AllThingsD » Ford

Facebook Is Still Figuring It Out. Will Advertisers and Investors Wait Around?

Peter Kafka — Wed, 16 May 2012 02:42:27 +0000

There are a bunch of ways to explain away GM’s decision to stop spending ad dollars on Facebook. We’ll get to those.

But there’s one thing that even the most ardent Facebook fan can’t argue with: Facebook advertising is very much a work in progress.

Don’t take my word for it. Listen to Facebook itself: “We believe that most advertisers are still learning and experimenting with the best ways to leverage Facebook to create more social and valuable ads,” the company says in its IPO filing.

If you’re a Facebook bull, those words sound reassuring. Facebook sold $3 billion worth of ads last year, and it’s just getting started. Imagine what happens when things really kick in.

But if you’re a skeptic, and there are lots of them, that uncertainity is a real problem. When Google went public in 2004, it had already built AdWords, the search ad engine that still generates the majority of its revenue today. Facebook doesn’t have an AdWords, so it doesn’t have a tried-and-true plan it can present to advertisers: Put dollars in here, see results over there.

Instead, Facebook marketers try different things over time. A few years back, they were all building Facebook apps. Then they started concentrating on amassing fans/followers. Now, digital marketing people tell me with confidence that all of that thinking is outmoded, and that the real Facebook pros are the ones who create “engaging content” on the site, then buy ads to “amplify” that message.

Facebook’s challenge gets even tougher because instead of search ads, whose success and failure are easy for advertisers to evaluate — Did someone click on my search ad? If they did, did they buy something or fill out a form once they got to my site? — Facebook aspires to the big branding dollars that advertisers spend on TV. And those are much harder to score. So convincing GM or anyone else to move big money from traditional ads, which marketers are at least comfortable with, to the wild world of social, requires a lot of work.

The good news for Facebook is that it’s so big that it might succeed even if it never cracks the social ad code. Any Web site with 900 million users and counting, who spend a ton of time there, is going to pull in a lot of ad dollars through sheer force of gravity. If Facebook can keep its users happy, it may get away with muddling through on the ad part.

But being a big, lumbering giant that attracts ad dollars without knowing what it’s doing isn’t the message Facebook wants to sell to advertisers. Or to investors.

OK, on to the “this isn’t that big of a deal” arguments. I’ve heard a bunch, all of which come from (different) people who don’t want to be quoted.

Obviously there’s a backstory here. If GM didn’t want to keep advertising on Facebook, it didn’t have to announce that three days before an IPO.
Big Fuel, GM’s social media ad agency, didn’t do a good job. That’s why GM fired them in December. For the record, here’s a quote from a Big Fuel rep: “GM never seemed persuaded of the value of social media in general and Facebook likes in particular. In a sales-driven culture, it is very hard to wrap your head around putting money in places where you don’t see immediate results in an uptick in sales.”
Starcom, GM’s media buying agency, didn’t do a good job. That’s why GM fired them in January.
How the heck did GM spend $3 on Facebook “content management” for every $1 it spent on Facebook ads, as the WSJ reports? That’s a sure sign that someone was doing something wrong.
Ford loves Facebook.
GM is pulling $10 million out of Facebook. Facebook did more than $3 billion in ads last year.

Again, all of those may be valid points.* But if Facebook really wants to allay outsiders’ fears, it needs to be able to prove conclusively that its ads work, in a scalable way, for a wide variety of advertisers. It can’t do that yet.

*I’m totally amazed by the $3-to-$1 ratio, and am wondering if it’s not to late to pivot myself into a “Facebook content creation consultant.” Those numbers also remind me very much of the late 90s, when companies like Organic went public based on the fact that they knew how to build Web sites and their clients didn’t, and they could charge accordingly. That didn’t last long.

Microsoft and Toyota Drive to the Cloud With Azure-based Electronics Systems for the Car

Ina Fried — Wed, 06 Apr 2011 17:35:35 +0000

Microsoft has driven home a deal with Japanese automaker Toyota.

Toyota President Akio Toyoda and Microsoft CEO Steve Ballmer are holding a joint press conference at 1 pm PT today, and Mobilized hears that the new deal is a fairly broad pact covering a couple of different areas of Microsoft’s business.

There are certainly plenty of areas of potential collaboration. Microsoft’s Windows Auto software is used to power entertainment and navigation in a number of cars from Ford, Kia and others.

Reports also suggest there will be joint work on energy efficiency, and Microsoft has been signing up lots of big companies for its various cloud computing efforts.

Update: The two companies have issued a press release outlining the deal.

Toyota will use Windows Azure to power a new generation of in-car systems, known in the industry as telematics.

The two sides are also playing up the energy efficiency piece of the news, noting that the electronic systems can be used to monitor energy use, in addition to traditional tasks like navigation and entertainment. As part of the deal, the companies are making a $12 million investment in a Toyota subsidiary that offers digital information systems to its car owners.

Azure-based systems are due to start showing up in Toyota electric and hybrid cars next year, with an aim to have a global system up and running by 2015.

1:03 p.m. PT: The companies have started their press conference. Toyoda kicks things off by noting that he debated going to Redmond for the event in the wake of the massive earthquake. However, he said that after visiting some of the hardest-hit areas, he concluded the best thing he could do is to “provide hope and steady economic progress.”

“So, I am here,” Toyoda said.

As for the joint efforts, Toyoda spoke about an opportunity to improve in-car electronics as well provide “smart grid” services that can help ease the load of electric vehicles.

1:06 p.m.: Ballmer also takes a moment to acknowledge the quake and note Microsoft’s contributions to the recovery effort before diving into the specifics of the deal.

The first incarnation of the service will show up starting next year on hybrids and plug-in electrics. Examples of the possibilities, Ballmer said, are that car owners will be able to use their PC to turn on heat or air-conditioning while the car is charging or use a smartphone to remotely check maintenance information.

Ballmer talks about it as the ultimate in mobile computing and noted the need for information, given that many people spend a significant amount of their time in their car.

1:17 p.m.: Asked why the companies are starting with hybrids and electric vehicles, Ballmer said the companies are trying to “shoot ahead” of where the business is today, adding that technology will be needed to help manage power consumption, in addition to traditional navigation and entertainment products.

It’s still a little vague how much of what the companies are doing initially is for in-car electronics as compared to cloud-based services that are accessed via a PC or phone. I’ve asked about this, so hopefully we will get some clarity.

1:29 p.m.: Ballmer notes that the deal is, to some degree, about information accessed in the car, but adds it is also about information getting to and from the car to the cloud and other devices.

Gogii Hires Ex-Myspace Exec to Make Group Texting Pay Off

Tricia Duryee — Tue, 05 Apr 2011 16:00:59 +0000

Gogii, a company that makes a popular group text messaging app called textPlus, has hired Chandra Hill to head up its monetization plans as it weighs paid vs. ad-supported features.

Text messaging applications, which offer the ability to send messages to a group of people via a single phone number, were in the spotlight at SXSW. Companies such as Gogii, KIK, Beluga, GroupMe and Fast Society were the talk of the town since they provided easy ways for large groups of people to socialize and get in touch quickly.

Following the event, GroupMe provided its first hint at what its business model would be when it opened up its mobile group chat to brands, which would be highlighted in a “Featured Groups” section.

Now, Gogii is beefing up its monetizing efforts.

Hill, who will have the title of VP of monetization and publishing, was most recently VP of mobile monetization at Myspace.

She will oversee all company revenue, which includes in-app purchases, advertising and a new publishing unit, said Gogii CEO Scott Lahman. “I can’t think of anyone better who can hit the ground running. She’s been doing this for years at Fox and at Myspace. This is almost the exact same role.”

Gogii’s textPlus application has 7.7 million monthly active users and recently set a record for sending 35 million messages in one day.

While Hill is just joining the Los Angeles-based startup, the company has been monetizing with advertising from the beginning. ”We hit seven-figure revenue-quarters last year, and that’s continued to grow. We are well past the testing stage. Advertising campaigns were up 300 percent in the first quarter compared to the same period last year.”

Mostly, the app relies on splash ads–which are like a homepage takeover–which the user sees immediately after opening the application. Lahman said users on average open the application 10 to 15 times a day, and that the ads have a click-through rate in the high single digits. There are also banner ads from within the applications, which are seen by its nearly eight million monthly active users.

Lahman said they made the decision to monetize with advertising because it allowed them to grow the business much faster than if they charged for it. A paid version of the application, which has no advertising, allows the user to pick the area code for the phone number they use. He said six to 10 percent of its users choose to upgrade. The app costs $4.99 and is available on iPhone and Android.

“The advertisers love it. We are the text client for a lot of our customers–that’s why they use it so much to send so many messages.”

Gogii uses a mix of its own direct sales force in addition to farming out some inventory to mobile ad networks, like Google’s AdMob, Jumptap and Greystripe. Returning advertisers include Disney, Fox, Target, Ford, Paramount, CBS, Unilever, JCPenney, MTV, Coca-Cola and Zynga.

The new publishing business, which Hill will oversee, will experiment with a sort of white-label service, which will allow a brand to completely take over the application for a specific brand or event.

Lahman said in March, 25 percent of the company’s revenues were coming from paid features inside the application. It’s his goal to hit 50 percent by the end of the year. “That will come against a growing advertising business–that’s not cannibalizing it,” he said.

Apple's D.C. Lobbying Efforts Get Fierce

John Paczkowski — Fri, 04 Feb 2011 20:01:04 +0000

Apple closed its big government affairs office in Washington, D.C., in the late ’90s and since that time has maintained a fairly low profile inside the Beltway, relative to other big tech firms.

Its 2010 lobbying spend was about $1.6 million. (Microsoft’s was $6.9 million.) But while it might seem that any lobbying Apple might need to do in Washington could be easily accomplished by a phone call from one of its directors–one in particular–evidently that’s not the case. Because the company has hired a new lobbying firm to help deal with its D.C. concerns: Fierce, Isakowitz and Blalock.

It’s not clear why Apple hired the firm; lobbying disclosures say only that it will handle “innovation” issues for the company, and sources I’ve spoken with seem unaware of any big legislative pushes the company might be mulling. That said, Fierce, Isakowitz and Blalock is a formidable lobbying firm with a number of executives who did stints in the Bush administration and the Republican National Committee, and a client list that includes some very big names: Coca-Cola, CTIA, the National Cable and Telecommunications Association, Ford, Time Warner and Oracle.

Think Larry Ellison got a referral fee?

Hulu Orders Up a New Bite-Size Show. It's Going to Taste a Lot Like "Talk Soup."

Peter Kafka — Mon, 06 Dec 2010 11:30:41 +0000

Hulu is a great place to see shows that just ran on TV. Is it a good place to see Internet shows that talk about shows that just ran on TV?

Stay tuned!

Plans are underway for a Hulu-only mini-show slated to run on the video site daily, offering up zippy commentary about TV and pop culture.

Some limited details: The show, which is casting now, will run five minutes an episode Monday through Friday. It’s supposed to offer “a quick and humorous survey of the past 24 hours of Media and pop culture.”

In other words, think of all of the TV shows that do something like this already–pretty much everything that runs on E! and half of what runs on VH-1–and shrink it down to a bite-size Web creation. They’re not reinventing the wheel here.

You can glean a tiny bit more about the show, via a casting call ad, at the bottom of this post. An actress who auditioned last week tells us the sessions were “mobbed.”

(Of course! But note that anyone who does get the gig won’t be hitting the jackpot–$1,000 a week, leave your SAG card at home.)

I’m assuming that “HD Films,” the show’s producer, is the same studio that is already producing “The Jace Hall Show,” a Web show about videogames, which runs on Hulu and other sites. Jace Hall is listed as a producer on this one, too.

Hulu rep Elisa Schreiber declined to discuss the show, telling me via email that “we’re not sharing any details because it’s still in the early stages.”

So why do we care? Because Hulu’s primary purpose in life, for now, is to provide a place for people to watch bona fide TV shows on the Web–and primarily shows from its three broadcast TV owners: News Corp.’s Fox, GE’s NBC and Disney’s ABC. (News Corp. also owns this Web site.)

But it has also been dabbling in Web originals over the past year or so: See “The LXD,” and “If I Can Dream.”

Hulu now has an original show in the works starring Whitney Port (who was on “The Hills,” Google tells me), designed to promote Mattel’s Ken doll (really). And there’s something coming from Ford and the producing team behind “The Amazing Race.”

The through-line behind all of this stuff: Webby takes on reality shows, which are cheap to produce for conventional TV and even more so on the Web (again, note the union-free note on the casting info below).

Nothing revolutionary, but it does point to an interesting question: At what point does the line between the best Web video and mediocre TV disappear?

No one thinks the Web is going to replace TV at its best–expensive original fare like “Lost” or “Glee,” or big-time events like the Super Bowl and the Oscars. But there’s not that much high-end, original stuff on TV.

And lots and lots of your programming grid is filled with repeats, which the Web can do just fine. And then lots of less exciting, and less expensive, fare like “The Biggest Loser” and the like, which the Web hasn’t done. Yet.

But there’s no reason that it couldn’t. And when and if that starts happening with some frequency, there will be even less reason to keep paying for expensive TV packages….

Here’s the text from the casting notice (click to enlarge):

4G Networks and Macs vs. PCs

Walter S. Mossberg — Wed, 10 Nov 2010 23:48:16 +0000

I know T-Mobile and Sprint already have 4G networks. Do you know when 4G on Verizon is coming out? And have you heard anything about 4G on AT&T?

Sprint has a 4G network in scores of cities, and T-Mobile has a souped-up 3G network in many cities that it says can achieve 4G speeds. Verizon has pledged to introduce 4G service in several dozen cities by year-end. AT&T is planning to start rolling out 4G next year.

Two important caveats apply here. First, the term “4G” is a slippery one. While all of these networks offer faster data speeds than traditional 3G, they don’t actually meet the technical definition of 4G speeds set by the international standards body that defines such things. Second, to get the full speeds offered by these new networks, most people will need a new phone. Currently, there are only a handful of phones that can do so.

My daughter is graduating from high school and has been accepted to several Ivy League universities. She going in to the medical field. Her friend is urging her to get a Mac instead of a PC. What would you suggest?

As I noted in my buyer’s guide last week, Windows PCs come in more varieties and are usually less expensive up front, which could help offset college costs. Macs have extremely high customer satisfaction, according to most major surveys, better built-in software and, perhaps most important, they aren’t susceptible to the vast majority of malicious software, a particular problem on college campuses that can cost money and time and risk losing work.

I’d suggest that once she selects a college, she should check to see which type of computer the college suggests and supports, what the academic prices are, and whether there is any special software required for pre-med courses that would favor one type of machine over another.

Thanks for your recent article on Ford’s latest automotive digital system. My biggest concern with these various electronic applications is how fast they can become obsolete. I can imagine keeping a $36,000 car for eight to 10 years. I can’t imagine many of the electronic systems will still work with the phones and who knows what else by then. Will Ford provide software upgrades to keep the vehicle relevant?

Yes. Ford has developed a system that allows you to download updates to its SYNC digital system from the Web to a USB flash drive, using your computer. You then insert the portable drive into a USB port in the car to upgrade its software. More information is at http://bit.ly/cK33kD.

You can find Mossberg’s Mailbox and my other columns online at http://walt.allthingsd.com.

Ford Drives Digital Dashboards to Next Level

Walter S. Mossberg — Thu, 07 Oct 2010 01:03:22 +0000

Americans spend vast amounts of time in their cars, where many feel cut off from the digital world. Using a cellphone or digital music player, even in a legal manner, can be clumsy. And a car’s user interface for non-driving functions can seem ancient compared with how other devices are controlled outside the vehicle.

[ See post to watch video ]

So, auto makers have been trying to bring some of the feel of computers and consumer electronics to the dashboard, making it easier to use phones and music players in a safe way, through big screens and voice-command systems that allow the use of these devices without handling or seeing them. Ford placed a large bet on this trend in 2007 with a system called Sync, which I liked when I reviewed it then.

Now, Ford (F) is taking another big step, introducing a second generation of Sync that aims to redesign the entire user interface of the dashboard with color-coded touch screens, better voice recognition and five-way control pads on the steering wheel. This new system redefines the way you control in-car entertainment and climate settings; permits personalization of things like instrument-cluster gauges; and even lets you set up a Wi-Fi network in the car.

I’ve been testing the new Ford system, called MyFord Touch, for a couple of weeks on a 2011 Ford Edge Limited SUV, one of the first two models on which it is being offered. (The other is the Lincoln MKX, with a MyLincoln Touch system.) The Edge starts at $27,000, but the configuration I tested, on which the new interface is standard, lists for $36,000. On other versions of the Edge, MyFord Touch is available as part of a $1,000 option package.

MyFord Touch’s 8-inch touch screen, with function icons in the corners that switch the screen among four main functions: multisource audio entertainment, navigation, phone and climate control.

In general, I liked MyFord Touch, once I got used to it and configured its settings and its connection to phones and music players. The layout of most of the displays is clear and logical, and the voice-command system is still the best I’ve ever used in a car.

But Ford’s new user interface has so many options and functions that I believe it presents a challenging learning curve. Learning the new system can be distracting while driving, at least at first—even though Ford disables some functions while the car is in motion and even though voice commands are easy and plentiful, allowing you to keep your eyes on the road and hands on the wheel.

I urge caution, because this a very different dashboard than you may be used to. I only had the car for a short time, and put very few miles on it, so I can’t say how quickly the new features can become second nature and nondistracting. But anyone buying a car with MyFord Touch should always set up and configure it while parked, use voice commands whenever possible and avoid experimenting with new features and functions while driving. My advice is to learn these in the driveway, gradually.

Instead of the usual array of knobs, dials and passive screens, MyFord Touch is dominated by a giant 8-inch touch screen, with large function icons in the center and color-coded corners that you touch to switch the screen among four main functions: multisource audio entertainment, navigation, phone and climate control. There is also a “home” view, combining common functions that can be personalized.

The system also has several other elements. There are twin 4-inch screens on either side of the speedometer. The one on the left presents vehicle information, such as miles traveled, and allows you to customize some of the gauges so that, for instance, you can finally banish that tachometer you never use in favor of, say, a digital readout on gas-mileage efficiency. The one on the right replicates, in simpler form, the main functions of the center screen, so you can select and check things like audio and climate control without looking at, or touching, the main screen.

These smaller screens are controlled by five-way arrow clusters on the steering wheel, like controllers on iPods and other devices usable by touch alone. There also are some large, touch-sensitive buttons below the main center screen for things like setting volume and fan speed.

Finally, most, but not all, of these functions can be controlled by tens of thousands of available voice commands. And many of these commands can now be spoken without prefacing them with special terms. For instance, you can dial a contact by saying her name at any time, even if you’re not in the phone module on the screen, and even if you don’t first say “phone.”

This voice system worked very well for me, and is the crucial element of reducing distraction. But it wasn’t perfect. For instance, it had trouble with some names in my contact list with multiple entries, and with some streets in the navigation system.

Ford believes the combination of the touch screen, the instrument cluster screens and controls, and the voice commands provides a redundancy and ease of use that should allow both a familiar digital experience and safe driving. Of course, some believe doing anything but driving, no matter how those tasks are performed, is dangerous.

I tested MyFord Touch with an iPhone and an Android phone, which I connected wirelessly; and a standard iPod, which I connected via one of the two USB ports built into the car. I also tested a USB flash drive containing music and a couple of photos, since you can add a personal photo to one of the available views on the big screen. In addition, I tried a USB cellular modem lent me by Ford that creates a Wi-Fi network in the car, presumably only for the use of passengers with laptops and other devices.

All of these devices worked pretty well, but not without issues. The car easily recognized and used both phones for calling, and the iPod generally worked fine. But Bluetooth streaming of music from the phones, which is still an evolving industry feature, periodically failed and never displayed song or artist names. On the physically connected iPod, some album covers didn’t display.

At the moment, only one USB modem, an AT&T (T) model, works with MyFord Touch, and setting it up proved complicated. My general view is that, while operating the touch screen’s main functions is easy, the various setup and option menus are too complex.

The new Ford system can read text messages to you and let you send a limited number of canned responses—the idea being to make texting in a car somewhat safer. But I couldn’t try this as neither of my test phones supported this function.

Ford also has announced that the new system will support some third-party apps, like the Pandora music service, and will eventually have a Web browser for the big screen that would only work when the car is parked. But neither of these features is available yet.

For those who believe doing anything but driving in a car is dangerous, no amount of touch screens, voice commands or redundancy will do. But, for people who would like to enjoy some of their digital lifestyle in a car, MyFord Touch is worth checking out—as long as you take it slowly.

Write to Walt Mossberg at mossberg@wsj.com.

Status Update: Getting Funny Looks Because I'm Talking to My Car

Voices — Wed, 08 Sep 2010 18:28:55 +0000

In the race to bring more voice tech to vehicles, Ford may have pulled ahead with its Microsoft-based Sync system, but it looks like GM is ready to make a run with a rebuilt OnStar. Bloomberg says the venerable in-car communication service may start offering some free features next year, reportedly including voice-to-text ability that would, among other things, let drivers update their Facebook pages as they jockey for the best lane on the freeway. Luckily, OnStar already includes accident assistance.

Ford Motor Company CEO Alan Mulally at D8: The Full, Uncut Video

Beth Callaghan — Mon, 26 Jul 2010 19:38:29 +0000

As promised, All Things Digital is posting the full videos from our eighth D: All Things Digital conference, held in early June.

Here’s the last interview Walt Mossberg and Kara Swisher did at D8, but definitely not the least: Ford Motor Company (F) CEO Alan Mulally.

Here’s the full video of the D8 interview session.

[ See post to watch video ]

Want to see it bigger? Click here.

Tesla IPO Firing on All Cylinders Batteries [UPDATED]

John Paczkowski — Tue, 29 Jun 2010 21:12:34 +0000

Tesla Motors went public today in the first initial public offering from an American car company since Ford’s (F) in 1956. And already, its stock appears to have attracted a cult following.

Floated with an initial offering price of $17, shares in the company opened at $19 and closed at $23.89–up $6.89, or 40.5 percent. Not a surprise, really, since Tesla (TSLA) raised the size of the IPO to 13.3 million shares from 11.1 million shares yesterday, presumably because of strong interest in the offering from investors.

That Tesla hasn’t earned a dime since it was founded in 2003 and doesn’t expect to post a quarterly profit until at least 2012 doesn’t seem to have fazed investors, who are evidently quite impressed with the company’s $109,000 all-electric Roadster and the fact that it has managed to sell 1,063 of the vehicles in less than two years.

“A lot of people were puzzled about why we were going public without profits,” CEO Elon Musk said today. “The reason we are not profitable today is because we are in the midst of expanding with the Model S.”

The bet here, then, seems to be the promise of the S, the $50,000 electric sedan the company plans to bring to market in 2013. And that appears to be working out quite well for Tesla.

WSJ's D8 Special Tab: Jobs, Zuckerberg, Ballmer, Cameron and More in Their Own Words!

Kara Swisher — Mon, 07 Jun 2010 07:15:11 +0000

Today, The Wall Street Journal published its special tab, both online and offline, featuring edited transcripts of some of the interviews Walt Mossberg and I did at the eighth D: All Things Digital conference last week.

The excerpts come from interviews we did with Apple (AAPL) CEO Steve Jobs, Facebook CEO Mark Zuckerberg, Microsoft (MSFT) CEO Steve Ballmer, Hollywood megadirector James Cameron, Federal Communications Chairman Julius Genachowski, NPR CEO Vivian Schiller and Ford (F) CEO Alan Mulally.

Also: A look back at quotes from past D conferences, which just makes BoomTown feel old.

Check it all out here.

And you can also see the full video of the interview with Jobs here. All Things Digital will be posting all the videos from D8, with a new one going up each Monday and Thursday.

D8 Video: Ford CEO Alan Mulally Tells Jason Calacanis Why We're Not Going to Drive Electric Cars Anytime Soon

Peter Kafka — Fri, 04 Jun 2010 17:39:19 +0000

Mahalo CEO Jason Calacanis loves his Tesla. So why can’t the rest of us drive an electric car, too? Ford (F) CEO Alan Mulally fielded the question in the final panel of the D8 conference today.

Bonus question for our readers: Since Calacanis won’t tell us how much his Tesla cost, can anyone hazard a guess?

[ See post to watch video ]

Ford CEO Alan Mulally Live at D8

Peter Kafka — Thu, 03 Jun 2010 19:27:26 +0000

Ford CEO Alan Mulally has come to D8 to take the hot seat, a position he should be used to after steering Ford through the recent financial crisis. Ford shunned the bailout money that carried GM through a restructuring and sustained Chrysler through its sale to Italian automaker Fiat.

Ford (F) recently released SYNC, a voice-activation package on some models that integrates the content and functionality of mobile devices with the car itself. SYNC also adds apps to the car, though it’s not clear what these features will mean for the future of American automakers.

Liveblog

Mullaly appears onstage wearing a very bright red vest. Vibrant!

At Walt’s request, Mulally shows off a piece of paper with handwritten notes that purport to explain Ford’s interest in all things digital. Lots of computers are involved in the creation of your Taurus.

12:30 pm: Kara wants to know why cars have been basically digitally ignorant for a long time. Walt: You open the door to you car and it’s 1957 again. Why is that?

For the record, Mulally doesn’t think you should text and drive.

He also wants you to keep your hands on the wheels and eyes on the road. So there’s lots of digital stuff being built into dashboard and console. Like the SYNC iPod/phone, etc., manager.

Ford is playing around with features like allowing drivers to have their text messages read to them. But safety is paramount. All of our data says your safest operation is when you have your hands on the wheel and eyes on the road. But right now, we feel that listening to email and text is a good first step. But we don’t want you sending email and text via voice, at least for now.

12:35 pm: Kara–Why is this taking so long? [i.e., "where is my jetpack?"]

Walt: Yeah! Even fancy German and Japanese cars don’t do it well. It’s pathetic!

Mulally: Don’t blame me! I just got here. Part of the problem is that car development is much slower than consumer electronics R&D cycle. For instance, a lot of competitors have embedded a phone in the car. We’re avoiding that and focusing on interface, so as consumers exchange and swap devices, they can do that.

12:38 pm: A pitch for “My Ford Touch,” which seems to have lots of bells and whistles, but sounds confusing to this frequent walker and subway-taker.

12:39 pm: Walt tries explaining it. “The instrument cluster, which has been on steering wheels forever, is now going to be a on a screen.”

Mulally: Right. We want to make it intuitive. Etc.

12:40 pm: Still trying to explain it. Screen goes on steering wheel and allows customizable controls for operating car, as well as extras.

12:41 pm: Kara–what is that people want to do, anyway?

Mulally: Good question. We watch what people do in cars and try to help them do it, because they’re going to do it anyway. For instance, we’re building in Pandora to our cars. You’ll get the music via the Web, from your cellphone, but you’ll operate it on our panel. Also Stitcher, Open Beak, etc.

A lot of people here are using apps. You’ll get to use them in the car.

12:43 pm: Walt–Will you need a special Ford version of these apps?

Mulally: Yep. You use our API

12:44 pm: Kara wants better navigation services. She doesn’t want to hear a mean German lady giving her directions though.

Walt: Yeah! All of your GPS systems are lousy! The ones on phones are better!

Mulally: We’re with you. That’s why we want to rely on developers to build the good stuff, via our API.

12:47 pm: Let’s talk about the car industry, period. You just got here. You were in aerospace, before. Also, the whole oil spill thing does change the way we look at cars, right?

Mulally: Before I left Boeing (BA), I thought about where the car industry was going. What I decided was that the industry is the soul of Manufacturing–“big M”–all around the world. Lots of stuff goes into this, no matter what country or region. It’s also part of the solution to economic growth, energy independence and environmental sustainability.

On that note: Clearly, the internal combustion engine is going to be around for a while. But we can make them operate more efficiently, etc. Take a v6 and make it run like a v8m, etc. Meanwhile hybrids are tough because you have two different systems: Batteries and internal combustion. Then in the future, we need to move to all-electric. We have a great road map for all of this. First all-electric cars launch this year. Hydrogen is farther out, don’t have the tech for it yet.

12:52 pm: Mulally describes challenges of electric car–need to figure out how and where to get the juice to cars.

12:53 pm: Kara–What about health of business?

Mulally: I like being here much better than testifying in front of Congress.

Kara: How did you get here?

Mulally: I flew! That’s why we have airplanes. For long-distance travel.

12:53 pm: A Zuckerberg hoodie joke.

12:54 pm: Mulally–Time goes fast. Last year, I was testifying on behalf my competitors, who were bankrupt. Now I’m a capitalist. But if GM and Chrysler went away, they’d take the supply base along with them, and they’d probably have put the U.S. into a bona fide depression.

I was asking for temporary help. I didn’t think all of us would end up owning our competitors.

12:57 pm: Mulally–Recovery is coming, by the way. We’ll have 3.5 percent expansion of GDP this year. And Ford is doing well. We’ll have market-share increases.

Kara: What kind of car do you drive?

Mulally: A different one every night.

Q&A

[I hope someone asks about the New York Times series that said that anything you do in your car besides driving is a safety risk. Anyone?]

Q: Please talk about the Mercury situation.

A: We had too many brands. Ford, Mercury and Lincoln. Mercury was supposed to be a gap-bridger between Ford and Lincoln. But the Ford line expanded, so we didn’t need Mercury. “Everybody’s got great options in Ford.” It’s also good news for Lincoln–because we don’t have other premium brands anymore, we’ll refocus on Lincoln for luxury.

Q: Proud Tesla owner Jason Calacanis wants to know why electric isn’t everywhere already.

A: We can make electric cars, but as you know, we can improve them, like battery life.

Calacanis: No. It’s not a problem. Batteries are great at Tesla.

Mulally: Nope. Most of them are too big, too heavy. There’s a lot of room to improve the batteries.

Other point is that the infrastructure has to get there. You need charging stations for people in apartments, in rural areas, etc. When we get there, Ford will be there.

Kara, and Walt want Jason to tell us how much his Tesla cost. Astonishingly, he goes mute.

Q: Did you really say you don’t intend to get a revenue stream from connectivity of cars to data? You don’t want a piece of money made by Yelp, Garmin, etc.?

A: You heard me correctly. We’re laser-focused on safe and efficient transportation. So there’s no conflict of interest.

Q: Walt wants to if these electronics actually sell cars.

A: I demoed this stuff for you, and you’re a tough critic, and you said “whoa!” This technology is absolutely a differentiator.

Q: You’re talking about innovation in cars. Does dealer network have to change too?

A: Absolutely. We’ve been right-sizing the dealer network to match demand for five years. Once you do that, throughput goes up, profitability goes up, interest in improving facilities goes up, etc. Then we can improve consumer experience.

Walt: Because it’s terrible right now.

Mulally agrees without saying so.

Q: China is pushing hard for electric cars. What does that mean for you?

A: I think China is going to continue to take a real leadership position on this. Big population, and they have a chance to really make a difference and maybe leapfrog the past.

Q: There’s that great Ford quote about not listening to his customers, because if he did he’d be in the horse business. So how you do innovate?

A: Stay closet to innovation. And have a point of view about how the industry is going to progress.

Q: Ah! Someone asked about focusing while you drive.

A: Eighty percent of accidents involve taking your eyes off the road. So we’re convinced that the mind has the cognitive ability to do other things while driving as long as you continue to watch the road. So we minimize anything that’s a distraction: Keyboard, certain confusing apps, etc. We are definitely going to be a gatekeeper with regard to apps, because it’s crucial that you not be distracted.

We’re done! Thanks for sticking around. See you in a year!

A note about our coverage: This liveblog is not an official transcript of the conversation that occurred onstage. Rather, it is a compilation of quotes, paraphrased statements and ad-lib observations written and posted to the Web as quickly as possible. It is not intended as a transcript and should not be interpreted as one.

The D8 Site Is Now Live

Kara Swisher — Tue, 18 May 2010 17:15:46 +0000

The conference site for the eighth D: All Things Digital is now up.

There are posts related to D8, and we will be adding more in the next two weeks, ahead of the June 1 start of the conference.

The site also includes D8 speaker pages, which display a bio, big graphic, prior photos and videos. When the conference kicks in, these pages will also be populated with up-to-the-minute posts, photos and videos.

There will also be a Twitter feed module on all the D8 pages, which will show tweets from All Things Digital bloggers and more.

Onstage in interviews with Walt Mossberg and me at the event:

Apple (AAPL) CEO Steve Jobs; Hollywood director James Cameron; Microsoft (MSFT) CEO Steve Ballmer; AOL (AOL) CEO Tim Armstrong; Steve Burke, COO of Comcast (CMCSA); Federal Communications Commission Chairman Julius Genachowski; Web leader Steve Case; Peter Chou, CEO of HTC; John Donahoe, president and CEO of eBay (EBAY); Paul Jacobs, CEO of Qualcomm (QCOM); Jeffrey Katzenberg, CEO of DreamWorks Animation SKG; Alan Mulally, CEO of Ford (F); Richard Rosenblatt, co-founder, chairman and CEO of Demand Media, in a session with Editor-in-Chief, President and CEO Paul Steiger of ProPublica; Vivian Schiller, president and CEO of National Public Radio; and, last but hardly least, Mark Zuckerberg, CEO of Facebook.

The D8 Site Is Now Live

Kara Swisher — Tue, 18 May 2010 17:15:44 +0000

The conference site for the eighth D: All Things Digital is now up.

There are posts related to D8, and we will be adding more in the next two weeks, ahead of the June 1 start of the conference.

There will also be a Twitter feed module on all the D8 pages, which will show tweets from All Things Digital bloggers and more.

Onstage in interviews with Walt Mossberg and me at the event:

Welcome Back, Steve: Apple CEO Jobs to Appear Onstage at D8

Kara Swisher — Wed, 28 Apr 2010 00:01:30 +0000

Apple (AAPL) CEO and Co-founder Steve Jobs will appear at the eighth D: All Things Digital, in an interview on the opening night, kicking off our tech and media conference that will also include famed Hollywood director James Cameron, Microsoft CEO Steve Ballmer and Facebook CEO Mark Zuckerberg, among others.

(Jobs is pictured above at D5 in 2007.)

Jobs has been onstage many times at D, including in a famous joint session with Microsoft (MSFT) Co-founder Bill Gates. In the interview, which was conducted by Walt Mossberg and me, the pair of tech legends talked about their long history in the industry (you can see the video of that interview below).

There is much to talk to Jobs about, obviously, including the new iPad, the mobile market and the iPhone, its tense relationship with Google (GOOG) and the next innovations from the Silicon Valley computer icon.

It should be a news-filled year at D. Also onstage: Ballmer, who is appearing with the software giant’s chief software architect Ray Ozzie. In addition, Cameron will discuss the impact of tech on the film industry and his mega-hit movie “Avatar.”

Also onstage: Steve Burke, COO of Comcast (CMCSK), which recently purchased NBC Universal; Federal Communications Commission Chairman Julius Genachowski; former AOL (AOL) leaders Steve Case and Ted Leonsis; Peter Chou, CEO of HTC, which is embroiled in an ugly legal fight with Apple; John Donahoe, president and CEO of eBay (EBAY); former Hewlett-Packard (HPQ) CEO Carly Fiorina, who is now a candidate for U.S. Senate in California; Paul Jacobs, CEO of Qualcomm (QCOM); Jeffrey Katzenberg, CEO of DreamWorks Animation SKG; Alan Mulally, CEO of Ford (F); Richard Rosenblatt, co-founder, chairman and CEO of Demand Media, in a session with Editor-in-Chief, President and CEO Paul Steiger of ProPublica; Vivian Schiller, president and CEO of National Public Radio; and, last but hardly least, Zuckerberg of Facebook (yes, Mark, there will be a question about competition you’ll need to answer–and not via a question about the question either–be prepared!).

We also have a few more speakers to announce, so stay tuned.

Here is the Jobs-Gates video from 2007:

[ See post to watch video ]

And here’s our official press release:

STEVE JOBS, JAMES CAMERON AND STEVE BALLMER TO SPEAK AT THE EIGHTH ANNUAL “D: ALL THINGS DIGITAL” CONFERENCE

NEW YORK (April 27, 2010)–All Things Digital today announced the speaker lineup for the eighth D: All Things Digital, The Wall Street Journal executive conference that will be held from June 1-3, 2010 near Los Angeles, Calif.

Apple CEO Steve Jobs will be this year’s opening-night speaker, Microsoft CEO Steve Ballmer will make his fourth appearance and “Avatar” director James Cameron will appear onstage at D for the first time on the annual event’s second night.

Founded by co-producers Walt Mossberg and Kara Swisher in 2003, the D conference is a gathering of the most influential figures in media and technology. Each year, Mossberg and Swisher put these top players to the test onstage during unrehearsed, unscripted conversations. The results are candid, entertaining sessions that provide glimpses into the strategies of the industry’s most creative thinkers.

D8 will also showcase leading executives from the mobile, digital, media, automotive and political arenas including:

• Steve Burke, COO of Comcast
• Steve Case, Chairman and CEO of Revolution
• Peter Chou, CEO of HTC
• John Donahoe, President and CEO of eBay
• Carly Fiorina, Candidate for U.S. Senate, California
• Julius Genachowski, Chairman of the FCC
• Paul Jacobs, CEO of Qualcomm
• Jeffrey Katzenberg, CEO of DreamWorks Animation SKG
• Ted Leonsis, Vice Chairman Emeritus of AOL, Chairman of Revolution Money and Owner of Washington Capitals
• Alan Mulally, CEO of Ford
• Ray Ozzie, Chief Software Architect of Microsoft
• Richard Rosenblatt, Co-Founder, Chairman and CEO of Demand Media
• Vivian Schiller, President and CEO of National Public Radio
• Paul Steiger, Editor-in-Chief, President and CEO of ProPublica
• Mark Zuckerberg, Founder and CEO of Facebook

Live blogs and photos from each session will be available on AllThingsD.com during each interview, with video highlights posted shortly afterwards.

The D conference has been sold out since January. For more information, full D coverage and video of past conferences including the historic joint appearance by Steve Jobs and Bill Gates at D5, see http://allthingsd.com/d/.

D8 is sponsored by AMD, Houlihan Lokey, Juniper Networks, Microsoft, NYSE Euronext, Qualcomm and Thomson Reuters.

Inside Ford's App-Happy Fiesta–But No Manilow (and BoomTown is a Fanilow)!

Kara Swisher — Mon, 26 Apr 2010 15:51:41 +0000

Last week, outside the Facebook f8 developers conference, BoomTown checked out the new 2011 Fiesta model, which will be the first vehicle in which smartphone apps can be voice-controlled via its in-car synching software.

While getting a test, I interviewed the Ford dude–Julius Marchwiki–who has been in all the YouTube videos of late touting its digital prowess.

Ford has been trying to fast-forward its automobiles in the digital space to try to differentiate itself from other car makers, using SYNC AppLink, as well as other innovative Web-friendly features.

In December, Ford (F) said it would make the next generation of its SYNC-enabled vehicles into Wi-Fi hotspots, allowing drivers and passengers to connect to the Internet everywhere much more seamlessly in a moving car.

Presumably, the ultimate in mobile.

One speed bump: SYNC AppLink will work only with Google (GOOG) Android and Research in Motion (RIMM) BlackBerry devices for now, although Ford promises an Apple (AAPL) iPhone solution soon.

Pandora Internet radio, online talk radio aggregator Stitcher and mobile Twitter client OpenBeak are the first SYNC-enabled mobile applications.

Here’s my interview with Marchwiki, as well as Scott Monty, Ford’s social media guru:

[ See post to watch video ]

Ford Launches Voice Control of Apps in Car: No More Phone-Fiddling While Driving?

Kara Swisher — Tue, 20 Apr 2010 11:15:45 +0000

Ford, which has been trying to fast-forward its automobiles in the digital space, announced today that its 2011 Fiesta model will be the first vehicle in which smartphone apps can be voice-controlled via its in-car synching software.

One issue: Initially, Ford’s SYNC AppLink, downloadable as an upgrade, will work only with Google (GOOG) Android and Research in Motion (RIMM) BlackBerry devices.

As to the more popular iPhone from Apple (AAPL)?

“Ford will introduce AppLink on all SYNC-equipped vehicles next year, as well as provide interoperability with iPhone and other smartphones,” the auto company said in a statement.

Still, anything that stops dodos from fiddling with a smartphone while driving can’t be bad.

Ford (F) has been trying mightily to differentiate itself by digitizing its cars.

In December, Ford said it would make the next generation of its SYNC-enabled vehicles into Wi-Fi hotspots, allowing drivers and passengers to connect to the Internet everywhere much more seamlessly in a moving car.

Pandora Internet radio, online talk radio aggregator Stitcher and mobile Twitter client OpenBeak are the first SYNC-enabled mobile applications.

Ford also said it is launching a developers’ network to boost the number of apps that can be used in SYNC-enabled cars.

Here are some videos showing the system in use:

Pandora

Sticher

OpenBeak

And here’s the full press release from Ford:

SYNC APPLINK TO LAUNCH ON 2011 FIESTA, MAKING FORD FIRST TO DELIVER VOICE CONTROL OF SMARTPHONE APPS

• Ford will first offer SYNC® AppLink, a downloadable software program, on the 2011 Fiesta, allowing owners to access and control AndroidTM and BlackBerry® smartphone apps with voice commands and vehicle controls

• Pandora internet radio, Stitcher “smart radio” and Orangatame’s OpenBeak are the first SYNC-enabled mobile applications

• Ford to create SYNC developer community with launch of new “Mobile Application Developer Network” (www.syncmyride.com/developer), giving developers a pathway to partner with Ford on SYNC-enabled applications

• Ford’s platform approach with SYNC is poised to harness smartphone app development and mobile web access; apps expected to be a $4 billion industry by 2012; analysts predict the mobile device to become the No. 1 source for Internet access by 2015

SAN FRANCISCO, April 20, 2010–Customers have spoken–asking for safe, convenient access to their smartphone apps while in the vehicle–and Ford is responding by announcing the new SYNC AppLink software that will allow hands-free voice control of popular smartphone apps.

SYNC AppLink, a downloadable software upgrade, will be released for 2011 Ford Fiesta owners with the award-winning SYNC communications and infotainment system later this year, allowing drivers hands-free control of apps on their Android or BlackBerry smartphones via voice commands and vehicle controls. Ford will introduce AppLink on all SYNC-equipped vehicles next year, as well as provide interoperability with iPhone and other smartphones.

“The growth in smartphone mobile apps has been explosive, and Ford has worked hard to respond at the speed of the consumer electronics market,” said Doug VanDagens, director of Ford’s Connected Services Organization. “SYNC is the only connectivity system available that can extend that functionality into the car. AppLink will allow drivers to control some of the most popular apps through SYNC’s voice commands and steering wheel buttons, helping drivers keep their hands on the wheel and eyes on the road.”

The Android MarketTM and BlackBerry App World™ are among the leading growth markets for mobile apps. The new SYNC AppLink will seamlessly integrate apps using the vehicle’s voice and user interface controls, including buttons on the steering wheel, increasing eyes-on-the-road and hands-on-the-wheel time.

The first SYNC-enabled apps available later this year include Pandora internet radio, Stitcher “smart radio” and Orangatame’s OpenBeak app for Twitter, with additional apps on the way. Updated versions of each app, incorporating the SYNC application programming interface (API), will be available through Android Market and BlackBerry App World for customers to download.

Built-in, Beamed-in and Brought-in: The SYNC App Ecosystem

From its introduction, Ford has been building an ecosystem of available SYNC apps, continuously improving the consumer experience.

• Built-in apps, including Vehicle Health Report and 911 Assist™, are downloaded and installed directly on the in-car SYNC operating system

• SYNC apps like Traffic, Directions & Information rely on beamed-in, or “cloud-based,” information. Drivers access the Ford Service Delivery Network, a network of data centers providing turn-by-turn directions, business searches, and on-demand news, sports and weather information, through a simple voice-connection using their cell phone.

• SYNC AppLink represents the third category of the ecosystem, brought-in apps, leveraging apps installed on a user’s smartphone, such as Pandora, Stitcher and OpenBeak

Studies show mobile app development–a niche market just three years ago–is expected to blossom into a $4 billion industry by 2012. Sites serving specific mobile operating systems, such as Android and BlackBerry OS, have experienced massive growth, with analysts predicting the mobile device will become the No. 1 source for Internet access by 2015, surpassing the home computer.

Ford and SYNC will answer the consumer demand by offering the only platform available for drivers to safely control their mobile devices and applications in the car. Leveraging SYNC’s safer voice commands and steering wheel controls, drivers are able to keep their hands on the wheel and eyes on the road. “Brought-in” apps residing on a consumer’s smartphone also eliminate the need for yet another piece of hardware to be installed in the car which only serves to add cost and complexity.

Customers will be able to download SYNC-enabled mobile apps through the same app store interfaces currently used. As SYNC-enabled versions of existing apps are released into the app stores, users will be prompted to download the latest version upon connection. Also, as developers grasp the notion that the vehicle interior has opened to them, a new dimension of apps designed from the outset to maximize the unique in-car environment will follow.

Opening the door to developers

To facilitate future SYNC-enabled app development, Ford has also activated a new developer network on its SYNCmyride Web site (www.syncmyride.com/developer). Interested developers can find a link to submit innovative ideas, and sign up for the latest information and news about the SYNC application programming interface (API) and software development kit (SDK). The package will allow developers to modify existing applications and create all-new apps that can successfully interface with SYNC.

Working with trusted partners, Ford is completing beta-testing on the SDK. Once beta-testing is complete, a broader release of the development tools is planned for later this year. Initial reports have been positive, with one of Ford’s development partners creating a SYNC-enabled version of its app just three days after receiving the development tools.

“We’re very pleased by the rapid development time and positive feedback we’ve seen from our first partners,” said VanDagens. “We want to encourage all developers to visit our site and submit ideas, helping us tap into the global pool of innovation and creativity.”

What Do Rush and NPR Have in Common? Internet Talk Radio Hub Stitcher Nabs $6 Million From Benchmark.

Kara Swisher — Tue, 06 Apr 2010 11:30:25 +0000

Online talk radio aggregator Stitcher nabbed $6 million from Benchmark Capital and will use the money to give radio blabbermouth Rush Limbaugh, as well as the endlessly talking heads of National Public Radio, even more digital distribution.

The San Francisco-based start-up often describes itself as the the Pandora of online talk radio. And like the digital music site, Stitcher lets its users create and customize their own free personalized talk/information/news radio stations.

The site focuses mostly on its apps for a variety of mobile devices, especially increasingly popular smartphones. It offers programs from about a thousand different sources, such as NPR, E! and The Onion.

Stitcher also recommends new programs to users based on their selections.

The infusion of funding in a Series B round led by Benchmark–whose partner, Bob Kagle, will have a seat Stitcher’s board–will allow it to expand its advertising sales force and improve its offerings, said CEO Noah Shanok in an interview with BoomTown last night.

“The hope for everyone in terrestrial radio is to find new audiences, so as we grow, they will too,” said Shanok, who co-founded Stitcher in 2008. “We want to be a part of everyone’s everyday life.”

Shanok said fast-growing usage and engagement–which he declined to give specifics about–was the reason Benchmark was attracted to the company.

The new funding adds to $3 million Stitcher already raised from New Atlantic Ventures and investors Ed Scott and Ron Conway, who also participated in the new round.

While the mobile app on the Apple (AAPL) iPhone is the most popular, Stitcher also offers software for Research in Motion (RIMM) BlackBerry, Palm (PALM) Pre and Google (GOOG) Android devices.

Stitcher is also pushing into other areas, such as being part of Ford’s (F) initiative to make its SYNC-enabled vehicles into Wi-Fi hotspots, allowing people to connect to the Internet everywhere much more seamlessly in a moving car. They will be available later this year.

Here’s the press release on the funding:

Stitcher Secures $6 Million in Series B Venture Funding

Benchmark Capital Leads New Round to Help Transform the Way We Listen to Talk Radio

SAN FRANCISCO, CA. (April 6, 2010)–Today, Stitcher, a service that allows users to customize talk radio programming on their mobile devices, announced that it has completed its Series B round of financing. Led by Benchmark Capital, with participation from previous investor New Atlantic Ventures and tech veterans including Ed Scott and Ron Conway, the funding will be used to further Stitcher’s product and platform development. Bob Kagle of Benchmark will join Stitcher’s board of directors.

“We know that people prefer listening to news, talk and information programming when they’re on-the-go. The rise of smartphones has finally created an opportunity to give people exactly what they want to hear–on their commute, at the gym, on a road-trip–wherever and whenever they want it and that’s exactly what Stitcher does,” said Noah Shanok, CEO of Stitcher. “Benchmark’s funding, combined with Bob’s guidance, will help us continue to take advantage of the growing market for mobile content distribution.”

Stitcher’s free service allows users to create a personalized audio programming experience. With Stitcher, users can listen to the news and talk radio shows they enjoy whenever and wherever they like, using their mobile devices. Users choose their favorite programs from more than a thousand different sources, and Stitcher then delivers the audio feeds to their phone as a single, regularly updating radio station. Stitcher also helps users discover new content on a variety of topics–including business, sports, politics, entertainment, and current events–by recommending additional programs based on the shows users have in their feeds. A single radio station can include programming as diverse as Fox Headline News, NPR’s Fresh Air, TechCrunch Headlines, Onion Radio News, and E!’s Hollywood Rap Up.

“Stitcher is transforming the way we all consume news, talk radio, pod casts,” said Bob Kagle, general partner at Benchmark Capital. “Noah and his team are building a platform that will deliver the personalized experience consumers currently enjoy for music to the broader world of audio programming. We’re thrilled to join the Stitcher revolution.”

Microsoft's Bing Makes More UI Changes–And Checks In With Foursquare

Kara Swisher — Thu, 25 Mar 2010 12:45:36 +0000

Today, Microsoft’s search engine-that-could, Bing, will begin rolling out another significant upgrade to the user interface seen by consumers.

The software giant also announced on its Bing blog and at an industry conference that it would integrate status data from hot geolocation start-up Foursquare into its Bing maps as an app.

Bing has already been weaving updates from a variety of social networking sites, such as Twitter and Facebook, into its services.

The New York-based Foursquare, a location-based social networking site that has been growing quickly recently, lets its users “check in” from a variety of locations. In Bing, it will be accessible via “Map Apps.”

Wrote Bing’s Todd Schwartz on the service’s blog in a post titled, “New Stuff Coming From Bing This Spring”:

The foursquare map app is a powerful combination of the spatial canvas that Bing Maps provides, combined with foursquare’s user reputation service ability to see who has unlocked specific badges, where and who has been crowned mayor of certain locations making it easier to explore any city in the world as if you were a local. Let’s say you’re travelling to New York City for the week, but you don’t know what’s hot in Greenwich Village. Selecting the foursquare Map App in Bing Maps, and zooming into to Greenwich Village will get you tips that show you what locals are saying about the hot spots in that area. It’s like an interactive day planner, designed to help find the best things to do in that area. And if you have questions, you can always contact users through foursquare to get the inside scoop.

More interesting, though, is the continuing drive to innovate Bing.

Starting today, pages served up by Bing–which you can see below compared with the old ones–will be more focused, with a range of new navigational elements meant to gauge search “intent” better.

This means relocating its “Quick Tabs” functionality to the top of searches from the side, for example, as well as a more defined “Bing Box,” which pulls information together better.

The goal, said Bing Director Stefan Weitz: To differentiate as much as possible from dominant search rival Google (GOOG).

“Google and Bing are diverging more than ever,” he said in an interview yesterday with BoomTown. “Google is focusing on gathering all the world’s information and we are focused on delivering knowledge based on a user’s intent.”

While it sounds a little like goobledygook, it’s probably a good competitive strategy for Microsoft (MSFT) to avoid competing directly with Google in search.

And so far, it seems to have worked, with Bing’s share growing slowly but surely over the year since its launch, mostly at the expense of Yahoo (YHOO).

Weitz calls the new look on the pages–which will start with a focus on celebrity, auto and travel searches and reach about five percent of U.S. users initially–“not a radical departure, but an evolution.”

And, indeed, new page results from searches for Lady Gaga and Miami Beach, for example, look only slightly different, with added navigational tabs on top and a more task-oriented feel.

In contrast, though, a search for Ford Mustang is dramatically different, with a more visual feel that is almost like a really informative brochure.

Here are screenshots of the befores and afters (click to enlarge):

Miami Beach (old):

Miami Beach (new):

Mustang (old):

Mustang (new):

Lady Gaga (old):

Lady Gaga (new):

The Case for the Fat Start-Up

Ben Horowitz — Wed, 17 Mar 2010 19:00:09 +0000

Much has been written and said about the current economic downturn and the resulting lessons on how to run high-technology companies. Quite famously, Sequoia Capital, the premier venture capital firm in Silicon Valley, held a mandatory all-CEO meeting in fall 2008 during which it advised them to “Cut spending. Cut fat. Preserve capital.” (You can see the presentation here.)

The presentation catalyzed a movement. Start-ups everywhere adopted a lean, low-burn, low-investment model. To this day, companies seeking funding at our venture firm, Andreessen Horowitz, proudly proclaim in their pitch decks that they are raising tiny amounts of capital so they can run lean.

On the one hand, it is a fact that capital invested is negatively correlated with returns in the venture capital industry. Pumping too much money into a small start-up is unhealthy for both the company and the investor. On the other hand, Facebook has raised several hundred million dollars and is on track to produce fantastic returns for all of its investors.

So what’s a start-up to do? Much of what has been written and said about lean start-ups makes good sense. However, that advice is often incomplete, and some of the things left unsaid are the least intuitive. In this article, I will articulate some of those things left unsaid in arguing the case for the Fat Start-up.

Here is my central argument. There are only two priorities for a start-up:
Winning the market and not running out of cash. Running lean is not an end. For that matter, neither is running fat. Both are tactics that you use to win the market and not run out of cash before you do so. By making “running lean” an end, you may lose your opportunity to win the market, either because you fail to fund the R&D necessary to find product/market fit or you let a competitor out-execute you in taking the market. Sometimes running fat is the right thing to do.

What the hell do I know?

“Al Pacino couldn’t be no gangsta, DeNiro in ‘Casino’ he no gangsta
Wanna be, wanna see, wan’ get a shovel
dig Tookie up n*&%^!, cause he know gangstas”

–The Game

At this point, some of you are asking yourselves, “What the hell does Ben know? If he were really smart, then he’d know that thin is in.” It turns out that I have some experience in managing a fat start-up through the dot-com implosion of the early 2000s. This chart offers a brief summary of equity market history when I was CEO of Loudcloud and Opsware (click to enlarge):

Note that the Nasdaq index is very highly correlated to the start-up funding environment. During the two years I was CEO of Opsware, the Nasdaq fell 80 percent, far more than it has fallen during the current 2008-10 downturn. So the 2000-02 environment was at least as traumatic as this one for Silicon Valley companies–and arguably much worse.

Here is a brief summary of Loudcloud/Opsware’s fund-raising history during that time:

September 1999: Loudcloud founded
November 1999: Loudcloud raises $21 million at a $45 million pre-money valuation (Benchmark Capital is the lead investor)
January 2000: Loudcloud borrows $45 million from Morgan Stanley (MS)
June 2000: Loudcloud raises $120M at a $700M pre-money valuation
March 2001: Loudcloud goes public on Nasdaq, raises $160 million and is valued in the public markets at approximately $480 million. Total funds raised to this point: $346 million.
August 2002: Loudcloud sells the managed services business to EDS (this was the only actual business we had at the time) for $63.5 million and becomes a software company (and changes its name to Opsware).
September 2002: Opsware trades for 35 cents per share or approximately a $28 million market cap.
September 2007: Hewlett-Packard (HPQ) acquires Opsware for $1.6 billion

During this period, Loudcloud/Opsware had over 20 direct competitors. Almost all the competitors from the Loudcloud era went bankrupt, including MFN/SiteSmith, Exodus, LogicTier, Williams Communication, Global Crossing, WorldCom/Digex and Storage Networks. Those that survived got bought with valuations of less than $100 million (e.g., Totality) or still have very low valuations (e.g., Navisite).

How did we do it?

“I had a dream I could buy my way to heaven
When I awoke, I spent that on a necklace”

–Kanye West

So how did we navigate through the great dot-com crash, crush the competition, emerge as the No. 1 company in our space and sell the company to HP for $1.6 billion? Did we “cut spending, cut now, and preserve capital?” Did we make cash preservation our No. 1 priority?

No, we didn’t. To underscore the point, here are Loudcloud’s average monthly cash burn figures for the quarters ending in:

Apr 2001: $39 million
Jul 2001: $35 million
Oct 2001: $29 million
Jan 2002: $25 million
Apr 2002: $22 million
Jul 2002: $19.4 million

As you can see, we were aggressively investing in the business throughout 2001 and 2002. While we did reduce our cash burn, we did not make cash preservation our No. 1 priority. As it was, over the course of the transition from Loudcloud to EDS, we sadly laid off 400 employees and transferred another 150 to EDS. However, we didn’t scrimp and save our way to a $1.6 billion acquisition: Instead, it’s what we chose not to cut that ultimately got us there.

Loudcloud was a Web-hosting business. Today, we’d call it a “cloud services” business, but people weren’t quite ready for the “cloud” in 2001. We supercharged our hosting business with software (called Opsware) that automated our Web-hosting operations. The other cloud services businesses of our day also had software investments. However, as the macroeconomic climate changed, they all “cut deep and cut now.” In the end, they ended up putting their software in maintenance mode and stopped building new features.

As we weighed a decision to make the same deep cuts in our own software R&D efforts (a move advocated by the intelligentsia of the day, as well as nearly every MBA we had working in the company), I faced a hard decision: Cut deep and get to cash flow break-even quickly or continue to invest heavily in software?

In the end, I decided to run fat so that we could continue to invest in the Opsware software. At the end of the day, I realized that much larger companies like IBM (IBM) could hire smart people and train them. But without a lasting technology-based advantage, it would be increasingly hard for us to defeat them and build our customer base despite early wins with Ford (F), Fox Sports, and the U.K. government (to name just three of our early customers).

Running fat meant that I laid off zero software engineers so that we could keep on investing in our technology, find our product/market fit, and build a lasting technological advantage.

Still, we had to reduce costs or we would clearly go bankrupt. With this new view of the world, I decided that rather than divesting our intellectual property, I would divest our business. Now, that may sound logical the way I’ve described it, but consider these facts:

We were generating $65 million/year from the Web-hosting business.
We were a publicly traded company with a market capitalization of close to $200 million.
All of our investors (pubic and private) believed in and invested in the Web-hosting business.
We had close to 500 employees at the time. Nearly all of them were supporting the Web-hosting business.
We had no other business. We had software, but we did not have a software product and certainly did not have a software business.

Despite all of this, we sold the Loudcloud hosting business to EDS and became Opsware the software company. It was not clear that this was a good idea at the time. In fact, the market thought it was a terrible idea: Our stock promptly lost 80 percent of its value, putting our market cap at about $28 million. It’s worth pointing out that this was about $40 million less than the cash that we had in the bank.

During the transition, we shrank our payroll from 450 employees to fewer than 100. Even with this massive reduction in expenses, it would take another three quarters to reach cash-flow break-even, a milestone we finally reached in Q2 of 2003.

One could argue–and many did–that we should have cut a lot deeper than we did given that we only had one customer. Although EDS was a very large customer (it generated $20 million/year in revenue), a brand new software company doesn’t need 100 people. We could have taken steps to reach cash-flow break-even immediately (clearly, that might have helped us get above 35 cents per share). In other words, we could have “gone lean” by cutting deep, cutting now, and preserving capital.

But rather than do what seemed obvious, I decided to keep on investing. Here’s why: In an economic boom, cash is great, but not necessarily a meaningful competitive advantage. If every company is well funded, being super-well funded doesn’t help you win. In fact, being super-well funded can actually screw you.

But in a bust (like the one we were in), having a lot of cash can be a huge competitive advantage because you can use that cash to put enormous pressure on your underfunded competitors. And that’s what we did.

We spent aggressively to match our best competitor’s product, feature for feature. And we used our public currency to acquire important adjacent functionality (network, process and storage management) that our competitors did not have and couldn’t acquire because they didn’t have the cash (or the equity).

In doing so, we were able to beat a really high-quality start-up (Bladelogic) that did not have the massive technical and cultural baggage that came from exiting the managed services business. Bladelogic was eventually sold to BMC (BMC) for $800 million. But I’m firmly convinced that had we not spent the money, Bladelogic would have emerged as the No. 1 company in the space and gotten the $1.6 billion exit instead of Opsware.

In the end, by continuing to invest aggressively in our technological advantage despite a hellacious funding environment, we were able to turn a doomed business into a winning one.

That is the very short version of how we won the market during the great tech recession of the early 2000s.

So did we learn?

“Hegel was right when he said that we learn from history that man can never learn anything from history.”

–George Bernard Shaw (1856-1950)

Every start-up is in a furious race against time. The start-up must find the product-market fit that leads to a great business and substantially take the market before running out of cash. As a result, the top two priorities are always to:

Find the product that 1,000 enterprise or 50 million consumers want to buy and grab those customers before your competitors do.
Raise enough cash and spend it intelligently so that you don’t go broke along the way.

Clearly, you can’t succeed if you don’t achieve both priority No. 1 and priority No. 2. So why is taking the market more important than not running out of cash? Because the only thing worse for an entrepreneur than start-up hell (bankruptcy) is start-up purgatory.

What is start-up purgatory, you ask? Start-up purgatory occurs when you don’t go bankrupt, but you fail to build the No. 1 product in the space. You have enough money with your conservative burn rate to last for many years. You may even be cash-flow positive. However, you have zero chance of becoming a high-growth company. You have zero chance of being anything but a very small technology business (see Navisite). From the entrepreneur’s point of view, this can be worse than start-up hell since you are stuck with the small company.

You recruited all the employees, you raised all the money and you made all the promises. You either see it through or leave–without your good reputation. No one wants to work for an entrepreneur who quits his or her own company. This is start-up purgatory, where you work just as hard, reap none of the rewards, and watch all your best people leave you. It sucks to be you.

The Bottom Line

Spending a little or spending a lot is a means, not an end. Choose the right strategy to win the market or you may end up going straight to purgatory.

As you listen to the virtues of the lean start-up–lightweight sales, light engineering, and so on–keep the following in mind:

If you are a high-tech start-up, your value is in your intellectual property. Don’t stare at your spreadsheets so long that you get confused about that.
You cannot save your way to winning the market.
The best companies can raise money even in this market. If you are one of those, you should consider raising enough to wipe out your competition.

Thin is in, but sometimes you gotta eat.

Ben Horowitz is co-founder and general partner of Andreessen Horowitz. He co-founded Loudcloud, later renamed Opsware Inc., in 1999 and served as CEO of the company before it was acquired in 2007 by Hewlett-Packard. He was most recently vice president and general manager of Hewlett-Packard’s Business Technology Organization Unit.

Why the Future of Video Ads Looks a Lot Like Ancient History

Peter Kafka — Tue, 16 Mar 2010 20:02:16 +0000

Video publishers are still monkeying around with different ad formats. The latest, used by just about everyone except Google’s YouTube (GOOG), is a menu that lets video watchers pick their own ad before the video starts. But the easiest sell is the one where the advertiser is integrated directly with the clip.

That’s tough to do for many reasons, and even when you can do it, it’s pretty hard to scale. But here’s what it’s supposed to look like: Starbucks sponsoring a 25-song video series put on by The Onion.

Simon Dumenco has details on the campaign, but at its core it’s the most basic kind of video advertising, and the kind we saw at the beginning of video advertising. It’s a back-to-the-future version of TV’s early days, when brands like Texaco and Ford (F) sponsored shows called “Texaco Star Theater” and “The Ford Show.”

Back to the present: Look at how much plugging Starbucks (SBUX) has plugged in here! A preroll, plus what amounts to a preroll at the beginning of the video, plus more Starbucks references as the clip goes on. Don’t know what the coffee chain is paying for sponsoring this stuff, but the company seems determined to get its money’s worth.

Ted Leo and the Pharmacists cover the Tears for Fears song, “Everybody Wants to Rule the World”:

Exclusive: Apple to Buy Quattro Wireless for $275 Million

Kara Swisher — Tue, 05 Jan 2010 03:37:13 +0000

Apple is set to announce that it has acquired Quattro Wireless for $275 million, several sources confirmed.

The announcement of the acquisition might come as soon as tomorrow, upping the ante in the mobile advertising business significantly.

Google (GOOG) recently forked over an astonishing $750 million for Silicon Valley’s AdMob, a Quattro competitor, which Apple (AAPL) had also made a bid to acquire.

Both innovative start-ups are aimed squarely at the fast-growing market to advertise on smartphones, such as Apple’s iPhone and Google’s Android devices.

In fact, the search giant will unveil the Nexus One tomorrow, a mobile phone powered by its Android operating system software, which Google designed and will sell on a Web site instead of via telecom companies.

Waltham, Mass.-based Quattro has raised close to $30 million from two main venture investors–Highland Capital Partners and Globespan Capital Partners. Founded several years ago, its clients include Ford (F), Disney (DIS) and the National Football League.

Competitors in the space are many still, despite these big acquisitions, and include Millennial Media and Jumptap, both of which are now clearly in play to other players, from telecoms to other device makers to big Internet companies.

An Apple spokesperson declined to comment to BoomTown about the deal and email inquiries to Quattro have not yet been returned.

Ford to Enable Wi-Fi Hotspots in Some Cars: BoomTown Rejoices

Kara Swisher — Mon, 21 Dec 2009 11:00:51 +0000

Last week, when BoomTown was taking a taxi from JFK Airport, I was more of a geek loser than usual, using my USB broadband modem to connect and write a post (while, I will be honest, also watching the latest Serena-screws-up-again episode of “Gossip Girl”).

With all the potholes and traffic, the jostling cut off the connection several times, which was deeply annoying, since I need to be jacked into the matrix 24/7.

Now comes news that Ford (F) will make the next generation of its Sync-enabled vehicles into Wi-Fi hotspots, allowing you to connect to the Internet everywhere much more seamlessly in a moving car. They will be available next year.

Oh, joy! Now, I can monitor celeb disasters constantly on TMZ, continue to not confirm friend requests on Facebook and obsessively Gowalla myself while moving at 80 miles per hour, which should freak some people out.

While there are lots of in-car wireless solutions, such as MiFi, this one seems like it could be one of the easier ones, allowing you to use any USB modem to connect to the automobile, which then provides access to anyone in it with a password (yes, you can stop that snotty BMW next to you in traffic on 101 from stealing your signal).

Ford’s Sync cars are a lot like many other digitally souped-up ones, with lots of data, voice-operated info and hands-free calling, but this is a welcome new innovation.

Here is a video by Ford showing the system, in which one kid in the backseat is using an Apple (AAPL) laptop and one a Microsoft (MSFT) PC:

And here is an interview I did in October, in which Ford’s digital guru Scott Monty said: “Social media is the cocaine of the communications industry”:

[ See post to watch video ]

Finally, here’s the official Ford press release:

FORD SYNC GOES WIFI TURNING CAR INTO MOBILE INTERNET HOT SPOT FOR PASSENGERS WHILE ON THE GO

• Next-generation SYNC® system to incorporate in-car WiFi system powered by customer’s USB mobile broadband modem, turning entire car into hot spot

• New capability will be standard on select SYNC-equipped vehicles with no additional hardware or subscriptions required beyond the user-supplied mobile broadband modem

• Standard WiFi Protected Access 2 (WPA2) security protocols will be in force, and only owner-permitted devices will be able to access the network, helping ensure secure, robust connectivity for in-car users

DEARBORN, Mich., Dec. 21, 2009–Ford Motor Company will turn vehicles into rolling WiFi hot spots when it introduces the second generation of its popular SYNC® in-car connectivity system next year.

Inserting an owner’s compatible USB mobile broadband modem–sometimes called an “air card”– into SYNC’s USB port will produce a secure wireless connection that will be broadcast throughout the vehicle, allowing passengers with WiFi-enabled mobile devices to access the Internet anywhere the broadband modem receives connectivity.

“While you’re driving to grandma’s house, your spouse can be finishing the holiday shopping and the kids can be chatting with friends and updating their Facebook profiles,” said Mark Fields, Ford president of The Americas. “And you’re not paying for yet another mobile subscription or piece of hardware because Ford will let you use technology you already have.”

Studies by the Consumer Electronics Association show that as many as 77 million adults make up the so-called technology enthusiast drivers population, more than half of whom express the desire for a connected communications and information system in their vehicles. Even among the general population, more than one third of Americans would be interested in the ability to check email and access Web sites in their vehicles.

Upgradeable and secure

The USB port provided by SYNC lets owners leverage a variety of devices, including the mobile broadband modem. And through simple software updates, SYNC can be adapted to connect with the latest devices.

“The speeds with which technology is evolving, particularly on the wireless front, makes obsolescence a real problem,” said Doug VanDagens, director of Ford’s Connected Services Solutions Organization. “We’ve solved that problem by making SYNC work with just about any technology you plug into it. By leveraging a user’s existing hardware, which can be upgraded independent of SYNC, we’ve helped ensure ‘forward compatibility’ with whatever connectivity technology comes next.”

The SYNC WiFi capability is a simple solution for bringing internet into the vehicle, versus competitive systems on the market. Being factory-installed, the hardware is seamlessly integrated into the vehicle, whereas competitor’s systems are dealer-installed and require a bulky bolt-in receiver and transmitter that take up cabin space. Also, competitive systems cost approximately $500 for equipment and installation, not to mention the monthly subscription fee.

“Using SYNC with existing mobile devices helps Ford provide the most value, the most flexibility and the most convenience for owners,” said Fields. “Constant connectivity is becoming a routine part of our customers’ lives, and we’re making existing technology more accessible without adding costs: That’s the kind of value Ford drivers have learned to expect.”

Using the SYNC WiFi system, a signal will be broadcast throughout the vehicle. Default security is set to WiFi Protected Access 2 (WPA2), requiring users to enter a randomly chosen password to connect to the Internet. When SYNC sees a new WiFi device for the first time, the driver must specifically allow that device to connect, preventing unauthorized users from “piggybacking” on the SYNC-provided signal.

Hulu Makes Its First Move Outside the U.S., Courtesy of a Reality Show You Don't Know

Peter Kafka — Fri, 18 Dec 2009 11:00:44 +0000

Hulu is a big hit in the U.S. But even though the video site has spent a year trying to gain a foothold in other countries, you still can’t see it anywhere else.

This should change early next year, but in the most limited way. Hulu plans to let users in the U.K., and most likely, other countries, access its U.S. site to watch a single show: The made-for-the Web reality series, “If I Can Dream.”

The show comes via 19 Entertainment, owner and creator of the “American Idol” franchise, and has a similar theme: It will follow five would-be stars as they try to make their way as actors, singers, etc. They’ll live in a Hollywood house wired with HD cameras and microphones, and viewers will be able to follow them live, seven days a week, via a streaming Web video site.

That footage will be edited down to a 30-minute weekly highlights show for Hulu. And that’s the show that should provide many international viewers with their first glimpse of Hulu, owned by GE’s (GE) NBC, News Corp.’s (NWS) Fox and Disney’s (DIS) ABC.

The press release announcing “If I Can Dream” says “it will be the first recurring show to be available to select international audiences via Hulu,” though it doesn’t spell out which countries or a time frame. But I’m told the series is set to start running early next year and that the U.K., where 19 Entertainment is based, is one of the countries slated to get access.

There’s still a possibility that the international plans could fall through. However, 19 Entertainment owns the show outright, which ought to make things easy. And both Ford (F) and Pepsi (PEP), which have already signed on to underwrite much of the show’s costs, advertise internationally, which ought to make things even easier.

But since “If I Can Dream” will use recorded music as a soundtrack, clearing the rights to every song in every territory could pose a problem.

That uncertainty should also help explain why Hulu has taken so long to expand the rest of the site to other countries: Even when Hulu finds major TV partners that want to work with it–which isn’t always a given–sorting out rights problems for every show or movie can be a lot of work.

Meanwhile, a few notes on “If I Can Dream”:

Hulu and 19 Entertainment, which is owned by Bob Sillerman’s CKX (CKXE) licensing shop, don’t seem exactly sure how to describe the new venture. Hulu’s press release calls it a “post-reality entertainment show.” But 19 Entertainment’s PR guy asked me specifically to avoid calling it a reality show. “It’s a Web experience,” he explains. Okay, then.
Whatever you want to call it, at least parts of “If I Can Dream” will seem familiar: There’s the Peeping Tom component of “Big Brother,” mixed with “Idol’s” star-making. And if we’re lucky, some drunken debauchery a la “The Real World.”
The most interesting element is the show’s path to Hulu: 19 Entertainment originally pitched the show to broadcast and cable networks, which hemmed and hawed, I’m told. But sources say Hulu jumped at the chance to run the show as an exclusive. Theoretically, if it does well enough on the Web, it could end up on conventional TV next year, too. But “If I Can Dream” is designed to turn a profit without leaving the Internet.
The show is synergized from the get-go: In addition to the Ford, Pepsi and Hulu connections, it will also use promotion from News Corp.’s MySpace, which will help run a talent search to find new faces as the old ones cycle out. And Clear Channel (CCO) will use its network of radio stations to promote the talent.
The cast of five seems to be composed of exceptionally good-looking people. If you’re trying to view this clip from outside the U.S., you’ll have to take my word for it: