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Google's Eric Schmidt Shows Off Movie Studio, a Tablet Video-Editing App

Ina Fried — Tue, 15 Feb 2011 16:58:56 +0000

Google’s Eric Schmidt said that while computers are being criticized for driving humans apart, the opposite is actually taking place as devices are doing work that humans don’t want to.

“Computers are really here to make us happier,” Schmidt said, promising these devices will give people more time with friends and family, not less.

Schmidt, who gave up the CEO role last month, said that nearly all devices will get more interesting when they connect to the Internet. A music player that doesn’t connect to the network isn’t very interesting, he said, perhaps opening the door to the announcement of a long-talked-about, cloud-based Google music service.

The talk is just geting started. Mobilized got a really good seat in the front row, just two seats over from Andy Rubin, and has live updates below.

5:59 pm: Schmidt talking about things phones should be able to do, such as figure out better traffic routes and bridge language barriers. “You really can do magic,” he says, pointing to Google Translate, which lets you speak one language and have a language you don’t speak returned. “That’s done in a twentieth of a second or what have you,” he says.

6:01 pm: Brings out colleague to show an application on “an interesting new device.”

6:03 pm: The device is the Motorola Xoom tablet and the program is “Movie Studio,” an app built from the ground up for creating and editing movies on tablets.

He has a few images and videos from around Barcelona.

He creates a movie onstage and shows how it can easily be shared on YouTube. (This looks like iMovie and Windows Live Movie Maker so far–both of which also let you edit movies and share directly to YouTube.)

6:07 pm: Upload goes slowly, though, as Schmidt notes it is the problem of doing a demo at a mobile network convention where everyone is hammering the networks.

6:09 pm: The goal of many of Google’s products, Schmidt says, is to do tasks quickly so that people can get back to being human. “We ultimately believe that speed matters,” Schmidt says. Google Instant, he says, can save two to five seconds per search.

Search is also becoming more personal. With permission, users can get more information. Next up, he says, is autonomous search as information comes up as one walks or drives, and is driven by location.

“That’s just the beginning of a large number of new apps that use that infrastructure to make a big difference,” Schmidt says.

Schmidt says how much info to share will be up to the user, but those that opt in can get much richer results.

There’s also a trend, he says, to returning more structured data, such as travel.

6:12 pm: Stat time: 120 million people using Chrome, up three times from a year ago.

YouTube revenue doubled in 2010. Now just being able to monetize professional content at a rate that starts to make sense for content partners.

6:18 pm: Computer science can help all kinds of things, Schmidt says. With phones and tablets, “You never forget everything” which is precisely what phones are good at.

If you choose, you can remember the hotels you stayed in and the people you met, etc., “Humans forget,” he says.

Computers are also preventing people from ever getting lost. When I was a boy growing up in Europe “I was always lost,” Schmidt says.

Translation may not prevent war, but should at a minimum increase dialogue, Schmidt says.

6:18 pm: “Even better you are never lonely,” he sats, because computers can point you to nearby friends or connect you to distant ones.

You are never bored, Schmidt says. You are never out of ideas because we can always suggest what you can do next.

Other changes, include the self-driving cars that Google has been working on.

“It’s obvious that cars should drive (themselves),” he says, adding that there will be a “kill switch” in case there are bugs. And it will take time, he says.

“This is coming. It will be decades, I suspect–not a year.”

He also says these innovations will scale to the masses.

“It’s a future for the masses, not the elites,” he says.

6:21 pm: With that, on to Q&A.

6:23 pm: Talking about targeted broadcast quality ads as next frontier.

“Who wants to see an ad that is not relavent to them,” Schmidt says. And that leads to revenue, which Schmidt points out is the whole point of advertising in the first place.

6:24 pm: Question on Android fragmentation saying there is frustration among phone makers and developers.

“We hear some of this,” Schmidt says. “You’ve stated the problem more strongly than I would have, but I will take that as feedback.”

6:26 pm: Question about role of Google in financial services.

Schmidt quips that Larry Page and Sergey Brin periodically suggest that Google issue Google Bucks as its own currency, but Schmidt says he always points out the regulatory issues.

On a serious front, he talks about the power of near-field communications as a means to turn real-world transactions into electronic ones.

“In that are very large businesses,” he says.

(Google built NFC into its Nexus S device.)

6:29 pm: Are you interested in Twitter?

“We love Twitter and I like to tweet,” Schmidt says, eliciting laughter from the crowd.

6:31 pm: Why so many operating systems?

Sometimes these things occur because the teams move so quickly, Schmidt says.

People have been asking when Gingerbread and Honeycomb will come together. Schmidt: You can imagine the follow-on release will start with an “I” and be named after a desert and will combine the best of both, Schmidt says.

These releases occur on roughly a six-month cycle, Schmidt says.

6:33 pm: On Chrome OS, Schmidt says there will be an opportunity to merge that with Android over time, but better to wait for the operating systems to mature and a natural time than to push them together too soon.

6:34 pm: On HTML5, Schmidt imagines that some number of years from now, most apps–mobile and desktop–will be running on HTML5.

6:39 pm: Question on Google’s role in health care.

Phone should be able to, at a minimum, carry medical info. Several percent of queries on Google are health-related.

6:42 pm: Is Facebook with its “Like” button a main competitor?

Today our main competitor is Microsoft. Microsoft has a good product in Bing, he says.

“There’s a couple cases where it might be too good. We discussed that in a blog post.”

They have the cash, the scale and the reach to do good and amazing things.

6:44 pm: On Nokia-Microsoft partnership:

“We would have loved it had they chosen Android,” Schmidt says. “That offer remains open.”

Android would have been a good choice for Nokia, he says.

‘We certainly tried” to get them, he says.

6:46 pm: How do you approach the fact that Android going higher and lower in the market?

Schmidt says that the company tries to show the best in its Nexus line, while putting minimum specifications out there to set the bar for what developers can expect.

6:47 pm: Question on why Google is not more broadly used in the education market?

Schmidt says the company has funded a number of YouTube professors. “We’ve not yet come up with the killer [education] app,” he says.

6:49 pm: Asked about Google’s interest in the PC operating system market, Schmidt says that Google’s answer is Chrome OS. Sometime in the spring you will see a series of PC makers come out with Chrome OS devices. However, he adds they won’t run current PC apps, such as Windows apps.

“It does not run any of your current PC applications so you might think about it,” Schmidt said. That said, he adds there are, in most cases, cloud-based options that are roughly equivalent.

6:52 pm: With that, Schmidt wraps up.

Bill Gross's UberMedia Raises $17.5 Million From Accel, Index and Steve Case

Kara Swisher — Mon, 14 Feb 2011 17:04:37 +0000

UberMedia, which just bought TweetDeck for $30 million in equity last week, has raised $17.5 million, in a round led by Accel Partners.

The valuation for the Pasadena, Calif., start-up founded by well-known entrepreneur Bill Gross (pictured here)–which was actually struck some month ago–is $40 million.

Accel’s Jim Breyer will join the board of UberMedia, maker of social media reading and posting tools, which is currently largely aimed at the Twitter ecosystem.

“We are hoping to work very closely with Twitter, which is certainly our goal, as well as other social media platforms like Facebook,” said Breyer in an interview with BoomTown this morning, answering a question about previous tensions between Twitter and UberMedia. “There will be a lot of efforts to monetize Twitter and there is no silver bullet.”

Index Ventures and Steve Case’s Revolution Ventures also participated in the round.

The company did not reveal the amount raised, nor the valuation for UberMedia.

But many like him are trying to find a way to monetize the huge microblogging platform–including Twitter–and take advantage of its enormous scale.

Gross founded the start-up last spring.

Armed with $3.5 million in venture funding from a group of leading investors, including Index, Revolution, betaworks, First Round Capital and angel investors such as Mahalo’s Jason Calacanis and BuzzMachine’s Jeff Jarvis.

Started in Gross’s Idealab start-up incubator and called TweetUp (and then PostUp), it was initially cast as a keyword-based bidding marketplace akin to Overture/Goto.com, the first paid search system he created a decade ago.

TweetUp also offered an organic search service to surface the best tweets. This put it at odds on several fronts with Twitter, which began to aggressively move to take over key parts of its business that had largely been left to third-party developers.

That still remains UberMedia’s essential goal, and Breyer hopes that the new investment will show Twitter that UberMedia hopes to work in harmony with it, as other developers have done successfully with Facebook. (Accel and Breyer himself are big investors in the social networking giant, so he should know.)

“Like Twitter, we want to drive the customer experience,” he said, pointing out successes such as the Zynga gaming service. “This is a lot like Facebook several years ago and cooperation worked out well for everyone.”

Here’s the official press release:

Accel Partners Leads Investment Round in UberMedia, Jim Breyer Joins Board of Directors

PASADENA, Calif.–February 14, 2011–UberMedia, the leading independent provider of applications for reading and posting to Twitter and other social media platforms, today announced that it completed a financing round led by Jim Breyer of Accel Ventures. Existing investors Steve Case of Revolution Ventures and Danny Rimer of Index Ventures also participated.

“At UberMedia, our goal is to enhance the Twitter experience with functionality in our clients and to be the best partner with Twitter in growing and enhancing their ecosystem,” said Bill Gross, Founder and CEO. “In particular, the addition of Jim Breyer to our board will really enable us to succeed at this mission. His experience on the boards of Wal-Mart, Facebook, Marvel Entertainment, Dell and so many other high-profile consumer brands will be particularly helpful.”

“We’ve been watching closely Bill’s efforts at UberMedia to build upon the ground-breaking communications platform created by Twitter,” said Jim Breyer of Accel Partners. “We see a tremendous business in the kinds of innovations in user experience being developed at UberMedia. The result of these efforts will be an expansion in the number and variety of people engaged with Twitter as well as a method for advertisers to reach consumers in highly targeted and relevant ways.”

And here are two video interview I did with Gross last April when the company was founded:

[ See post to watch video ]

Exclusive: Facebook Exploring Permitting a Tender Offer for $1 Billion of Employee Shares at $60 Billion Valuation

Kara Swisher — Thu, 10 Feb 2011 18:34:03 +0000

Facebook is exploring permitting a tender offer up to $1 billion of its employee shares, after being approached by a number of big institutional investors about investing in the company, according to sources close to the situation.

The new approximate valuation? An eye-popping $60 billion, sources said, which is a significant increase to a recent $1.5 billion investment round by Goldman Sachs and its international clients that had pegged the social networking behemoth at a $50 billion valuation.

And the reason? Liquidity, allowing Facebook employees to monetize their privately held shares, since the company is not likely to have an IPO for at least a year.

That’s been a big issue for Facebook as it seeks to walk the ever dicier line between being a private company and becoming a public company.

And managing how its shares are dispersed is critical, especially with regulatory concerns about these private secondary markets increasing.

All the machinating is because Facebook has tried hard–via ever bigger funding rounds and ever larger valuations–to delay its IPO, in order to grow its massive 600-million user base away from scrutiny.

The move is not dissimilar to one that the Palo Alto, Calif.-based company did in mid-2009, when one of its major investors, DST, forked over $100 million for employee shares in a transaction that was in addition to a $200 million investment.

At that time, current and former employees of Facebook were able to sell up to 20 percent of their common shares at $14.77 per share at a $6.5 billion valuation.

If completed, the new tender offer would be at a share price almost 10 times that. But sources said interest is high among big institutional investors who want a piece of Facebook before its inevitable initial public offering.

It’s likely the deal will be split between two or more investors, sources added.

A Facebook spokesman declined to comment.

The latest wrinkle is part of a massive race to invest in the winners of Web 2.0, often via secondary market sales.

Silicon Valley venture firm Andreessen Horowitz, for example, confirmed it had bought $80 million in shares of Twitter, in a story first reported here.

Q&A: Bill Gross's UberMedia Goes for a Third Name and Strategy

Liz Gannes — Mon, 24 Jan 2011 09:00:10 +0000

Last week the year-old start-up PostUp, formerly known as TweetUp, renamed itself UberMedia. So much for worrying about brand recognition!

The Pasadena, Calif.-based company also acquired the independently developed BlackBerry application UberTwitter, adding to its acquisition of Echofon (the Twitter client for iPhone and other Mac devices) at the beginning of the month and Twidroyd (Twitter for Android) in September. Update: On Monday UberMedia said it had acquired an additional company, Mixx, the former competitor to Digg that now curates social media channels for brands.

UberMedia, despite its seemingly perpetual identity crisis, has particular notoriety because its founder and CEO, Bill Gross, first popularized paid search advertising with his company GoTo.com in the late ’90s. When Gross first launched the company last April, he said he’d do the same thing for Twitter.

Since then, Twitter has launched its own ad system and tightened up on permissions for rival ad networks.

UberMedia has let its Twitter account recommendation widgets languish, but says they will be relaunched soon as a new product called FollowMe. Meanwhile, the Twitter clients the company has acquired have a combined three million active users. They are some of the leading independent options, despite somewhat precarious positioning now that Twitter has launched its own official clients for most every platform.

Gross is traveling in Europe this week, but UberMedia COO Jon Kraft got on the phone with NetworkEffect over the weekend to say that there is indeed a method behind all this name-changing and client-acquiring madness. Here’s an edited transcript:

NetworkEffect: Why the name UberMedia?

Kraft: Obviously we’re very excited about the acquisition of UberTwitter, and we felt like our mission had expanded a bit since we first launched. It was really all about this paid search platform, and PostUp was a great name….

And before that you had another name, TweetUp.

Yes, but as we started to grow our business on the client side, we saw ourselves increasingly as a media company. We’re not crazy about the fact that we’ve changed our name twice now, but hopefully we’ll build a company around that brand.

How did this acquisition strategy come about?

We first bought Twidroyd seven months ago, and we really loved what we learned about the way consumers use Twitter.

What is the involvement of the founders of the companies you bought? Are they all running their respective apps?

Obviously a big part of what makes those companies exciting is the passion of the founders, so we encourage them to operate fairly independently.

Who is the staff of UberMedia?

We have some business development to create partnerships, but the vast majority is engineers. We have a little over 40 employees as a distributed team.

And what’s happened to the sponsored Twitter accounts and tweets?

We’re still very excited about what we’re doing with the marketplace, but there are a number of other innovations that we’re planning. The bigger vision is to innovate inside the Twitter ecosystem.

What does that mean in the context of Twitter competing within its ecosystem, especially through Twitter clients? That doesn’t seem like a category other start-ups and investors are investing in as much today.

It’s not easy to organically grow a new Twitter client from scratch, it’s a real challenge. But I think the Twitter platform is still greatly under-leveraged, and there’s surprisingly low penetration of Twitter users today.

But it’s not as if Twitter allows application makers to just make whatever money they want on its platform.

Twitter has been understandably conservative about wanting to protect the user experience across their platform, so we’re being conservative as well and thinking of other ways to innovate and monetize.

What is your company’s relationship with Twitter?

It’s a great relationship. I can’t talk details about what we’re discussing, but the relationship is quite good.

Are you raising more funding? [UberMedia, which launched out of Gross's Idealab, had previously raised $3.5 million from Index Ventures, Betaworks, Revolution, First Round Capital and others.]

We’re not talking about our funding right now, but obviously you have to raise money in order to grow aggressively.

Will you keep acquiring? It seems like you have Twitter clients for most of the major platforms now.

It is possible, but not top of our priority list.

One things you have not had is a problem with agility.

That’s a concise way to put it.

What about Bill Grosss involvement? Is he still CEO or is he doing other Idealab stuff?

Absolutely. He’s head-down 100 percent on this project.

YouTube Revenue Doubled Last Year. Which Means…What?

Peter Kafka — Fri, 21 Jan 2011 12:00:02 +0000

True to form, Google didn’t offer much real insight into its operations during yesterday’s earnings call.

But pressed to talk about some of the company’s non-search businesses, Chief Financial Officer Patrick Pichette did allow that YouTube’s revenues “more than doubled” last year.

That’s good to know! But also not a shock. Last quarter, when the company offered up a smattering of numbers to appease inquiring minds, it told us it had doubled the number of video views it was monetizing, to two billion a week.

So the real surprise would have been if YouTube revenues hadn’t doubled in the last year.

Meanwhile, trying to figure out the true size, and value, of YouTube remains a guessing game for the best-intentioned observers.

Citigroup’s Mark Mahaney, for instance, thinks YouTube’s gross revenue is on a $1 billion run rate, but figures that number could grow by as much as 50 percent this year. Barclays’ Doug Anmuth, though, offers up a slightly more modest estimate of $1 billion + for 2011.

Profits? Who knows.

One pretty safe guess: Google won’t be giving us real YouTube numbers we can chew on for quite some time.

GameStop Expands Digital Strategy by Opening Doors to an Android Storefront

Tricia Duryee — Tue, 18 Jan 2011 13:30:18 +0000

GameStop is expanding from primarily selling games in retail stores found in malls around America to a digital strategy that includes a new mobile component starting today.

The announcement expected today is timed with the release of its new Android application, which will let users of Google’s operating system download hundreds of games for free to either their phone or tablet.

In an interview, GameStop President Tony Bartel said: “The console continues to be a growth business, but it’s also exploding outside of console. It’s moving to anywhere people have a device that’s capable of reaching the Internet–if that’s a smartphone, or one of the 50 tablets that we saw at CES. Our gaming strategy is anytime, anywhere on any device.”

That’s a relatively new concept for GameStop, which jumped into the digital realm only following its acquisition of Kongregate six months ago.

Kongregate operates an online gaming community that gives tools to game developers so they can add achievements, virtual goods and community aspects to their games.

The Android application will be called Kongregate Arcade, which will leverage those same experiences found online. The app will be available to users from the Android Market for free. Inside the game, users will be have access to 300 free games to start.

Traditionally, Kongregate makes money from in-game advertising and virtual goods sold. Its mobile app will be monetized through ads only.

Kongregate CEO Jim Greer said he thinks users will find it easier to discover new games on the Arcade app than on Android’s default market. “We see the discovery of games in Android marketplace as an issue. It’s hard to find titles and it’s not well curated,” he said. “We’ve learned a lot about making customized game recommendations to players based on what they’ve played and what their friends have played, and their ratings and game play styles.”

In addition, he said the Android version will be linked to its PC version, allowing users to tap into the community they’ve already built, and earn achievements on both the phone and online.

GameStop plans to promote the application in its physical stores and leverage Kongregate’s 13 million monthly unique visitors on the PC to make it a hit. Already, Greer says, Android users are the most likely to visit the company’s mobile Web site.

Interestingly, Kongregate has created the experience in Adobe’s Flash Player, meaning that even if Apple allowed it, it would not work on the iPhone because Apple doesn’t support Flash. Likewise, it will only work on Android phones that support Flash–that is, phones with version 2.2 or higher.

GameStop will be competing against other companies, such as Aurora Feint’s OpenFeint game network, which claims to have 3,400 games and 55 million users across Apple and Android. In a way, GameStop will also go head-to-head with one of its more traditional competitors, Amazon.com, which is preparing to release an Android app store that also aims to solve the discovery problem.

Exclusive: MySpace and Google Zero in on Renewing "Realistic" Search Deal

Kara Swisher — Thu, 16 Sep 2010 08:45:31 +0000

After what started out as one of Web 2.0′s most frothy deals and soon became a contentious relationship, several sources said that Google and MySpace are moving close to signing a new agreement, in which the search giant would remain the provider of search and online advertising technology for the social networking site.

But, said sources, this deal is a lot different from the one signed four years back when the News Corp. (NWS) unit was flying high and Google (GOOG) forked over $900 million in guaranteed payments to stave off a competitive effort from Microsoft (MSFT).

This time, because MySpace’s traffic has declined so precipitously over these years, the new deal has no giant guaranteed payments and not even any of the bells and whistles the recent renewed and expanded search deal AOL (AOL) struck with Google has.

“It is a different time and MySpace is in a much different place,” said one source close to the situation. “This is a realistic deal.”

Sources stressed the deal with Google was not complete, although it could be struck within weeks.

Sources said Microsoft (MSFT), which had been in talks with MySpace too, has largely dropped out, although it certainly could put forward another offer at any time.

But, said sources, the search volume from MySpace is not as valuable to Microsoft’s Bing search service and it would have to pay MySpace more since it does not monetize as well as Google.

Another bidder, Yahoo (YHOO), sources said, was not considered a factor in the competition, although it could also still make a better bid.

Google and MySpace continued their talks about renewing the deal after their original contract ended at the end of July, agreeing to two one-month extensions.

The hope is, if struck, a new Google deal will perform better, given MySpace will launch a soup-to-nuts renovation of its site, codenamed Futura, in mid-October.

Before that, the Beverly Hills, Calif., company, which has undergone much management turmoil over the last year, has been dribbling out some of these new features.

That has included new profiles and also the ability to synch status updates on its site with Facebook.

Yes, the very social networking giant whose total decimation of MySpace in the consumer space has been at the heart of its problems in making its original Google deal as lucrative as was once hoped.

MySpace declined to comment on the status of its negotiations, and Google has not yet returned a query about the deal discussions.

Please see this disclosure related to me and Google.

Exclusive Video: Bill Gross Talks About TweetUp and Gives a Tour of Idealab

Kara Swisher — Mon, 12 Apr 2010 04:01:33 +0000

Bill Gross is widely considered the man responsible for the invention of paid search advertising, which heralded such Web powerhouses as Google (GOOG).

Now, in a can-lightning-strike-twice effort and armed with $3.5 million in venture funding from a group of leading investors, the well-known entrepreneur has decided to monetize Twitter on his own.

Thus, Gross has just launched a public beta of TweetUp, a keyword-based bidding marketplace akin to the innovative Overture/Goto.com he created a decade ago.

Gross will be the CEO of TweetUp, which will also offer an organic search service to surface the best tweets from the microblogging site.

Coincidentally, Twitter is now aggressively moving to take over key parts of its ecosystem, which has largely been left to third-party developers. It is also expected to announce some kind of advertising system of its own this week.

Tweet fight, anyone?

Here are two video interviews I did with Gross last week at his Idealab offices in Pasadena, Calif. The first is an interview about TweetUp and the second, below it, a tour of the well-known incubator where he came up with his latest scheme:

[ See post to watch video ]

Paid Search Inventor Bill Gross Moves to Monetize Tweets With TweetUp–And Without Twitter (Plus Screenshots)

Kara Swisher — Mon, 12 Apr 2010 04:00:45 +0000

Just as Twitter finally prepares to announce its plans to make money–after what has seemed an eternity–the man responsible for the invention of paid search is beating the microblogging site to the potentially profitable punch, and without its involvement.

Armed with $3.5 million in venture funding from a group of leading investors, well-known entrepreneur Bill Gross is launching a public beta of TweetUp, a keyword-based bidding marketplace akin to Overture/Goto.com, the first paid search system he created a decade ago.

Gross will be the CEO of TweetUp, which will also offer an organic search service to surface the best tweets, a move that seems to put it in competition with Twitter’s own search service.

This comes just as Twitter is aggressively moving to take over key parts of its ecosystem, which has largely been left to third-party developers.

TweetUp could now give these developers a chance to make money on Twitter without relying on Twitter.

TweetUp is backed by Index Ventures, betaworks, Revolution LLC, First Round Capital and other investors, including Mahalo’s Jason Calacanis and BuzzMachine’s Jeff Jarvis.

And TweetUp has struck a number of distribution deals with well-known Twitter search clients and Web sites–such as Seesmic, Answers.com and others–and will pay them half its revenue.

Gross has been working on the service since February at his Idealab start-up incubator in Pasadena, Calif.

He said he got the idea after he was struck by how hard it was to sort through good tweets from the TED conference, as well as how quickly a substantive tweet he posted, which was related to the global climate change event, disappeared as more recent ones replaced it in real time.

Said TweetUp in a press release about its system:

“In addition to an algorithm that combines a variety of factors to determine relevance, tweeters can bid on keywords in a competitive marketplace very similar to what now occurs at Internet search engines. This sophisticated combination of factors pushes the best tweets to the top of the results of users’ searches, allowing them to find the most compelling tweeters, and it enables serious tweeters to expand their following quickly and cost-effectively. TweetUp search will work alongside Twitter’s traditional search to provide a richer array of results.”

Twitter is also making several moves to monetize itself of late, with most observers expecting an advertising system to be announced soon.

The company has also been adding tools, which puts it in direct conflict with outside developers. On Friday, for example, Twitter announced it was purchasing Tweetie, maker of a popular Apple (AAPL) iPhone client for the messaging service.

The start-up has traditionally relied on third-party developers to build apps for the service, much as Facebook did at its start.

But Twitter management and key investors have recently been signaling that the company would be taking over key aspects of its business. This has caused tensions, obviously, in the wider Twitter ecosystem.

Thus, it will be interesting to watch how Twitter reacts to what Gross is doing with TweetUp.

(BoomTown also did an exclusive video with Gross about it all, which is posted here, as well as a tour of Idealab.)

Here are a few screenshots of TweetUp (click on images to make larger):

TweetUp Client

Answers.com

Business Insider

Business Insider Search #1

Business Insider Search #2

And here’s the official press release from TweetUp:

TweetUp Establishes Twitter Marketplace Where the Best Tweeters Rise to the Top

Unique Combination of a Relevance Algorithm and Bidding System Increases Number of Followers and Improves the Quality of Twitter Searches

PASADENA, CA–APRIL 12, 2010–TweetUp, Inc., announced today a new Twitter marketplace designed to showcase the world’s best tweeters and enable them to grow a highly targeted following. TweetUp is a new patent-pending platform that combines the popularity, relevance and influence of tweets and tweeters with a bid-based marketplace. Major partners, including leading Twitter search clients and top web sites, will display the results, enabling users to easily find the best tweets and tweeters in the world.

TweetUp was founded by Bill Gross at Idealab, where he also devised the first model for paid internet search, Overture/Goto.com, over a decade ago. TweetUp is backed by Index Ventures (investor in Skype, last.fm, Myheritage and Playfish), betaworks (investor in Twitter, TweetDeck, Bit.ly), Revolution LLC (founded by Steve Case, investor in Zipcar, LivingSocial, Everyday Health), First Round Capital (investor in Mint.com, StumbleUpon, CoTweet), Jason Calacanis (founder of Mahalo) and Jeff Jarvis (founder of BuzzMachine).

“Twitter has such tremendous potential as a real-time information network far beyond what has been realized to date,” said Bill Gross, Founder and CEO of TweetUp. “For most people, though, 80% or more of the tweets that fly by them when they’re searching for something are useless noise. For serious tweeters, the task of attracting interested and relevant followers is equally daunting. TweetUp will change all of that.”

TweetUp has addressed the needs of both users and tweeters in a single search mechanism. In addition to an algorithm that combines a variety of factors to determine relevance, tweeters can bid on keywords in a competitive marketplace very similar to what now occurs at Internet search engines. This sophisticated combination of factors pushes the best tweets to the top of the results of users’ searches, allowing them to find the most compelling tweeters, and it enables serious tweeters to expand their following quickly and cost-effectively. TweetUp search will work alongside Twitter’s traditional search to provide a richer array of results.

Danny Rimer, a partner with Index Ventures, TweetUp’s lead investor, said, “TweetUp is an opportunity to bring real-time information to the entire Web, and to do it in a way that creates value for everyone concerned. We feel that TweetUp can dramatically improve both the utility and ubiquity of Twitter, and in doing so build a monetization mechanism for real-time search that rivals that of traditional Internet search.”

TweetUp’s search results will be available to hundreds of millions of individuals through revenue-sharing distribution agreements with leading Twitter clients, including one of the leading multi-platform clients, Seesmic, one of the leading Android clients, Twidroid, the leading source of tweets, TwitterFeed, and the leading social media authority and influence ranking system, Klout, as well as popular web sites including BusinessInsider.com, Answers.com, and PopURLs.

Together, these clients and web sites will bring TweetUp search results to more than 40 million unique users per month and serve more than half a billion impressions per month.

“Increasingly, people looking for answers want more than just black and white facts, but also real-time insights relating to the issues surrounding their questions,” said
Bob Rosenschein, Answers.com CEO. “We are at the forefront of meeting that demand, and partnering with TweetUp is an exciting new way to add value to the
Answers.com user community.”

“I have been sharing in social networks and blogs for ten years and realized the power of having a true community,” said Loic Le Meur, CEO of Seesmic. “This is why
I was immediately attracted to working with Tweetup. People who are serious about sharing and having a community around themselves are also often those who have the most interesting ideas to contribute.”

“We believe that the impact of the real-time web, and of Twitter in particular, has only just begun,” explains John Borthwick of betaworks, a major investor in TweetUp, as well as in TweetDeck and Bit.ly. “Because TweetUp will be accessed on mainstream websites across the world, Twitter will be introduced to hundreds of millions of new people. Furthermore, these new users will experience thoughtful tweets, in context, targeted to them according to their areas of interest, and delivered from serious tweeters who care about building a passionate audience.”

“When we created AOL 25 years ago, we believed in the power of community and built a significant company around it,” said Steve Case, AOL co-founder and founder
of Revolution LLC. “Twitter is proving the power of community continues to thrive, and I am excited to be backing Bill Gross and TweetUp as they innovate in the social
media space by making Twitter more useful to a mainstream audience.”

With today’s announcement, TweetUp launches a public beta period in which tweeters can open an account and begin adding search keywords to their profile. For the first 1000 who sign up, the company is providing a $100 in credits to allow tweeters to see how TweetUp’s network can improve their standing in search resultsand attract more followers.

YouTube's Ad Push Creeps Forward

Peter Kafka — Wed, 17 Feb 2010 17:00:49 +0000

How are Google’s efforts to turn YouTube from a money pit into a profit center coming along?

Google (GOOG) continues to insist that it will start making money from its Web video site soon. But for now, YouTube’s finances are a black box. From the outside, though, we can see indications that the site is at least becoming more serious about getting more ad dollars out of more videos.

Take this new study from TubeMogul, the Web video-tracking service. It says that 44.7 percent of YouTube’s most viewed videos are professionally produced and/or products of YouTube’s “partner” program, meaning that YouTube has the ability to shove ads on them. That’s up from 36.3 percent six months ago.

Here’s the full breakdown:

And for comparison, here’s what that looked like six months ago:

These charts don’t break it out, but TubeMogul reports that 41.93 percent of the 100 most popular videos on YouTube on a given day actually carry some kind of advertising, up from 36.72 percent.

If you want to be glass-half-empty about it, you could argue that six out of 10 of YouTube’s most popular clips still don’t carry ads, which is a problem. But that would be grouchy of you! Progress is still progress.

No comment from YouTube. But I imagine that if executives there did have something to say, they’d argue that 1) outsiders like TubeMogul really don’t have a good grip on their metrics, and that 2) focusing on the top videos at the site is misleading, since the site has been working hard to monetize the mid- and long “tail” of its clips.

Of course, the best way to respond to this sort of educated guessing would be to open YouTube’s books. But I’m not holding my breath on that one.

Meanwhile, here’s an ad-free clip YouTube recommended that I watch:

How to Monetize Your Blog

Nitrozac and Snaggy — Tue, 20 Oct 2009 17:43:41 +0000

What Happens in Vegas Doesn't Stay in Vegas: Kara Visits BlogWorld Expo

Kara Swisher — Fri, 16 Oct 2009 13:00:18 +0000

Yesterday, BoomTown traveled to the South Hall of the Las Vegas Convention Center–and it was not even time for the annual Consumer Electronics Show!

Instead, I was attending BlogWorld Expo, an annual event for bloggers of all kinds–from military bloggers to political bloggers to a roving pack of mommy bloggers–who gather to find out about all kinds of social media software and tools and, most importantly, how to monetize their sites.

I was at BlogWorld, which runs through tomorrow, to interview Ford Motor Company (F) digital guru Scott Monty, who compared social media to cocaine onstage.

There were a lot of other cool sessions and it was a surprisingly large and energetic and decidedly bloggy crowd, who were intent on schmoozing and trading tips in an analog venue.

Here is a quick video interview I did with BlogWorld honchos Dave Cynkin and Rick Calvert about where blogging is going:

[ See post to watch video ]

MySpace, Facebook Move Lots of Display Ads, Not So Much Money

Peter Kafka — Tue, 01 Sep 2009 20:19:36 +0000

Just how big are MySpace and Facebook? Big enough to account for nearly one in five of the display ads Web marketers buy in the U.S.

That factoid comes via Web-tracking service comScore (SCOR), which says the two sites accounted for 17.4 percent of the display ads in the U.S. market in July.

News Corp.’s (NWS) MySpace, in the midst of a turnaround effort, has a slight lead over Facebook–9.2 percent of the market versus 8.2 percent. That makes sense since MySpace has always been aggressive about loading up with ads, while Facebook has been fairly reticent, much to the dismay of the “when are you going to monetize?” crowd. (Click table to enlarge.)

That’s something you knew intuitively, of course. But interesting to see it in graphic form.

Another data point you already knew, but may still find worthwhile to see in black and white: Just how small the scraps are for the rest of much of the social network ad world. By comScore’s count, the next eight-biggest social networks command a collective 1.4 percent of the market. (By the way, ever heard of MocoSpace.com before? Do you know anyone who claims to be a user?)

Remember that we’re just talking about overall impressions, not dollars. And ad impressions on social networks are famously cheap, so this stat only tells part of the story. But it’s an important part. It illustrates the potential that the services have, even if they haven’t capitalized on it (not that they haven’t tried).

Meanwhile, here’s a bonus table from comScore laying out the top advertisers on social networks. No surprise to see the likes of AT&T (T) and Sprint (S) here. But perhaps it’s noteworthy that Verizon (VZ), the strongest U.S. telco, spends the least on social media impressions. Meanwhile, social network app makers/services like Zynga are spending heavily.

(News Corp. owns Dow Jones, which owns this Web site.)

YouTube's Profit Plan: Spend Less, Sell More (Duh)

Peter Kafka — Wed, 26 Aug 2009 13:30:31 +0000

How is Google (GOOG) going to transform YouTube from a money pit into a profit center?

Part of the magic trick will involve cutting costs. That’s hard to see play out in real time, except when we get flare-ups like YouTube’s fight with Warner Music Group (WMG) over new contract terms. The other part of the abracadabra–selling more ads on more videos, particularly “viral” hits–is easier to spot, particularly because YouTube keeps pointing it out.

For instance: Yesterday’s announcement that the site would start attaching ads to many more popular videos submitted by users and share the proceeds with the uploaders.

YouTube was typically vague about how the plan will work, but the most telling news is that it thinks it can increase the number of “partners” it shares ad revenue with from “thousands” to “tens of thousands.”

Translation: All those skateboarding dog videos you make fun of? We’re going to turn them into money machines. Just watch!

I’m going to make an educated guess and posit that for all the effort YouTube has made to “monetize”–I hate that word, but what can you do?–its gazillions of videos, its most important revenue generator is still its homepage. YouTube’s competitors think a one-day “takeover” there may cost an advertiser as much as $500,000.

There’s not a whole lot of upside left for YouTube in the homepage, though. It’s the gateway to the world’s biggest video site, and the second-biggest search engine, and you either want to advertise on it or you don’t.

But the rest of site remains a big opportunity. YouTube can keep chasing splashy “premium content” deals like the ones it has struck with Sony (SNE), Disney (DIS) and Time Warner (TWX). And at the same time, it can try selling more of the “long tail”–basically, everything that isn’t “premium.”

YouTube’s long-tail efforts sometimes get ignored, especially when the site is compared to Hulu and its array of TV shows and movies. But YouTube executives have insisted for a while that long-tail videos will play a big role in the site’s future, and the new move underscores that.

“I think they are working [the long tail] hard but are not articulating it well,” the head of a competing Web video company told me earlier this month. “It may be because they are worried about how advertisers and agencies will view them, but it may also be that they are not revealing it all until it’s farther along.” Yesterday, YouTube gave us another peek.

Apple to Palm: Talk to the Hand

John Paczkowski — Wed, 15 Jul 2009 18:00:18 +0000

[ See post to watch video ]

D7 Interview: Jon Miller and Owen Van Natta Say MySpace Needs to Innovate

Peter Kafka — Wed, 27 May 2009 23:49:44 +0000

A couple of years ago, MySpace was the hottest thing on the Web. But that was a couple of years ago. Now the social network has gone cold: It is losing audience to Facebook and other sites and may well lose a very lucrative search deal from Google (GOOG). Fixing MySpace is the chief priority of Jon Miller, the former AOL boss who was brought on as News Corp.’s (NWS) chief digital officer in March. About a month after that, Miller brought on former Facebook executive Owen Van Natta and a new management team to run MySpace, displacing the site’s founders. Time for Van Natta to tell us just how he intends to save what was once one of the most important sites on the Web. And time for Miller to explain the digital future for the rest of News Corp.–which happens to own the All Things Digital Web site and conference.

Video Highlights

[ See post to watch video ]

Live Blog

Walt whips out his poll data again. Points out that Facebook and MySpace are neck-and-neck in overall use. But 61 percent of people say they are using MySpace less often than they used to. “Less usage would be bad,” notes Owen. Back to the poll: Why did people use MySpace less? Nearly one third–30 percent–replied: “I got bored.” Owen thanks Walt for the free market research.
Kara: What happened at MySpace? How did it come to this? Owen: “If you don’t continue to innovate and give people what they want next…people are going to shift interests elsewhere. They’re going to continue to evolve their usage of the Web. The thing about MySpace is, there’s a lot that’s unique about MySpace. We need to seize on that.”
Walt: Gimme some examples of how MySpace is different/unique. Owen: It’s more open, people share more information more freely, a bigger canvas, the ability to create pages that I don’t like the look of but people do.
Kara: Jon Miller, tell me about the parking story at AOL. Jon: Did I tell you about this? Ok. A month after I go to AOL, following the merger with Time Warner, I went to visit people. Visited a division of Time Warner and senior staff. Hostile vibe. I tried to defuse it with parable about what happens when your car gets towed in New York, and how the people who work in the car lot didn’t actually tow your car, so please don’t yell at them.
Kara: You were at Velocity, investing with Ross Levinsohn [who helped News Corp. with the original MySpace deal]. Why did you leave? Jon: I thought there was a big opportunity. Owen: “Jon told me it was so he could get comped at D.”
Walt: Can you make this work with just advertising? Jon: It’s the central question of our time in the media right now. Free vs. paid. Obviously consumers want everything to be free. Kara: “You’re a Communist.” Jon: Obviously that doesn’t work. “It’s pretty clear that there has to be some recognition of value.” And we’re starting to see that take shape. And there has to be recognition that different things have different value. If it’s all free or all ad-supported, it won’t work. Ask Jeff Zucker about that–he loves the cable business. The real question is how much, and who’s going to pay, and is it going to be bundled?
The gang draws parallels between the cable business (content plus access) and the old AOL (content plus access). Could that work somewhere else?
Jon: The $10 wholesale price for a CD isn’t coming back. Maybe it’s $6. Maybe it’s $8. Those changes put big pressure on that business. We’re not just going to come out of the recession and see everyone spend the same money they used to spend.

Kara: Back to MySpace. What happened? You both were up for Jon’s job, correct? [Pause]. Jon: “I just interviewed by myself.”
Owen: MySpace is a really big site. Of course I’d want that job. I like building things. I built houses in high school in Palo Alto. At MySpace, there’s such opportunity to build.
Kara: You were at Facebook, left Facebook, went surfing, then Playlist, then this. Is there a connection?
Owen: I’ve always liked social networking. Was at a start-up that got bought by Amazon (AMZN). Facebook vs. MySpace: Fundamentally different. MySpace focused on a platform that allows people to be super-creative. Music is a big thing on MySpace. 550,000 people are friends with Green Day. Consuming their albums. We sponsored a secret show. Jon went and scared the band.
Walt: My kids are musicians and have pages on MySpace. I asked them, and they say they never go there, except to promote the band. They’re both on Facebook and they both Twitter. Is MySpace too closely linked to music, too narrowly branded? Or is that a big advantage?
Music’s a huge advantage. We have joint ventures with the major labels. But video is a big advantage, too. My job is to bring teams together to figure out what people are doing, and give them the right tools, and if they’re not using it, figure out why or stop doing it.
Jon: People only change their behavior for a few reasons. One is music. I also think what’s interesting about the Web is you can nail something for a single group, and it can broaden out. For MySpace that was music, and for Facebook that was college.
Walt: People think all these social networks are for kids. But do you want to aim at a single age group?
Owen: We have 130 million uniques. But we need to core down and heavy up where you have traction. And we need to focus on younger demographic.
Is Facebook a competitor? Jon: Yes. But so is everything else. So is Twitter. Walt: Seems like these things naturally evolve from one site to another. How can you recapture that excitement from a few years ago? Owen: We already have 130 million people coming to the site every day. If we can excite them with new products, that can happen.

Owen refuses to disclose super-secret disruption plan? Not saying, even though Kara threatens to touch Owen’s knee, Bartz-style.
Jon sings the praises of innovation and liberating employees to let them be more entrepreneurial so they can iterate. There are some recurring buzzwords here.
Walt wants to know if there are ways to monetize MySpace that haven’t been tried. Jon: In advertising, it means a lot of things. Premium, performance, search, etc. We’ll have things like targeting, and micropayments, and we’ll be able to introduce subscriptions for some products.
Kara: What’s up with the Google (GOOG) deal? Owen: It’s important, but it’s not the majority of our revenue. Also, it’s half over. So we need to be heads-down focused on our own site. With these long-term deals, you need to figure out how to make them work. This is no different. The most important thing is how is Google going to feel at the end of this partnership?
Jon: When it comes time to negotiate, one thing to think about is whether we could do an overall deal with Google that wraps in more News Corp. properties.
Q&A: Sorry, missed the first question. The second question is yet another one from Mark Glaser, who is popping off at every one of these. He wants to know why MySpace is so loud and garish.

Owen: I don’t like a lot of the loud stuff either, so we need to work on personalization.
Kara: What about Facebook’s fascist approach, where it works the same for everyone?
Owen: We are going to look different and feel different than everyone else, and that’s good.
Jon: The tendency when you fall behind in product areas is to think that you have to catch up by checking boxes. I think that’s wrong. You should leapfrog and focus on emerging behaviors, and go for the big moves. Question: Lessons from AOL? Jon: Yes. Everything I did I should have done faster and sooner.
Ethan Smith from The Wall Street Journal wants to know about music and MySpace. I don’t quite follow it. Oh, it’s about labels complaining about that they’re not making enough money from MySpace. Edgar Bronfman Jr. is the most vocal here. Owen: I’ve talked to Edgar and it’s a complex partnership, and we’re figuring things out together, just like Google.
Quentin Hardy from Forbes wants to know about organizational behavior theory. Jon: Keep market-facing. That’s the No. 1 thing. It must also be metrics-driven. You have to know how your stuff is being consumed, by whom and how they’re doing it. Once you start doing that, you’ve got a shot. You also have to make sure you’re looking at the right metrics. Page views, for instance, may be the wrong metric, if generating page views upsets your customers.

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 we were able. It was not intended as a transcript and should not be interpreted as one.

Facebook's Zuckerberg: $10 Billion Is a "Fair" Valuation

Peter Kafka — Tue, 26 May 2009 17:48:56 +0000

Looking for lots of specifics about the $200 million at $10 billion valuation deal that Facebook and Digital Sky Technologies just announced? Then you have come to the wrong conference call, my friend. But for what it’s worth, Facebook CEO Mark Zuckerberg did sound fairly upbeat and confident during his chat with reporters Tuesday morning–the way you’d expect someone who just cashed a check for a couple hundred million to sound.

The big picture: Even though Facebook’s official valuation has slid from $15 billion–November 2007, when Microsoft (MSFT) invested–to $10 billion, Zuckerberg is OK with that, arguing that 1) that deal was done at the peak of the market and 2) the pact was never really a financial deal, but a way for Microsoft to partner up with Facebook–and, though he didn’t say it, to box out Google (GOOG). That sounds pretty reasonable.

Zuckerberg’s main talking points were that his company didn’t need the money, but it sure was nice to have, both to fund growth and make any M&A easier to pull off. And when it came to his new partners, he argued that DST’s existing portfolio, which includes several other social networks, would provide models/examples for his company as it continued to expand outside the U.S.

Earlier:

Facebook and its newest investors Digital Sky Technologies, are holding a teleconference to discuss the $200 million at 10 billion valuation deal the two parties just announced. I’ll be covering the call live.

Call starting “momentarily.”

On the call: Facebook Mark Zuckerberg, DST CEO Yuri Milner. Also, via phone (from D7!): Facebook COO Sheryl Sandberg and DST’s Alexander Tamas.

Zuckerberg reading statement that more or less tracks press release: “Advertising product” improving, “our business is doing really well” and we’re on track to create a “nice” business, and that’s why investors want in. DST approached us, has interesting profile and experience and insight into social networks. “We found their thinking and their leadership to be really impressive.”

Money provides “cash buffer” to support our continued growth, also possible other moves. No specific plans to talk about “but nice to have flexibility.”

Milner: “I realize not all the participants on the call are familiar with us.” Goes over DST portfolio. “We have now started to actively expand abroad.” We’re a holding company, have raised and invested more than $1 billion since 2005. Rattling off portfolio companies now.

Q&A:

What does this mean for possible IPO? Zuckerberg: “Our approach to financing has really been that we want to take money and work with partners”…”for a lot of start-ups, you get the feeling that the IPO is really the end goal…that’s not the case for us…we’re not rushing toward it…that’s really all I have to say about that today.”

What’s valuation for common stock? Zuckerberg: No comment. “There are different transactions that we’ve structured differently…we hope that there will be different things in the future…probably sometime in the next few months.”

What does this say about Microsoft’s $15 billion valuation? Zuckerberg: We did that deal at the peak of the market. That was part of a broader relationship. That investment was just one piece of it. This is also a relationship that we’re forming with DST…we hope we will work with other things over time.

“We feel really good about the progress we made…we feel this is a good and fair valuation for us.” The Microsoft deal was at peak of market and was a strategic deal. “The world was in a pretty different place at that time.”

The international audience is 70 percent of our users. How do you monetize that? Zuckerberg: I have a few things to say, but want Yuri to talk, too. Milner: We have invested in five social networks in Europe. They have been able to monetize better than Facebook because they’re further along the curve than Facebook, which is a global company. But we think that Facebook will improve. Money will come from micropayments and advertising.

Zuckerberg: We can do advertising and have been experimenting with payments. Social networks in DST’s portfolio all monetize in different ways. Each is doing well, with a different model. We’re still growing. Online and direct advertising are growing the quickest, but over time, we expect to be able to build out a large number of these things.

What is your ad revenue going to be? Zuckerberg: A couple of months ago, we felt that everyone outside the company was underestimating our performance. We’ve been EBITDA-profitable for five straight quarters coming on six. Revenue growth has been 70 percent. Cash-flow positive sometime in 2010. That’s important because it means this investment is pure buffer. I realize those aren’t absolute numbers, but those are the ones we’re talking about.

Will DST be involved in management? Milner: We have our own businesses to run. We’ll keep in touch.

Questions about micropayments. Zuckerberg: We’ve tested a lot of things. It’s not a big part of our business, could be greater one day. They create a lot of value for users, and there are ways to monetize them. I’m looking forward to learning how these models are working.

Please talk about common stock/employee stock purchase plans. Zuckerberg: Going back to first question re. IPO. We want to make sure that we can continually make it so employees can be focused on the long term. We felt that if we let people have a little bit of liquidity, it can take some of the pressure off and let people focus on making company as good as it could be. We started to do this last year and had to hold off. Now we hope to be able to do it again.

Will that be the only way you are allowing employees or ex-employees to sell shares? Zuckerberg: Still talking about.

Is current Facebook ad business to be the main business going forward? Doesn’t mean it will be main business in the long term. You guys know everything that we’re talking about now.

Why aren’t you running big brand ad campaigns? We’re very interested in it. We have a big ad sales team. Building out offices internationally: U.K., France, a few more coming up. We think the best way to serve advertisers is to create ads that people interact with, that are “social and engaging.” I don’t want anyone to think that this isn’t a big part of our business, because it is.

Sandberg: Heavily engaged with brands. Ads specifically designed for Facebook, so they look different and behave differently than other ads on other sites, and that’s a good thing.

Preferred shares–are these are substantially similar to the ones Microsoft bought? Zuckberg: “I’m gonna duck that one.”

Does the company have any debt? Zuckerberg: [pause] There’s been some information that’s been public about debt we have for operating equipment. Beyond that, we do equity deals.

Will you do other investment deals? How many did you look at? Zuckerberg: He doesn’t really answer this question; instead he goes on to praise DST. Milner: We see things that other people don’t see, which is monetization that other social networks have been able to do. So we “kind of feel comfortable with that valuation.”

Is this largest foreign investment in Facebook? Zuckerberg: Um… [pause]. There’s been some public information about other folks we’ve worked with, but I think from reading some of the records you can get the answer to your question.

Other new deals? Zuckerberg: It was really at our option to find someone we were comfortable with. We didn’t feel like we needed to take an investment, and now we feel like we have the buffer we want.

Working on video chat product? More international products? Zuckerberg Yes. There are lots of things like that that we’re working on now. We want the site to be available in every country. We’re not translating the site. Users translate the site themselves. And a lot of the features are universally applicable.

Call finished.

YouTube: The Money Pit

John Paczkowski — Fri, 03 Apr 2009 20:00:49 +0000

“Eventually we’d like to make money out of it.”

– Google CEO Eric Schmidt on YouTube

It’s been well over two years since the $1.65 billion acquisition and Google has yet to truly monetize YouTube. And while the company persists in claiming it has the “luxury of time” to develop the business model through which it will recoup its investment in the popular video site, it’s clear that time is running out. To wit, a report this week from Credit Suisse that predicts YouTube will earn $240 million in revenue in 2009. Which wouldn’t be half bad were it not for the fact that YouTube is on track to lose $470 million in 2009. The research house figures YouTube will rack up about $711 million in operating expenses this year–$360 million on bandwidth alone.

An unfortunate disparity, that. Is it one that can be corrected? Credit Suisse seems to think so. “In our view, the issue for YouTube going forward is to increase the percentage of its videos that can be monetized (likely through more deals with content companies) and to drive more advertiser demand through standardization of ad formats and improved ad effectiveness,” it explained in a research note. Of course, this is exactly what YouTube is doing. On Monday the company said it has agreed to an ad revenue-sharing partnership with Disney (DIS) that will see it putting ABC and ESPN videos on YouTube. A small first step, but one that could portend a trend. Especially, if as Google (GOOG) CEO Eric Schmidt says, the company hopes to eventually make money out of it.

IBM-Sun Day Monday?

John Paczkowski — Fri, 03 Apr 2009 18:00:08 +0000

[ See post to watch video ]

The Guardian's Changing Media Summit in London: No Answers There Either!

Kara Swisher — Thu, 26 Mar 2009 21:33:19 +0000

On BoomTown’s recent grand tour of Europe, I paid a visit a week ago to London to moderate some sessions at Media Guardian’s Changing Media Summit 2009.

As in the U.S., a lot of the same questions were asked there about when and how the new media business would cross the Rubicon to transform into a strongly profitable and sustainable enterprise.

Via advertising? Subscriptions? Product placement?

“We’ve got to get to a place where we’re going to become an industrialized-sized business,” said one panelist at a session on monetizing such media, in what was a common question.

Well, considering how small the revenues in new media still are compared to traditional media, along with the recent negative impact of the econalypse, even a profitable popcorn stand would be an admirable achievement right about now.

Still, the room was packed at the Park Plaza Riverbank Hotel overlooking the Thames River and Big Ben, as people searched for answers.

One of the panels I moderated had the much-too-vaunted title of “The Future of Media: Capturing the Essence of Reinvention in the New Age.”

The panelists talked about what the media company of tomorrow looks like, as well as discussing the Next Big Thing.

The group included Ashley Highfield, managing director and VP, consumer and online for Microsoft (MSFT); Larry Kramer, former president of CBS (CBS) Digital and senior adviser to Polaris Ventures; Peter Smith, president of GE (GE) NBC Universal’s international unit; and Mike Volpi, CEO of video start-up Joost.

Here’s a video of interviews I did talking about all this and more while at the Guardian Media Group’s new digital-heavy offices in London.

It includes Volpi and Kramer, as well as Guardian-owned paidContent.org head Rafat Ali and the BBC’s tech news correspondent, Rory Cellan-Jones:

[ See post to watch video ]

If This Monetization Plan Doesn't Work Out, There's Always the Amazon Tip Jar

John Paczkowski — Wed, 08 Oct 2008 16:34:05 +0000

Eventually we’d like to make money out of it.”

Google CEO Eric Schmidt on YouTube

It’s been two years since the $1.65 billion acquisition and Google (GOOG) has yet to truly monetize YouTube. And while Google CEO Eric Schmidt insists the company has the “luxury of time” as it searches for ways to recoup its investment in the popular video site, it’s clear the issue is gradually becoming more pressing. “We’re waiting for the innovations,” Schmidt said recently. “The innovation will come. We know it will come. We know it’s there.”

Could the “it” to which Schmidt refers be the new e-commerce platform YouTube is launching? Perhaps. Beginning this week, YouTube is embedding “click-to-buy” links in certain videos on its site, which refer users to affiliate services selling the music featured in them. “Click-to-buy links are non-obtrusive retail links, placed on the watch page beneath the video with the other community features,” YouTube explained in a post to the Official Google Blog. “Just as YouTube users can share, favorite, comment on, and respond to videos quickly and easily, now users can click-to-buy products–like songs and video games–related to the content they’re watching on the site.”

An interesting idea. And should it prove successful, it could begin to justify YouTube’s jaw-dropping $1.65 billion purchase price. “This is just the beginning of building a broad, viable e-commerce platform for users and partners on YouTube,” the company explained. “Our vision is to help partners across all industries–from music, to film, to print, to TV–offer useful and relevant products to a large, yet targeted, audience, and generate additional revenue from their content on YouTube beyond the advertising we serve against their videos. And those partners who use our content identification and management system can also enable these links on user-generated content, by using Content ID to claim videos and choose to leave them up on the site.”

If This Monetization Plan Doesn't Work Out, There's Always the Amazon Tip Jar

John Paczkowski — Wed, 08 Oct 2008 16:34:05 +0000

Eventually we’d like to make money out of it.”

Google CEO Eric Schmidt on YouTube

Bewkes on Bebo: Well, That Was $850 Million Well Spent … Maybe

John Paczkowski — Thu, 18 Sep 2008 12:55:08 +0000

We just want you to know that as we assess our capital allocation options, we will continue to adhere to the disciplined framework that I just outlined.”

– Time Warner CEO Jeff Bewkes, Aug. 06, 2008

Disciplined capital allocation is a key priority for Time Warner (TWX). That said, the company “may have overpaid” for Bebo, the social-networking site it acquired for $850 million in cash back in March. So said Time Warner CEO Jeff Bewkes in an interview with Portfolio.

Portfolio: And if you had to do it all over again … would you pay $850 million for Bebo?

Jeff Bewkes: Maybe. I’ll tell you why I can’t give you an answer. Because when you’re doing an acquisition in an auction, the core purpose of the auction is to try to get as much buyer and competing interest. When you look back at it, you then have to reveal–which I can’t to you–what I know about the other bidders. And you learn more of it after than before. The reason we said–when we kept being pressed by people, when they said “did you overpay or not?” we said we don’t know–is if our plans work out, we did not overpay. But then somebody says it’s compared to what you could’ve paid. If our plans work out less well than we thought, we would have overpaid by a few hundred million dollars. I’m not sitting here now–I don’t know if that’s the case–under a high case, we’ve actually made a lot of money on it. So it’s really too early to say. It’s kind of like saying, did Google (GOOG) overpay for YouTube? What was that number–$1.6 billion? They haven’t monetized that yet

Dramatic YouTube

John Paczkowski — Wed, 10 Sep 2008 20:44:48 +0000

As in search, in Web video Google is the one to beat.

Americans viewed some 11 billion videos during July, and they watched most of them on Google sites, according to the latest metrics from comScore. Of the more than 11.4 billion videos viewed in the month, nearly 44 percent were seen on Google (GOOG) properties. And 98 percent of those were viewed on YouTube, which continues to dominate the online video space. The remaining 55.9 percent was split among nine properties led by Fox Interactive Media and MySpace (NWS), which ranked a very distant second to Google, with just 3.9 percent of videos viewed. None of the remaining eight sites even cracked three percent.

So who’s watching all this video?

Answer: nearly 142 million U.S. Internet users–almost 75 percent of Americans with Internet access. On average they spent 235 minutes watching video in July. And they rarely spent more than 2.9 minutes on any one video, which makes perfect sense when you think about it. “Dramatic Chipmunk” is just five seconds long, and I’m told it’s the greatest video on the Internet.

This Reminds Me of the Time I Forgot to Optimize My AdWords Campaign …

John Paczkowski — Mon, 30 Jun 2008 12:09:08 +0000

“We feel that we have recreated the mass media.” That’s how Google’s Kim Malone Scott, in a moment of Zuckerbergian modesty, described the company’s video syndication service that will debut this fall and, shortly thereafter, transform online content distribution.

Working with Seth MacFarlane, creator of the “Family Guy” animated series, Google (GOOG) will in September begin distributing “Seth MacFarlane’s Cavalcade of Cartoon Comedy,” a series of digital shorts
to be embedded on Web sites as free, ad-supported streams.
About two minutes in length, the shorts–which MacFarlane describes as “animated versions of the one-frame cartoons you might see in The New Yorker, only edgier”–will be syndicated through Google’s AdSense advertising system, which will target them at MacFarlane-friendly segments of the Web. Some will be accompanied by standard pre- or post-roll ads, some by “brought to you by” tags, and others by original commercials created by MacFarlane.

The shorts are essentially like little Assisted Ad Delivery Devices, intelligently targeting advertisements at those receptive to viewing them. “We believe the revenue could be formidable,” said Karl Austen, a lawyer who worked on the deal. “What is exciting is that this is a way to monetize the Internet immediately. Instead of creating a Web site and hoping Seth’s fans find it, we are going to push the content to where people are already at.”