AllThingsD » Texas

Tasty Geek: Nathan Myhrvold Takes His Modernist Cuisine to "Top Chef"

Kara Swisher — Sat, 07 Jan 2012 18:38:09 +0000

Being the huge fan of “Top Chef” that I am — hellllloooo, Padma! — it was even more a treat to see former Microsoft legend, controversial patent grabber and full-time fiddler Nathan Myhrvold as a guest judge this past week on the current season of the popular cable television show.

For those who usually associate him with geekery, he is also a big foodie and the author of fancy tome “Modernist Cuisine: The Art and Science of Cooking.”

Right now, the six-volume, 2,400-page book set retails for $499 on Amazon. As described on the site: “The authors and their 20-person team at The Cooking Lab have achieved astounding new flavors and textures by using tools such as water baths, homogenizers, centrifuges, and ingredients such as hydrocolloids, emulsifiers, and enzymes.”

“Top Chef” is now set in Texas, so the topic was barbecue, an apparent fave of the techie too. But I really liked the competitor chefs’ race in the Quickfire Challenge to pull off some feat of molecular gastronomy best.

A side of patent troll pâté anyone?

Here are the videos:

Siri, Why Don't You Have A Texas Accent?

Arik Hesseldahl — Fri, 16 Dec 2011 19:57:02 +0000

I don’t know exactly why anyone is surprised that Samsung is making Apple’s A5 chip in Texas, but for some reason they are. Reuters reported today that the South Korean chip giant is building at a factory in Texas the wonderchip that powers both the iPhone 4S and the iPad. That’s the surprise. Rather than a factory somewhere in Asia, Samsung is cranking out the chips in the Lone Star State.

Given that Apple and Samsung have been working together for years — the first iPhone chips were Samsung made, after all — I’m not entirely sure why anyone is surprised that this Samsung fab was expanded to accommodate, among other customers, Apple.

Maybe the cybernetic voice of the iPhone’s marquee feature, the personal assistant Siri, should sport a Texan twang, rather than a non-specific accent. There’s a lot more inside the iPhone that comes from Texas than just the A5.

For one thing, the chip itself, or some significant portion of it, was probably designed in Texas to begin with. Remember Intrinsity? That’s the boutique chip design company that Apple acquired in 2010. Yes, that’s the one. Where was it based again? You guessed it: Austin, Texas.

There’s more. This is the very same factory that Samsung announced it was going to expand last year with a $3.6 billion investment. Indeed, yours truly even covered the announcement for Bloomberg News.

The previous fabs have been turning out Flash memory chips since the late 1990s. And since Samsung is the world’s largest supplier of Flash memory, and Apple is the world’s largest consumer of Flash memory, there’s a pretty good chance that the iPhone you’re carrying right now contains flash chips built in Texas. However, Apple buys flash memory from other companies too, including Toshiba and Hynix.

Then there are lots of other smaller components that come from Texas. Texas Instruments supplies the chip that drives the touch screen. As its name implies, TI is based in Dallas and has six fabs in Richardson, Texas (and many others around the world), one of which may turn out the touch screen controllers that iSuppli found in the iPhone. (TI wouldn’t confirm one way or the other if it’s made in Texas, but there’s a pretty good chance!)

And then there’s the audio codec chip from Cirrus Logic, found by market research firm iSuppli in its teardown analysis. It’s another company based in Texas, and so while the chip itself was probably manufactured in Asia, it was designed at Cirrus HQ in Austin.

And finally, don’t forget that Apple itself maintains a huge presence in Austin. The Austin American Statesman reported last year that the company was nearing a deal to lease 55,000 square feet of office space for the Intrinsity team, and is thought to employ about 2,500 people in and around Austin, most of them based at a 400,000 square foot campus.

So for all of Apple’s California good vibes, there’s a lot of Texas in every iPhone it makes.

Report: Apple's A5 Chip Made in Texas

Lauren Goode — Fri, 16 Dec 2011 16:48:16 +0000

Reuters reports that, according to sources, the A5 processor used in Apple’s iPhone 4S and iPad 2 is made in a sprawling 1.6 million-square-foot Samsung Electronics factory in Austin, Texas. The Korean electronics giant began supplying the A5 processors to Apple this year from the Austin plant, the story says. Both Apple and Samsung spokespersons declined to comment.

Here's Gowalla CEO's Non-Denial Denial Email to Investors About Facebook Acquisition

Kara Swisher — Mon, 05 Dec 2011 05:54:43 +0000

Update: Facebook has confirmed it is hiring Gowalla’s core team, while the Gowalla product will be shut down.

Even Gowalla CEO Josh Williams isn’t pretending a deal for Facebook to buy the location-sharing company isn’t happening, as you can read below in an email he sent to his investors.

Both companies declined to comment on a story on Friday and over the weekend. CNN had the scoop about the social networking giant acquiring Gowalla, which I have taken to calling Not-Foursquare.

That’s because — despite its often clever approach and innovation — it never caught up with the leading social location service.

Gowalla, which changed its approach several times, had been for sale for some time, said several sources.

The Austin-based start-up has raised just under $11 million from a range of investors, including Greylock Partners, Shasta Ventures, Alsop Louie Partners and the Founders Fund, along with a batch of well-known angel investors.

But let’s put this one to bed with the email that Williams sent out after the CNN story broke Friday, which was read to me tonight, so I might not have all of it perfectly and it is missing a sentence about I-will-smack-the-leaker):

Subject: Rumors and speculation

CNN just broke the news that Gowalla has been acquired by Facebook. This story was leaked from an unknown souurce.

The ink on the deal is not dry, so our holding pattern is that we do not comment on rumors and speculation. I have another email penned that was ready to send you today, assuming you would get this news before the story was officially released.

But now it is all over Twitter, so you have likely heard. A longer email will be sent soon. Until then, I am so very grateful for what you have done to make Gowalla a success.

The second confirmation email has apparently not yet been sent, but I will try to get it when it is, along with the price.

So, until the official official yes, here’s a video interview I did with Williams in April of 2010 about the location “wars”:

[ See post to watch video ]

Cisco to HP: Please Stop Suing Those Employees We Poach

Arik Hesseldahl — Wed, 23 Nov 2011 20:47:49 +0000

Networking giant Cisco Systems would like to stop hearing so often from lawyers at rival Hewlett-Packard. More specifically, it would like HP to stop suing ex-HP employees seeking jobs at Cisco.

In a Cisco blog post, the company’s general counsel, Mark Chandler, accused HP of overzealously lawyering up to try to stop former HP employees from going to work for Cisco. The fear is that those former employees will share HP’s confidential information to Cisco’s benefit. “Trade secrets are protected by intellectual property laws, not by non-compete agreements and vague theories that a new job would ‘inevitably’ cause an employee to use trade secrets of his or her former employer,” Chandler helpfully reminded HP’s legal team.

Courts in California have generally held the kind of noncompete agreement that would prevent someone leaving HP for Cisco, or vice versa, to be unenforceable. But one of the people in question used to work for HP in Texas, and moved to California for the Cisco job. HP lawyers, Chandler says, swooped into a courtroom in Texas hours before a related hearing in California (the point being that the court that hears the case first is the one that tends to decide the case).

Chandler doesn’t name the employees involved, but that Texas-to-California move sounds an awful lot like the case of Paul Perez, the former CTO of HP’s StorageWorks, who resigned earlier this month for a job at Cisco; John Marsh, at the Ohio law firm of Hahn Loeser, writes about the case here.

I asked HP for a comment on this, and they haven’t gotten back to me. However, HP is not the only one with aggressive lawyers trying to enforce noncompetes. A federal appeals court recently ruled in favor of HP and an executive it had hired earlier this year from IBM. Giovanni “John” Visentin, who had been a general manager, quit his job at IBM in January and said he was going to HP, but offered to stay on for a transitional period. IBM sued him the next day, and asked the court for an injunction that would have prevented him from taking the job. The trial judge and the appeals court both ruled that IBM’s aggressive behavior made the “emergency” its lawyers said existed worse by its refusal to even talk to the employee.

Chandler closes his post with a promise that the company “will apply California’s rule in favor of employee mobility nationwide,” which is a comfort should you be mulling a job offer from Cisco and work at a rival outfit.

And though the circumstances are different, Cisco is not without its own history of over-aggressive lawyers, as in the infamous case of Peter Adekeye, a former Cisco employee who started his own company servicing Cisco gear; Ars Technica covered the case here. Having filed an antitrust suit against Cisco in the U.S., Adekeye wound up arrested and detained in a Canadian jail. A judge there finally let him out, saying that the only “reasonable inference I can draw from the facts is that the criminal process was used to pressure the applicant (unsuccessfully) into abandoning his antitrust lawsuit against Cisco.”

When it comes to ex-employees, lawyers tend to get really tough.

Update: Like I said, the Adekeye case is different circumstances, and as a Cisco spokesman points out in the comments below, Adekeye is under indictment; though it’s been described as a “ridiculous” case, you sure can’t beat it for weird legal twists and turns.

U.K. Arrests Two More Suspected Members of LulzSec

Arik Hesseldahl — Fri, 02 Sep 2011 13:30:29 +0000

The summer that started out dominated by news of attacks by the hacker gang LulzSec/Anonymous is closing with news of more arrests of alleged members of the group by police in the U.K.

Scotland Yard says it has nabbed two more people that it says are members of the group; one of them is said to be connected to crimes committed under cover of the online identity “Kayla.”

In a statement, police did not release the names of the two men arrested. They are aged 20 and 24, and one comes from the town of Mexborough, while the other comes from Warminster. The arrests were conducted in cooperation with local police and the FBI. In one case, a home was searched and computer equipment taken.

It was the second pair of arrests in as many days. On Thursday, police arrested two others as part of the growing worldwide investigation into the activities of LulzSec and Anonymous.

And yet the hacker crimes continue, seemingly unabated. Anonymous has dubbed today “Texas Takedown Thursday” or #TTT on Twitter. The target: Law enforcement agencies in the state of Texas, in apparent retaliation for the arrests earlier this summer of 16 people said to be associated with Anonymous.

The group says it has leaked about three gigabytes worth of email and other data from private email accounts it says belong to certain police officials in Texas. It also claimed credit for defacing a Web site belonging to the Texas Police Chiefs Association.

It’s the second such targeting of police officers in a particular state. In June, the group went after the Arizona State Police, posting home addresses of officers.

LulzSec and Anonymous, in their various contortions, have had a busy summer. The group and its sympathizers started out making Sony’s existence miserable, on the heels of an attack on the PlayStation network; the attack brought the network down for several weeks.

Amazon Seeks Greater Fulfillment by Adding Distribution Centers

Tricia Duryee — Thu, 07 Jul 2011 21:53:37 +0000

Amazon is expanding its warehouse capacity at an insanely aggressive pace, having already announced five new distribution centers so far this year, including two since yesterday.

The five new facilities will add about four million square feet of space and hire thousands of new employees.

But that’s just the beginning. The company has plans to expand even more as it adds more merchandise to its inventory and tries to speed shipping to meet the popularity of services like Amazon Prime.

In all, the Seattle-based e-commerce giant plans to add at least nine fulfillment centers this year, of which roughly half will be located in North America. If the company’s growth rates continue, it may end up building even more, execs disclosed during its last earnings call.

It is the second year in a row that Amazon has built out more capacity, having added 13 fulfillment centers in 2010. The company currently has fulfillment centers in Arizona, Delaware, Indiana, Kansas, Kentucky, Nevada, Pennsylvania, Texas and Virginia.

Today, it announced it will build a fourth distribution center in Phoenix, spanning 1.2 million square feet, making a total of 4 million square feet in the state. For perspective, that’s the equivalent of nearly 70 football fields.

Yesterday, it said it was adding 900,000 square feet in Indiana.

Amazon hires thousands of full-time positions at these facilities, including roles in picking, packing and receiving, and shipping.

Amazon did not specify how many employees would be necessary at each location, but said for example that it was seeking 2,000 workers in Lexington County, S.C., and 2,700 in Hamilton County, Tenn. (not including 4,000 seasonal workers).

The company’s impressive growth was put into context earlier this year by Geekwire, which reported that Amazon had hired 4,200 employees in the first quarter to bring its total to 37,900.

While Amazon must build these facilities to keep up with demand, the investments are costing it significantly. In the first quarter, Amazon’s revenues jumped 38 percent, but net income fell by 33 percent compared to the year-ago period.

Still, it’s a price that must be paid. You can’t store everything in the cloud.

Pre-$200 Million Valuation: Flipboard's Mike McCue at SXSW (The Full Onstage Video)

Kara Swisher — Thu, 21 Apr 2011 18:30:38 +0000

In March, BoomTown travelled hipster-Texas-style for the South by Southwest festival in Austin.

I was there to check out the geek-packed scene, but also to interview Flipboard’s Mike McCue in an onstage interview there.

The Silicon Valley start-up, which makes an innovative and highly designed social media reading app for the Apple iPad (iPhone and Google’s Android mobile operating system to come), recently raised $50 million in new funding, giving it a $200 million valuation.

This interview with McCue took place before that, but it’s still a wide-ranging map to where the much-touted Flipboard is headed.

Here’s the video:

[ See post to watch video ]

Exclusive: Flipboard Confirms $50 Million Funding at $200 Million Valuation

Kara Swisher — Thu, 14 Apr 2011 20:23:12 +0000

Late last month, BoomTown posted about a huge venture funding effort by the high-profile and even more highly designed social media reading app for the Apple iPad, Flipboard.

Today, its co-founder and CEO Mike McCue confirmed the $50 million round at an eye-popping $200 million valuation, in a wide-ranging interview at the start-up’s Palo Alto, Calif., HQ.

“We’re obviously thrilled, because we think it confirms our focus that people want a beautifully designed way to interact with content and to share it,” he said. “And there is a lot more to come–on a scale of one to 10, we’re just at a two or three.”

The bulk of the new second round of funding–Flipboard had previously raised $10.5 million–came from New York-based Insight Venture Partners.

Insight’s Jerry Murdock said in an interview that he was excited about the idea of “social endorsement” that Flipboard was pioneering.

“We back great entrepreneurs and Flipboard is that and also in an obviously unique position to solve a problem of media consumption in the digital age,” he said. “The sky is the limit. Or more precisely it is the best environment to consume curated real-time content for Twitter and Facebook, because of the user experience and social endorsement integration with the content.”

Insight is also an investor in Twitter.

Also stepping up in the new Flipboard round is Comcast’s venture arm, as well as previous investors, including Kleiner Perkins, Index Ventures and a spate of well known angels, such as Twitter co-founder and product guru Jack Dorsey, Facebook co-founder and Asana dude Dustin Moskovitz, the ubiquitous Ron Conway, actor Ashton Kutcher and the investment company of former News Corp. exec Peter Chernin.

“From a Comcast perspective, we’re intrigued with Mike and what he’s doing with content aggregation,” said Amy Banse, Comcast Interactive Capital’s new head. “We think we can learn from him and he from us.”

Co-founded by longtime entrepreneur McCue (Netscape, Tellme) and former Apple iPhone engineer Evan Doll in January, Flipboard launched to much attention in July.

The elegant Flipboard–which McCue recently told me in an onstage interview at the South by Southwest conference in Austin had zero revenues thus far–has changed the game on the consumption of social media.

Its innovative social magazine concept is attempting to make the social networking universe more accessible, consumable and, perhaps most importantly, visually arresting via its rich app.

Essentially, Flipboard pulls information from media RSS feeds and sites such as Twitter and Facebook data streams and then reassembles it in an easy-to-navigate, personalized format in a mobile tablet touchscreen environment.

In its current offering, there are pull-quotes, photos, videos, status updates and even the first paragraphs of linked-out content. There is also the ability to comment and share, as if one were on a social networking or microblogging site.

McCue said the new giant pile of cash will be used to increase its 32-person staff to about 50, international expansion, small acquisitions and more product development on more platforms.

The next in the arena will be the iPhone version of Flipboard, said McCue, followed by one for the Google Android mobile operating system eventually.

Left unsaid, of course, was the need for funding to fight the likelihood of increased competition in the hot space for delivering both professional and social content to consumers on a wide range of devices.

Rivals are varied, such as Silicon Valley’s most adorable news reader start-up Pulse and also Zite, a news reader which was recently sued for copyright infringement by a group of major publishers.

There are bigger potential players, such as Google, which is trying to find various ways to move into the social space.

In fact, said several sources, Google and others have made acquisition approaches to Flipboard, which has instead opted for raising more funding and staying independent for now.

McCue declined to talk about that, but did note that he is not surprised by publisher interest, especially of the worried and wary kind, in the arena.

“Anyone not respectful of others’ content is going to get in that kind of trouble,” he said, noting Flipboard has struck deals with 17 big publishers so far, including this morning’s announcement about a partnership with Oprah Winfrey’s and Discovery’s OWN cable network. “There is not one half to this equation.”

Right now, the Flipboard app is free and the business plan is advertising and some possible subscription scenarios.

McCue said advertising will be the key to Flipboard’s business plan in the future, although it’s not clear if the company will ever sell advertising itself.

Rather, it will partner with publishers seeking better distribution in the explosive tablet and smartphone market, where Flipboard has been gaining traction quickly.

But until that is sorted out, there is now $50 million more in the Flipboard kitty to figure it all out.

“With this funding, we can grow at the right pace and have a lot of flexibility to get the product right,” said McCue. “And, that’s the most important thing.”

Yahoo Bored Meeting? Not This Time!

Kara Swisher — Wed, 13 Apr 2011 16:35:48 +0000

Today and tomorrow, Yahoo’s directors are gathering here in Silicon Valley for one of their regular meetings that take place over the course of the year.

While board meetings in general are usually pretty dull affairs–and Yahoo’s, in particular, are typically glacial ones–there is a lot on the plates of those with purview over the machinations of the long-struggling Silicon Valley Internet giant.

Here’s a primer of what might (and might not) be happening, according to sources, of course, as Yahoo continues on its quest to reinvigorate itself–a journey that is beginning to make Siddhartha’s transformation into Buddha enlightenment look speedy.

A Yahoo spokeswoman declined to comment on anything below, although I did run it all by them.

The U-Shaped Turnaround

At Yahoo’s recent sales meeting in San Antonio, CEO Carol Bartz went all Sesame Street on the troops, using the letter “U” as an illustration to indicate where in the cycle the company was in its turnaround.

Apparently, just on the other side of the very bottom of the letter, heading inevitably upward.

Her argument was that the company has finally cleaned up its platform mess and its confusing corporate structure, and that its display and search advertising business is now recovering nicely.

All true, except there are some other key issues, such as the slowness of the search and online advertising partnership with Microsoft to make some serious hay.

In fact, although its display business will show a definite strong recovery in Yahoo’s quarterly results next week, its search business–both in market share and revenue per search (RPS)–has, as one person close to the situation put it succintly, “fallen off the cliff.”

That’s due, in part, to getting the new system with Microsoft delivering better results, which is not happening yet (if ever!).

In this quarter, Microsoft has honored its contractual guarantees and will make up the difference–which will result in masking the magnitude of the RPS loss. It’s a worrisome trend to watch.

The Asia Situation

Yahoo and its Asian partners are still mulling over various options regarding the company’s large ownership stakes there.

What is happening with its share in China’s Alibaba Group, according to sources, is precisely nothing right now, as has been made clear in recent comments by its CEO and co-founder Jack Ma.

“If you cannot make the business cool, you have no right to be angry with me,” said Ma in an article in Forbes published this week, referring to Yahoo. “I just don’t trust them…I’ve been working with them for years, and I’m disappointed.”

Relations between Ma and Bartz, sources said, remain as bad as ever, and even the normally close one between Ma and Yahoo co-founder Jerry Yang is strained.

Plus, Ma told Forbes, as he has said before, Alibaba is not taking its auction site, Taobao, public–leaving Yahoo in possession of an appreciating but decidedly private asset.

Japan is a different story, with the disposition of Yahoo’s stake in Yahoo! Japan the subject of long and continuing negotiations for a while now.

While the earthquake and tsunami crisis there did slow discussions down, there is still active recent movement about a variety of cashing-out scenarios, all of which have massive tax and regulatory issues.

Without boring you with the specifics, one option is to create a tracking stock, another a spin-off of the asset and still another some sort of stock trade.

But no matter what happens, Yahoo will have to pay some sort of taxes on its 35 percent stake in Yahoo! Japan, now worth $8 billion.

But if its CFO Tim Morse–the key figure working on the deal–can pull it off, what will Yahoo do with all that money?

Acquisition Guns Blazing? Or Sputtering?

In a recent forum in Silicon Valley, one of its M&A minions said Yahoo had its “guns blazing” with regard to acquisition activity in 2011, as deliciously reported in The Wall Street Journal, despite the company’s lackluster acquisition record.

Sources said the exec had his ears soundly boxed by his managers for the dopey remarks, since Yahoo has had such a lackluster record in the arena–especially compared to others.

And, oh yes, Yahoo’s M&A head just decamped to gaming phenom Zynga.

That aside, Yahoo should be deep in the market for hot start-ups to help revive its innovative spirit, but it remains hindered by a continued reluctance by new start-ups to join it and by its reputation for being a place where entrepreneurs go to die.

That certainly could change at any time with the right execs in place, but Yahoo is competing with a plethora of more exciting companies and also a seemingly endless venture capital gusher of cash of late.

While it is the board’s job to approve acquisitions and not source them, perhaps it is its job to pressure Bartz and other execs to get off the stick and hit at least one of the targets Yahoo aims at.

Targets are plentiful in advertising, content and even social, with many start-ups playing right into a lot of arenas Yahoo needs some help.

And help it does need as talent keeps walking out the door daily, mostly to hotter prospects such as Zynga and social buying sites Groupon and LivingSocial.

There is no question it is hard for any large company to hold onto top staff when there are so many enticing bonbons out there as options, but it can be done.

One good thing: Its newish head of product Blake Irving and head of U.S. media and advertising Ross Levinsohn seem to be playing well together and are setting a tone of stability that is much needed.

Enter the Kenny

That said, there remains endless swirl, especially with key investors, about the performance of its CEO.

While she started off as a publicly in-your-face exec, Bartz has definitely stepped out of the limelight of late, as her pugnacious manner started to irritate Wall Street and others.

It was a good idea, since it has taken the focus off the lack of stock and revenue progress she had loudly promised.

Still, Yahoo shares have continued to stay locked in the mid-teens, as investors wait for some sign that Bartz’s turnaround has worked.

The entrance of its spanking new director, Akamai President David Kenny, has further increased speculation about management and board changes at Yahoo.

This is Kenny’s first board meeting, but this well-connected newbie is someone who is clearly going to rise quickly to the top of decision-making at Yahoo.

That’s because the smooth and well-liked Kenny, who also has deep advertising experience as founder of the Digitas agency, has a long relationship with Yahoo and also with Yang.

He also now has much more tech cred as a leader of one of the Internet’s most important infrastructure companies, with a ton of regular contacts with media giants, ad networks and video providers that are Akamai’s clients.

In other words, Kenny (pictured here) is the full package of ad and tech experience that would make him an obvious Yahoo CEO candidate when Bartz’s contract is up in early 2013, if not before.

He’s also the person most likely to take over for longtime BoomTown punching bag Roy Bostock as chairman of the board at some point.

None of this is happening soon, but it is clearly an interesting development.

There are other machinations, of course, from continued interest from private equity players in Yahoo, as well as a variety of takeover scenarios, each more complex than the next.

While often derided as yesterday’s news by the elite of Silicon Valley as on an inevitable downward path, those plots are there because Yahoo remains a stellar brand with consumers worldwide and an Internet property with huge traffic and a big ad business.

In other words, it’s a U that someday maybe could be a V.

Liveblog: Is Yahoo Still in Search? Indeed and It's Answers Not Links!

Kara Swisher — Wed, 23 Mar 2011 17:20:14 +0000

At least once a day, BoomTown gets a call from investors, analysts or other troublemaking types–you know who you are!–wondering why Yahoo is still plugging away in search.

With a declining market share in the arena and a search technology outsourcing deal with Microsoft, it’s not a bad question to ask.

But Yahoo begs to differ, introducing a new feature called Yahoo Search Direct at a press event in San Francisco today.

I liveblogged it, natch.

10:14 am: I was late, as per usual, but walked in just as the session was getting started.

Yahoo’s Chief Product Officer Blake Irving–looking fetching in a purple cashmere sweater–was talking about search.

He immediately turned it over to Shashi Seth, Yahoo’s head search dude, who immediately said: “Answers not links.”

Huh?

Actually, the product is pretty nifty, showing a lightning-speed box that shows more robust search results, although not unlike offerings from both Microsoft’s Bing and, of course, Google Instant.

While both have different takes, it is essentially a direction in which search brings in maps, photos, and–of course–advertising.

You can see a movie times example here (click to make the image larger):

10:23 am: Wait, it was over before it started! Whoa. No more bells and whistles?

And I still was enjoying Irving’s sweater and I wanted to touch it, but that would have been wrong.*

Seth then took questions from the reporters.

“We believe the next generation of search…people are looking for answers,” he said.

Very true, but perhaps not so much from Yahoo anymore.

Still, Yahoo Search Direct is a laudable try and it’s also nice to see some innovation from the long-troubled company.

“We are the premier digital media company,” said Seth, parroting a new description of Yahoo that the Silicon Valley company is now using since its recent sales meeting in San Antonio.

I asked a question about whether there is a dedicated app for the tablet of Yahoo Direct Search, which sources had also told me was shown to the troops in Texas.

Yep! It will be ready later this year.

I also asked about how much all this search innovation was costing compared to return on the investment.

No answers from either Irving or Seth.

Someone then asked if there would be a lift in market share from the feature.

That’s the plan, Stan!

10:41 am: More questions about the comparisons to Google Instant. Of course, it’s the same type of thing, in the contest to win the King of Relevancy crown among consumers.

Google Instant. Yahoo Search Direct. Quora. My dentist, who seems to know everything. In case you didn’t know, dentists are very erudite.

Seth noted that even though Yahoo has only 15 categories covered in Yahoo Search Direct, there will be hundreds to come, as well as more features on top of this feature.

Personally, I want my search delivered to me on a silver tray by a man in a purple cashmere sweater.

Speaking of purple, the demo dude kept putting Elizabeth Taylor into the query box, which depressed me. Violet eyes now closed forever.

That was the real story today.

As if to round out the event, someone asked whether critics are right about whether Yahoo should still be in search.

“We’re in this for good,” said Irving firmly.

“Look, we are not focused on the past,” added Seth, who was not here in this very room at a similar Yahoo search event years ago, when similar promises were made about search going away from a page of blue links. “I don’t even know if you’d call it search in three years.”

What would you call it then?

“Find,” joked Irving. And later, “It’s actually ‘found.’”

Apparently, Yahoo was lost and now is found via Yahoo Search Direct.

*By the way, I touched the sweater, which was–in fact, Blake–periwinkle, which is a twee version of purple.

(You can see a video interview I did with Seth after the demo here.)

Pretty Flipboard Fundraising at an Even Prettier $200 Million Valuation

Kara Swisher — Wed, 23 Mar 2011 14:15:12 +0000

Flipboard, the high-profile and highly designed social media reading app for the Apple iPad, is out raising another round of funding at an eye-popping $200 million valuation, according to numerous sources close to the situation.

The Palo Alto, CA, company declined to comment on its new funding efforts, which sources said had recently accelerated.

While that valuation might change, several sources considering the investment said it is unlikely to go down in the current frothy financing market in Silicon Valley, especially given Flipboard’s splashy profile and top-drawer pedigree.

Co-founded by longtime Silicon Valley entrepreneur Mike McCue and former Apple iPhone engineer Evan Doll in January, Flipboard launched to much attention in July.

That included $10.5 million in venture funding from Kleiner Perkins, Index Ventures and a spate of well known angel investors, such as Twitter Co-founder Jack Dorsey, Facebook Co-founder Dustin Moskovitz, the ubiquitous Ron Conway, actor Ashton Kutcher and the investment company of former News Corp. exec Peter Chernin.

At the time, it was unclear what Flipboard’s valuation was. But now, said several sources, it’s clocking in at a hefty $200 million, which is perhaps no surprise at a time of increasingly lofty investments in tech start-ups.

Suddenly, Foursquare’s $95 million valuation seems like a bargain! (Sorry, Dennis Crowley, for comparing you to the Kool-Aid pitcher dude.)

In any case, the elegant Flipboard–which McCue recently told me in an onstage interview at the South by Southwest conference in Austin had zero revenues thus far–has changed the game on the consumption of social media.

Its innovative social magazine concept is attempting to make the social networking universe more accessible, consumable and, perhaps most importantly, visually arresting via its rich app.

Essentially, Flipboard pulls information from sites such as Twitter and Facebook data streams and then reassembles it in an easy-to-navigate, personalized format in a mobile tablet touchscreen environment.

In this offering, there are pull quotes, photos, videos, status updates and even the first paragraphs of linked-out content. There is also the ability to comment and share, as if one were on Twitter or Facebook.

Flipboard has since added a number of features and will be launching its new iPhone app later this year.

Right now, the Flipboard app is free and the business plan is advertising and some possible subscription scenarios.

It will be interesting to see who will jump into this leader in a nascent market, besides its current investors. Sources said one likely target group for Flipboard could be a large traditional media company.

Until the financial dust settles, here is the video of an onstage interview by the Digital Solution’s Katherine Boehret with McCue at the All Things Digital event, D: Dive Into Mobile, in December:

[ See post to watch video ]

(Full disclosure: ATD is part of Flipboard’s publisher beta program.)

Video: GroupMe Dudes Talk Group Messaging Phenom (and Drink Beer at the Same Time)

Kara Swisher — Mon, 14 Mar 2011 22:01:45 +0000

If you had to pick the hotsy-totsy start-up to win the media darling of South by Southwest award for 2011–following in the precious footsteps of Foursquare and Twitter from years past–it would probably have to be GroupMe.

The group messaging/conference call/location/photo sharing service has, as these things tend to, garnered a lot of heat since its debut less than a year ago.

That has, of course, also meant the requisite big venture funding–$11.5 million in total–for the New York-based GroupMe, including from SV Angel, betaworks, First Round Capital, Lerer Ventures, General Catalyst Partners and Khosla Ventures.

And, no surprise, the dead-simple idea now has many start-up rivals, all vying to use combine mobile, texting, social, location, groups and smartphones into some unholy megatrend.

Still, GroupMe has built a slick little offering, which is likely to get scooped up by some bigger entity (or perhaps just copied, which is the sincerest form of flattery in tech).

Until then, its Co-founders Jared Hecht and Steve Martocci are enjoying their day in the sun–quite literally, at their free grilled-cheese-and-beer giveaway at SXSW this weekend in Austin, Texas.

Here is my video interview with their-future-is-so-bright-they-have-to-wear-shades pair:

[ See post to watch video ]

Video: BoomTown Versus Texas Hipsters and Cheddar Cheese Cats at SXSW

Kara Swisher — Mon, 14 Mar 2011 19:18:17 +0000

As it turned out, BoomTown did not succumb to hipster poisoning on my sojourn this past weekend to Austin, Texas and the famous South by Southwest festival.

The annual gathering, which has interactive, music and film elements, started last week and is still going strong–fueled, as far as I can tell, by beer, blogging, empanadas and excessive start-up hype.

Actually, it was a good time had by me, despite assertions from some longtime attendees that SXSW had somehow jumped the shark.

I personally saw no shark-jumping, but there certainly were a lot of free t-shirts and fake tattoos.

Here is a video of a variety of scenes from the weekend, from all over SXSW, from our very own All Things Digital party (I now can retire, since I had a drink named after me) to encountering a giant cheddar cheese sculpture of cats.

Yes, it was that kind of SXSW.

Enjoy:

[ See post to watch video ]

Memo Time: Yahoo Reorgs Its Ad Staff, As "The Race" Begins

Kara Swisher — Wed, 09 Mar 2011 14:15:12 +0000

In the wake of the departures of two top ad execs to social buying sites, the hiring of another from AOL and a whole new sales management team in place, it’s got to be time for a reorg at Yahoo!

And so it is.

Below is an internal memo from Yahoo’s head of U.S. ad sales Wayne Powers–who was hired in November–about changes in the Silicon Valley Internet giant’s key advertising unit.

The changes come in time for Yahoo’s global ad sales meeting, taking place in San Antonio, Texas next week.

The theme of this year’s event is “The Race Is On,” sources said, which BoomTown does not exactly grok.

Who is Yahoo racing? Does it have a fast car to do so? And is it an amazing race or just meh?

Sources tell me that, unlike at previous such confabs, there will be no big names speaking, with a focus instead on the basics of sales training and operations.

More interesting: Apparently, there are no phones allowed and violators will get their wrists slapped.

Obviously, you ad sales people will have to leak to me via carrier pigeon.

In all seriousness, it will be an important gathering as Yahoo seeks to revitalize its sales team, which has seen a spate of management changes recently.

Most recently, two longtime sales execs have left–Lee Brown to Groupon and Mitch Spolan to LivingSocial–while former AOLer Mark Ellis joined.

Here’s the rest of the mishegas via the memo:

From: Wayne Powers
To: XXX@yahoo-inc.com
Cc: Carol Bartz
Cc: Ross Levinsohn
Cc: Blake Irving
Cc: Elisa Steele
Cc: Tim Morse
Cc: David Windley
Cc: Rich Jacquet
Cc: Rose Tsou
Cc: Wayne Powers
Cc: Christophe PARCOT
Cc: Susanna Lee
Cc: Linda Lubsen
Cc: May Petry
Cc: Tekeita Lodge
Cc: Zealous Wiley

Subject: Organization Announcement

Sent: Mar 8, 2011 3:01 PM

Team,

As we evolve our best-in-class sales organization, I would like to make two key organizational announcements. I am pleased to announce that Liz Ritzcovan will be joining Yahoo! as vice president of Marketing Solutions, leading our Sales Development organization. I am equally excited to announce the promotion of long time Yahoo!, Andrea Morokutti, to vice president of Sales Operations and Strategy.

Liz was most recently vice president, Corporate Sales and Client Services, Digital at Time, Inc. where she led all media efforts and oversaw strategic digital planning processes in coordination with Time Inc, Amex Publishing and Time Warner Broadcast. Along with her team, she was focused on developing and forging sales and marketing partnerships to ensure broad distribution and effective media planning for Time’s corporate and brand partners.

Liz brings an impressive history increasing profits and expanding client and partner bases for various organizations ranging from entrepreneurial start-ups to leading multi-billion dollar global corporations. Prior to joining Yahoo! she held various leadership positions at Interbrand, CondeNast and Miller Publishing. Her expertise in print, digital, broadcast and emerging media strategy and new advertising models will be a tremendous asset to the organization. Liz has a B.A. from University of New York at Potsdam. Liz will be starting later this month and will be based in New York. She will also be at the sales conference and is looking forward to meeting many of you.

With nearly 11 years under her belt at Yahoo!, Andrea’s most recent role has been vice president of Demand Ops Finance in the Americas Region under Mark Liao. Prior to that, Andrea held various leadership positions within finance, including support of the CMO organization, Mobile and Corporate. With Andrea’s solid expertise in finance and business strategy, this new role was a natural progression for her and we excited to have her join the team. Andrea will continue to be based in Sunnyvale.

Both Liz and Andrea will report directly to me. Frank Weishaupt will continue to lead our North America Region Ad Marketplaces organization. And I’d like to thank him for his leadership of the Sales Development and Operations organizations over the last nine months.

Please join me in welcoming Andrea to the team and Liz to Yahoo!.

On a related note, Mark Ellis started last week and is up and running. He’s hitting the road and spending time meeting clients and Yahoos. Look out for him next week at the sales conference.

I’d like to thank Mitch for his many years of service at Yahoo! and wish him the best of luck in his future endeavors.

Wayne

Viral Video: "Attack the Block" and BoomTown Debut at SXSW

Kara Swisher — Mon, 07 Mar 2011 08:15:42 +0000

Like many a geek–and after a decade away–I’m headed to South by Southwest later this week.

To get in the mood for the well-known multimedia festival in Austin, here’s one of the films making its debut this coming weekend.

It’s called “Attack the Block,” and is about a teen gang fighting an alien invasion. Plus, it has the best tag line ever: “Inner City Versus Outer Space.”

Which is just about how I am feeling about SXSW!

In any case, despite my lack of hipster cred, I will be there for a party hosted by WordPress with drinks by The Wall Street Journal Digital Network and All Things Digital on Friday, as well as to interview Flipboard Co-founder and CEO Mike McCue on Saturday in an afternoon session with the subtitle: “Game-Changer or Passing Fad?”

NetworkEffect’s Liz Gannes and The Digital Solution’s Katherine Boehret will also be at SXSW, so expect plenty of coverage from Texas.

Until then, enjoy this movie trailer, y’all:

Amazon's Exit Spurs Tax Fight in Texas

Ana Campoy — Thu, 17 Feb 2011 13:00:05 +0000

The planned closure of an Amazon.com Inc. distribution center in a suburb here has opened a debate about whether taxes or jobs is the better answer for Texas’ tattered budget.

The online retailing giant said last week that it would close its center in Irving due to a dispute with the state comptroller, who is demanding that Amazon pay $269 million in sales taxes it should have collected on goods sold to Texas residents.

Comptroller Susan Combs, a Republican, said she was disappointed to see the facility’s 119 jobs go, but her duty was to collect.

That position had caused discomfort for Gov. Rick Perry, who promotes his policies as job-creating. In a rare public disagreement with a fellow Republican, he said Ms. Combs made the wrong call.

Read the rest of this post on the original site

Texas Wants Google to Spill Its Secrets–Here's the List

John Paczkowski — Wed, 16 Feb 2011 16:14:45 +0000

The antitrust investigation Google is facing in Texas is quite a bit broader than originally thought. A civil investigative demand sent last July by the office of Attorney General Greg Abbott, and first reported by Bloomberg, reveals an inquiry not just into ad pricing, but site ranking and “the manual overriding or altering of” search results as well.

The 13-page CID includes 39 different requests for documents ranging from those setting forth Google’s policies and procedures for calculating AdWords prices and minimum bids to minutes and agendas from search quality team meetings and records of the “black listing” or “white listing” of specific Web sites. Also requested: Documents that “describe, analyze, or discuss competition for advertisers from Bing and Yahoo” and others concerning the strategy for e-commerce services like Froogle and Google Shopping.

It’s an extraordinarily thorough set of demands and shows the Texas AG to be reviewing not just Google’s ranking of search results and setting of advertising prices, but questioning whether the company favors its own businesses and advertisers in results. Has Google complied with them? That’s not yet clear, though company spokesman Adam Kovacevich says discussions with Abbott’s office continue.

“Since we started Google we have worked hard to do the right thing by our users and our industry, and while there’s always going to be room for improvement, we’re committed to competing fair and square,” he said. “We’re continuing to work with the Texas attorney general’s office to answer their questions and understand any concerns.”

Texas_GOOG_CID –

You've Got Arianna: AOL Buys Huffington Post for $315 Million in Cash and Stock, Appoints Huffington Editor in Chief

Kara Swisher — Mon, 07 Feb 2011 05:01:47 +0000

In a bold and definitive move, AOL is paying $315 million, mostly in cash, to buy the Huffington Post, one of the Web’s most prominent news and opinion sites.

As part of the deal, Huffington Post co-founder Arianna Huffington (pictured here)–who was derided by some when she co-founded the left-leaning site in 2005 with investor and well-known communications exec Kenneth Lerer–will become president and editor in chief of the Huffington Post Media Group within AOL.

The deal was signed late this afternoon, and the board of directors of each company and shareholders of the privately held Huffington Post have approved the transaction.

In an exclusive video interview BoomTown conducted earlier today in Dallas, just before Super Bowl XLV, both Armstrong and Huffington were jovial that the whirlwind deal, begun in November, actually worked out so quickly.

Perhaps giddy, they hit upon a common motto:

“One plus one equals 11.”

Get it? One and one next to each other is the number 11!

Let’s move on, shall we?

AOL said it is expected to close in the late-first or early-second quarter of 2011.

Once culminated, it will put Huffington in charge of all AOL content and other properties, including well-known names such as Engadget, Moviefone, MapQuest and TechCrunch.

She said she plans to move to New York from Los Angeles, although she will also maintain her longtime Brentwood home there.

And content for all these sites will be integrated deeply into the Huffington Post, giving it a huge new infusion of editorial material.

More to the point, the flashy acquisition–which essentially came together in less than two weeks in January–will become the linchpin of AOL CEO Tim Armstrong’s aggressive, if risky, strategy to focus the long-troubled company as a content and advertising powerhouse.

For AOL, the deal gives it a popular branded site that is very good at generating lots of page views and impressions very efficiently–which is the company’s whole thrust these days.

That means lots more ad inventory to sell and an injection of content talent, giving AOL the scale it desperately needs.

The move also obviously gives AOL a much-needed editorial identity and cohesion, which it doesn’t really have.

In fact, many think AOL needs a rallying point to bring clarity to its hodgepodge of recent acquisitions that all center on the notion that a strong company has yet to emerge in the premium content space.

Here is a mock-up of the front page of AOL tonight (click on it to make it larger):

While it all makes for a riveting narrative by the charming Armstrong, AOL still has not delivered the business turnaround promised after its spinoff from Time Warner in 2009.

Wall Street, which has given Armstrong a lot of rope, has become more impatient of late to see results–especially more robust increases in its display advertising business, as its access business dies off–after AOL spun off from Time Warner in 2009.

In its quarterly report last week, AOL reported earnings of 61 cents a share on revenue of $596 million.

But, as MediaMemo’s Peter Kafka wrote:

The bigger picture is that Armstrong’s turnaround is still in progress. Ad revenue was down 29 percent in the last quarter, although that number is worse than it looks. A big chunk of the decline comes from moves AOL has intentionally made that will cut revenue in the short run in return for more profitable sales down the road.

A more representative data set for Armstrong are his display ad sales, which are down 14 percent overall and eight percent in the U.S..

The bad news is that the rest of the Web ad industry is well into rebound mode; the good news is that AOL has trained Wall Street to expect numbers like these. If you’re waiting to see positive sales numbers, Armstrong said during AOL’s earnings call this morning, wait until the second half of this year.

In any case, the move is a good one for the Huffington Post since it will vault it to the next level of growth.

Other companies, such as Yahoo and NBC Universal, had looked at the company as a purchase target, and many expected it to eventually sell out to a larger company.

Sources close to the Huffington Post said that that outcome seemed the most likely, and the recent expansion of the site and its audience made it a good time to do a deal now.

Talks with Yahoo last year went nowhere, sources said, but Armstrong was not as slow to act.

Indeed, the actual deal happened quickly, said Armstrong and Huffington in a video interview with BoomTown earlier today (which you can see here).

The pair started talking in early November of last year at the Quadrangle Conference in New York and continued their discussions through the holidays.

Armstrong made the official offer to Huffington by phone in January, while she was at the World Economic Forum in Davos, Switzerland, and he was snowed in in New York.

Five time multiple to the Huffington Post’s upward of $60 million in expected revenue for the coming year, and nearly 10 times the $31 million for 2010, the offer was accepted quickly.

AOL used cash for $300 million of the purchase and $15 million in stock for the rest.

“The idea of turning a fire hose of traffic onto our content made enormous sense,” said one person close to the situation. “Everything is changing so fast, it seemed like the time was right.”

An IPO was also considered for the Huffington Post, sources said. But since the site only recently moved into profitability–although barely–such an event would have been farther out.

That’s despite the fact that the Huffington Post has seen fast-growing traffic and influence, spurred in part by Huffington’s larger-than-life persona in both the mainstream media and blogosphere.

The wide-ranging site–which has added a number of content areas in recent years beyond its flagship political offering–currently has almost 26 million unique monthly visitors, according to recent stats, moving in close range to established news organizations such as the New York Times.

That kind of success seemed unlikely when the Huffington Post launched on May 9, 2005, positioning itself as as a liberal counterweight to the popular right-leaning Drudge Report.

But the Huffington Post’s heady mix of celebrity bloggers, personality and voice, as well as aggressive curation of links from other sites, quickly caught on.

To fund its efforts, the New York-based online media company has raised $37 million from angel investors such as Lerer–the largest individual shareholder, followed closely by Huffington–and venture firms such as Greycroft Partners, Softbank Capital and Oak Investment Partners.

The growth has not been without controversy around issues such as lack of payments to bloggers who contribute and accusations that the site uses too much content from other Web sources when linking.

And Huffington herself has also been a lightning rod, which has been both positive and negative for the site.

But, there is no question she is one of the Web’s most prominent players, along with writing books, appearing on television frequently and being a fixture at high-profile events in New York, Los Angeles and Washington, D.C.

That includes a never-ending panoply of parties that feature a potent mix of movie stars, corporate poo-bahs, glad-handing politicians and lots of journalists from all over the media.

In fact, full disclosure, I was at one of those parties this past weekend for actor Colin Firth and others involved in the making of the Oscar-nominated film “The King’s Speech.” (Apropos of nothing, actor Helena Bonham Carter is as smart as you would expect, but much more delicate.)

As part of the AOL deal, CEO Eric Hippeau–who has been integral to professionalizing the business and will be joining Lerer Ventures–and Chief Revenue Officer Greg Coleman will leave the Huffington Post.

Ironically, Coleman was replaced by Armstrong as head of ad sales at AOL after he took over as CEO. Coleman got a big payout and will now apparently get another.

But the rest of the 200 Huffington Post employees are moving over to AOL with Huffington, who Armstrong hopes will be the company’s ace in the content hole going forward.

There are likely to be changes to come too at AOL, within weeks, especially in its content-side management and site staffs.

AOL provided some quotes in support of the deal from prominent Internet figures who know Huffington well.

“Arianna is one of the preeminent authors and editors of our time, and Tim has a remarkable track record of business success,” said Facebook COO Sheryl Sandberg. “Bringing them together creates tremendous potential for AOL.”

And Twitter co-founder Biz Stone said:

“Editorial vision and leadership are essential in order to transmute our shared cacophony of voices into a valuable dialogue. Arianna’s expertise, empathy, and entrepreneurial enthusiasm forms a kind of alchemy turning mere words and phrases into powerful expressions of humanity.”

Inter-Internet harmony: How sweet!

Here is the official press release, with all the details, but there is also an 8 am ET AOL conference call tomorrow:

AOL AGREES TO ACQUIRE THE HUFFINGTON POST

Acquisition Will Solidify AOL’s Strategy of Creating a Premier Content Network With Local, National and International Reach

Arianna Huffington To Lead Newly Formed The Huffington Post Media Group Which Will Integrate All Huffington Post and AOL Content, Including News, Tech, Women, Local, Multicultural, Entertainment, Video, Community, and More

The New Combined Media Group Will Reach 117 Million Americans and 270 Million Globally

Group Uniquely Positioned To Redefine the Future of Brand Advertising and Marketing For an Engaged and Influential Audience

New York, NY–February 7, 2011–AOL Inc. [NYSE:AOL] announced today that it has entered into a definitive agreement to acquire The Huffington Post, the influential and rapidly growing news, analysis, and lifestyle website founded in 2005, which now counts nearly 25 million unique monthly visitors*.

The transaction will create a premier global, national, local, and hyper-local content group for the digital age–leveraged across online, mobile, tablet, and video platforms. The combination of AOL’s infrastructure and scale with The Huffington Post’s pioneering approach to news and innovative community building among a broad and sophisticated audience will mark a seminal moment in the evolution of digital journalism and online engagement.

The new group will have a combined base of 117 million unique visitors a month in the United States and 270 million around the world**. Following the close of this transaction, AOL will accelerate its strategy to deliver a scaled and differentiated array of premium news, analysis, and entertainment produced by thousands of writers, editors, reporters, and videographers around the globe.

As part of the transaction, Arianna Huffington, The Huffington Post’s co-founder and editor-in-chief, will be named president and editor-in-chief of The Huffington Post Media Group, which will include all Huffington Post and AOL content, including Engadget, TechCrunch, Moviefone, MapQuest, Black Voices, PopEater, AOL Music, AOL Latino, AutoBlog, Patch, StyleList, and more.

“The acquisition of The Huffington Post will create a next-generation American media company with global reach that combines content, community, and social experiences for consumers,” said Tim Armstrong, Chairman and CEO of AOL. “Together, our companies will embrace the digital future and become a digital destination that delivers unmatched experiences for both consumers and advertisers.”

Armstrong continued, “Arianna is a singularly passionate and dedicated champion of innovative journalistic engagement, and a master of the art of using new media to illuminate, entertain and enhance the national conversation. Arianna is a remarkable person and she will continue to create remarkable outcomes for the combined company.”

“This is truly a merger of visions and a perfect fit for us,” said Huffington. “The Huffington Post will continue on the same path we have been on for the last six years–though now at light speed–by combining with AOL. Our readers will still be able to come to the Huffington Post at the same URL, and find all the same content they’ve grown to love, plus a lot more–more local, more tech, more entertainment, more finance, and lots more video. We are fusing a legendary and powerful new media brand with a vibrant, innovative news organization, known for its distinctive voice, a highly engaged audience, an expertise in community-building, and a track record for demystifying the news and putting flesh and blood on the data while drawing our audience into the conversation.”

Huffington continued, “By uniting AOL and The Huffington Post, we are creating one of the largest destinations for smart content and community on the Internet. And we intend to keep making it better and better.”

Kenneth Lerer, The Huffington Post’s Co-Founder and Chairman, said, “The Huffington Post team has created a potent brand with the proven track record of knowing how to grow traffic, inform and entertain its readers and build a one-of-a-kind online community. Add that to the powerful scale and resources of AOL and you have the perfect combination for today and the future. Together these two companies will be a premier online content provider. From local citizen reporting through AOL’s Patch, to The Huffington Post’s national reporting on politics, business and culture, consumers will have access to everything they want whenever they want it.”

AOL has agreed to purchase The Huffington Post for $315 million, approximately $300 million of which will be paid in cash funded from cash on hand. The Huffington Post is privately owned by its two cofounders, as well as a group of investors. The proposed transaction is subject to customary closing conditions, including receipt of government approvals. The boards of directors of each company and shareholders of The Huffington Post have approved the transaction. The transaction is expected to close in the late first- or early second-quarter 2011.

The Huffington Post over-indexes on educated, affluent users, reaching the key decision makers in C-suites around the globe. The Huffington Post speaks to this influential audience via a host of prominent voices on its group blog. Among those who have blogged on The Huffington Post are: President Barack Obama, Secretary of State Hillary Clinton, Mayor Michael Bloomberg, Larry Page, Diane Sawyer, Buzz Aldrin, Nora Ephron, Bill Maher, Madeleine Albright, Robert Redford, Katie Couric, Neil Young, Rahm Emanuel, Mia Farrow, Senator Russ Feingold, Senator Al Franken, Ari Emanuel, Harry Shearer, Senator John Kerry, Representative Nancy Pelosi, Madonna, Lawrence Summers, Jamie Lee Curtis, Ryan Reynolds, Craig Newmark, Alec Baldwin, Aaron Sorkin, Natalie Portman, Scarlett Johansson, Russell Simmons, Sean Penn, Bill Gates, Norman Lear, Charlie Rose, Elizabeth Warren, Tavis Smiley, Sheryl Sandberg, George Clooney, and former President Bill Clinton. And the audience speaks back, generating four million comments a month***.

The Huffington Post’s affluent, influential audience, that is growing at a rate of 22 percent (December 2009 vs. December 2010)****, when combined with AOL’s massive scale, video offerings and local expertise, will represent an incredibly desirable demographic for a broad range of advertising partners across the board.

And here is Armstrong’s internal memo to the AOL staff:

AOLers,

We are taking another major step in the comeback of AOL. Today we are announcing that we have agreed to acquire The Huffington Post, one of the most exciting, influential, and fastest growing properties on the Internet. We believe in brands, quality journalism, and the positive role of communities in the world–The Huffington Post shares our values and the combination of the two companies will create the premier global and local media company on the Internet.

Co-founded six years ago by Arianna Huffington and Ken Lerer, The Huffington Post has grown to become an industry leader–one of the Web’s most popular and innovative sources of online news, commentary, and information. Arianna and team have created a brand and a destination that focuses on the consumer experience. By combining The Huffington Post with AOL’s network of sites, thriving video offerings, local expertise and enormous reach, we will create a company that is laser-focused on serving our audiences across every platform imaginable–social, local, video, mobile and tablet.

The Huffington Post is core to our strategy and our 80:80:80 focus–80% of domestic spending is done by women, 80% of commerce happens locally and 80% of considered purchases are driven by influencers. The influencer part of the strategy is important and will be potent.

The Huffington Post is a strong influencer brand and it attracts a valuable audience, including a great focus on women’s content. In addition, Arianna Huffington is a world-renowned expert on women’s topics and issues, and has enabled The Huffington Post to grow rapidly by continually developing new audiences.

In the local area, the combination of the two companies will create a scaled connection between global and local communities on one platform. This will create a new way for people to get local and global information in a timely and entertaining way.

The Huffington Post will join the family of AOL Brands that are destinations for an influencer audience, brands like TechCrunch, Engadget, AutoBlog, and Moviefone. Uniquely, The Huffington Post is the platform for influential people–the people that drive trends, commerce, politics, entertainment, news, and information. Adding this strategic platform to our already strong network of sites, including the AOL homepage, has the potential to make AOL the most influential company in the content space.

Arianna Huffington is one of the most successful entrepreneurs in the Internet space and someone that is even more successful in building communities and relationships in every corner of the globe. The Huffington Post and Arianna have created a company that has partnered with the most successful and well-known leaders in all aspects of society that touch important topics to give consumers direct access to the most influential decision makers and community leaders.

This acquisition will create a high-quality and diverse digital ecosystem encompassing local, national and international news, politics, entertainment, technology, fashion, sports, health, personal finance, green, lifestyle, the arts and more. This deal will combine the amazing talent at AOL with the innovative and talented staff of The Huffington Post. Here are just a few high-level points around what this deal brings to market:

* Together, AOL and The Huffington Post will have 117MM unduplicated domestic monthly UVs, and ~270MM monthly UVs worldwide (according to comScore Dec 2010).

* The Huffington Post is one of the fastest growing web properties on the Internet. It grew 22% last year–that’s faster than Twitter, which grew 18% – and 15x as quickly as the Internet grew last year (comScore Dec ’09-’10).

* Both AOL and The Huffington Post count powerful, affluent users among their top loyal visitors, significantly over-indexing in $100K+ income users.

* AOL passed Hulu in unique viewers on video in the fourth quarter of 2010; video views on AOL are up 400 percent year-over-year.

* Between AOL’s innovative Project Devil ad unit, engaging users for 27 seconds longer than traditional display ads, and The Huffington Post’s highly-vocal community, with 4MM+ comments per month, we will marry attention-grabbing content and brand experiences for both advertisers and consumers.

In the local area, the combination of the two companies will create a premier global/local syndication network at scale. This will create a new way for people to get local and global information in a timely, informative and entertaining way.

To maximize the strategic advantage of this great deal, we will be creating a new group at AOL called The Huffington Post Media Group. Within this group will be AOL Media, AOL Local & Mapping, AOL Search and our new friends at The Huffington Post. We will continue operating the towns structure, AOL.com and HuffingtonPost.com.

I’m thrilled to announce that Arianna Huffington will join AOL’s executive team as President and Editor in Chief of The Huffington Post Media Group. We have asked Jon Brod to lead the overall operational integration on the AOL side of the combined entities. Jon will lead the local group integration and work closely with David Eun and the teams in AOL Media. We will work quickly with The Huffington Post to create a combined organizational design to coincide with the deal closing. While we wait for the required regulatory reviews to be completed and the transaction to close before implementing the design, we will move very quickly to plan the details of the integration of the two companies. To this end, we will announce the new organizational structure as soon as possible.

In the meantime, we will continue creating great content and products for our consumers within the town structure and stay laser-focused on the aggressive goals we have set for our winter luge. We are on the right track and will continue our weekly operating cadence and town structure to drive successful results against our company goals.

Here’s a special message for all of you we taped to welcome The Huffington Post and Arianna to our AOL Family:

http://today.office.aol.com/company-news/2011/02/aol-agrees-buy-huffington-post

And of course we wanted to welcome Arianna to our “You’ve Got” video of the day–check her out on AOL.com.

We will be holding a company all hands meeting to address your questions related to today’s exciting news. We will video conference from our New York office on the 6th Floor at 9:30 AM ET and will be joined by Arianna Huffington and key executives from her organization. We will also be holding a call for our west coast offices at 2:00 PM ET and for our Patch offices at 2:45 PM ET. See below for meeting info (conference rooms will be sent out shortly).

AOL is playing to win…and The Huffington Post and AOL will occupy a unique place in the future of the Internet. Let’s go get it done.

–TA

(More full disclosure: As has been previously reported by MediaMemo, All Things Digital had the briefest and most preliminary of discussions with Armstrong about moving to AOL last year, while exploring several other options. All’s well that ended well: We stayed at Dow Jones, which is owned by News Corp.)

Exclusive Video: AOL's Tim Armstrong and HuffPo's Arianna Huffington Talk About Their Acquisition Touchdown From the Super Bowl

Kara Swisher — Mon, 07 Feb 2011 05:01:45 +0000

Here’s an exclusive video interview BoomTown did with Huffington Post co-founder and Editor in Chief Arianna Huffington and AOL CEO Tim Armstrong this morning at Super Bowl XLV in Texas, just ahead of their announcement tonight that the Internet company was buying the news and opinion site.

Like both the Green Bay Packers and the Pittsburgh Steelers, the pair are going for an Internet content win, after AOL paid $315 million, mostly in cash and a small amount of stock, for the Huffington Post.

With the acquisition of one of the Internet’s best-known news brands, AOL is making its biggest move so far as it seeks to establish itself as a content leader on the Web.

As part of the deal, Huffington will become editor over all AOL content properties.

And editorial material from all these sites will be integrated into the Huffington Post, giving it a huge new infusion of editorial material.

The pair talk about all this and more in the longish video interview here, which I did in Dallas earlier today:

[ See post to watch video ]

Man, I Got So WikiLeaked Last Night

Beth Callaghan — Tue, 21 Dec 2010 20:23:29 +0000

“WikiLeaks” has entered the canon of the English language, but not according to the OED. Research done by a group known as Global Language Monitor shows that “WikiLeaks” has appeared in global media more than 300 million times since 2006. The Texas-based group cites a minimum of 25,000 mentions in English-speaking media as a requirement for the name to become its own lowercase, generic word. Unfortunately, GLM doesn’t specify its definition or whether the word would be used as a noun, verb, adjective or adverb.

Four Arrested in Tech-Heavy Insider Trading Case

Arik Hesseldahl — Thu, 16 Dec 2010 18:29:24 +0000

The FBI has arrested four people in connection with an insider trading investigation that’s been conducted by prosecutors in New York City, and the defendants are connected to several technology companies.

James Fleishman, 41, of Santa Clara, Calif., a sales manager for a research firm called Primary Global Research, based in Mountain View, was arrested on charges of wire fraud and conspiracy. According to a statement from Manhattan U.S. Attorney Preet Bharara, Fleishman conspired to provide confidential information, including material, non-public information to the firm’s clients using a network of employees at various tech firms.

One was Daniel Devore, a global supply manager at Dell who also worked as a consultant for the research firm. Devore pled guilty on Dec. 10 to charges of wire fraud and conspiracy to commit wire fraud. The complaint against him says he was paid more than $145,000 during a period starting in late 2007 and ending in Aug. 2010 for providing inside information on Dell’s suppliers. Devore is said to be cooperating in the case.

Three more people were arrested today, all on charges of wire fraud and conspiracy to commit wire fraud:

Mark Anthony Longoria, 44, of Round Rock, Texas, worked as a supply chain manager for Advanced Micro Devices. The complaint says Longoria provided Primary Global clients with revenue and gross margin information, sales figures and average sales prices, all very useful to stock traders. According to the complaint he was paid more than $200,000 for the information.

Walter Shimoon, 39, of San Diego, worked for Flextronics, the Singapore-based contract manufacturer as its senior director of business development. Between 2008 and 2010, the complaint says, he was paid $22,000 for consultation calls with Primary Global clients during which he supplied insider information about Flextronics’ dealings with Apple, filling them in with confidential details about the forthcoming iPhone models, and about the iPad.

Manosha Karunatilaka, 37 of Marlborough, Mass., worked for Taiwan Semiconductor Corp., the massive chip foundry company. The complaint says he provided Primary Global clients with insider information on that company, including confidential sales and shipping information, and was paid $35,000 between January of 2008 and June of 2010.

There’s more details here from The Wall Street Journal.

The criminal complaint is below:

Shimoon, Et Al. Complaint

Shopkick Checks In With Target–CEO Cyriac Roeding Talks About Social Shopping

Kara Swisher — Tue, 16 Nov 2010 18:28:13 +0000

The idea of being rewarded for being a consumer is getting a lot of heat of late, as retailers seek to take advantage of the fast-moving social phenom among consumers, especially young ones.

Thus, a wide range of efforts to combine location-based mobile apps with purchasing, both online and offline.

Earlier this week, BoomTown posted on a funding for one such start-up, Topguest, which links check-ins with airline and hotel loyalty programs.

Today, another company in the space, shopkick, announced it had added another store–Minneapolis-based Target–to its list of retailers deploying its platform and mobile app.

As with customers of Macy’s, Best Buy and others, users of the shopkick app will receive points and other rewards, as well as instant mobile coupons, just for walking in the store.

The point being: Retailers need to reward foot traffic and not just purchases.

The Target partnership is limited now to 242 stores in the Chicago, Dallas, Los Angeles, Miami, Minneapolis, New York City and the San Francisco area.

Target will also offer scannable mobile coupons to customers for redemption at checkout.

It will be interesting to see how effective apps such as shopkick are as they roll out, as consumers test them.

Unlike others that offer quick deals–from Foursquare to Facebook to, now, Yahoo–shopkick uses its “kickbucks” as an enticement simply for being present in a store or scanning certain barcodes.

It’s certainly easy enough–my son, Louie, did it with ease and definite enjoyment–although a user does need to remember to fire up the app when entering a participating store.

There is also a small device retailers need to install need to make the shopkick ecosystem work.

CEO Cyriac Roeding, a former EVP for CBS’ mobile unit, created the concept for the Menlo Park, Calif.-based start-up while an entrepreneur-in-residence at Kleiner Perkins.

The company has raised $20 million in venture funding from Kleiner’s iFund, longtime Silicon Valley investor Reid Hoffman, as well as Hoffman’s home at Greylock Partners.

Here is a video interview I did with Roeding about where shopkick is going next:

[ See post to watch video ]

Viral Video: Fear the Beard, Kung-Fu Panda and How SF Didn't Stop Believing in the Giants!

Kara Swisher — Tue, 02 Nov 2010 07:02:26 +0000

Go Giants!

As in: The World Series Champions San Francisco Giants!

After BoomTown and the Swisher boys finished toilet-papering the intersection of Castro and 18th Streets (and my No. 1 son Louie sure has some arm on him), it was back to All Things Digital Global HQ to gloat all night about the baseball triumph.

And also wallow in victory over those fans in Texas who did not think our lovely City by the Bay and its vegan-leaning, organic-loving, get-your-freak-on-living denizens could pull it off.

Yes, we are too politically correct, but it must be said, in any case: Fear the Beard! (Also, Beware the Hair!)

And Giants fans also know how to do great music video, such as this one by Ashkon, created a few weeks ago:

Zynga Makes Another Acquisition–Dallas's Bonfire Studios

Kara Swisher — Tue, 05 Oct 2010 17:00:58 +0000

Zynga announced another small acquisition today, as it continues to vacuum up small independent online game developers across the U.S. and internationally.

This time it’s Dallas-based Bonfire Studios, which the San Francisco-based social gaming start-up said would now be called Zynga Dallas.

Bonfire makes titles for the PC and Xbox 360, such as “Age of Empires,” “Age of Mythology” and “Halo Wars.”

Zynga said Bonfire’s three founders–David Rippy, Bill Jackson and Scott Winsett, will become GM, creative director and senior art director, respectively, of Zynga Dallas.

Zynga’s other recent purchases include Challenge Games, which is based in Austin, as well as several others abroad.

Financial terms of the deal were not released by Zynga.