Archive for May, 2010

OK, so I’m a tech Pollyanna. Sue me

Thursday, May 27th, 2010

Heading into the teeth of earnings season, the news won’t be much more encouraging. At best, it promises to be a rough patch. At worst, who knows? The VIX, a volatility index, climbed to levels Monday that now basically price in the coming of Armageddon. OK, we’ve seen better times. But before jumping off a ledge, some historical context is in order.

The pendulum swings both ways. Fact is that we’ve been here before, folks. Not in the exact same circumstances, of course, but in an atmosphere where the fashion of the day favored sackcloth and ashes.

With banks disappearing, liquidity drying up, and the political class clueless about events overtaking the economy, this is what a crisis looks like. If you want a good primer on the origins of what’s now turning into a global credit crunch, check out the primer, courtesy of 60 Minutes, that I’ve embedded at the bottom of this post.

• Another Wall Street house cut estimates on Yahoo.

• Netflix lowered its quarterly outlook.

As the author of Ecclesiastes wrote a long time ago, there is nothing new under the sun. Cliche or not, take that advice to heart in the days and weeks ahead. It may come in handy.

The $64,000 question (now $32,000 and falling) is the impact on the technology industry. So it is that just Monday, the following items came in on the transom:

But Silicon Valley kept doing what it always does, inventing better hardware and software. Venture capitalists regained their nerves, entrepreneurs got funded, and innovation flourished.

• SAP issued a third-quarter warning.

• eBay announced plans to lay off 1,000 employees.

You know it’s grim out there when the television talking heads report that the stock market only
finished down 369 on a day when it fell as low as 800 points.

(Credit:
CNET News)

More people have fresher memories of the Internet bubble burst. That was an especially ugly time as tech got nearly obliterated after 2000. For a while, it seemed the weekly additions to the Dead Pool of former high flyers would never end. But as bad as it got, that was only a brief chapter in the longer-running story of the computer industry. Normalcy returned and market valuations–for real companies, not the fakers–would later recover.

Remember the October 1987 crash? In its aftermath, technology companies couldn’t get the time of day from investors. Back then, I was a young reporter and was amazed that it didn’t seem to matter that companies like Apple or IBM had beaten expectations. Their stocks would still get creamed. The herd simply was too frightened to think past the headlines du jour.

Diddit makes your ‘bucket list’ social

Monday, May 24th, 2010

In a demo earlier this week, Paul Gauthier–the co-founder of Ludic Labs, the creator of Diddit–told me he wants to turn this into a simple way for people to get new ideas for things to do based on their existing activities. “One of the things we’re going to be able to do is start harnessing it like Amazon or Netflix,” he says. “Diddit will be able to say ‘what you did, you’ll like doing these things.’ This will work once we hit a critical mass of data. Our search engine days will help us with that.”

Here's an example list. Diddit breaks down what its members have done for each item or activity.

Missing at launch, but in the works, is a mobile application. Gauthier says it’s a clear next step considering most people have their phones with them while they’re doing these activities. He wants it to be a resource that people can pull up when they’re in a place they’re unfamiliar with. The application would also pull double duty, letting users chronicle something they just did or saw while out and about and taking advantage of their phone’s built-in camera and GPS.

At least that’s the plan.

Gauthier is referring to his work at the now Yahoo-owned search software company Inktomi, of which he was a co-founder.

The site shares much in common with Yelp and its lists feature, and the recently launched ThisMoment. You can make your own list using activities or locations that others have already added to the database. You can also share a story about any item or activity, complete with a rating from 1 to 10.

There’s also no way to search through its members based on shared activities or hobbies. A dating site called Youniverse that we checked out back in June of last year did a great job at this, and made the match-ups far more engaging–even if you weren’t looking for love.

Lofty ambitions aside, when it comes to explaining how and why it’s matching you up with other users the tool is not quite there yet. For instance, it doesn’t tell you what things you share in common with the people it suggests as friends.

(Credit:
CNET Networks)

Faults and all, I found Diddit to be a very enjoyable way to take stock of life and what you’ve done. Some users have put together truly well-thought-out lists that are a joy to go through, and the promise of future lists and items to check off makes it worth coming back to.

As you begin to build up more of a profile, Diddit starts to match you up with other members who have done or enjoyed similar things. Likewise, it categorizes the things you’ve done to give you a bird’s eye view of what you may not know you liked, as well as areas you need to fill out. All of this data will eventually culminate into a really deep recommendation tool.

Diddit is a new site for making lists. These lists are not the kind you make for the grocery store or things you need to do at work. Instead it’s places you’ve been, toys you had as a kid (or adult), and anything else that could be chronicled. Some might find this useless, but it’s what the site does with the data you’ve given it that makes it so fun.

Google Chrome breaks out of beta

Thursday, May 20th, 2010

Google’s browser, Chrome, is officially leaving beta today.

The update system has been used for 14 updates of the beta product so far. This 15th update will be the first non-beta release.

Chrome's privacy options are now in one place.

How to get it
The first people to get the non-beta version will be new users who download the browser directly from Google. Also Thursday, a small proportion of existing Chrome users will automatically get the update. On Friday, all the remaining Chrome users (10 million, according to Google) will get the download. (You can also download it from CNET here.)

What’s in a Google beta?
For a Google product, Chrome is leaving beta very quickly — 100 days after public launch. Pichai said that Chrome now meets Google’s “internal standards for stability and performance” and that its heavy use inside Google before its public release has contributed to its rapid graduation to released product status.

“All the developement is in the open,” Pichai said. Curious users can monitor Chrome’s progress at Chromium.org, or download the Google Chrome Channel Chooser, which will tell their installation of Chrome to download either the betas between major updates of Chrome, or even the nightly (and often buggy) builds of the browser as it is developed. Pichai recommends that last option for those dying of curiosity about Chrome’s upcoming extension support.

Are you more inclined to use Chrome now that it’s officially out of beta?
( polls)

Features that the team is still working on include autofill for forms, native support for RSS feeds, “and so on.” But the top three features that Pichai says he and his team are working on are extension support and
Mac and Linux versions.

There are new features, as well. The bookmark manager is being revised to do a better job for people who have lots of bookmarks, and for those who want to import or export bookmark lists. Privacy options have all been consolidated into one dialog box. And there are improvements in the security features of the browser.

Yesterday at the Le Web 08 conference in Paris, Google VP Marissa Mayer told TechCrunch’s Mike Arrington that the move would be happening, but she did not say when. Google representatives have confirmed the Thursday change of status for Chrome.

Rate Google Chrome on Download.com.

Google has big plans and goals for Chrome. Truly widespread adoption of the product won’t happen in businesses or on the pre-installed software suites of new computers until the product is not just known to be stable by users but vouched for as production-ready by Google — and that means taking it out of beta, even if the word itself means less than it used to.

But clearly there’s more at play here than that. For comparison’s sake, only recently did Google remove the beta tag from Picasa, and it was years old and in its third major version. Gmail is still in beta, despite being relied on by tens of millions of users.

If you want to know whether you have the update, check Chrome’s About page. If you don’t have the current version, you can force the update from the dialog box. Normally, Chrome checks for updates every fifth hour of use.

What’s included
Sundar Pichai, vice president of product development, told me that this release of Chrome will have “tons and tons of bug fixes,” especially around audio and video playback, which should now be “more stable.” Chrome will also be faster. Pichai said Google’s browser is 1.4 to 1.5 times faster (depending on which benchmarks you use) than it was at launch.

Microsoft Windows 7 not a lock for ‘09

Tuesday, May 18th, 2010

LAS VEGAS–It’s not clear whether Microsoft is just trying to be overly cautious, but top Windows executive Bill Veghte said the company is telling PC makers that
Windows 7 might or might not be ready in time for this year’s holiday season.

Veghte also said that the economy is factoring into his marketing plans for Windows, which is in the middle of an advertising push initially estimated at several hundred million dollars over several years.

“I’m telling them that it could go either way,” Veghte told CNET News in an interview Wednesday. “We will ship it when the quality is right, and earlier is always better, but not at the cost of ecosystem support and not at the cost of quality.

Asked whether he thought the same applied to the unit’s staffing level, he said Windows is core to the success of the company,” but added that he’s “certainly looking at how we can be more efficient, and given the mission in our advertising spending that we just talked about, efficient in where we apply our headcount and efficient, but not at the risk of jeopardizing the opportunity that we have.”

“Given the economic situation, as shareholders would expect us to tighten our belt, but with the things that are most important, and customers would expect us to do that while continuing to innovate,” he said. “The expectation is that the dollar we spend on advertising today will go further than it did in July…and the Windows business is pretty core to Microsoft, it’s core to the Microsoft brand, so we will continue to invest in support of Windows.”

Virtual goods bubble looming

Sunday, May 16th, 2010

With all of this interest and efforts toward monetization, is this a bubble waiting to burst?

Virtual goods are part of the walled garden in which they are purchased and consumed. If they fail, they only fail within that specific environment and don’t take down the ecosystem because there really isn’t one.

So far, my answer is no.

For example, I can’t start a company to sell virtual cookies on Facebook (though I can use Viximo, which takes the lion’s share of the revenue) and even if I could sell on Facebook the virtual cookies wouldn’t transfer to other sites Gaia or Habbo. I also can’t take the sword I purchased in WoW and use it in IMVU. And while that might be nice, it probably doesn’t matter.

It’s not clear just how big the virtual goods market is, nor have we seen it become completely bastardized as we eventually will when marketers try to sell anything and everything. In the mean time, it’s nice to see any economy flourishing.

Just today social network Hi5 introduced multicultural holiday gifts along with a new payment system. Virtual world Habbo also introduced a new type of currency and reward program for loyal users.

There is no portability of the goods between social networks or virtual worlds due to technical and business reasons and therefore there are limited opportunities for outside providers to base their businesses in other-world environments. That insulates others (meaning not the base site) from going down with ship.

The buying and selling of virtual goods is an extremely nascent market that seems to be heating up dramatically. Almost daily there are announcements pronouncing large virtual good revenues on the horizon and new forms of payments and rewards for the intrepid user.

Skype’s temporary iPhone vanishing act

Sunday, May 16th, 2010

Skype says the issue is being fixed and that the VoIP app for iPhone is in the process of repopulating the App Store. Skype for iPhone is already available again in Europe, Skype says, and will return to global app stores within a few hours at most.

Updated at 12:30 p.m. PDT with more information.

A week after its initial release in the iTunes App Store, Skype for iPhone has mysteriously disappeared. The vanishing act is temporary, Skype tells us, and began between 10 a.m. and 11 a.m. Pacific Time.

“The Skype for
iPhone app was down for a couple hours, caused by our own submission of a ‘hotfix’ to simply address some feedback and minor improvements. The release date for the ‘hotfix’ was incorrectly applied to the current version of the app.”

According to a Skype representative,

Apple activates Genius feature for iTunes videos

Saturday, May 15th, 2010

iLounge spotted the new Genius feature, which recommends movies or television shows you might be interested in purchasing from the iTunes Store based on your current video library. Apple unveiled a similar feature for music last year, but one notable difference with the video version is that it only seems to work with videos that have been purchased from Apple, according to iLounge’s early testing.

When iTunes 8.1 shipped earlier this month, the company initially said the video Genius feature would be available in the release notes for that software, but it was not active. At the time, an Apple representative promised the company would activate the feature “in the coming days.”

Apple has switched on its Genius recommendation engine for videos, two weeks after releasing the latest version of iTunes (download for Windows and Mac) without the promised feature.

Tax, shipping costs coming to Google Product Searc

Saturday, May 15th, 2010

On most deal sites like Slickdeals or Fatwallet you’ll see people work this out on their own–Google is just taking that extra step out of the equation, which could make it even easier to find a good deal without surprises. As an addendum to this feature, I would love Google to cross-reference its product index with a rebate index to let you save that much more on bargain goods.

The new system runs through Google’s Base product, letting retailers note whether they charge tax. It’s also set up to let them set tax and shipping amounts by location so that the price will change based on where the searcher is from.

Nobody likes to find a good deal that ends up being a bad one because of exorbitant shipping costs. In the jungle of online retailers indexed in Google’s Product Search (formerly Froogle), nothing is more common. To solve that problem, Google has begun a voluntary program for retailers to include their shipping and tax information so that potential buyers can see what the total cost will be before clicking.

Nortel slashes outlook, looks for asset buyers

Tuesday, May 11th, 2010

Meanwhile, Cisco Systems, which competes with Nortel in some areas, on Tuesday at an analyst conference reiterated its confidence in its long-term growth projections of between 12 percent and 17 percent. CEO John Chambers noted slower near-term growth, as customers tighten their belts, but even in the short run, Cisco still expects to grow 10 percent.

Nortel said its revenue for 2008 will be about 2 percent to 4 percent lower than it was the previous year. Third-quarter revenue will be about $2.3 billion, short of the $2.66 billion that some analysts had expected.

Of course, Cisco has diversified its business in different areas and has always been focused on Internet Protocol technology. It is also pushing video technology as a main growth area. On the other hand, Nortel’s products are focused on telecommunications, a segment that has come under severe pressure lately.

The company blames its woes on phone companies and large corporate customers, which have been cutting back on their capital expenditures more than had been expected. Nortel CEO Mike Zafirovski said the company is conducting a comprehensive review of its business. And he said it is looking for a buyer for its metro Ethernet equipment business.

Telecommunications equipment maker Nortel Networks announced on Wednesday that it has slashed its business outlook and is looking to sell some of its assets as the economy worsens.

State attorneys general push online child safety s

Wednesday, May 5th, 2010

Disclosure: I am a paid student fellow at the Berkman Center at Harvard University, which participates in and hosted the meeting of the Internet Safety Technical Task Force. In particular, professor John Palfrey, the chair of the Task Force, is also the Faculty co-director of the Berkman Center, where I work. I have neither consulted with Palfrey, nor any of my other colleagues at Harvard with regard to this blog post. It reflects my own opinions, and certainly not those of Harvard or any of the other people associated with the Berkman Center.

The not so thinly veiled threat aired at the event was that if the industry didn’t police itself, the various state AGs might have to push for regulation. The fact that the technology isn’t effective doesn’t seem to be a major cause for concern. All that really seems to matter, at least for the policy makers, is that the industry do something, which can then be sold to voters back home as a success in protecting little Jane or Johnny.

Internet users are a fickle bunch–that is, they are not particularly loyal to brands, and if a company’s product ceases to be cool, users will leave in droves. As an example, just look to Friendster, which was at one point the most popular social-networking site on the Internet. Once MySpace offered a better, more enjoyable experience, Friendster turned into a cyber-ghost town. While the network effect is indeed a powerful and sticky force, a lame user experience will be more than enough to make users leave for greener pastures.

Fast forward a couple years: Napster had been sued into financial oblivion, and America’s teens had moved on to a significantly more legislation-resistant file-sharing platform–Kazaa. This file-sharing company, designed by three men from Sweden, developed by programmers in Estonia, headquartered in Australia, and incorporated in the south pacific island nation of Vanuatu, was global in scale, and for the most part, completely beyond the reach of America’s laws.

Attorneys general from a number of states have given their support to a collection of weak and ineffective age verification technologies, all of which aim to protect children on the Internet. At a meeting of the Internet Safety Technical Task Force at Harvard University on Tuesday, the consensus seemed to be that while none of the technologies actually work, doing anything at all was better than nothing. Simply put, no one wants to be blamed for inaction against online child predators.

Second, the social-networking sites: Facebook and MySpace, the 500-pound gorillas of the industry don’t seem to be too keen to adopt any of the existing solutions pitched by vendors–primarily because the technology doesn’t do much, won’t stop abuse, and will cost the companies money. While News Corp’s MySpace certainly has deep pockets and could easily pay a couple million for age verification software, the company appears to be resisting calls to do so primarily out of an urge to avoid a slippery slope. That is, if the social-networking site can be pressured into forcing its user base to jump through one level of inconvenient and burdensome verification, other demands will soon follow.

Third, the “solution” vendors: This collection of companies rely upon fear to sell their products–not so much fear of the abuse of children by predators, but the fears of companies and politicians that they will be accused of not doing anything. These firms are not selling complete solutions to the problem of age verification (since one does not exist)–but are selling excuses. That is, if social-networking sites purchase their products, and children are later groomed or abused online, the companies will at least be able to claim that “we’ve purchased and used the best age verification products that industry offers. Don’t blame us–we’ve at least tried to do something.”

Won’t someone think of the children?
Given the intense political pressure to do something about child safety online, and a complete lack of proven, peer-reviewed, and abuse-resistant technologies available on the market, a number of private companies have stepped in to fill the void–with products that can at best be described as ineffective, and at worst as snake oil.

This form of verification has been repeatedly criticized as “laughable” by security experts. As a test, I was able to successfully view the trailer for Sony’s new thriller movie, Quarantine, by giving the name, date of birth, and ZIP code of vice presidential candidate Sarah Palin, all of which were available on the politician’s Wikipedia page. Sony Pictures uses an age verification service from Sentinel (another company which presented at the task force meeting), which seems to only protect the fragile eyeballs of technologically unsavvy youngsters who have not yet learned how to use a search engine.

First, the politicians: Attorneys general from 49 states have been focusing on this issue for some time, culminating in an agreement signed with MySpace back in February of this year–the only state to reject the deal was Texas, whose AG felt that the deal didn’t go far enough. This is an issue that carries a lot of weight with voters, and as New York AG Andrew Cuomo’s recent strong-arming of ISPs over their Usenet news feeds has demonstrated, easy political wins can be gained with little to no pushback from the tech industry.

Whatever you think of file-sharing, there is one thing that is beyond debate: Due to a change in the legal environment, Americans abandoned, en-masse, an American company’s P2P offerings, and instead signed up for the services offered by a foreign company whose CEO could never be hauled before the U.S. Congress. Furthermore, while Napster was primarily a service offering free music downloads, the Kazaa platform offered easy access to music, movies, pirated software, and pornography (of both legal and illegal varieties)–all from the same easy to use graphical interface. That is, by chasing file-sharing underground, we completely gave up any possibility of lightly regulating it.

The offshore problem
The elephant in the room in this debate is the issue of foreign Internet companies. That is, if American social-networking sites are forced to implement oppressive and burdensome age verification rules, teens may ditch MySpace and head to a Chinese, Brazilian, or Indian Web company, where a user’s age is not verified.

Kicking off the meeting, Richard Blumenthal, the Connecticut attorney general, summed up the general expectation of the other 48 state attorneys general involved in the effort: “If we can put a man on the moon, we can make the Internet safe (for children).” Unfortunately, while the federal government sunk billions of R&D dollars into NASA’s space efforts, the AGs have yet to cough up any research funds, and seem to expect industry to come up with their own solutions.

No one present at Tuesday’s Task Force meeting had any solutions to this problem, nor were they too keen to discuss it. It would be cruelly ironic if in an effort to protect America’s youth online, those same children were chased into the hands of unscrupulous foreign firms with little incentive to protect their users from predators and other forms of harm.

Now, as another example, consider the case of Napster, the first peer-to-peer file-sharing company. Remember that for a time, Napster was the most popular file-sharing tool on the Internet, with tens of millions of users. As an American company, once Congress got wind of the file-sharing phenomenon, it was able to hold hearings, and force the CEO of Napster to appear before the Senate Judiciary Committee.

Several age verification solutions were presented at the task force meeting, from companies that included Aristotle, IDology and Sentry. All of the companies seem to do pretty much the same thing–collecting information from public records, and then prompting users to enter some of this info when they wish to log in to an “age restricted” Web site. One example of this is the rated R movie trailers of many Hollywood movie studios, which require a user to enter in his or her name, ZIP, and date of birth before playing the trailer.

Updated:This post originally contained incorrect information about Sentinel’s products. That has been corrected (see below).

During the question and answer sessions following their presentations, each of the age verification and other child safety technology vendors admitted that their products are neither bullet proof nor even that difficult to evade. However, they all generally preached a belief in the security benefits of “raising the bar” and providing a “bump in the road.”

Update: The original version of this blog post included Sentinel in the list of companies who push weak age verification software to social networks. In fact, Sentinel has voluntary withdrawn its age verification products from the social networking market, although it continues to supply the easy-to-evade product to Hollywood movie studios.

Speak softly and carry a big stick
With companies and politicians falling over themselves to prove how much they are doing to keep children safe, it is worth taking a look at the incentives and motivations of this industry.

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