financial District and a handful of other locations to final resolution. We’re adding cell towers; and over the coming months, we’re building and upgrading high-capacity antenna systems to boost performance in high-traffic areas like stadiums, convention centers, and public transportation routes.

So will be see significant improvement in both markets in the coming months? Perhaps. Certainly, AT&T is suggesting we can expect one. And, as Stankey noted this morning, “Today a dollar in wireless investment yields twice the capacity than it did a year ago.” Let’s hope so–especially in markets like New York and San Francisco.

PREVIOUSLY:

Apple COO: Leave AT&T Alone

If You Think AT&T Has Network Problems Now, Just You Wait

AT&T 3G Improving–If You Can Get a Signal

Admitting You Have a Problem Is the First Step, AT&T

Usage-Based Data Pricing: The Solution to AT&T’s iPhone Problems?

AT&T Ranked Last in Consumer Reports’ Best Cellphone Service Survey

Apple Joins AT&T/Verizon Spat With New iPhone Ads

AT&T Awarded Hug and a Box of Tissues in Verizon Ad Case

Time to Cut AT&T Some Slack, iPhone Users?

Thanks, iPhone: 2,000 Percent Increase in Bay Area Data Traffic Since 2008, Says AT&T

Verizon to AT&T: Do Yourself a Favor and Shut Up

Frosty’s Winter Litigation Wonderland: AT&T Demands Verizon Pull Holiday iPhone Ads

Verizon Banishes iPhone to Island of Misfit Toys

Verizon on AT&T Suit: There’s a Word for That. “Junk

Verizon to iPhone Users: “Want Five Times More 3G Coverage? There’s a Map for That.”

iPhone Owners Would Like to Replace Battery, AT&T

AOL Product Guru (and Google Vet) Shashi Seth Bolts for Yahoo After Just Three Months

Peter Kafka — Wed, 13 Jan 2010 20:35:53 +0000

That was quick: Shashi Seth, the “product guy” and former Google (GOOG) executive hired by AOL (AOL) just three months ago, is leaving the company and headed to Yahoo. AOL, of course, has been a net importer of Google veterans since bringing sales boss Tim Armstrong aboard to run the company last spring.

No word yet on what Seth will be doing at Yahoo (YHOO). UPDATE: Seth’s new position will be senior vice president, search products team, Yahoo announced on a blog post.

In the letter announcing his departure, below, he cites the new job’s strain on his family–it’s worth noting that his description of the situation is a bit more impassioned than the generic “leaving to spend time with his family” explanation, though not really more detailed.

Here’s what Jeff Levick, president of global advertising and strategy at AOL, said about Seth in September:

“Shashi is unmatched in the industry as an innovator with an outstanding track record of developing new and better ways to serve advertisers on the Web. As we move forward on our strategy of becoming the world’s largest provider of display advertising, Shashi will play a critical role in creating the best products in the business for our advertising partners.”

And here’s what Levick had to say about him today, followed by Shashi’s letter to his former colleagues:

From: Levick, Jeff

Sent: Wednesday, January 13, 2010 3:12 PM

To: AOL_Advertising

Subject: AOL Advertising Organization Changes

AOL Advertising–Along with the other changes going on across the company today, I wanted to let you know Shashi Seth will also be leaving AOL effective today. While Shashi was only with us for 90 days, we appreciate the early steps he took to help us redefine AOL’s advertising product roadmap.? ?I’ve attached Shashi’s note below. As you’ll see he’s taken another position in the Valley–at Yahoo–which will enable him to remain closer to his family.

In the interim, Jamie Fellows will be leading our Global Advertising Products organization. I’ll look forward to seeing everyone at our All Hands next Tuesday and as always if you have questions, please let me know.

Best, ?Jeff

Dear Team:

It is with a heavy heart that I must tell you that I am resigning from my role at AOL. Very recent developments in my personal life have made it impossible for me to maintain an executive role that requires extensive travel.

Over the last 3 months my relationship with my wife has been impacted severely, and the last 2 months have been very difficult for me as I saw my family unravel in front of my eyes. My family has always come first, and decided that we needed to give it everything we have to put this family back together. Spending more time together will be an important ingredient for success. The holidays gave us an opportunity to start that process, discuss plans for the future and laid out a plan that allows us to reset and rebuild our lives.

Last week I was approached by a Bay Area company about an interesting role, discussions progressed very quickly, and I’ve accepted their offer to join. This new role will enable me to remain local, and gives me lots of flexibility in where I work from (we might move to India for some time) and be available for my family, yet gives me something interesting and challenging to work on.

This is very hard for me, as I have enjoyed working with all of you, and truly believe in our products, vision and AOL as a company. The new organization, the new culture, the new focus, but above all having leaders like Tim and Jeff, all point to success in short order.

I apologize for all the inconvenience and the disruption caused by my action, and I hope you will understand. I will root for you from the sidelines, and celebrate AOL’s success. Someday, we may have the chance to work together again.??Jan 22nd will be my last day at work. Jeff and I have put together a transition plan that will allow us to continue business as usual. You will see emails and meeting invites that will start the process.??I will truly miss working with each and everyone of you.

Good Luck!

Shashi

Yep, Palm's Coming to Verizon, With a Couple of New Phones

Peter Kafka — Thu, 07 Jan 2010 19:03:08 +0000

Palm is expected to announce today that its Pre and Pixi smartphones will be available on Verizon Wireless (VZ) . What else is in store? This is normally Palm (PALM) bete noire John Paczkowski’s territory, but John’s en route to Las Vegas from the Bay Area, so I’ll be tapping away.

Some totally unverified gossip from my fellow scribes here at the Venetian Hotel in Las Vegas: Expect an AT&T (T) announcement as well. [UPDATE: Make that "sort of verified"--AT&T already indicated it would support the Palm operating system yesterday, as Business Insider's Dan Frommer notes.]
Palm CEO Jon Rubinstein takes the stage: Our platform is a deliberate bet on the Web, he tells us. It’s at “the heart of everything we do at Palm.”
Rubinstein notes that there have been 85,000 downloads of the webOS software development kit since launch in July and 20,000 registrations for the new online developer program, adding that these are clear indicators of interest in the Palm platform. [Translation: We're going to start catching up to Apple (AAPL) and its gazillions of apps. Promise.]
Rubinstein: Pixi is the “perfect choice for consumers looking to purchase their first smartphone.” That’s why we have these supercool back covers available. Check ’em out! And now a video of people talking about our stuff. [In the video, a talking head mentions "the death of the PC." Ominous!]
Palm announces a new partner: French carrier SFR, co-owned by Vivendi and Vodafone (VOD). Vivendi SVP Jean-Marc Tassetto says his company reaches half of the country’s population, simultaneously taking a dig at Apple and offering praise for Palm: “We started negotiating in Cupertino, we ended up in Sunnyvale.”
Palm SVP of Product Marketing Katie Mitic updates Palm’s developer program. After six months in closed beta, it is formally opening up. Any developer can submit a webOS app. Why work with Palm, Mitic asks? Her answer includes more coded Apple digs: The company promises a “fast and easy development” cycle and “freedom and choice” in how developers take apps to market. There are now 1,000 apps and Palm expects much faster growth.
Palm promises a “new approach to app distribution,” i.e., you won’t have to get Palm apps exclusively through Palm’s equivalent of iTunes. You can get them anywhere on the Web or via mobile. Mitic shows off Projectappetite.com as an example.
Coming this spring: A “Hot Apps” bonus program–$1,000 to developers with the best distribution (both free and paid), measured by downloads.
Also coming: A new “Plug-in development kit” for webOS.
We’re shown some new games from the likes of Gameloft and Electronic Arts (ERTS), including Need for Speed and Sims, etc. These are available today in the U.S.
Here’s Travis Boatman, VP of EA Mobile’s Worldwide Studios. Palm came to us a few months ago, he notes, before offering praise for Palm (duh): “Within a few weeks, we realized how great this SDK is….It’s really easy to use,” etc.
Some demos: Sims3, Need for Speed Undercover (which does indeed look “gorgeous,” as Boatman says).
More from Katie Mitic, who introduces Paul Cousineau, product marketing director, who is going to demo something involving Pre’s camera.
New feature: Video recording. Cousineau demos an editing feature with footage he just took onstage. It can be shared to Google’s (GOOG) YouTube, Facebook, etc., and will be available to all customers in February via software update. “No new hardware required.”
Cousineau demonstrates integration of various webOS features, moving data/elements from one app to another–sharing a YouTube clip that was just shot, for example.
Back to Mitic: More on over-the-air software updates. There have been nine updates since June, she says, covering battery performance, email, search, etc., adding that Palm is “bringing the pace of Web development to the mobile environment.” The February update will have a battery performance boost, too.
Back to Rubinstein, who focuses on two new products. He pulls the first, “Pre Plus,” from his pocket, describing it as a “more elegant, easy-to-use experience.” Button goes away, memory increases. It comes with 16 gigabytes of flash. The second new product,”Pixi Plus,” comes with built-in Wi-Fi. More color choices for back cover.
Carrier announcements: Both new phones are available exclusively on Verizon Wireless.
There’s a new 3G “mobile hotspot” app for both new phones that allows users to tether with the “appropriate data plan.” They can connect up to five devices.
Next: A taped message from Verizon Wireless CMO John Stratton, who is snowed in at O’Hare International Airport in Chicago, apparently. Phones will be avail starting Jan. 25, he says.
How much will the new Palm phones cost? We won’t tell you! Ho ho ho.
Rubinstein recaps, promising to allow CES visitors to actually hold the new phones this time. (Last year Palm had a “look but don’t touch” policy when it showed off the Pre).

There’s no mention of AT&T, even though the carrier has been talking about Palm options in public. Interesting. Maybe there’s a “one carrier per press event” rule.

UPDATE (sort of): After the event, I asked Rubinstein about the phantom announcement from AT&T. Here’s the entire exchange.

Rubinstein: “We don’t have anything to announce.”

Me: “Really? Because AT&T executives are saying they’ll have two phones running the webOS later this year.”

Rubinstein: “We don’t have anything to announce.”

He was smiling a bit, though. Certainly cheerier than when I asked former Palm CEO Ed Colligan about Pre pricing last year.

AT&T 3G Improving–If You Can Get a Signal

John Paczkowski — Wed, 06 Jan 2010 15:07:37 +0000

So AT&T has finished upgrading its 3G footprint to HSPA 7.2, completing the first phase of an effort that will improve connection reliability and at some point later this year or in 2011, raise its maximum 3G data speed to 7.2 Mbps from 3.6 Mbps.

Welcome news for long-suffering AT&T (T) subscribers, who recently ranked the carrier dead last in the annual Consumer Reports survey of wireless customer satisfaction. But the carrier’s improvements only apply to cities where additional back-haul connections have been added to support those higher speeds.

Sadly, for New York City and Bay Area residents, neither region qualifies. As AT&T head of operations John Stankey told attendees of a Citigroup (C) conference Tuesday, those cities present particularly challenging density and zoning issues.

“I thought by the time we’d closed 2009 we would be in a better place in New York City than we were,” Stankey said. “But New York City is a little bit of a different animal and it’s a good example of having to scale in this data environment, where not only do we have a lot of capacity issues to deal with but physically there is network equipment and network elements that are needed to be changed out.”

Elaborating, Stankey added, “They just flat-out have hit their capacity levels and we have to replace them with new ones. And as a result of that, those transitions and that work has taken us a little bit longer and it’s been a little dicier than what we had hoped it would be.”

And evidently, the situation is equally dicey in San Francisco.

“Our challenges [in San Francisco] are largely zoning-oriented,” Stankey explained. “It’s a little bit tougher in places in San Francisco to do adjustments to antennas that we need to do in areas like the Financial District, where we had antenna structures that worked really well in a 2G environment. They need to be replaced to support 3G services and it’s just taking time to get the zoning ordinances square to replace those antennas and clean up the portions of the city that we are dealing with.”

Okay. So New York City and San Francisco upgrades are tough going–that’s understandable. They’re both big, tech-savvy markets with high data demands. Still, it’s a travesty that a carrier like AT&T still can’t reliably connect calls in either of them when the company is raking in 80 percent more wireless data revenue than it did in 2007.

[UPDATED]AT&T, the iPhone and New York City's Newly Discovered Fraud Epidemic: What Doesn't Add Up?

Peter Kafka — Mon, 28 Dec 2009 04:22:55 +0000

Update: AT&T is once again accepting iPhone orders from potential customers living in Manhattan.

Live in New York City? Want to buy an iPhone? Don’t try ordering one from AT&T’s Web site: The wireless carrier, at least for now, won’t sell New Yorkers a new phone online, citing “increased fraudulent activity.”

But residents of Manhattan and the city’s other four boroughs can buy an iPhone directly from AT&T (T) stores. And the city’s five Apple (AAPL) stores will sell you one, too.

So what gives?

An initial report from Consumerist.com, quoting an AT&T online service rep, suggested that the carrier shut down online sales because “New York was not ready for the iPhone” and that the city doesn’t “have enough towers to handle the phone.”

That answer might strike a chord with New York iPhone owners who gripe about the carrier’s capacity. But it strains credulity: Would AT&T really try to resolve its iPhone problem by hampering iPhone sales–and not tell anyone in advance? And if so, why not choke off online sales in San Francisco and the Bay Area, where heavy iPhone use also strains the carrier?

New story: Since the Consumerist story appeared Sunday afternoon, AT&T service reps have been telling New Yorkers like me that it won’t sell us the phone online because of fraud problems.

What does that mean? Sean, the pleasant AT&T rep I talked to tonight, told me he could sell me a refurbished, 8-gigabyte 3G iPhone online or over the phone. But if I wanted a new iPhone, he said, I’d have to go to a retail store.

Why? “There’s actually been a problem in that area with fraud for the iPhone. It’s kind of a high-risk area.” Sean then reassured me that he was “not saying there’s bad neighborhoods anywhere. That’s not what that means.” But he couldn’t offer any more details.

Digital Daily’s John Paczkowski, in an online chat with a service rep, got a similar answer. As John points out, this answer also doesn’t make a lot of sense. If New York really is beset by a plague of scammers, why is AT&T selling other expensive smartphones, like Research In Motion’s (RIMM) BlackBerry line, over the Web? (Click text below to enlarge.)

There are other things that don’t line up here: The AT&T PR rep I talked to tonight knew nothing about this. And shutting off online sales of the company’s most high-profile phone to the biggest city in America seems like the kind of thing a corporate spokesman would have an inkling about.

Likewise, AT&T’s Google (GOOG) ad campaign sends New Yorkers searching for iPhones directly to this page, which doesn’t mention that you can’t actually buy an iPhone online. If you click on the “Buy Now” and give the site a New York zip code, you get the following nonsensical message: “We’re sorry, there are no Packages & Deals available at this time. Please check back later.”

My hunch: This is a decision that didn’t get run all the way up the chain of command. And it’s one that’s going to get reversed sooner than later. I’ll update when I hear back from AT&T.

UPDATE: This won’t clear anything up: “We periodically modify our promotions and distribution channels,” says AT&T PR guy Fletcher Cook, via email.

Time to Cut AT&T Some Slack, iPhone Users?

John Paczkowski — Wed, 18 Nov 2009 20:46:47 +0000

Since 2008, AT&T’s network in and around San Francisco has experienced an increase in 3G data traffic of 2,000 percent.

If you find this metric as astonishing as I do, consider this: The increase in Bay Area data traffic is actually below the national average–significantly below. According to AT&T (T) CTO John Donovan, 3G data traffic on the company’s wireless network has risen nearly 5,000 percent in the past 12 quarters nationally (see chart below; click to enlarge).

“Today, we’re seeing unprecedented growth in mobile broadband traffic,” Donovan said during his keynote at the Open Mobile Conference on Nov. 5. “This growth has required extensive rethinking of wireless networks as we know them, as well as significant advances in the supporting IP backbone and other infrastructure.”

A 5,000 percent increase in 3G data traffic: That’s an astonishing figure. Seems to me it’s entirely likely that any carrier that had been first with the iPhone–including catcalling rival Verizon (VZ)–would have suffered network troubles similar to those that plague AT&T today.

No other U.S. carrier offers a super-smartphone that has sold as well as the iPhone and that people use much like a laptop. Sure, Android and Palm (PALM) webOS devices are used in this way as well, but there are far fewer of them and they have significantly fewer data-hungry apps.

Research in Motion (RIMM) offers some BlackBerries that are used this way, but only some, and there are only 3,000 or so apps available for them. iPhone owners have 100,000 apps from which to choose. And while it’s obvious that there are more BlackBerries in use than iPhones, some of these rely on AT&T’s network, which only compounds the carrier’s problems.

So, really, any carrier that had been first to market with the iPhone would have seen its network overtaxed, especially after Apple (AAPL) launched the iPhone 3G and the iTunes App Store. Those events effectively upended traditional planning models for network capacity in a way that no one was prepared for.

Perhaps other carriers would have fared a bit better. Verizon’s 3G network, even back in 2007, was much deeper and broader than AT&T’s. But could it really have supported a 5,000 percent increase in data traffic without incident? I’m not so sure.

Which is not to say that AT&T is blameless. Its network has lagged and continues to do so, and the iPhone and the massive surge in data traffic it brought with it are not entirely responsible for that.

But they are obviously a big factor. It will be interesting, then, to see how Verizon’s network holds up in comparison if and when the carrier gets the iPhone.

[Image Credit: Morgan Stanley Managing Director Mary Meeker]

Google CEO Eric Schmidt’s Take on Silicon Valley Wannabes

Jessica E. Vascellaro — Thu, 05 Nov 2009 16:12:15 +0000

Eric Schmidt is brimming with Bay Area pride.

In the 33 years that the Google (GOOG) CEO has lived in the Bay Area, Schmidt says he has watched a long list of regions try–and fail–to create technology capitals of Silicon Valley’s scale.

“You can tell them by doing a query on Google like Silicon X, or something like that,” he said in an interview last month. “The Silicon Glen, that was Scotland. Silicon Alley, that is New York. Just do the search. They are all there.” He continued, “They have had some success but they aren’t the scale of Silicon Valley yet anyway.”

Read the rest of this post on the original site

Clearwire Launches Test in Silicon Valley

Eric Savitz — Wed, 16 Sep 2009 00:25:51 +0000

Clearwire (CLWR) today announced the launch of its a developer version of 4G service in the Bay Area. The developer version of the WiMax-based network covers “more than 20 square miles” in Santa Clara, Mountain View and “parts of downtown” Palo Alto. (Parts? Downtown Palo Alto isn’t that big; it only cover parts of it?) Clearwire notes that the service area includes the headquarters of both Intel (INTC) and Google (GOOG); the Cisco (CSCO) campus will be adding “in the coming months.” All three companies will be
“partners” in the project, the company said.

Clearwire plans to launch full service in the Bay Area in 2010.

Read the rest of this post on the original site

Time Inc. Pines for a Kindle Killer–If Someone Else Builds It

Peter Kafka — Thu, 10 Sep 2009 22:35:56 +0000

Is Time Inc. building a Kindle Killer? Nope.

My pal Owen Thomas, late of Valleywag, has published a piece for NBC’s Bay Area local site that suggests that Time Inc. wants to get into the hardware business and produce its own e-reader.

That’s something other publishers, like Hearst and News Corp. (NWS), are actually doing or have at least mulled. But multiple sources familiar with the Time Warner (TWX) unit’s thinking say that’s not the case here.

But the publisher certainly is thinking about ways to create specialized content for e-reader devices and about the best way to distribute that content.

Time Warner executives have talked about this openly for many months–see Time Inc. digital guru John Squires’s comments in June–and Thomas appears to have gotten his hands on an internal document that addresses the same topic.

Most intriguing, according to Thomas’s read of the documents: A Hulu-like spinoff that would do…something:

The presentation concludes that Time Inc. and other partners should form a new, jointly owned company. Time Inc. might spin out its Maghound service, a service which lets consumers bundle multiple magazines together into a single monthly subscription, to form the base of the joint venture. The company is also considering acquiring other businesses to jumpstart the venture.

No comment from Time Inc.

But I do know that Time Inc.’s executives have met with other publishers about collaborating on e-reader standards, etc. And I do know that Time Inc. executives think a special version of their print products, designed specifically for e-readers, is a good idea. Most everyone I talk to in magazine publishing, in fact, believes this.

And I understand why they do. In their minds, the e-reader versions of their products function just about the same way magazines do: People pay to read them and advertisers pay to distribute their messages through them. And–this part is crucially important, from their perspective–publishers retain control of distribution and the billing relationship with their customers.

That relationship gets obliterated in Amazon’s (AMZN) Kindle model: Publishers wholesale the stuff to Jeff Bezos, who deals with consumers directly. This is also one of the music industry’s big regrets about the digital age. Even though labels are selling their stuff on the Web, via Apple’s (AAPL) iTunes and others, they still don’t have direct relationships with its customers.

Which is why publishers are desperately hoping that they’ll be able to push their stuff through someone other than Jeff Bezos. On the surface, at least, it looks as though their wishes are being met: A bevy of Kindle competitors–Sony (SNE), Plastic Logic, iRex, etc.–is surfacing. Surely one or more of those will figure out how to offer publishers the terms they want.

But even if one or more of the Kindle clones succeeds, print publishers still have a core problem: They need to convince consumers that content–in any form, on any device–is worth paying for. That will work in some cases, but for many it’s going be a very hard slog.

Who Shot Valleywag? Gossip Bloggers Thomas (Outgoing) and Tate (Incoming) Speak!

Kara Swisher — Sat, 02 May 2009 04:20:43 +0000

Was it Facebook COO Sheryl Sandberg in Fraiche Yogurt with a Macbook Air? Or Tesla Motors CEO Elon Musk on the streets of San Francisco with a Model S? Or, most likely of all, Marissa Mayer of Google in the penthouse with a Manolo Blahnik spiked heel?

For all the invective this trio has taken from him, all would certainly be prime suspects if some nefarious fate befell always controversial Valleywag gossip blogger Owen Thomas.

Actually, the truth is a little more mundane: The self-described “scourge of [Silicon] Valley” is moving onto another digital job as head of GE (GE) unit NBC Universal’s new Bay Area Web site, whose motto is “Locals Only.”

There, the 37-year-old Thomas will run a site that focuses on news from around the San Francisco region, with a mix of national stories. But, sources said, he is still going to continue to drill down on tech too, so those burned before by him should not relax too much.

Thomas has been running Valleywag since mid-2007. Its staff got pretty large for a while, until it was recently downsized and its content stuffed into Gawker, the flagship site of Gawker Media. The Valleywag site remains, though, and will continue to.

And it will now be the domain of deceptively fresh-faced Ryan Tate, Thomas’s replacement. The Berkeley resident, 32, has been the night editor for Gawker since early last year.

Interestingly, Tate was an intern for The Wall Street Journal’s California edition and also worked for tech-oriented publications like Business 2.0, Upside and the San Francisco Business Times.

Thomas is reportedly staying on at Valleywag through the middle of the month and then it will be Tate’s turn to make mischief with tech’s more puffed-up mandarins.

In an effort to scare Tate into steering clear of BoomTown, I invited the pair to All Things Digital HQ this rainy afternoon for a little sit-down to discuss where the controversial site has been and where it is going.

Here’s the video (and below it, a video interview I did with Thomas and then-Valleywag writer Megan McCarthy, when he got the job):

[ See post to watch video ]

StumbleUpon Stumbles Out of eBay's Arms to Be Reborn as a Start-Up (Plus the Entire Press Release)

Kara Swisher — Mon, 13 Apr 2009 20:20:55 +0000

The content-discovery service, StumbleUpon, has gotten itself back to start-up status, after being bought by eBay two years ago.

It announced today that it was returning to being an “investor-backed startup” by a roster of well-known Silicon Valley investors, including Ram Shriram of Sherpalo Ventures, Accel Partners and August Capital.

Its founders, Garrett Camp and Geoff Smith are also back, with Camp now in place as CEO.

“We are grateful to eBay for its guidance. However, we realized there were few long-term synergies between the two businesses. It is best for us to part ways and focus on our respective strengths,” said Camp, stating the very obvious.

That’s quite a boomerang since it was acquired by the auction giant in 2007 for $75 million.

Before that event, which was at the height of the Web 2.0 fervor, the Canadian-born social-bookmarking start-up, which launched several years ago, came to the Bay area in 2006 and got some fancy venture investors (Mitch Kapor, Ron Conway, Shriram and others) who ponied up a couple of million dollars. It soon became a traffic-generating hit.

But rumors of the San Francisco-based company being sold by eBay (EBAY) have swirled around it almost since it was bought, although there was no sale.

The same has been true for eBay’s other purchase, of voice-over-IP service Skype. A recent report in the New York Times said its founders were also considering buying Skype back from eBay.

Under eBay, the site has floundered a little bit, but made some changes, such as unveiling a new Web-centric look and feel and a new partnering program last fall that represented a major shift for the online discovery service.

In that change, users no longer had to register for the service or download its toolbar to “stumble” the Web.

Terms of the deal were not released, but we’re digging! Um, stumbling!

More to come, but here’s the full press release from the company, as well as a video I did at the party StumbleUpon threw after getting acquired by eBay, including an interview with then-thrilled Camp:

StumbleUpon Goes Independent; Backed by Founders and New Investors

April 13, 2009 – StumbleUpon, the best way to discover new content on the Internet, today announced that after nearly 2 years as a subsidiary of eBay Inc., it has returned to the ranks of an investor-backed startup. StumbleUpon is now backed by the original company founders, Garrett Camp and Geoff Smith, as well as a number of well-known investors including Ram Shriram of Sherpalo Ventures, Accel Partners, and August Capital. Camp takes on the role of CEO of StumbleUpon.

“We are grateful to eBay for its guidance. However, we realized there were few long-term synergies between the two businesses. It is best for us to part ways and focus on our respective strengths,” said Camp. “This change makes it possible for StumbleUpon to continue to innovate and focus on becoming the Web’s largest recommendation service.”

“StumbleUpon helps users discover the best of the web–it’s a way to find interesting content you wouldn’t think to search for,” said Shriram. “StumbleUpon’s personalized recommendation engine brings serendipity back to websurfing, and lets users sift through socially-endorsed content with a single click.”

StumbleUpon will remain focused on helping people discover interesting content by increasing the accessibility of the StumbleUpon service and the quality of recommendations. In addition, StumbleUpon has plans for several new products and features to be released in the upcoming months.

[ See post to watch video ]