AllThingsD » Colorado

Want to Know What Consumers Think? Check Their Gut.

Arik Hesseldahl — Thu, 29 Mar 2012 13:30:27 +0000

I don’t watch it, but perhaps it’s suitable that the TV series “Mad Men” is back on the air, because it allows me to reintroduce you to Matt Warta, the CEO of GutCheck, a Denver-based start-up. Warta bears a passing resemblance to a character on the show, Roger Sterling.

GutCheck, you may remember, is set on upending the decades-old institutions of consumer research. Ad agencies and research companies spend $7 billion a year rounding up focus groups and asking roomfuls of consumers a bunch of questions and paying them for their time. Basically, it leverages the power of the Internet to reach out to consumers directly and ask them the questions that advertisers need to ask as they build out their campaigns. No need to gather them all in a meeting room and pay someone thousands of dollars to survey them in person, then gather up the results weeks later.

It’s a small shop that has some pretty big customers: Intel, General Mills and Hallmark are among its corporate clients. And some big ad agencies use it, too, including Kaplan Thaler and GSD&M.

Today, Gutcheck is launching a new service called Instant Research Communities. In a world where people are often willing to become fans of a product or a brand, or “Like” it on Facebook and Twitter, or express public opinions about a brand in dozens of ways, the one-on-one opinions of those people are often valuable. GutCheck can quickly gather a bunch of qualified respondents from this pool of “brand advocates,” as they are often called in the ad business.

For what? Testing out early versions of an ad campaign that’s in development, or asking them what they think about a new product or a potential business move. The same recruitment engine the company developed for its virtual focus group service works here, too. You get you group together in a matter of hours, and have your research ready in days instead of weeks. The company is unveiling the service at the Advertising Research Foundation’s Re:think conference in New York.

Warta, a former venture capitalist, raised $2 million in funding from Highway 12 Ventures, a Boise, Idaho-based venture capital fund. Given the clients the outfit has landed in the last year, it has been running fine on that funding since then. Warta told me, however, that he’ll probably be looking to raise another round before 2012 is over.

I asked Warta yesterday whose business GutCheck aims to disrupt, expecting it to be some network of big agencies that specialize in wrangling and convening consumers into groups where they can be probed for opinions and attitudes. He told me it’s really a much more informal network of small local and regional companies that do the wrangling and the polling, under contract to the large ad agencies and consumer goods companies. “It’s really just a bunch of small mom-and-pop shops,” he said.

I’m no expert on the advertising business, but it sounds a little messy and ad hoc. Certainly, Roger Sterling would have something snappy and incisive to say about that. But I don’t watch the show, so you’ll have to just imagine it.

An Epic(Mix) Day on the Slopes in Colorado

Arik Hesseldahl — Sun, 04 Mar 2012 23:00:30 +0000

The activity of skiing goes back a long way in human history. Wikipedia tells me that there are cave drawings dating back to about 5,000 B.C., depicting people on skis. And pieces of wood, thought to have been primitive skis used for transportation and to help hunt wild game, have been found in Greenland dating as far back as the 10th or 11th century.

I didn’t know any of that before I took my first skiing lesson a few days ago. To make a long story short, I fell three times, didn’t break any bones, and had a fantastic time on the slopes in Beaver Creek, Colo.

I also know that I skied a total of 2,830 vertical feet.

What tells me so precise a number is a Web service called EpicMix created by Vail Resorts, of which Beaver Creek is a part. The service tracked my skiing activity and awarded me a set of different badges, in a manner reminiscent of Foursquare. Since it was my first time, I earned a “First Run” and a “Toe Dipper” badge, both for first timers, plus one for having visited Beaver Creek itself. It also tracked how many times I rode up the various lifts.

Central to it are ski pass cards that are enabled with RFID tags. When you get on a lift, your tag gets scanned, making your movements trackable. That might strike some as creepy, but it also makes it easy to track your stats throughout the season and over time.

So, if you want to brag about having skied some advanced black diamond-level run, there’s no disputing it. You can just point your doubters to EpicMix. It’s also really social: You can share your stats on Facebook and Twitter, and friends from both networks can easily be added to your list of friends on EpicMix.

There are also pictures. Professional photographers are stationed around the resort snapping photos of skiers in action or between runs. As long as the photographers get a scan of your pass, your photos show up in your EpicMix account, and you can buy a high-quality download for $20. They only caught me once after my lesson was over for a group shot with my patient and mellow instructor Tom Newman and fellow first-time skier, Claire from London, who took the class with me. As you can see from our faces, it’s probably not the last time we’ll be seen with long, flat things attached to our feet.

Welcome to Colorado, Where the Start-Ups -- And the Snow -- Are Plentiful

Arik Hesseldahl — Thu, 01 Mar 2012 20:09:56 +0000

I grew up in the Pacific Northwest, but for some reason never had the occasion or opportunity to visit Colorado. I also never learned to ski. The second fact is ridiculous, because for many years I lived a short drive from one of the great skiing spots in Oregon. I simply never took up the sport. I guess I saw a few too many kids in school come back from ski outings wearing casts on legs and arms, and generally preferred my bones unbroken.

Consider, then, the irony that I find myself at the Venture Capital in the Rockies conference at the Beaver Creek ski lodge near Avon, Colo., something of a skiing mecca, where pretty much everyone lives to glide down the mountain, and many people seem to take jobs that happen to include lift tickets as a fringe benefit. The conference is really only a day long, but is scheduled for two. Today is the “ski day,” where everyone disappears to take to the slopes. Except me.

I’m here because I was invited to speak on a media panel with reporters from a few other organizations. We talked for an hour or more about the changing nature of journalism and all that that entails, where before a crowd of start-up entrepreneurs and venture capitalists, we wondered aloud about such things as whether venture capitalist and Zynga director Brad Feld counts as a journalist because he also writes a widely read blog. Answer: No. The start-ups, most seeking some kind of investment, gave short presentations on their companies.

Here are a few of the companies that caught my attention, either because I saw their presentations or because I met their executives:

Flixmaster: How many times have you stopped watching a Web video that was going on too long, or because you couldn’t easily navigate to a particular highlight you wanted to see? What if Web videos were as readily navigation-friendly as a Web page? Flixmaster has a software-as-service video technology that makes Web video a lot more interactive than it generally is today. If you hope to engage potential customers with video, it helps to increase viewing time. And adding interactivity to a video nudges viewers to stick with a video longer. Many stop watching after less than a minute, CEO Erika Trautman said in her presentation. The videos are in HTML5, which means they’re already iPad- and Android tablet- and smartphone-friendly. You can get an idea of the result from this holiday-themed video on the company’s blog.

Mocavo: In the Web genealogy business there is as yet really no serious competition to the dominant player, Ancestry.com. Mocavo aims to bring it by challenging Ancestry’s walled-garden approach. In six months, it claims to have added six billion genealogical names to its index. Compare that to the nine billion records that Ancestry amassed over 15 years. Mocavo books $60 per new subscriber versus $20 per month for Ancestry. It aims to make people’s genealogical information a lot more easy to share on social media sites, and to publish.

Dizzion: This enterprise-focused start-up aims to help CIOs tackle the big trend you constantly hear about these days, the consumerization of IT: That’s where employees bring their personal devices to work and expect to have them supported. Its product is a “virtual desktop,” or desktop as a service, that provides an operating system, software, files and other stuff you need to get through the workday, all from the data center running as a managed service. Users can access it all from a desktop machine or a tablet or smartphone.

CMDirect: This company got my attention mainly because it was so unlike all of the others in attendance. It’s basically an electronic trading platform that specializes in commodities like sugar, which at the moment is the only commodity that is currently traded on it, but plans are in the works to expand into coffee and soybeans. It’s not about trading futures, but in the actual commodities, and includes a lot of tools for managing risk. The CEO, Julie Lerner, is a veteran commodity trader with Cargill, and has a lot of specialized knowledge in how that world works. The company has a bunch of patents pending around its processes and tools.

Sestus: This is a security and authentication company that caught my attention in part because during its presentation, CEO Taun E. Willis said that the firm is taking business away from RSA, the security unit of IT giant EMC. In a world where passwords are just not good enough at keeping intruders out, you need to authenticate using two factors, a password and something else. RSA hardware tokens are popular and widely used, as are the “soft” tokens that simulate the hardware tokens in software running on smartphones. Instead, Sestus offers virtual tokens that are less costly to deploy and to support than hardware and software tokens. It’s a small outfit, but punches above its weight, sporting 260,000 U.S. consumers who use its virtual tokens to access online accounts. One big customer is the U.S. Department of the Treasury, where Willis said Sestus supplanted RSA.

NextGreatPlace and Inspirato: If there was a rivalry to be found among any of the presenting companies, it was between these two. NextGreatPlace is a play on the vacation club theme. Members join for an annual fee, said to be in the sub-$1,000 range, for access to a network of vacation homes. It combines an online and offline travel planning process that’s been described as “Zappos for travel.” Inspirato, on the other hand, aims to do something similar, but with an emphasis on luxury and higher-net-worth travelers. I sat next to its CEO, Brent Handler, at dinner Tuesday night, and he told me that its members pay a one-time fee of $15,000 and an annual membership fee of $2,500 for access to a network of high-end vacation homes in your typical luxury destinations like Colorado, Hawaii and the Caribbean.

So those are but a few of the companies that presented here. The snow has been falling all day, and everyone around me is going on about how it’s a perfect day for skiing. So I’m off to go take my first downhill skiing lesson ever. I’ll let you know how that turns out.

Update: I originally said that AOL founder Steve Case was an investor in NextGreatPlace. I got mixed up. It turns out that he had backed NextGreatPlace founder in founder Tom Filippini’s prior company, Exclusive Resorts. Sorry about that.

Federated Media Buys Lijit Networks

Kara Swisher — Tue, 04 Oct 2011 12:00:16 +0000

San Francisco-based Federated Media Publishing said it has bought Lijit Networks, a smaller online advertising analytics and tools firm.

The price for the Boulder, Colo., start-up — which was founded in 2006 — was undisclosed, but it has received just under $29 million in venture funding from firms such as Foundry Group. Federated said Lijit would continue to operate independently, “but in conjunction.”

In an interview yesterday, Federated CEO Deanna Brown said the buy was to round out offerings for its clients and to better compete in a world where most of the online ads go to the top five players.

“I am excited we can give both publishers and advertisers more tools for engagement and monetization,” she said.

Federated, which lost big social-media news site Mashable earlier this year, also benefits from increased scale and inventory of sites.

Lijit CEO Todd Vernon, who will become EVP of technology at Federated, said that it was ever more important for ad-focused firms on the Web to “deliver the entire stack.”

“Lijit has a core competency in the media business, and combined with FM’s best-in-class sales force, we can offer everything needed to do effective online campaigns,” he said.

Here’s the official press release:

Federated Media Publishing To Acquire Lijit Networks

Combined Entity Will Power More than 77,000 Independent Publishers Across the Web Via Comprehensive Advertising, Analytics and Reader Engagement Tools

SAN FRANCISCO, October 4, 2011 – Federated Media Publishing, which powers the best of the Independent Web, today announced the acquisition of Lijit Networks, Inc. Lijit is a leading provider of advertising services, audience analytics and reader engagement tools for online publishers of all sizes. The combined entity will reach nearly 300 million global unique visitors according to Quantcast.

Lijit, headquartered in Boulder, Colorado, will continue to operate independently but in conjunction with the rest of Federated Media Publishing. Lijit CEO Todd Vernon and COO Walter Knapp will take on corresponding EVP of Technology and SVP of Platform Revenue responsibilities at Federated Media Publishing and will report directly to Federated Media Publishing’s CEO, Deanna Brown. Additionally, Lijit board member Seth Levine from Foundry Group will join the Federated Media Publishing board of directors, effective immediately.

With the addition of Lijit Networks’ existing publisher relationships, Federated Media Publishing will now reach more than 77,000 online publishers and nearly 15,000 expert communities, making it one of the largest companies to power publishing on the Independent Web. The acquisition vastly expands the combined company’s inventory of sites, offering premium advertisers improved scale and reach.

Publishers Will Profit and Flourish

Lijit helps publishers more thoughtfully interact with and better understand their audience by providing analytics and engagement tools that build deeper relationships, lengthen time on site and increase page views. These robust and actionable audience analytics and reader engagement tools leverage intent, behavior and demographics to help publishers of all sizes increase revenue and better engage their readers.

Additionally, the combined advertising services provided by FM and Lijit will give publishers of all sizes a revenue stream that complements existing sales efforts and helps grow and monetize their website businesses, no matter what the size.

Advertisers Can More Easily Analyze and Engage

The combination of Federated Media Publishing’s premium online advertising and conversational marketing programs and Lijit’s proprietary data collection tools will empower advertisers to better understand user intent, contextual relevance and demographic information. And by leveraging the combined entity’s extensive publisher relationships, advertisers will have unprecedented scale on the Independent Web.

Introducing Programmatic Buying to the Independent Web

Programmatic buying is one of the fastest growing trends in digital media and the introduction of Lijit’s robust RTB exchange will equip media buyers with one of the largest platforms available. Over the next few months, Federated Media Publishing and Lijit will develop a series of private exchanges that will highlight leading independent publishers. These exchanges will allow brands to engage active, passionate consumers found in highly conversational online communities and publications, while delivering premium CPM rates via FM’s conversational marketing programs.

Quote

“The Lijit Networks team is just as passionate and committed to powering publishers as we are at Federated Media Publishing and that was a crucial element to this decision,” said Deanna Brown, chief executive officer, Federated Media Publishing. “Our combined relationships, proprietary tools and conversational marketing services will be invaluable to publishers and advertisers alike.”

“Federated Media invented how to leverage authentic voices and engaged conversations that exist in the Independent Web,” said Todd Vernon, founder and CEO of Lijit Networks. “The combination of the two companies is a game changer in the industry that unlocks new opportunities for both companies and our combined publisher network.”

Online Shopping on the Side

Walter S. Mossberg — Thu, 08 Sep 2011 01:05:31 +0000

Online shopping is quick and easy if you know what you’re looking for, or only have to decide between a couple of products. But it can get tedious and time-consuming if you’re making a purchase that requires lots of comparisons over multiple sites.

[ See post to watch video ]

So, I’ve been testing Digital Folio, a new, free software product to be announced next week. It’s a browser add-on that lets you save and view potential product choices in a single place, and quickly see how their prices compare among some major online retailers.

You just drag links to products that interest you into a sidebar right alongside your Web browser. This module stays with you regardless of what website you’re viewing, and its contents can be shared with friends.

Best of all, for certain kinds of products from certain merchants, the sidebar will almost instantly show price comparisons for the same item from other online stores—even if you aren’t viewing the other stores’ websites. If you decide to buy an item, you just click on its link in the sidebar, and you’ll be taken to the retailer’s site, where you can place your order as you normally would.

Digital Folio is labeled as a beta, or test, version. But, in my tests, I found that, despite some limitations and rough edges, it’s a powerful piece of software that I believe could save shoppers both time and money.

Its maker, a small startup from Denver of the same name, has been showing and testing Digital Folio for awhile, but finally feels it’s ready for wide use. You can try it now at digitalfolio.com. The company makes money by getting a small cut of purchases made by Digital Folio users at partner online merchants.

Before getting into the details, it’s important to lay out three key limitations of Digital Folio today. First, while it can save potential choices for any kind of product from any site, Digital Folio only generates automatic price comparisons when you save product listings from its five online retail partners, which it calls “Smart Retailers.” These are Amazon, Best Buy, Target, Wal-Mart and Sears.

Second, even at the partner retail sites, Digital Folio’s price comparison feature works for only 13 categories of items, all of them electronic products or appliances. These include cameras, computers, TVs, printers, refrigerators, dishwashers and microwaves. Oddly, two of the hottest such product categories—smartphones and tablets—aren’t included now in the price-comparison feature, but the company is planning to add more products.

Third, it only works with the two most popular Web browsers: Internet Explorer on Windows and Firefox on either Windows or Macintosh. And you’ll need relatively recent versions of the browsers and the computers’ operating systems. I tested it using the latest versions of the two browsers on the latest versions of Windows and the Mac OS.

Mobile versions are planned in the coming months for Windows Phones and Apple mobile devices, with an Android version coming later.

There are other comparison-shopping products, but none that work like this.

Digital Folio’s sidebar has two main sections, marked by tabs at the top. One called My Folios stores your lists of possible purchases. These can be divided into sections, or folios, for different products. For instance, in my tests, I set up folios for cameras, laptops and TVs. Each folio can also have sections, like laptops with screens in a certain size range.

The second tab is called Compare, and it provides the varying prices at the five partner merchants, though these prices don’t yet include shipping and handling costs.

Digital Folio shows you the best price among its partner stores for any given item.

Here’s an example of how it worked for me in my tests. While shopping for a pocket-size digital camera, I noticed on Amazon a certain Canon Powershot model. So I dragged its link into the Digital Folio sidebar. It was $129 on Amazon, but Digital Folio immediately advised me that Sears had it for about $113, and Wal-Mart for $119. It also listed higher prices at other of its partner merchants.

An even more interesting thing happens when you go to a retailer’s page that lists many items in a category, say a page at Amazon that lists TVs. The Compare tab starts pulsating and, in seconds, it generates a list of all the items on the page, along with prices at the other partner merchants.

In my tests, this allowed me to see that a certain Samsung model was cheapest at Amazon, but a Vizio model that also caught my eye was a lot less at Wal-Mart.

Unlike items you’ve deliberately dragged into Digital Folio, these instant comparisons at list pages don’t stay in the sidebar. They disappear when you navigate away from the page. But they’re amazingly dynamic. For instance, if you narrow down the selection on the list page by, say, brand, size or price, the Digital Folio list with price comparison changes along with it.

So what are those rough edges I was talking about? Well, I found setup to be clumsy on Internet Explorer, requiring multiple steps. I also much preferred using the product on Firefox, because, when you click on an item in the sidebar to revisit its original page, that page opens in a tab. By contrast, in Internet Explorer, it opens a new window and has to slowly reload the Digital Folio sidebar.

Also, you can’t drag an item directly into a folio in the sidebar. Instead, you have to wade through a dialog box to choose the folio where it should reside. And you can’t automatically, or rapidly, set up a new folio for a new category of item you find on a site; you have to first manually establish a new folio.

The product also doesn’t automatically refresh itself on one computer, if you’ve made changes to your folios on another. And it crashed Firefox repeatedly on one of my test Macs, though not on another.

Still, despite its early limits and design drawbacks, I believe Digital Folio is a good start toward making complicated online buying decisions simpler.

Email Walt at mossberg@wsj.com.

Microsoft Opens Colorado Retail Store in Wyoming

John Paczkowski — Wed, 13 Jul 2011 19:45:13 +0000

Microsoft currently has 11 retails stores in the United States. Three years from now it will have 86.

During Microsoft’s Worldwide Partner Conference today, COO Kevin Turner said the company will open 75 more brick-and-mortar storefronts over the next two to three years. Said Turner, “We’ve got a huge opportunity to get the Microsoft story out there.”

This will account for a significant expansion of Microsoft’s first retail settlements which to date have been limited to cities in California and a handful of other states, including Colorado — which Microsoft evidently believes to be located in Wyoming.

A wise move, particularly with more Windows Phones headed to market. As Microsoft CEO Steve Ballmer conceded last week, Microsoft’s smartphone share has gone from “very small to very small.” An expanded retail presence in key markets could do something to change that.

Phone-Controlled Robot Ball Set to Roll Around CES

Ina Fried — Mon, 03 Jan 2011 17:39:48 +0000

There will be a lot of quirky gadgets rolling through Las Vegas as the Consumer Electronics Show this week in addition to all the big-time announcements such as new phones, TVs and tablets.

Among those to keep an eye out for is a little robotic ball from Orbotix, a seven-person start-up from Boulder, Colo.

The company’s lone product, Sphero, is still in the prototype stage but could be indicative of the types of products the world is likely to see more of. Sphero is like a remote-control car, except it’s a baseball-sized sphere. Also, it is controlled from either an iPhone or an Android device.

Although the mechanics of a remote-controlled ball are fairly simple, Orbotix CEO Paul Berberian told Mobilized, it takes some sophisticated controls to operate a ball, which, unlike a car has no real up or down.

“It would have been impossible three years ago to make this work for under thousands of dollars,” Berberian said.

Luckily, sensors have gotten tiny and cheap and today’s smartphones have all the processing power one needs. Sphero communicates with the phone using Bluetooth. Berberian said that Bluetooth has a number of advantages, including the ability to use the cell phone’s Internet connection should developers want to write games that tap into the Web.

Berberian said he can also imagine all manner of augmented reality games that take the rolling ball and turn it into everything from a pony to a race car, depending on the age and interests of the ball’s owner.

First, though, Orbotix must get the product to market. Although prototypes are being shown off at CES, it’s not slated to hit the market until late in 2011. The goal is for it to sell for under $100.

Orbotix has some backing to get there. After getting its start last year in a regional tech incubator, the company landed venture funding from the Foundry Group.

Sphero is not the first phone-controlled object out there. An iPhone-controlled helicopter made the rounds at a past CES and a model is now on the market.

However, the ball is designed as a little rolling robotic platform, with an open programming interface so that developers out there can write their own games using Sphero.

Berberian said that the company already has a few variants of the game, beyond just trying to steer around a little ball. Among the options is a sumo wrestling notion in which two players, each with their own Sphero, try to knock the opposing ball outside of a certain ring. There’s also a tug-of-war concept in which players answer questions to vie for control of the ball to move it toward opposite goals.

That, Berberian said, is only the beginning of the company’s ambition. It hopes others will write programs for Sphero as well, with the company aiming to have a number of such programs available when Sphero hits the market later this year.

At this point, there are far fewer than 100 of the balls, all prototypes rolling around the company’s offices. Berberian said the company plans to bring about a dozen of them to Las Vegas for people to play around with at the company’s booth.

In case you are thinking, as I was, “Wow, what a great cat toy,” Berberian insists it’s not designed for pets.

“What people choose to do in their own home is up to them,” Berberian said. However, he cautioned that Sphero is “not designed for a Great Dane to pick up and start chomping on and survive that kind of pressure.”

Here’s an Orboitx-produced video that shows one of the prototypes in action.

Sphero Sneak Peek from Paul Berberian on Vimeo.

Wallow in Microsoft's Q4 Glory: The Show-Me-the-Money Slides

Kara Swisher — Thu, 22 Jul 2010 22:55:29 +0000

As it turned out, Microsoft (MSFT) blew past even the sunniest Wall Street expectations in its fourth-quarter earnings.

Spurred by a robust PC upgrade cycle, net income rose to $4.5 billion, or 51 cents a share, from $3 billion, and revenue to $16.04 billion from $13.1 billion. Analysts had been expecting earnings of 46 cents a share on $15.2 billion in revenue.

(Even losses from the Online Services Division were lower than the previous quarter, dropping from $731 million to $696 million–although this quarter’s losses were more than the same quarter a year ago, which were $585 million.)

BoomTown was on a plane jetting to Aspen for the Fortune Brainstorm Tech conference, so I missed liveblogging the management call this afternoon (sorry, Frank!). Here are the software giant’s slides of the financial results to peruse at your leisure:

Microsoft Q4-FY10 Slides

Blue Mountain Arts' Polis of Web 1.0 and His First Year as a Congressman in Web 2.0

Kara Swisher — Mon, 22 Mar 2010 12:18:01 +0000

While in Washington, D.C., last week, one of BoomTown’s last stops was at the office of Colorado Democratic Congressman Jared Polis on Capitol Hill.

Although I usually try to avoid politicians at all costs, it was terrific to check in with Polis, who was one of the more interesting players in the Web 1.0 scene.

His family–the Schutzs–created a pioneering and unusually fast-growing online greeting cards site in 1996, Blue Mountain Arts, inspired by their independent analog company.

In 1999, they sold it to Excite@Home for $780 million, a little less than half in cash, in what turned out to be one of the final bubble deals of that era.

Proof of that: American Greetings (AM) snapped up Blue Mountain Arts for just $35 million in cash in 2001.

By that time, Polis–who decided to use his mother’s maiden name–had involved himself in educational issues in his home state and finally won a seat in Congress in 2008.

Polis, 34, whose entrepreneurial ventures in tech preceded and followed Blue Mountain, talked with me about his first full year in office, which includes a lot less tech focus than you might imagine.

Here’s the video, which includes a tour of Polis’s Congressional office in the Cannon House Office Building:

[ See post to watch video ]

CBS Digital Boss Quincy Smith's Not-Quite Exit Interview: "Hulu's a Great Service. That's Part of the Problem."

Peter Kafka — Wed, 28 Oct 2009 20:31:56 +0000

Quincy Smith has finally announced that he’s sort of leaving CBS but will stay on as an adviser on its Web video strategy. So it seems like a good time for him to explain just what CBS’s Web video strategy is.

The short version is that unlike its broadcast peers, CBS (CBS) has been reluctant to make many of its shows available on the Web because it worries that doing so cuts into its core TV business.

So while GE’s (GE) NBC Universal and News Corp.’s (NWS) Fox put Hulu together, CBS stayed away. And when Disney (DIS) decided to join the joint venture earlier this year, CBS executives argued strenuously against the deal. Instead, CBS has been content to use the Web as a promotional tool for TV via outlets like Google’s (GOOG) YouTube.

The longer version is below, via the transcript of a brief chat I had with Smith this afternoon to discuss his plans and the network’s. This is stuff he’s talked about before–to reporters, in industry forums, and even via emails he wishes he hadn’t written–but I’m running it at length here.

Because 1) I think Smith does a good job of explaining the push-and-pull of Web viewership vs. Web economics that everyone in big media is grappling with, and 2) I want people to see just how difficult it is to keep up when Smith talks. He can get out a lot of words in a relatively short time.

I also had a quick chat with CBS CEO Les Moonves, who made many of the points Smith did, but with less verbiage: I’ll get you that transcript shortly, too.

Peter Kafka: Since you’re going to be advising CBS’s Web video strategy, why don’t you lay out, for the record, where things stand?

Quincy Smith:

We recognize that the Web is two things. It’s both a new medium…and there my example has always been, look at fantasy football: When you’re nice enough to watch the Jets just pound the snot out of the Raiders on Sunday, on a CBS channel…on fantasy football on CBSSports.com, you start on the Tuesday before and end the Wednesday after.

And what are you doing? You’re personalizing it, you’re becoming more of a fan of the game [Smith goes on to praise CBSSports.com's feature set]. All of those things are additive, so when Sunday comes in, you’re actually more of a fan, and you’ve even more convinced you’re going to watch that broadcast show.

Now, I realize that sports is reasonably bulletproof, and a good case study to begin with versus some of the other programming, but the fact is, the Web is a new medium. So what do I also mean? Tech reviews on CNET, Money Watch being watched on BNET. GameSpot videogame reviews.

Access to content that CBS didn’t already have, that are additive–both in their own right online, with the margins that the CNET business is used to, and where we’re getting just stronger and stronger from a margin perspective–and potential content that can also be applied to our [local TV stations owned by CBS], our affiliates, our broadcast news, as well as the radio. So that’s the side of our business that is $600 million revenue and $50 million-plus profit on the bottom line.

The other side of the Web, the side that is most thought of by many journalists, is the threat of an IP-deliverer of video. And how you turn that threat into an opportunity.

And so, from that perspective, as you know, we didn’t go ahead and say, “Okay, we’re going to lock down and stream, with all of our other peers in broadcast, and come up with the same rules, and embed and right-click this and go away.” I’ve never had a beef with Hulu. Hulu’s always worked as a great service. That’s part of the problem.

As a network, we need to make sure that our content is being seen where the dollars matter. And right now that’s on air. Opportunities like TV Everywhere–we’re not putting all of our eggs in that basket, though we are big advocates of it–are ones where you can actually take and expand and extend the television market online, so it doesn’t matter what screen you watch “CSI” on; what matters is that you watched it, it counts and you saw the ads.

But until that happens, it’s crazy to just stream the shows for zero economics. When in fact you can make a lot more money doing things that are additive and complementary to the rest of the CBS line. That’s where CBS interactive comes in now.

Kafka: But TV viewers are showing an increasing interest in watching their programs on the Web, whether from legal services like the Web or illegal torrents and pirate sites. Don’t you need to reach them where they are?

Smith:

Now, if you really look at those numbers, what they’ll say is [online and offline video are] both growing, right? We’re having the best year ever as America’s largest broadcast network, and I think that 99.9 percent of that–this is the quote I’ve never been able to get in there–is that’s [because] of the great content that we have. There’s some infinitesimal basis point that’s relevant [to CBS ratings because] we are making sure that when people watch it, they’re more inclined to watch it on television. For now.

Once that solution moves, once those economics move–whether that’s more ads, [higher] CPMs, more ad buyers….You and I can say all day long, “We’re sold out on Web video. That’s going really well. It’s sold out.” Well, no kidding, it’s sold out. It’s a $700 million market. The television market is $120 billion. And of that, $700 million, half of those [ad buyers] are spending 90 percent of their time doing Google keywords, not buying online video.

The key is, how do you turn television buyers into video buyers? And that’s where a solution like TV Everywhere comes into play.

And by the way, looking at [Hulu CEO Jason] Kilar’s comments the other day, in Colorado [at an industry convention], he sees that too. He’s more sophisticated on this stuff than most anybody. From the perspective of, he understands that’s where the big dollars are. And so he probably went at it as, “I’m going to aggregate all the people first, so hopefully things like TV everywhere come to us.” From our perspective at CBS, we’ve got to go to them.

I don’t hate Hulu. Hulu’s world-class video viewing. What I don’t understand is, why license all that content to something that works that well, that seamlessly, yet–without the economic model around it?

Geek in Black: Barry Sonnenfeld Comes Out From Behind the Camera to…Vlog?

Kara Swisher — Mon, 12 Oct 2009 12:26:26 +0000

For many years now, one of our regular attendees at the D: All Things Digital conference has been award-winning movie and television director, producer and writer Barry Sonnenfeld, who is–as it turns out–a not-so-closeted geek in his spare time.

(He also appeared onstage in 2006 at D4 in an interview with Walt Mossberg, which you can see here.)

In fact, the man behind movies like “Men in Black” and TV shows like “Pushing Daisies” (and who likes to sport a Stetson and cowboy boots 24/7) does a gadget review column for Esquire magazine called “The Digital Man.”

Now he is branching out to a vlog about his geek passions on Crackle, which will appear every two weeks from wherever he is–either from his homes in East Hampton, N.Y. or Telluride, Colo., or from movie or TV sets.

And, compared to the cinéma vérité style of BoomTown (translation: shaky filming and bad sound), Sonnenfeld’s vlogs are pretty high quality, although they are not too overdone as those from Hollywood types always are, and it’s hard not to admire the editorial use of a martini.

Here’s his intro video vlog below, as well as one about a cross-country trip Sonnenfeld and his “analog” dog, named Lucky, took in a 2010 Ford Taurus SHO (super high output) and another about his experience helping his wife, Sweetie, cook for some film industry friends using the Traeger Professional Wood Pellet Grill.

Next week: A chain saw, although I hope Sonnenfeld will go light on the martinis for that demo.

From Crackle: The Esquire Digital Man Preview:

From Crackle: Ford Taurus SHO:

From Crackle: Traeger Professional Wood Pellet Grill:

Sequoia's Voter Consternation Drive

John Paczkowski — Fri, 24 Oct 2008 21:52:14 +0000

A man who reportedly believed Republicans were conspiring to steal today’s election entered an Allentown polling site, signed in and proceeded to smash the screen of one of the electronic voting machines with a metal cat paperweight, poll volunteers said.

‘He smashed it with the cat’s ears,’ said volunteer Jim Govostis.”

–Morning Call, Nov. 7, 2006

Fantastic. Here we are, just two weeks before the 2008 presidential election and the integrity and accuracy of some of the electronic voting machines that will determine its outcome are in question.

Again.

According to new research from the Princeton University Center for Information Technology Policy, the Sequoia AVC Advantage machines used throughout New Jersey and Louisiana, and in a few counties in Colorado, Virginia, Wisconsin and Pennsylvania as well, can be hacked in eight minutes to manipulate vote tallies.

From the Princeton report:

The AVC Advantage contains a computer. If someone installs a different computer program for that computer to run, it can deliberately add up the votes wrong. It’s easy to make a computer program that steals votes from one party’s candidates, and gives them to another, while taking care to make the total number of votes come out right. It’s easy to make this program take care to cheat only on election day when hundreds of ballots are cast, and not cheat when the machine is being tested for accuracy. This kind of fraudulent computer program can modify every electronic ‘audit trail’ in the computer. Without voter-verified paper ballots, it’s extremely hard to know whether a voting machine (such as the AVC Advantage) is running the right program.”

Damning allegations and ones which Sequoia categorically denied after unsuccessfully attempting to suppress them. According to Sequoia, its voting machines are vulnerable only in a classroom setting. In real-life election scenarios, they’re just fine. “…Simple, established, and previously used accuracy and security protections–removed from the Advantages studied in the report published by the plaintiffs–make the items in their report next to impossible,” Sequoia said in rebuttal to Princeton researchers’ claims. “In fact, many of the scenarios painted by plaintiffs depend on the existence of crooked, malicious, and corrupt pollworkers, while the success of some scenarios depends on both corrupt pollworkers and inattentive voters.”

How reassuring.

Well, at least they’re not switching votes between candidates like some of those touchscreen systems in West Virginia, right?

PREVIOUSLY:

[Image Credit: Diebold Variations]

Sequoia's Voter Consternation Drive

John Paczkowski — Fri, 24 Oct 2008 21:52:14 +0000

A man who reportedly believed Republicans were conspiring to steal today’s election entered an Allentown polling site, signed in and proceeded to smash the screen of one of the electronic voting machines with a metal cat paperweight, poll volunteers said.

‘He smashed it with the cat’s ears,’ said volunteer Jim Govostis.”

–Morning Call, Nov. 7, 2006

Fantastic. Here we are, just two weeks before the 2008 presidential election and the integrity and accuracy of some of the electronic voting machines that will determine its outcome are in question.

Again.

From the Princeton report:

The AVC Advantage contains a computer. If someone installs a different computer program for that computer to run, it can deliberately add up the votes wrong. It’s easy to make a computer program that steals votes from one party’s candidates, and gives them to another, while taking care to make the total number of votes come out right. It’s easy to make this program take care to cheat only on election day when hundreds of ballots are cast, and not cheat when the machine is being tested for accuracy. This kind of fraudulent computer program can modify every electronic ‘audit trail’ in the computer. Without voter-verified paper ballots, it’s extremely hard to know whether a voting machine (such as the AVC Advantage) is running the right program.”

How reassuring.

Well, at least they’re not switching votes between candidates like some of those touchscreen systems in West Virginia, right?

PREVIOUSLY:

[Image Credit: Diebold Variations]

More States Mull Taxing iTunes, Other Digital Downloads

Eric Savitz — Tue, 12 Aug 2008 14:24:07 +0000

State legislators look at Apple’s (AAPL) iTunes and other digital download services stealing away business from offline retailers and you know what they see? A piggybank.

News.com reports today that at least nine states this year have considered enacting “download taxes” on digital goods–and five of those states have adopted them, including Nebraska, Tennessee, Indiana and Utah. Similar laws are already on the books in Alabama, Arizona, Colorado, Hawaii, Idaho, Indiana, Kentucky, Louisiana, Maine, New Jersey, New Mexico, South Dakota, Texas, Utah, and Washington.

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