According to sources, AOL will be announcing that it is making cuts of up to 40 employees in its communication products teams, specifically its AIM instant messaging and AOL Mail units. As part of the changes, its SVP of business operations, Eric van Miltenburg, and AIM head Jason Shellen will be leaving.

[UPDATE: AOL confirmed those moves to be several hours after this post appeared.]

Shellen is a particularly high-profile departure, having sold his start-up Thing Labs, maker of the Brizzly family of Web-based social software, to AOL in 2010. The Thing Labs team, headed by the Google and Blogger vet, had been integrated into AOL’s AIM and other similar offerings.

Van Miltenburg, a former Yahoo exec, had headed up business operations for the now-shifted consumer applications unit.

The departures are among a number of exits by AOL execs who had come to the New York-based Internet company, which has struggled to turn itself around in recent years under CEO Tim Armstrong. The company is now facing a challenge from an activist shareholder, one of the reasons for a renewed focus on cost-cutting and other restructuring.

Unlike those services, though, ChatON is designed to work across different phone operating systems. The service, announced back in August, is for now available as a download from Samsung’s app store and on the Android Market.

In addition to conventional text-based instant messages, ChatON also allows multimedia and animated messages using a combination of audio, scribbled text and a background image, Samsung said. It also supports group chat.

Samsung plans to preload the software on smartphones running its Bada operating system starting later this month, and will make it “gradually” available for other operating systems by the end of the year.

The Korean electronics giant showed off the service last month at the IFA trade show.

“Through its multi-platform and global availability, ChatON heralds a new age of mobile communication,” Samsung Senior VP Kang Min Lee said in a statement.

Additional versions for iOS and BlackBerry are also in the works and should be available soon, a Samsung representative told AllThingsD.

“ChatON will be available for all major platforms and devices by the end of 2011, including Android, iOS and BlackBerry,” the representative said.

ChatON is one of a growing number of services designed to compete with traditional text messaging, which works across all cellphones but is basically limited to text or multimedia messages. BlackBerry Messenger and Apple’s forthcoming iMessage service offer additional options, such as the ability to tell when a message has been delivered or read. Among the unique features of ChatON is an option to see a ranking of those with whom one has the most contact.

The service will be available in more than 60 languages and in more than 120 countries, Samsung has said.

“Users around the world can now enjoy easier and richer interactivity with whoever they want, in the format they want — this is mobile communication reinvented and democratized,” Samsung’s Ho Soo Lee said in a statement.

Samsung’s service, to be known as ChatON, is the latest effort by a phone maker to follow in the footsteps of BlackBerry Messenger. Apple has already announced the iMessage service that will be part of the forthcoming iOS 5 operating system update.

Dedicated messaging services such as BlackBerry Messenger and iMessage allow customers to bypass carrier SMS charges while also enabling advanced features such as delivery confirmation and the ability to see when a user is typing a reply.

Although not the first to the game, Samsung has the ability to link together a significant number of devices, pledging to eventually offer the service on a range of smartphones, feature phones and even PCs and tablets. The company is also adding some unique features, including the ability to scribble a message, or to see with whom one communicates the most.

“With ChatON, Samsung has vastly simplified mobile communication by allowing users to connect to our upcoming feature phones and all major smartphones in the market,” Samsung’s Ho Soo Lee said in a statement.

Over the weekend, Samsung also announced new tablets and phones supporting LTE networks, and is expected to at long last bring its Galaxy S II phone to the U.S., with a launch event slated for Tuesday in New York. It was originally slated for Monday night, but the event was pushed back a day because of Hurricane Irene.

I have a small but fast-growing business and am strongly considering going with Macs, but I’m not sure if it’s the cost-effective way to go. What are the pros and cons?

A:

To a great extent, it depends on the size and type of business, but I can give you a few general pros and cons. Macs typically cost more upfront, but can save in maintenance costs because they aren’t susceptible to most malicious software and, in my experience, they crash less often. They tend to be easier to network, and, like Windows PCs, they work with Microsoft Exchange. They run standard productivity software, like Microsoft Office, and can access most online business sites and services. But there are many niche business applications that are written for Windows only. You can overcome this by running Windows on a Mac for the occasional program. But if your business would best operate using software that is only for Windows, you’d likely be better off with a Windows machine.

Q:

My wife loves my iPad but gets very frustrated because it doesn’t handle Flash player. Because of this, many of the sites she shops at are not operable on the iPad. Do you know if any of the other tablets are more Flash-player friendly, or whether Apple will come around anytime soon?

A:

The latest tablets running Google’s Android Honeycomb software can handle Flash, though in my tests I have found that it may not work on all sites. The PlayBook tablet from Research in Motion is Flash compatible, and did a good job on Flash sites when I tested it. I have absolutely no information that Apple plans to support Flash on the iPad.

Q:

How can I use AOL’s instant-messaging system on my T-Mobile Android phone?

A:

There’s an app for that. AOL makes an Android app for its AIM instant-messaging service. You can find it on the Android Market, or here. I can’t be sure it’ll work on your particular model, since some apps require different versions of Android, but it’s worth a try. There are also AIM apps for the BlackBerry and the iPhone.

You can find Mossberg’s Mailbox and my other columns at the All Things Digital website, http://walt.allthingsd.com. Write to mossberg@wsj.com.

Groupon is in talks with Chinese Internet giant Tencent to form a partnership to accelerate its effort in the critical Asian arena, said several sources with knowledge of the situation.

Terms of the deal are unclear, but sources said that it is likely to involve some sort of co-branded joint venture effort between the two–a key strategic move for Groupon, given the hard-to-penetrate-if-you’re-not-Chinese Chinese market.

More typical for Groupon has been to buy a top local player abroad and rebrand it, such as its launch of Groupon Hong Kong, Groupon Singapore and Groupon Philippines and Groupon Taiwan through the early December acquisition of daily deal sites uBuyiBuy, Beeconomic and Atlaspost, respectively.

Moving into the lucrative international arena, where there are innumerable clones of the dominant social buying service, is one of the big strategic reasons for Groupon’s recent $1 billion funding and also last week’s very noisy IPO toe-dipping.

(How much is BoomTown wishing I could be a fly on the wall to see all those investment bankers courting kooky Groupon CEO Andrew Mason? Memo to Andrew: Act like Snooki from “Jersey Shore” and see how they still slavishly kiss up to you like the soul-sucking suck-ups they are.)

Back to China, where cloning popular U.S. Internet brands has become an art form.

That includes one particularly appalling rip-off (pictured here) in China that looks exactly like Groupon and is actually called Groupon.cn.

(Although you’ve got to be in awe of the complete non-effort to pretend it is anything but a complete shoplifting of the brand.)

But, no matter how much that digital swiping goes on, much of Groupon’s growth recently has been outside the U.S., and the company’s strategic future lies internationally.

Of course, global expansion–especially in the famously difficult Chinese market, where the government favors native companies to an unprecedented degree–has stymied many other U.S. Internet phenoms, from eBay to Google to Facebook. (In fact, for obviously thorny privacy reasons, the social networking site has no presence in China.)

But for Groupon, especially with its public offering plans and need to distance itself from close rivals such as LivingSocial, it is a must-do to reach the deal-crazy and huge audience in China.

Thus, having Tencent as its partner is an obvious plus, given it is one of the biggest Internet services in the country, including its huge QQ instant messaging offering.

In addition, there is a strong link between Tencent and one of Groupon’s key investors, Mail.ru Group.

Mail.ru owns five percent of Groupon, said numerous sources, and Tencent is an investor in Mail.ru, which recently had an IPO.

And DST Global, an investment vehicle that is now separate from Mail.ru–although it shares Russian exec Yuri Milner, who is Mail.ru’s chairman and also DST’s CEO–is also a Groupon investor.

Got all that? As BoomTown has written before: It’s a small and way-too-connected world after all, especially when it comes to the goat rodeo of Groupon investors.

What will be interesting to see is if this makes a difference in China, which has been a consistent black hole for most major Internet companies.

Groupon declined comment, and there has been no response yet to an email query sent to Tencent’s PR group.

It has given wireless carriers in the country the ability to intercept messages sent over its BlackBerry Messenger (BBM) service and BlackBerry Internet Service (BIS) if requested by the government. “The lawful access capability now available to RIM’s carrier partners meets the standard required by the government of India for all consumer messaging services offered in the Indian marketplace,” RIM said in a customer update.

Well, not quite.

The Indian government also wants access to communications sent over RIM’s corporate service. The company hasn’t yet provided that and continues to argue that it’s impossible to do so.

“No changes can be made to the security architecture for BlackBerry Enterprise Server customers since, contrary to any rumors, the security architecture is the same around the world and RIM truly has no ability to provide its customers’ encryption keys,” RIM explained in its customer update.

In other words, the solution RIM has provided is a partial one. It still hasn’t met one of the Indian government’s key demands. Will this concession on BBM and BIS be enough to mollify it?

CIO Lars Rabbe says in a blog post that a set of support servers responsible for Skype instant messaging became overloaded, and as a result sent delayed responses. A bug in the latest Windows version of the Skype desktop software failed to process these delayed responses, causing them to crash. About half of the world’s Skype users who were signed on at the time the problem began were using that version of the software, and of those, about 40 percent crashed. Among them were users whose machines were serving as supernodes. Rabbe says as many as 30 percent of the Skype network’s supernodes were among the crashed machines.

Losing those supernodes increased the load on other still-functioning supernodes, which was compounded by all the crashed Windows users trying to restart their software and get back on the network. He says traffic to these supernodes surged to 100 times normal volume for that time of day.

What he doesn’t go into great detail about was why the instant messaging servers became overloaded in the first place. Was this another bug in the server software? It’s a little unclear from this explanation.

Rabbe says Skype is trying to learn from the incident and has instituted new procedures to try to prevent this sort of thing from happening again. But this can’t help but hurt its reputation as it looks for ways to diversify its base beyond the millions of free users it has and make some actual money.

The whole reason Skype is supposed to work as well as it usually does is the strength and resilience of the network, and the fact that the network gets stronger as more people are signed on to it. To say that two bugs in a strange confluence of events could bring that entire network down raises a lot of fundamental questions about Skype.

Rabbe says an investment program to increase capacity to support paid consumers and enterprise customers is underway and will continue into 2011. I’m betting Skype will speed it up.

However, according to a graphic elsewhere on the company’s Web site (see above), that’s still short of the service at peak times (and one would assume that, absent an outage, two days before Christmas might be one of those peak sorts of times).

The blog goes on to mention a few of the other lingering issues. “Please note that some features may not work as reliably as expected,” it said, adding that “peoples’ online status may be slow to update, and instant messages might not be delivered as quickly as they are normally. Group video calling will take longer to return to normal.”

Of course, all that is a lot better than yesterday, when the bulk of the service was down for millions of people.

UPDATE, 11:50 am: Things are looking up, according to the latest post from CEO Tony Bates. He reports that there are now about 16.5 million users online, about 80 percent of normal for this time of day. And a make-good offering is in the works. “I realise that it’s difficult to compensate you for not being able to talk to or see your friends, family or colleagues, but we’re planning to offer Skype Credit vouchers to all of our loyal paying customers to thank you for your continued support,” said Bates.

Here’s the video of his message:

UPDATE, 3:02 pm: Another dispatch from Bates, this time reporting that traffic volume is up to 90 percent of normal now, the system has been stabilized and the engineers think they know what went wrong (and it wasn’t a malicious attack). Bates also offered a few more details on the customer compensation plan. Here’s the video:

“Under normal circumstances, there are a large number of supernodes available,” Skype said in an explanatory blog post on its Web site. “Unfortunately, today, many of them were taken offline by a problem affecting some versions of Skype. As Skype relies on being able to maintain contact with supernodes, it may appear offline for some of you.”

The company says the solution is the creation of–wait for it–”mega-supernodes.”

“Our engineers are creating new ‘mega-supernodes’ as fast as they can, which should gradually return things to normal,” Skype said. “This may take a few hours, and we sincerely apologise for the disruption to your conversations. Some features, like group video calling, may take longer to return to normal.”

The company thanked everyone for their patience and said to continue following @skype on Twitter for further updates.

Update, 1:10 p.m.: Skype said in an update posted to Twitter that things are slowly getting back up and running.

“Skype is now gradually returning to normal–we expect it may take several hours for everyone to be able to sign in again, however,” it said.

A new Myspace mobile site at http://m.myspace.com launches today, formatted for iOS, Android, Palm and “select Nokia and BlackBerry devices.” It channels Myspace’s recent focus as an entertainment destination, with features emphasizing music and celebrity news and access to video content, but no music streaming.

An overdue iPhone app update is also set to arrive “in the coming weeks,” Myspace said. The company’s existing iPhone app hadn’t been updated since January 2010, and doesn’t include push notifications, instant messaging or status updating, according to vocal user complaints in the iPhone app reviews section. The new app will indeed include all those features, said a Myspace spokesperson.

It would seem, then, that RIM is on target to provide India’s Home Ministry with a solution that will allow it to “lawfully” monitor BlackBerry services by the January 31 deadline the two parties have agreed on.

According to RIM, that’s not the case at all. In fact, says the company, it has no plans to make any changes to the security architecture for BlackBerry Enterprise Server customers since A) it professes to maintain a consistent global standard for lawful access requirements and doesn’t make specific deals with individual countries and B) it couldn’t provide its customers’ BES encryption keys to curious governments even if it wanted to.

“RIM has once again found it necessary to address certain media reports in India containing inaccurate and misleading statements and information based on unsubstantiated claims from unnamed sources,” the company said in a statement given to me. “Our customers can be reassured that the BlackBerry Enterprise Solution continues to be the gold standard for security-conscious organizations in India and worldwide. All our discussions with the Government of India have been and continue to be productive and fully consistent with the four core principles we follow in addressing lawful access matters around the world. Any suggestion to the contrary is false.”

Despite that rather terse rejoinder, RIM says its negotiations with India are moving forward. “Our discussions with the Government in India have been and continue to be productive and we fully expect the matter to be satisfactorily resolved,” said a spokesperson.

In large part, that’s because if Facebook Messages were evaluated as an email system, it would look terrible. There’s no incorporation of IMAP so you can access your mail from other clients, there’s no way to save drafts, there’s no way to cc people, there are no folders.

Even more jarring, there are no subject lines or time stamps, and you only ever have one continuous conversation with a contact. Instead, like instant messaging, when you type a message and press enter, it gets set loose to your contact.

But maybe Facebook has a point, and we don’t need all that cc, bcc gobbledygook for personal communications. Maybe we just want to more casually correspond with each other. And some of these email conventions have probably outlived their usefulness. Facebook says prior to the change its top three subject lines were blank, “Hi!” and “Yo.”–if that tells you anything.

The problem is, the way Facebook Messages works is a bit complicated and unfamiliar. You can see why the company is rolling it out very, very slowly–it’s the kind of new experience that aggravates people and makes them whiny.

Facebook Messages treats the correspondence between you and another person as a single conversation, whether it’s by IM, within the Facebook Messages interface, received as an email or as a Facebook-delivered SMS. Often those channels overlap. Messages that are not from Facebook members, and those from entities other than individuals, get shunted to a second-tier inbox.

Yesterday I was playing with the new Messages, first within the Messages interface on the Facebook Web site, then on IM on the Web site, and then via text message when I closed my computer. A few things confused me–for instance, chat is disabled and disappears when you go into Messages. I guess it’s redundant to have the same conversation in two places. But as someone who felt like I was in an IM chat, it was super weird.

Another thing that’s odd is that those life-time conversation threads only really work for one-to-one relationships. Group messages seem like a little bit of an afterthought; for instance, group threads show a split-screen image of two of the participants’ profile pics, no matter how many people participate. The system is prejudiced against people who email you from outside Facebook (say, your mother emails your @Facebook.com address from an @Yahoo.com address), until you explicitly say you want to see them in your main Facebook inbox. If a person sends you messages from two email addresses, Facebook doesn’t allow you to help it understand that they are the same person.

While I will probably acclimate to the Messages experience over the next few weeks, one thing that’s going to continue to be very annoying, and accentuated by Messages, is redundant Facebook notifications. Already a problem for those of us who use Facebook on multiple platforms like the Web and a phone app, redundant notifications run rampant in Facebook Messages. Say someone sends you a message from the Web site and checks the box to send it to your phone. Without changing any defaults, you could get a text message from Facebook, an email message from Facebook, a new IM on the Web site and a flag that you have a new message in the Facebook nav bar.

I spoke to Messages product manager Dan Hsiao yesterday, and he said the team had thought carefully about trimming down notifications but decided it would be worse if users weren’t alerted to the fact that they had a message.

Hsiao said that his mantra in building the product was to make it “email compatible but not email complete.”

I think there will be two main outcomes from the new Facebook Messages:

• Other Web mail outfits will (and should) better integrate their email and instant messaging conversations, based on Facebook’s example. Folks like Gmail can go one better, and incorporate additional forms of communication like voice messages. Facebook is right–there’s no reason this shouldn’t all be condensed and scannable.
• Provided the Facebook Messages product doesn’t have major usability issues, it will continue to supplant email, especially for young people. There will be a bigger distinction between formal, especially corporate, correspondence via email and personal messages. If you think about it, we all already make a distinction between messages from people and messages from mailing lists, and Facebook is right to say the ones from people are more important.

The thing is, Facebook Messages splits out a part of the communication experience that is, for most, a part of other tools and services.

Facebook Messages won’t replace email for people who use email for professional purposes, people who prefer desktop mail clients or people who firmly associate themselves and their archive of emails with an existing address.

Rather than killing Gmail (and its much larger competitors Hotmail and Yahoo), Facebook Messages will probably have the biggest impact on usage of IM services like AIM and GChat. The only thing the new product will fully replace is the previous version of Facebook Messages–which, by the way, has 350 million active users, and four billion messages sent per day.

Please see the disclosure about Facebook in my ethics statement.

New user signups in China for Microsoft’s MSN Messenger, a competitor to Tencent’s leading QQ instant-messaging service, have gone “from tens of thousands normally to millions” per day since a flare-up between the two Chinese companies began, a person familiar with the situation said.

The conflict, which appears to have ignited two months ago when antivirus software company Qihoo 360 alleged that Tencent’s QQ was scanning the private data of its users and released software claiming to block plug-ins that could cause such privacy leaks. Tencent denied the allegations, then discontinued its services to QQ users who were also using Qihoo 360’s software. Qihoo 360 responded by encouraging users to discontinue use of QQ.

Read the rest of this post on the original site

The Silicon Valley startup is one of many companies exploiting the Internet to improve collaboration. It builds on several existing concepts, such as Web conferencing, Internet telephony and instant messaging. Sococo also leans on the notion of virtual spaces, pioneered by companies such as Linden Lab with Second Life.

David Van Wie, a veteran Valley entrepreneur who is Sococo’s CEO, says part of its inspiration came from a time when he and a group of professionals around the country were trying to put together a deal. “We were all sitting around with high-speed computers and networks,” he recalls, with access to advanced conferencing and collaboration tools.

Read the rest of this post on the original site

The deadline for compliance had been Oct. 31, but India’s Home Ministry has extended it to give RIM (RIMM) a bit more time to provide a solution that would allow it to “lawfully” intercept encrypted corporate information. The new deadline: January 31. Evidently, the two parties have settled on a solution; RIM just needs more time to implement it–at least that’s what these minutes from a recent Home Ministry meeting suggest.

“RIM would be asked to adhere to the timeline of January 2011 to give the final solution wherein lawful access for BlackBerry messenger will not involve the overseas data path. Intelligence Bureau (IB) and National Technical Research Organisation (NTRO), which had attended the discussions, found that the solutions offered by RIM (for BlackBerry messenger) are prime-facie agreeable. The timelines of January 2011 were also agreeable.”

That bit about lawful access not involving an overseas data path seems to suggest that RIM has, at the very least, agreed to host a server in India. What it’s planning to do beyond that remains to be seen. Company execs continue to insist that there’s no technical solution to allow lawful access to its BlackBerry Enterprise Service. This is the second time RIM has won a reprieve from the Indian government. It seems doubtful there will be a third.

In a product demonstration in its booth at this week’s Combined Exhibition of Advanced Technologies, also known as CEATEC, DoCoMo exhibited a device and mobile application called the “Taion Heart”, translated as the body temperature heart. The white plastic heart fits in the palm of your hand and when squeezed, it registers a pulse reading as well as the pressure with which you are squeezing the device.

That information is relayed by a wireless Bluetooth connection to a mobile phone running the application and is passed onto your partner’s phone, which in turn beams the information to their corresponding Taion Heart.

Read the rest of this post on the original site

Announced moments ago, the two-phase deal will see Avaya customers first given access to Skype Connect, the company’s play at the IP-enabled PBX and Unified Communications (UC) market. Later, by the second half of 2011, the two companies will further integrate their communications platforms so that Avaya and Skype users can interact with one one another via presence, instant messaging, voice and video.

The deal will give Skype more access to the enterprise market through the sales and distributions channels of Avaya, and Skype says the integrated product will address corporate concerns about security and communication management. For Avaya, having Skype and its hundreds of millions of users is a nice way to differentiate itself from rival Cisco (CSCO).

Acting as middleman in the deal–private equity group Silver Lake Partners, which bought Avaya in 2007 for $8.2 billion and later bought a majority stake in Skype from eBay (EBAY) for $1.9 billion.

Avaya and Skype Sign Strategic Agreement for Business Communications and Collaboration Solutions

BASKING RIDGE, NJ and LUXEMBOURG–(Marketwire – September 29, 2010) – Avaya, a global leader in enterprise communications systems, software and services, and Skype today announced a strategic agreement to deliver innovative, real-time communications and collaboration solutions to businesses of all sizes. The multi-phase deal includes both go-to-market and an industry-first, joint technology integration that seeks to enable businesses to lower costs and expand how employees, customers, partners and suppliers communicate and collaborate with greater convenience and efficiency.

In the first phase of the agreement, Avaya customers in the U.S. market will have access to Skype Connect(TM), a product which adds Skype calling to IP-based enterprise communications systems, providing a Session Initiation Protocol (SIP) communications channel between Avaya communications systems and Skype. Customers with Avaya Aura(TM) Session Manager or Avaya Aura SIP Enablement Server, CS1000, Avaya IP Office, or BCM systems can use Skype Connect to place calls globally for increased reach, while aiming to save on international calling. Enterprise-level security and features such as tracking, recording, regulatory compliance, and more are provided by the Avaya system.

Skype reported 124 million average monthly connected users during the second quarter of 2010. Now, Skype users can make inbound calls to Avaya customers in the U.S. market for free or at a low cost. Calls will be treated with Avaya’s routing, conferencing, messaging, mobility and contact center capabilities, as well as other collaboration services. For example, businesses can:

Establish Skype Click & Call buttons for inbound calling from Web sites
Establish Skype Online Numbers for inbound calling from landline and mobile phones
Route inbound calls from a Skype user to an enterprise extension

Avaya customers in the U.S. market who are interested in Skype Connect can speak with their Avaya sales representative or an Avaya Connect channel partner contacts beginning in October.

In the second half of 2011, Avaya and Skype plan to deliver integrated unified communications and collaboration solutions for enterprises within the U.S. The integration is intended to establish federation between Avaya Aura and Skype communications platforms and both user communities, so that an Avaya end-user and Skype user can engage and interact via presence, instant messaging, voice and video. A business, for example, could use Skype to access an Avaya-based contact center in a simple and highly integrated way to quickly and efficiently resolve customer service issues. The integrated solutions will also allow enterprise IT managers to manage and control the inter-connectivity between end users to meet their corporate IT policies.

“Avaya and Skype have been working along parallel paths to offer innovative, scalable, low cost, SIP-based communications to our respective markets,” said Alan Baratz, senior vice president, Avaya and president, Avaya Global Communications Solutions. “Now, the two companies will work together, striving to improve collaboration and customer service by federating Avaya and Skype solutions for a common user experience that delivers unique benefits for businesses and their customers who are Skype users.”

“Our relationship with Avaya is expected to expand the footprint for Skype Connect into more enterprises in the U.S. market, while allowing us to help Avaya’s customers benefit from Skype’s cost savings and access to Skype’s global user base,” said David Gurle, vice president and general manager of Skype for Business. “We believe our integrated solution in the second half of 2011 is expected to offer the benefits of Skype to a growing number of businesses and open up new ways for people to communicate and collaborate.”

After Russia-based Internet investor Digital Sky Technologies got $388 million in a stock-swapping deal with South Africa media giant Naspers–coming after an earlier $300 million investment from China’s Internet behemoth Tencent–BoomTown dialed up DST partner Alexander Tamas in London to interview him about the implications.

This developing international spiderweb of digital and media companies begged the question of what DST might do with all this new dough, especially since it has created quite a splash over the last year investing massive gobs of money in high-profile, social-focused U.S. Internet companies.

That has included, most prominently, social networking powerhouse Facebook, as well as Groupon and Zynga.

Actually, said Tamas, the money is for expansion of DST’s core businesses in Russia, Poland and the Baltics–in email, social networking, gaming and entertainment–at units such as Mail.ru, which was co-owned by Naspers and DST.

In essence, said many analysts, it will simplify its ownership structure, and could eventually lead to an IPO for DST.

For a 30 percent stake in DST and the $388 million, Naspers forked over its 39.3 percent stake in Mail.ru into DST.

“The idea was for us to be able to completely control our Russian portfolio,” said Tamas, part of a series of moves which included its recent purchase of AOL (AOL) instant messaging unit ICQ for $187.5 million in cash. “We wanted 100 percent at one company.”

Also a goal: To better link its services with those in China, owned by Tencent, which invested $300 million in DST in April, giving it just over a 10 percent stake.

Naspers, by the way, owns 35 percent of Tencent.

“It’s a pretty good dialog all around,” said Tamas (pictured here), linking companies with both global and local aspirations.

But it’s the global ambitions that have attracted the most attention to DST of late, which, Tamas noted, created some confusion and unfair maligning of the company.

Interestingly, although it is all mashed up on its Web site, DST itself is not technically the entity that maintains its investments in companies such as Facebook.

That would be DST Global, its international arm which directly hold the stakes. It is not part of the Naspers or Tencent deals.

Of course, both are run by the same people, especially DST CEO Yuri Milner, and DST has a stake in DST Global.

“Initially, DST did fund those transactions,” said Tamas. “But we wanted to separate these investments from the Internet company to give investors the clearer differentiation.”

As to its future investments, Tamas said the company will likely fund start-ups that “check the boxes,” including exponential growth and social virality.

That means only two investments annually, as opposed to 10.

He also said DST would continue to fork over large sums–its invested well over $100 million in each of its U.S. deals.

“There is a perception that we pay high prices,” admitted Tamas, who noted its Facebook investment is now valued at much more. “But we have a global outlook on what we are investing in.”

DST is also a believer in getting some of that financing in the hands of founders and early investors, since it relieves financial pressure to sell or go public before a start-up’s time.

“We want to give the companies we invest in a year or two run,” said Tamas. “That is the sweet spot.”

He said, after its U.S. flirtation, that DST is now looking more in Asia and Europe.

But, even with its expansion and getting investments from well-known media giant such as Naspers, Tamas said he is not sure DST can shake the continued questions about the sources of its funding, especially given some of its initial investors are clearly part of the much-maligned Russian business oligarchy.

“We always have to explain and justify all of Russia,” said Tamas defensively. “Obviously, Naspers did its due diligence, as have others, and they feel comfortable with DST.”

Still, Russian issues will remain a concern for the long term. As noted in a recent report by Bank of America (BAC) investment unit Merrill Lynch, for example, on the Naspers-DST deal:

“We are also concerned that DST’s dominance in the Russian internet space (close to 70% market/mind share) may attract the scrutiny of the Russian government. The precedent with the other leading Russian internet company Yandex, when the government got a veto on sale or a golden share, signals that the government may not welcome a full takeover of DST by Naspers or Tencent.”

“We know the issues,” said Tamas. “But the best digital companies going forward are going to have to understand and operate in different parts of the world that are not just in Silicon Valley.”

After what he considered weeks of unfair press coverage and running down of Microsoft (MSFT), the software giant’s Corporate VP of Corporate Communications, Frank Shaw, posted a pugnacious corporate blog entry today that trotted out some impressive numbers about Microsoft’s business.

Of course, he also took the opportunity to put up some not-so-much figures about competitors such as Apple (AAPL), Netflix (NFLX), Salesforce.com (CRM) and, of course, Google (GOOG).

My favorite dig is the stat on the “percent chance that Salesforce.com CEO [Marc Benioff] will mention Microsoft in a speech, panel, interview, or blog post.” The answer, natch: 100!

As it turns out, that was a follow-up to a very sharply worded letter Shaw sent out to communications teams across Microsoft (MSFT) earlier this month, obtained by BoomTown, in which he noted at the start:

“It has been a rough couple of weeks for us from a coverage standpoint. It seems like every time I turn on the computer, or talk to a reporter, or pick up a publication at home, or do a scan of my RSS feeds or Twitter client that I see more stories and opinions about the challenges we have, and how great some of our competitors are doing. iPad this, Droid that, sheesh.”

Sheesh? Who says that anymore?

Still, I like his gumption in using it! Thus, Shaw–who is an active blogger and Twitter poster–is apparently mad as heck and not going to take it anymore!

Here’s the blog post below, followed by the internal email Shaw sent (apparently inspired by the landscape at our eighth D: All Things Digital conference earlier this month):

Microsoft by the numbers

25 Jun 2010 12:30 PM

You probably saw the news this week that we’ve sold 150 million Windows 7 licenses in 8 months. That’s more than 600,000 per day. And, perhaps fittingly for a product called Windows 7, it adds up to 7 copies every second of every day since launch.

As a communications guy, I’m generally most comfortable with words. But since Microsoft is a pretty numbers-driven company, the Windows 7 milestone got me thinking about some *other* numbers, too.

Of course, numbers are only one dimension of a story. And we live in a hyper-competitive industry, with loads of challenges to go along with loads of opportunity. All the same, with Windows 7, Office 2010, Bing, Xbox 360, Kinect, Windows Phone 7, our cloud platform, and many other products, services and happy customers, 2010 is shaping up as a huge year for us.

So, without further ado, a few of my favorite numbers:

1

150,000,000
Number of Windows 7 licenses sold, making Windows 7 by far the fastest growing operating system in history.[source]

2

7.1 million
Projected iPad sales for 2010. [source]

58 million
Projected netbook sales in 2010. [source]

355 million
Projected PC sales in 2010. [source]

3

>10
Percentage of US netbooks running Windows in 2008. [source]

96
Percentage of US netbooks running Windows in 2009. [source]

4

0
Number of paying customers running on Windows Azure in November 2009.

10,000
Number of paying customers running on Windows Azure in June 2010. [source]

700,000
Number of students, teachers and staff using Microsoft’s cloud productivity tools in Kentucky public schools, the largest cloud deployment in the US. [source]

5

16 million
Total subscribers to largest 25 US daily newspapers. [source]

14 Million
Total number of Netflix subscribers. [source]

23 million
Total number of Xbox Live subscribers. [source]

6

9,000,000
Number of customer downloads of the Office 2010 beta prior to launch, the largest Microsoft beta program in history. [source]

7

21.4 million
Number of new Bing search users in one year. [Comscore report--requires subscription]

8

24%
Linux Server market share in 2005. [source]

33%
Predicted Linux Server market share for 2007 (made in 2005). [source]

21.2%
Actual Linux Server market share, Q4 2009. [source]

9

8.8 million
Global iPhone sales in Q1 2010. [source]

21.5 million
Nokia smartphone sales in Q1 2010. [source]

55 million
Total smartphone sales globally in Q1 2010. [source]

439 million
Projected global smartphone sales in 2014. [source]

10

9
Number of years it took Salesforce.com to reach 1 million paid user milestone. [source]

6
Number of years it took Microsoft Dynamics to reach 1 million paid user milestone. [source]

100%
Percent chance that Salesforce.com CEO will mention Microsoft in a speech, panel, interview, or blog post.

11

173 million
Global Gmail users. [source]

284 million
Global Yahoo! Mail users.[source]

360 million
Global Windows Live Mail users.[source]

299 million
Active Windows Live Messenger Accounts worldwide. [Comscore MyMetrix, WW, March 2010--requires subscription]

1
Rank of Windows Live Messenger globally compared to all other instant messaging services. [Comscore MyMetrix, WW, March 2010 - requires subscription]

12

$5.7 Billion
Apple Net income for fiscal year ending Sep 2009. [source]

$6.5 Billion
Google Net income for fiscal year ending Dec 2009. [source]

$14.5 Billion
Microsoft Net Income for fiscal year ending June 2009. [source]

$23.0 billion
Total Microsoft revenue, FY2000. [source]

$58.4 billion
Total Microsoft revenue, FY2009. [source]

fxs

It has been a rough couple of weeks for us from a coverage standpoint. It seems like every time I turn on the computer, or talk to a reporter, or pick up a publication at home, or do a scan of my RSS feeds or Twitter client that I see more stories and opinions about the challenges we have, and how great some of our competitors are doing. iPad this, Droid that, sheesh. Even BusinessWeek got into the act, taking some unfair shots at Natal under the guise of looking at our consumer strategy all up. Man, when someone is beating on Natal prior to E3, you can bet we’ve got momentum against us.

Sitting there at the All Things Digital conference last week and hearing from our competitors really got me thinking, though. What is our differentiation? Why do we make certain decisions? What drives the way we think about business and technology? The morning after the Steve Jobs q&a (which everyone should watch), I dragged myself out of bed to go for a run. As I’d driven into the hotel, I noticed with a sinking feeling that there were lots of hills. I asked the desk clerk if they had a jogging map. They did not. I asked if he could point me a direction that did not have a bunch of hills. He laughed and pointed “up” the driveway and said that if I turned left there would be a nice running path. “I drove in that direction,” I said. “Seems like it’s uphill.” He shrugged, and away I went. Up.

And to keep my mind off the elevation gain, I was thinking about that previous question–what drives Microsoft? Coming up the second hill, I got it. Fundamentally, we believe that we have the opportunity to make life better for billions of people around the world through our products and services. Not millions, not tens of millions, but billions. We started with the idea of a computer on every desktop, and even though the computer looks a lot different today than it did those years, and even though the developed world probably does have a computer on every desk, there are still billions more to go, and we are going to get there. And when you start thinking about serving billions, which we do, we’re playing a game that nobody else in the industry is. I don’t know about you, but I come to work thinking about what I can do to help w/ that big goal. And it’s not all altruism and unicorns, when we do a great job of creating products that make life better for billions, it makes us better as a company, we sell more, we learn more, our partners do better, we do better. And when you have big dreams and big ambitions (like we do) and when you set the bar high (which we do) then sometimes we don’t get over the bar. There are people in the world that see that and call it failure; but failing to hit the mark doesn’t mean quitting. That’s part of our culture, too.

The run back to the hotel was easier. I even scrambled up a bluff next to the path (imagining the theme to “Rocky” in my head) and stood looking out over the Pacific for a bit. And I thought about our challenges, internal and external. External is easy. Internal is harder.

There is a saying I’ve heard a bunch since I’ve been at Microsoft: “Hope is not a strategy.” Heck, I’ve used it myself, and felt pretty superior while saying it, since I was talking about something I didn’t really own. But standing on the bluff, I wondered.

In my last mail, I referenced the need for us all to be comfortable in the gap between what is and what we desire to create. If we simply live in what we have, we become cynics. And if hope is not a strategy, then neither is cynicism, and we have lots of cynics among us. It is a challenge, especially for those of us who help tell our story. I often see it used, and use it myself, to cover up the pain of not meeting a goal, or seeing a product/service be ill-received by the market. If I am able to mock and sneer, then nobody outside the company can make me feel worse at setbacks and even failures.

As the evangelists for the company, we must guard against this. Hope can’t be a strategy, but it (and its cousin belief) is a needed ingredient in any success. Think about this for a bit. Each and every one of us needs to be grounded in our challenges and our wins. Right now, we are massively over-indexed in thinking and knowing about our losses and challenges. But what of our wins?

At the conference later that day, I had a chance to engage in a spirited and mostly friendly discussion with some folks who thought we were doing a crap job all up. Stock price flat, no iPad, etc. Instead of shrugging and agreeing, I talked about our wins and our momentum. We’ve built a huge server business over the last decade, something else nobody has done. Windows 7 sales are up about 39 percent year over year, against a huge base. Office 2010 beta largest ever, Office is in the cloud. Bing is one year old, 4 points of market share–nobody has grown search market share against Google but we are doing it. They are copying our look, our home page. New Hotmail is driving them to offer something other than threaded email for Gmail. Xbox Live has 23 million users–again, only two companies in the last decade have built subscription services like this (Netflix is the other). Windows Azure has 10,000 paying customers, we just announced 700k deployment of live@edu, probably the largest cloud deployment in the world. Natal is coming, it’s cool. Yes, we want to (and will) do better in phones. Yes, we want to (and will) have more cool thin slate/tablet/other form factor devices that run Windows. I’ll tell you, while I don’t think I created any true believers, I did force people to think differently about Microsoft and what we’re doing, and I call that a win.

This is our job. We don’t just represent the products and services we work on, we represent the company all up. Be ready to tell that story. Tell it to your co-workers here at Microsoft, to your family and friends, to members of the media. They know about our challenges, they don’t know about our wins and momentum. So tell them.

fxs

As we have with every change to features and functionality on All Things Digital, today we are writing to give you details about a new Meebo toolbar on this site.

It appears at the very bottom of each page on our site.

The first thing you need to know: You can get rid of it whenever you like.

But we think you will like it, because it enhances our site’s navigation, highlights fresh content and provides instant-messaging functionality, all in one place.

Such as:

– Share Page: Drag the page–or individual page items, such as a headline or image–into social tools or chat tools to share with friends and colleagues

– News: The most recent headlines from BoomTown, MediaMemo and Digital Daily, as well as select headlines from The Wall Street Journal, MarketWatch and Barron’s

– Reviews: The latest product reviews and analysis from Walt Mossberg and Katherine Boehret

– Hot Topics: Links to our aggregated coverage of recent product launches and timely issues

– Twitter: An “uber feed” that combines all our tweets

Per our All Things Digital Privacy Policy, any toolbar usage information will be shared with Meebo solely for the purpose of using this service or for targeting advertising on the toolbar.

Meebo may use cookies to target these toolbar ads; for more information please read Meebo’s Privacy Policy.

If you want to use a chat tool, you’ll be asked to log in with a user name and password. Again, please see Meebo’s Privacy Policy regarding collection and storage of your IM passwords.

And as I said at the start, if you prefer not to use the Meebo service, click the down arrow at the far right of the toolbar to hide the unit. If you change your mind, click that arrow and the toolbar will reappear.

In addition, below is a video interview I did with Meebo founder and CEO Seth Sternberg about the toolbar addition, as well as his company’s new XAuth announcement.

XAuth is an open authentication effort, which includes Meebo and partners Google (GOOG), Yahoo (YHOO), Microsoft (MSFT), MySpace, JanRain, Disqus and Gigya. As described on its Web site:

XAuth is an open platform for extending authenticated user services across the web.

Participating services generate a browser token for each of their users. Publishers can then recognize when site visitors are logged in to those online services and present them with meaningful, relevant options.

Users can choose to authenticate directly from the publisher site and use the service to share, interact with friends, or participate in the site’s community. The XAuth Token can be anything, so services have the flexibility to define whatever level of access they choose.

Here’s the video with Sternberg:

Comments? Ideas? Write us at feedback@allthingsd.com.

]]> http://allthingsd.com/20100504/meebo-toolbar/feed/ 5 http://allthingsd.com/20100412/chinas-tencent-to-buy-stake-in-russias-dst/ http://allthingsd.com/20100412/chinas-tencent-to-buy-stake-in-russias-dst/#comments Mon, 12 Apr 2010 19:10:22 +0000 Loretta Chao http://voices.allthingsd.com/?p=23805 China’s largest Internet company, Tencent Holdings Ltd., is purchasing a 10 percent stake in Digital Sky Technologies Ltd., a Russian investment firm that holds a stake in Facebook Inc.

Shenzhen-based Tencent, which popularized instant messaging in China and operates an online game portal and other Chinese Internet services, said it will invest approximately $300 million in Moscow-based Digital Sky, also known as DST. The companies plan to explore “new business opportunities” in the Russian-speaking Internet markets, said Tencent President Martin Lau in a joint statement Monday.

“Our teams share many common views and beliefs and a clear vision about the significant opportunities that lay ahead,” said Digital Sky’s chief executive, Yuri Milner, in the statement. Digital Sky is known for its stakes in Russian Internet companies including Mail.ru, one of the country’s largest Web sites.

Read the rest of this post on the original site

]]> http://allthingsd.com/20100412/chinas-tencent-to-buy-stake-in-russias-dst/feed/ 0 http://allthingsd.com/20100407/why-are-aol-shares-up-today-maybe-for-admitting-bebo-is-a-total-bust/ http://allthingsd.com/20100407/why-are-aol-shares-up-today-maybe-for-admitting-bebo-is-a-total-bust/#comments Wed, 07 Apr 2010 21:15:01 +0000 Kara Swisher http://kara.allthingsd.com/?p=26301

AOL shares pushed higher today than they have been since its November spinoff, rising almost four percent to close at $27.44.

And the reason for the rise? One savvy investor suggested it was due to yesterday’s announcement that the company might shut down Bebo, the social networking site it egregiously overpaid for in 2008–$850 million in cash–only to see the asset dwindle badly.

Rather than finding a buyer, said the investor, a shutdown might allow AOL (AOL) to write down some of that acquisition, yielding it hundreds of millions of dollars in tax savings.

AOL bought Bebo in 2008, when it was still a Time Warner (TWX) division.

In addition, AOL is in the midst of selling off its ICQ instant-messaging business–likely to foreign buyers, in one of the slowest transactions ever. Once that deal is done, it could nab the company upward of $100 million to $150 million in cash.

With its current cash flow, that could give CEO Tim Armstrong a nice pile of dough, which could be further supplemented as he gears up for negotiations over a new deal for AOL’s search business with both Google (GOOG)–its current partner–and Microsoft (MSFT).

While the big-money guarantees are likely a thing of the past, AOL’s business–unlike, say, MySpace’s–is considered valuable by both companies. The current Google deal is up in December.

In any case, while the failure of translating its Bebo acquisition into any kind of success is pretty clear, perhaps the complete disaster does have some silver lining.

]]> http://allthingsd.com/20100407/why-are-aol-shares-up-today-maybe-for-admitting-bebo-is-a-total-bust/feed/ 1