Monday, August 31, 2009

The Latest from TechCrunch

The Latest from TechCrunch

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Analyst Believes iPhone Will Become Non-AT&T Exclusive In A Year

Posted: 31 Aug 2009 08:07 AM PDT

11529_large
Oh, Gene Munster. You keep popping up like the loose Cheerios my nine-month-old daughter drops at breakfast. What are you up to this time, you little scamp?

Munster of Piper Jaffray “predicts” that AT&T will lose its iPhone exclusivity by the end of 2010, thereby rendering the company impotent and insolvent. Some contenders for the iPhone throne include Verizon. This ignores the fact that AT&T is fighting like a champ to keep the iPhone until 2011 but it seems the popular perception of AT&T as a pile of fail may put a damper on Apple’s wish to stay put.

Is Munster right? Well there has been a little discussion of a non-GSM iPhone on the Internets. Look at the logistics: Sprint isn’t going to take the phone - they’re wrapped up in Palm right now - and T-Mobile is busy with Android. That leaves behemoth Verizon. Quoth Munster:

“We believe Apple is unhappy with the current status of video on the iTunes Store and is working to change it,” Munster said. “These changes, however, will take time, in the form of lengthy negotiations, in order to bring the rights for TV and movies up to speed in a digital world.”

I think a CDMA iPhone is in the cards, certainly, and I suspect they’ll try something like Blackberry and add a SIM card slot for international roaming. iPhone users are a nomadic lot and I can only imagine the outrage when a bunch of study abroad students turn on their Verizon iPhones and find they don’t work in Florence. As for the CDMA model coming “within the year?” Eh. Don’t hold your breath. The iPhone is selling pretty briskly right now and ramping up production of a CDMA model would be difficult at best.

Take all this with a grain of salt, though. Analysts are notoriously, well, wrong. Rob at BBG said it best when commenting on the AppleTVTV:

Their clients gamble that analysts know more. And sometimes, they do. As often as not, however, analyst clients end up paying someone with few real contacts to tell them the same thing that bloggers with few real contacts have already told the whole world, for the lulz.

Yes, friends, we work for the lulz.

Image from this funny dude

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Informal TC/CG Meet-up In Israel on September 8

Posted: 31 Aug 2009 07:28 AM PDT

Hey, all: I, John Biggs, will be in Israel from the Sept 5 through the 10th. I'd love to meet up with some great start-ups in the Jerusalem/Tel Aviv area. I'm most interested in the great gadgets coming out of there but I'm happy to sit down with local folks to talk web services. Here's what I'm thinking: I'd like to have an informal event on Tuesday, September 8. I don't know where it will be - suggestions are welcome - and if you'd like to sponsor an hour of drinks, please let me know. Either way, RSVP to john@crunchgear.com with the subject line "RSVP ISRAEL." I'll keep a mailing list and let you know where/when we'll hold the even on Monday morning.
TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

Disney To Acquire Marvel Entertainment For $4 Billion

Posted: 31 Aug 2009 06:34 AM PDT

The Walt Disney Company has agreed to acquire Marvel Entertainment in a stock and cash transaction, the companies announced this morning. Under the terms of the agreement and based on last week’s closing price of Disney, Marvel shareholders would receive a total of $30 per share in cash plus approximately 0.745 Disney shares for each Marvel share they own.

Based on the closing price of Disney stock on Friday, August 28, the total transaction value is $50 per Marvel share or approximately $4 billion.

Under the deal, which has been approved by the boards of both companies, Disney will acquire ownership of Marvel including its portfolio of over 5,000 Marvel characters. That portfolio includes many familiar names like Iron Man, Spider-Man, X-Men, Captain America, Fantastic Four and Thor.

Says Disney CEO Robert A. Iger in a statement: "We believe that adding Marvel to Disney's unique portfolio of brands provides significant opportunities for long-term growth and value creation."

Ike Perlmutter, Marvel's CEO, added: "Disney is the perfect home for Marvel's fantastic library of characters given its proven ability to expand content creation and licensing businesses. This is an unparalleled opportunity for Marvel to build upon its vibrant brand and character properties by accessing Disney's tremendous global organization and infrastructure around the world."

Mr. Perlmutter will oversee the Marvel properties, and will work directly with Disney's global lines of business to build and further integrate Marvel's properties.

Marvel stock is surging following the news, up 10+ points at the time of writing (+27%), while Disney’s is down a little (-0,5%).

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

FlyScreen Makes The Lock Screen Of Your Android Phone Useful (1,000 Invites)

Posted: 31 Aug 2009 06:26 AM PDT

Israeli startup Cellogic, makers of the fine FlyScreen software, have spent the last 8 months or so developing a custom version for the Android platform to complement their currently Symbian-exclusive version. Today, the company is debuting the private alpha version of the Android-compatible program, and we have 1,000 invites to offer for those carrying around HTC phones running Android 1.5 (it works on the Samsung Galaxy too but is less optimized for that particular device). So what's FlyScreen? Essentially, a collection of expandable widgets that comprise syndicated content (such as TechCrunch) and small apps that hook into Twitter, Facebook etc. You can use it to fetch the RSS feed of your favorite blogs, and thus be able to quickly access previews of published content, tag articles for later reading or share posts on Twitter and/or Facebook in just one click.
TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

Fox Livens Up Re-runs With Twitter Commentaries

Posted: 31 Aug 2009 03:10 AM PDT

screen-shot-2009-08-31-at-30139-amEveryone hates re-runs. They’re episodes you’ve likely already seen, being run out of order because there is no new content to run. But Fox may have just figured out a way to make them more interesting: Twitter.

The television network will be airing old episodes for two of its shows, Fringe and Glee, with Twitter commentary along the bottom of the screen. But no, sadly, not just anyone can tweet anything and have it be on national television, these will be moderated streams. And most of the it will be taken up by the tweets of the two shows’ casts and producers, apparently.

During the episodes, the cast members and producers will be watching and tweeting live. Fans be able to see their tweets on the bottom portion of their television screens or can follow along on Twitter itself by checking out the FRINGEonFOX and GLEEonFOX Twitter accounts. Select tweets from fans following along will be put on air.

Of course, CNN and some of the other television news networks have been using Twitter commentary for months now, and often put tweets on air. But doing the same on one of the major TV networks during prime time is another level of mainstream adoption for Twitter. It’s an extension of what we wrote about back in May, Twitter expanding beyond a simple web service.

So many Twitter users are already using the service to talk about their favorite television shows — as I’m writing this, three of the top ten trending topics are: Mad Men, Entourage, and True Blood — so integrating the two would seem to make sense. Now, if this were during a shows first run, the tweets might be distracting, but during a re-run, they add value.

It’s not clear if there is any financial deal in place for this, but this is clearly not the Twitter television show that got all the buzz a few months back. Money or no money, this is a great deal for Twitter.

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

Adobe Buys Business Catalyst / GoodBarry

Posted: 31 Aug 2009 02:59 AM PDT

We suspect Business Catalyst, the company behind e-commerce software suite GoodBarry, went a little early with the news on its own website, but that’s a boon for tech business reporters awake at this time of day. Turns out Adobe Systems has agreed to acquire the part American, part Australian company for an undisclosed amount.

Details are scarce since there’s no press release or official word from Adobe yet, but Business Catalyst has published a couple of Q&A on its website that shed a minimal amount of light on the agreement. From what we can gather at this point despite the vague wording used for the announcement, there won’t be too many changes at Business Catalyst as the products, partner agreements, team, pricing, etc. should remain largely unchanged. GoodBarry, on the other hand, being merely a Business Catalyst brand set up for their retail operations, will be gradually phased out and morphed into the Business Catalyst offering:

Most importantly, we’ll be refocusing our marketing and sales efforts on the web professional market (via businesscatalyst.com), as opposed to web-savvy DIYers such as you. In other words, this means that eventually we will cease “retail” operations and focus on our wholesale operations, and we will only be selling subscriptions to our software via our partner and reseller network.

As a result, the GoodBarry brand as such will cease to exist as of the 1st of October 2009, although the company says changes for customer will be mostly cosmetical (the billing and branding will be all Business Catalyst as of the aforementioned date).

The most important question however is why Adobe bought Business Catalyst in the first place and what its intentions are with the company in the near future. We’ve contacted the company for more clarity on that but in the meantime here’s what we know.

Business Catalyst / GoodBarry provides tools that help web designers set up online businesses for their clients with minimal cost and effort and no programming skills required, combining website content management, e-commerce features, e-mail marketing, business analytics and basic CRM tools into one system.

Adobe evidently offers a wide range of tools for web professionals, but in the near future does not plan to integrate Business Catalyst’s products into its own offering, although they are clearly looking to hosted services to deliver websites and online businesses more and more. There will be an initial transit period, but with regards to what will happen after that both companies remain mum and mention only that they are currently in ‘planning stages’ and will provide more information in the following weeks.

We’ll update if and when we hear more.

On a sidenote, this isn’t the first time Business Catalyst CEO and Founder Bardia Housman sold a company. In 1997, he co-founded Start (start.com.au), Australia's first free e-mail service provider, which in two years became the largest trafficked website in Australia as measured by Hitwise. In December 1999, Looksmart was acquired Start.

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

Platogo To Open Its Private Beta, And We Have Invites

Posted: 31 Aug 2009 02:57 AM PDT

Platogo Logo
Platogo, an Austrian startup which we recently covered as being a Mini Seedcamp finalist, opens up in private beta tomorrow. Platogo, (as in Play Together Online) aims to be the one-stop-shop for simple online multiplayer gaming. You’ve heard of MMORPGs such as World of Warcraft, but Platogo focuses on simple, easy-to-learn, online flash games with nifty graphics which are easy to play, thus tapping into the far larger market of casual gamers. We have 50 exclusive Beta Invites for Techcrunch Europe Readers. The first 50 commenters on this post will get an invite code. And we’ll see if we can strong-arm the startup into handing out more. [Update: We got them to add 150 more].

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

Netvibes Re-sells Tech To Germany’s T-Online In Its Race To Make A Buck

Posted: 31 Aug 2009 02:37 AM PDT

Recently NetVibes, the startup that lets you create a widget-filled customizable homepage, rolled out a free feature allowing users to create widget-based web pages, dubbed Theme Publishing. Ostensibly aimed at users, it also has one eye on potentially charging brands and agencies to create customised home pages.

In other words, Netvibes is trying to monetize itself as fast as possible. To that end it’s also now re-selling its architecture to portals and ISPs. Germany’s largest portal and ISP, T-Online, has thus now launched launched Meine Seite, a user-personalized, widget-based version of their site powered by Netvibes.

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

SevenSnap Is Bringing Controversial “Entertainment Shopping” To An iPhone Near You

Posted: 30 Aug 2009 09:11 PM PDT

Over the last few months we’ve seen the rise of a new and highly controversial kind of website that focuses on “Entertainment Shopping” — online stores that offer customers goods with very steep discounts, but with some risk involved in the shopping process. Some have likened these to gambling or scams, while others consider them auctions. In any case, it’s only becoming more popular, and now there’s a startup called SevenSnap that’s bringing Entertainment Shopping to the iPhone.

The app isn’t out on the App Store yet, but the company recently released a video (embedded below) that shows it off. Here’s how it works: every 60 minutes, SevenSnap puts a new item up for grabs (the example in the video is a Macbook Pro). If you want to have a shot at purchasing the item, you need to purchase “time credits”, which run a dollar per minute. Once you’ve done that, you can jump into the sale room, where you’ll get to watch as the item’s price drops every second (depending on how many people are in the room, it can drop by as much as $100 per minute). At this point it’s a game of chicken — the longer you wait the lower the price goes, but if someone pulls the trigger and purchases it then the price jumps up to its starting amount for everyone else. Remember, you’re paying a dollar per minute in the room, so whenever it resets you lose out on a few bucks.


SevenSnap Sneak-Preview (EN) from Tobias Hieb on Vimeo.

SevenSnap could be fun if you have cash to burn, but it’s not hard to see why people have issues with this kind of shopping site — If SevenSnap were to arbitrarily reset the prices of its items without actually selling them, it could effectively collect money for nothing. The startup may well turn out to be perfectly honest, but until the company has built up a reputation or there is some regulation involved, caveat emptor.

Other startups in this space have met with similar concerns regarding fraud, and are taking steps to make the process more consumer friendly. One of these is iBidCondo, which uses a somewhat similar model to auction off housing. We looked at the site July, when I (and a number of readers) pointed out some potential problems. In light of these concerns the site postponed an upcoming auction so that it can revamp its system to introduce more transparency.

The biggest name in this space is Swoopo, which uses the ‘falling prices’ model but has a much greater variety of products that are on sale simultaneously. The site recently introduced a new feature that negates some of the risk involved — even if you lose out on an auction, you can apply the money you’ve used to bid on it towards purchasing the product at its normal retail price. If you were only going to buy the product because of its incredibly low advertised price then you’re out of luck, but it’s definitely better than the old system where you would always walk away empty handed when you lost an auction.

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

A Look Behind The Curtain At Facebook’s Optimization Efforts

Posted: 30 Aug 2009 03:21 PM PDT

Facebook is big. Really big. So it comes as little surprise that every tweak made to the site (like the subtle change to the header a few days ago) can have a pretty substantial impact on the way people use the social network. Earlier this week Facebook’s Engineering team posted a note written by intern Zizhuang Yang, who has spent the summer researching how changes in things like load time can affect users. Yang writes about three main experiments he conducted over the last few months, including one involving overall site speed and two in the way pages load, and the results are quite interesting.

The first experiment examined how Facebook users would respond to a general slowdown. Yang found that regardless of site speed, users spend around the same amount of time on Facebook. That might sound like good news (at least they don’t get frustrated and leave immediately), but it means that if the site is running slowly users are going to be seeing fewer pages in the same amount of time, which Facebook obviously doesn’t want. So — no surprise here — Facebook is striving to make the site as fast as possible.

The second experiment involved the order in which items on the page should load. Yang writes that Facebook has been internally debating whether the page should display everything as quickly as possible, even before some necessary scripts to actually interact with the site have loaded, or to show a white page until everything is good to go and then render it all at once. Yang writes, “In all groups of users, keeping the page blank resulted in lower usage statistics. Thus the debate was resolved.” So if you’re ever on Facebook and you find that a certain button isn’t working for the first second or two after a page loads, this would explain it.

The third experiment involved loading stories in the News Feed. Regular Facebook users have likely noticed that the site will automatically fetch more News Feed stories as you scroll down the page. This feels like a nifty new feature, but it was actually designed by Facebook to cut back on load times — News Feed used to show 30 stories at once; now it loads 15 at first and only shows the next 15 if you scroll down the page. What Yang found, however, is that when people do scroll beyond the initial 15 stories they’re shown, they’re happy to wait the extra second or two for 30 new stories to load, which results in a signifiant boost in engagement. This makes perfect sense — if I’m actively reading through the News Feed (as opposed to just seeing it because it’s Facebook’s home page) it’s because I’m killing time or trying to catch up on my friends’ past posts. The more stories shown during this ‘catch-up’ time, the better.

Also interesting to note is that Facebook seems keen to put its internship program in the public eye — just last week the site’s blog included a post from an intern who build the Facebook Pages to Twitter syndicator, and now we’re seeing the fruit’s of another intern’s summer experiments. This may well be part of the company’s plan to attract new talent during its recent hiring spree.

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

TechCrunch Japan’s Tokyo Camp: 12 Startups Demo Their Wares

Posted: 30 Aug 2009 11:05 AM PDT

techcrunch_japan_event_tokyo_campFollowing last week’s startup contest WISH 2009, Japan just got another event that gave twelve selected tech companies the chance to demo their web services, apps and tools (almost all of which are thankfully available in English). This Friday, around 130 guests attended Tokyo Camp [JP], a demo event organized by TechCrunch Japan.

The occasion: The blog, which is one of Japan’s biggest and mainly translates articles from TechCrunch into Japanese, is under new management (by DESIGN IT!, LLC., a Sociomedia (Japan's anwer to Adaptive Path) group company).

Here are my thumbnail sketches of all of the twelve demos I saw at Tokyo Camp.

ivread_logo1I’vRead by Akky Akimoto
Officially launched at Tokyo Camp, I’vRead keeps a record of all books you've read via your Twitter account and lets you find users with a similar taste in books. All you need to do is to type the title of the book (or its ISBN or Amazon URL), add "@ivread" to the tweet and (as an option) write what you thought of it. Each of these tweets will then be automatically added to your personal user page on the I’vRead site (you don’t need to register at the site itself, being a Twitter user is enough). Look here for an example.

dango_logodango
dango wants to empower online game creators worldwide to focus more on the development of content and less on the things they have to deal with after a game is finished, especially the distribution problem. The company of the same name offers a comprehensive, integrated framework called "dango-PLAY". The system delivers online games to a number of social networks (i.e. Facebook or Japan’s Mixi) and dango’s homepage itself, using a single program and source code (dango is open source [JP]).

dango-Play aims at creating an integrated ecosystem for online games by matching users, linking to other games based on the framework, providing SMS services, managing user ID data, freeing developers from tracking user behavior etc. etc.

dango_service

One of the first games that’s been released based on the dango system is Facebook app “meromero park”, an ultra-cute mix between a social network, a virtual world and a pet-rearing game (the web version has already gained massive popularity in Japan and Taiwan). The Facebook app is available in English and French.

Jin-Magic TCP Traffic Optimization Technology by Akira Jinzaki
A veteran network technology guru and a Chief Technologist in Residence at Breakthrough Partners, Akira Jinzaki has single-handedly programmed what appears to be a powerful TCP traffic controller with the potential to change the way Internet traffic is currently being managed (99% of the Internet traffic is TCP-based). Jinzaki says his Jin-Magic software manages TCP traffic in a cost-effective way that is transparent to the network to get the most out of the exiting plumbing.

The software can sit anywhere in the network between the two end-points. WiMAX was used for the demo. Reception in the demo room was 2 to 4 bars out of 6 and TCP transfer rates were at best 1Mbps (with standard set-up). Turn on the Jin-magic on the server side configured to maximize TCP flow, the rates climbed up in the 4Mbps to 7Mbps range. The technology allows providers to maximize service for their investments. It may enable mobile data providers to serve 2 to 3 times more customers with uninterrupted video bandwidth with the existing infrastructure. Jin-Magic can be ported to smartphones, too.

pekay_little_author_logoPeKay’s Little Author
PeKay’s Little Author is a Facebook application that lets users create a graphic story using original characters on-screen and print it out in the form of a picture storybook. Alternatively, the virtual storybook (example) can be shared with others online or turned into a web greeting card.

PeKay’s Little Author is the brainchild of a well-known Japanese artist. The video below shows how the app works:

ixedit_sociomedia_logoIxEdit by Sociomedia
Launched at Tokyo Camp, IxEdit is a JavaScript-based “interaction design” tool for web applications that can be used from within the browser. Web designers can use IxEdit to practice DOM-scripting without having to code anything. The tool allows for elements of web pages that require “interaction”, i.e. pull-down menus, to be created with basic knowledge about HTML and CSS (no JavaScript coding is required).

IxEdit can be downloaded for free. View sample elements here.

universal_robot_logoMobile Vein Authentication Technology by Universal Robot [JP]
Universal Robot’s compact mobile vein authentication software (40KB core module) can be installed on cell phones, for example, and uses the camera to scan your wrist vein for identification. The technology seems to have many advantages: It works fast (I tried it myself), it’s completely software-based, compatible to a variety of CPUs and operating systems, usable for persons doing hard manual labor (who can’t use fingerprints), and most importantly extremely accurate (the company speaks of a false accept ratio of 0.001% and of a false reject ratio of less than 0.1%). The award-winning software works even with cameras with a 1MP sensor or lower.

mobile_vein_universal_robot

kuchikomi_logoKuchikomi@Sousenkyo [JP] by Hottolink
Tokyo-based Hottolink has shown a self-developed word-of-mouth analysis tool (dubbed “Word Of Mouth@General Election Of The Lower House” in Japanese) that’s supposedly able to predict the results of the general election of Japan’s Lower House (according to CEO Koki Uchiyama) that took place just today.

The prediction tool analyzes what’s being written in Japan’s blogosphere about political topics dynamically (it updates its projected results daily). Uchiyama said internal tests with previous elections proved to be very promising. We’ll know if the prediction model really works on Monday morning Japanese time after the election results are official (I will deliver an update here later).

logearthLogEarth
LogEarth requires a GPS logger or an iPhone GPS logger app to work. The service then records where you move around in the world (provided there’s a GPS signal) and visualizes your route with the help of Google Maps. The log data can be posted on blogs, too.

augmented_reality_brothers_logoThe 3 Augmented Reality Brothers [JP]
The 3 Augmented Reality Brothers aren’t really brothers, but their augmented reality project certainly had the highest show value at Tokyo Camp. Watch the Japanese video below to get an idea of what these guys are doing (their Vimeo channel is here).

AR3Bros episode-i | twitter & AR from ar3bros on Vimeo.

dodaii_logododaii by Feynman
dodaii is an in-app purchase management ASP created for iPhone devs. The system handles the payment records for companies offering apps in the App Store for a fee. More information on dodaii can be found in this English PDF and here. dodaii is currently in closed beta.

kanshin_kuukan_logoKanshin Kuukan [JP]
Kanshin Kuukan is a community site that helps its members find relevant products, restaurants, movies, songs etc. based on recommendations from users. The company of the same name showed a demo video of an iPhone app that scans the Twittersphere for relevant tweets and is scheduled for release in December (Japanese only).

Manetron
Manetron is an iPhone app that puts a Mellotron (an electro-mechanical, vintage keyboard) in your pocket. The app is available in the App Store for $2.99. Watch the video below to see and hear how Manetron works.

Many thanks to all attendees and demo companies who helped making Tokyo Camp a blast. And sorry to everyone who didn’t make it on the guest list this time (just like last time, we were overwhelmed by the response), but another event like this might happen again in the near future. Arigatou gozaimasu!

More pictures from the event were made by alpha blogger Masaki Ishitani and TechCrunch Japan’s translator Umihiko Namekawa.

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

Is the Tyranny of the Mac Fan Boy Waning?

Posted: 30 Aug 2009 10:41 AM PDT

animal_farmHere at TechCrunch there’s a daily argument in the office, on Yammer and even on the blog about the supremacy of the iPhone versus the Google-Voice-goodness of Android phones. I chalked it up to the usual get-off-my-lawn-style ranting of Michael Arrington, and assumed the average techie was still like MG Siegler, a total Mac-head who will love the iPhone no matter how bad the reception, how bad the battery life and how many times it breaks and he has to get a new one.

But some reporters– long harassed by Mac fan boys when they’ve dared to criticize the company (read: do their jobs) — are saying a sea change is occurring in Apple fan boy nation. Witness Jon Fortt of Fortune’s recent blog post where he says the Valley owes Microsoft an apology and compares Apple to Napoleon the pig in Animal Farm. He writes:

“I’m sorry, Microsoft. On behalf of Silicon Valley, I'm sorry.

We cursed you, mocked you, labeled you the Evil Empire. Your crime: trying to control the technology world. Sure, we had reason to be upset. During the dawning of the PC era, the Windows operating system made you the most powerful company in tech, and it went to your head.

Your detractors say you intimidated PC makers, crushed Netscape, and tried to turn the web into an extension of the Windows platform. As it turns out, local darling Apple (AAPL) probably would have done the same thing.

Just look at how Apple is behaving today with a fraction of the power you had.”

Now, look at the comments. You have to scroll pretty far down to get the usual how-dare-you-criticize-our-iPhone-lord-and-savior comments. Most of the comments disagreeing with Fortt are pretty well-reasoned arguments that raise good points.

Of course, it’s likely that Fortune moderates its blog comments, so maybe we’re not seeing the whole debate. But on the Sunday morning tech show that both Fortt and I appear on, he argued that indeed the fan boys just weren’t out in the same way they’ve been in the past. Host Scott McGrew argued he too had witnessed a fan boy sea change. [Video below; whole episode is here.]

I remain dubious, as much as I’d love to believe that sub-human behavior like the anti-Semitic attacks and death threats that Barrons writer Eric Savitz had to endure in March 2008 would never happen again. Savitz had the gall to report Wall Street was worried that iPod and iPhone sales might sag. It was hardly controversial considering the stock was down 35% for the year at the time he wrote it.

So, fan boys: Here’s your chance to agree with me for once. Is Jobs nation still alive and well? For the record, I hope I’m wrong. My husband and I own half a dozen iPods, a Mac desktop and four Mac laptops. We’re clearly fans of Mr. Jobs work. But placing a company above scrutiny is bad for business, bad for the Valley and bad for tech.

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TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

Free the H-1Bs, Free the Economy

Posted: 30 Aug 2009 09:00 AM PDT

h1bvisaThis is a guest post by Vivek Wadhwa, an entrepreneur turned academic. He is a Visiting Scholar at UC-Berkeley, Senior Research Associate at Harvard Law School and Executive in Residence at Duke University. Follow him on Twitter at @vwadhwa.

I have a suggestion for our President on how to boost economic growth without spending a penny: Free the H-1B’s.

More than a million doctors, engineers, scientists, researchers, and other skilled workers and their families in the U.S. are stuck in "immigration limbo.” They entered the country legally and have contributed disproportionately to our nation's competitiveness. They paid our high taxes and have been model citizens. All they want to do is to share the American dream and help us grow our economy.

They could be starting companies, buying houses, building community centers, and splurging like Americans. But because we don't have enough permanent-resident visas (green cards) for them, they're stuck in the same old jobs they had maybe a decade ago when they entered this country. They are getting really frustrated and many are returning to their home countries to become unwilling competitors. And they are taking our economic recovery with them.

Xenophobes will claim that immigrants take jobs away and blame them for everything that is wrong in their lives and in America. But as TechCrunch wrote last week, skilled immigrants create more jobs than they take away. That is a fact. My research team documented that one quarter of all technology and engineering startups nationwide from 1995 to 2005 were started by immigrants. In Boston, it was 31%, in New York, 44%, and in Silicon Valley an astonishing 52%. In 2005, these immigrant founded companies employed 450,000 workers. Add it up. That's far more than all the tech workers we gave green cards to in that period.

It's not only jobs that they’ve created. In 2006, more than 25% of U.S. global patents had authors who were born abroad — and this doesn't even count people like me, who came here, became citizens, and then filed multiple patents. Of Qualcomm's global patents, 72% had foreign-born authors, as did 65% of Merck's, 64% of GE's, and 60% of Cisco's. I'm not talking about silly patents filed with the U.S. Patent Office here, I'm talking about WIPO PCT  applications — the patents that help our companies compete globally.

Why does Silicon Valley need a foreign-born workforce? Because these immigrants are able come to a foreign land where they face hardship and discrimination and stand shoulder-to-shoulder with the world's best technical minds and most successful entrepreneurs.  They are able motivate Silicon Valley's top guns to work even harder and think smarter. They add a global perspective and enrich America.

The largest immigrant founding groups are Indian, British, and Chinese. Indian-born immigrants, for example, founded 6.7% of America's tech companies and 15.5% of those in Silicon Valley — but, according to the U.S. census, constitute way less than 1% of the U.S. population. So do the Chinese, but they contribute to 16.8% of our global patents. It doesn't take a statistician to figure that these are pretty impressive numbers.

Yes, I know that H-1B's don't start companies. And that is the problem. We don’t let them.

Hundreds of thousands of mostly very smart and highly educated workers who could be starting companies are not. While they wait for their green cards, they can't even change jobs or accept a promotion, for fear of losing their turn in line. If they lose their job, they have to find another job within 30 days — or get booted out of the country. Their employers know that these workers aren't going anywhere, so they can go easy on the salary increases and bonuses. Some unscrupulous employers do take advantage of them. And their spouses usually can't work, and in some states can't even get drivers licenses, because they don't have social-security numbers. Does this sound like America?

Unlike the daunting economic problems facing the country, this problem is easy to fix. Just increase the number of green cards for skilled workers. Maybe let them cut the line if they buy a house or start a company that employs a bunch of Americans. My guess is that we'll get tens of thousands of startups and a couple of hundred thousand houses sold. That is a bigger economic boost than the clunkers program we’ve just thrown $2 billion dollars at.

Crunch Network: CrunchBoard because it’s time for you to find a new Job2.0

TechCrunch50 Conference 2009: September 14-15, 2009, San Francisco

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