Saturday, January 29, 2011

The Latest from TechCrunch

The Latest from TechCrunch

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When The Drones Come Marching In

Posted: 29 Jan 2011 07:01 AM PST

Way back in the 1970s, hardware-hacker hobbyists built kit computers like the Altair 8800 — and in doing so paved the way for the computer revolution that would reshape every facet of modern life. Today the same breed of people are building and selling kit flight controllers for unmanned aerial vehicles (UAVs). Just sayin’.

Drones are far from new: the US military has been using them heavily for over a decade. (What else did the US military pioneer, back in the 1970s? Oh, right. The Internet.) UAV tech has long since metastasized around the world. India’s private sector builds UAVs for both military and scientific purposes; Lebanon’s de facto government Hezbollah has used Iranian-built drones for years; earlier this month, QinetiQ’s solar-powered Zephyr set a world record by flying for 2 weeks nonstop; and, of course, the French-built, iPhone-controlled AR.Parrot has brought UAVs to the masses. All awesome, and all innovating fast. At this rate this may well become the Decade of Drones.

Which makes me more than a little uneasy.

Because when I put on my criminal hat—which I’ve been known to do for a living—I immediately start thinking of kit-built UAVs packed with Semtex and targeted via GPS. Voila, poor man’s cruise missiles, available to any hardware hacker with a grudge; all s/he  needs is their target’s address. Fortunately, the powers that be have not fostered entire generations of experienced explosives experts with angry political grievances, right? Oh. Oops. Well, at least it’s not like engineers seem disproportionately likely to become terrorists… oh, wait.

Then there’s the smuggling problem. Colombian and Mexican drug cartels already use homemade submarines and build air-conditioned railway tunnels. You can bet they’ll be jumping on the drone train sooner rather than later. UAVs and USVs (unmanned submersible vehicles) are the ultimate mules; they’ll go anywhere, they’re reusable, and if and when they’re caught, you know they won’t cut a deal. How can you track a drone built from off-the-shelf parts, flown in from parts unknown, back to its sender? Easy: you can’t.

What makes drones dangerous is that, unlike most technologies, they can and will decouple criminals from their crimes. That makes them big trouble waiting to happen. The first extra-military drone assassination—and I’ll go on record now and predict one within the next five years—will doubtless trigger a cacophonous symphony of handwringing, tooth-gnashing, and the passing of lots of stupid and restrictive laws, but it will already be much too late. The twin genies of aeronautical engineering and microcontroller design are long out of their respective bottles.

Tomorrow’s UAVs will make today’s look like the Wright Brothers’ biplanes, and the only way to track and fight them will be with yet more drones. Hello, panopticon. Goodbye, privacy. Granted, I’m verging on science fiction here, but it’s science fiction that doesn’t seem all that evitable. The drone economy will soon be even bigger business than it already is … but I can’t shake the sense that it will ultimately be bad news for us all. Ponder that the next time you take your Parrot for a spin.



How’d Sequoia Let Yuri Milner Grab this Sweetheart Y Combinator Deal?

Posted: 28 Jan 2011 11:27 PM PST

Earlier tonight, Mike posted a bombshell that must have made super angels shudder. Not content with the grenade he threw into the late-stage investing world with aggressive investments in Facebook, Groupon and Zynga, tonight Yuri Milner announced a new partnership with Ron Conway that offers similar you’d-be-crazy-not-to-take-this-deal terms for every Y Combinator company.

But you know who might be even more bummed by the news than the super angels? Sequoia Capital. The top Valley firm led Y Combinator’s last funding, less than one year ago. At $8.5 million, this was a big step up for Y Combinator, dramatically allowing it to expand how many startups it could let into its incubator. And it should have been a big advantage for Sequoia too: A way to see a crop of new deals early in an increasingly competitive investing landscape, where most VCs are being shut out of early rounds by super angels. It seems Milner stole the opportunity right out from under Sequoia.

We haven’t talked to Sequoia, and it’s possible the partners don’t agree that Milner and Conway’s deal is a no-brainer. So far, most Y Combinator exits have been modest, and Sequoia isn’t known for giving sweetheart terms to entrepreneurs. I can’t think of many venture firms who would give a blanket investing offer before even seeing companies. Almost more than any other firm on Sand Hill Road, being a Sequoia Capital company has historically stood for something.

Then again, a few years ago, no Valley firms would invest in late stage Internet companies with the kinds of terms Milner was offering either– that is until Milner started doing it and locking in high paper valuation gains. The deal with Y Combinator isn’t classic venture capital any more than those late stage deals were. But a $6 million flier across 40 vetted companies sounds like a pretty safe way to hedge in a business where the rules have dramatically changed, barriers to entry have dramatically been lowered and money is an easily found commodity. Maybe Sequoia wouldn’t have done the same deal, but if the firm believed in Y Combinator enough to invest a year ago, it can’t be happy about this new arrangement.

Every VC will tell you that good deal flow is the biggest competitive advantage an early stage investor has. Milner may have just bought his way into this game for the low price of $6 million.



Start Fund: Yuri Milner, SV Angel Offer EVERY New Y Combinator Startup $150k

Posted: 28 Jan 2011 09:11 PM PST

Everything just changed in the angel investing world.

Two years ago Yuri Milner, through his investment firm DST, disrupted the traditional Silicon Valley venture capital model when he began investing in the hottest startups – companies like Facebook, Zynga and Groupon – at very high valuations and extremely easy deal terms. He looks brilliant in hindsight, with all of his U.S. investments at significantly higher valuations since he invested.

Most top VC firms have begun emulating DST’s deal structure.

Now he’s partnering (as an individual, not as part of DST) with Ron Conway’s angel fund, SV Angel. And they’re making a bold investment move. This evening they’ve just made a blanket investment offer to every Y Combinator startup in the most recent batch. They’re going to invest in all of them. Every single one. And this is the biggest Y Combinator class to date – some 40 new startups.

The new fund is called Start Fund. SV Angel’s David Lee is managing the fund.

They haven’t even seen most of the startups yet. This is a bet on the quality of Y Combinator startups in general.

All of the new Y Combinator entrepreneurs gathered at Y Combinator headquarters in Mountain View California on Friday evening to hear about the offer, They weren’t told why they were supposed to be there, just that something important was happening. The SV Angel team was there in person. Milner joined from Europe by video conference.

The terms? $150,000 in convertible debt. With no cap and no discount. If you’re an investor you know exactly what that means and you just shuddered a little. Those aren’t terms that most angels can match.

If you’re not an investor, here’s what it means. Yuri and SV Angel just offered to loan each company $150,000. That loan will convert if/when the company raises a proper angel or venture capital round at the same valuation that’s set in that round. Most convertible debt has a valuation ceiling and also gets a discount on conversion. This debt doesn’t.

It’s the most entrepreneur friendly investment that I can think of, short of just handing people money as a gift.

Each startup can choose to take the investment or not. If all 40 of the startups accept the loan then a total of $6 million will have been invested. And Milner/SV Angel say they intend to offer this for each Y Combinator startup in the future, too. That means Y Combinator entrepreneurs will not only get the $15k – $20k from Y Combinator during the first few months of their project, but they can look forward to another $150,000 a few months later. That’s usually enough to complete development and launch a product.

This is a huge win for Y Combinator, and cofounder Paul Graham seemed very pleased when we spoke by telephone this morning. He also says it’s a smart investment strategy. If only a couple of the startups have a large liquidity event it’s likely to be a good investment for Milner and SV Angel, he noted. “This is a hits driven business,” he said.

This also spreads incredible goodwill throughout the young entrepreneur community.

This also puts Y Combinator further ahead of competing early stage incubators/investors. Entrepreneurs now know they’ll be offered easy terms on $150,000 in capital just for being part of Y Combinator. That’s an incredible marketing advantage.

This is not such a big win for other angel investors, who are still struggling with business models and rising valuations. They tend to mob Y Combinator startups generally. And now they’ve got to deal with startups that don’t need cash as desperately, and who already have Milner and SV Angel as investors. That’s two more steps behind than they were before.

SV Angel says that this is a separate process from their normal investing. They’ll invest additional sums in some of the Y Combinator startups just as they always have. They’ve already invested in two from this batch so far, says David Lee, and it’s extremely early in the process.



Blekko Takes Curated Search Mobile With iPhone And Android Apps

Posted: 28 Jan 2011 07:52 PM PST

Blekko, the search engine that is fighting the good fight against web spam with human editors, is joining biggies Google and Bing in the mobile search arena today with an Android and iPhone application double whammy. Says Blekko CEO Rich Skrenta, "In a world where people want the most relevant answers on the go, mobile search is becoming increasingly more significant.”

The app has a sparse interface which allows you to view search results whether or not you are logged in with your Blekko account. With the exception of Facebook integration, the app pretty much runs the gamut of features found on Blekko itself, most notably the ability to search by /slashtag or curated topic. Results are sorted by most relevant and by date.

The app also offers suggested slashtags for each search at the top when you scroll down on a search. For Blekko power users, an interface with the buried treasure features of “Mark as Spam”"View SEO info”"Add to Slashtags” and “Open in Safari” can be accessed by clicking on the arrow next to each individual result in your search and then clicking on box/arrow icon the bottom right corner to reveal further options (see the image on the right, above).

Blekko, which boasts more than 100,000 slashtags created after its launch in November, has raised $24 million from VC superstars like Ron Conway, Mike Maples, Jeff Clavier and Marc Andreessen and most recently actual superstars like Ashton Kutcher.

As of today the app is free in the App Store and Android Market.



‘Angry Turds’ Is Like ‘Angry Birds’ Except With, Yes, Turds

Posted: 28 Jan 2011 04:54 PM PST

Ever wish Angry Birds had more poop in it? Well look no further than the App Store today, as Apps Genius has launched Angry Turds. As a monkey in Angry Turds, you get to battle evil island explorers who have stolen your monkey babies with various projectile weapons.

The concept is similar to Angry Birds as your objective is to throw stuff but the stuff here goes beyond rocks to coconuts, turds, banana bombs and grand poop-bas (I am so glad I never spent any money getting a journalism degree).

Angry Birds addicts will be happy to discover that the touch action of throwing objects is exactly the same as in Angry Birds except there’s no slingshot. The weapons themselves each have varying properties in terms of force and levels of destruction per throw.

What’s even more amazing than the fact that someone made this is that the App Store thinks that the word “turds” needs censorship (as in “Angry T*rds for iPhone”) but the word “poop” is as clean as the Pope himself.

For example:

“There is only one way to stop them, throw some t**ds! With your arsenal of t**ds, coconuts, poop bombs and bananas”

On why he chose this specific name and concept, Apps Genius CEO Adam Kotkin told us “People are into the whole poop thing. When you speak with a 12 year old you realize that they know more than the rest of us … It’s fun to throw poop around. Poop sells.”

Angry Turds is available in both free and $0.99 paid versions, with 10 levels and 30 levels respectively, in case you need to step your turd game up. You can download the app here.



War Maneuvers: Android Event Will Battle iPad Event For Press Love On February 2

Posted: 28 Jan 2011 04:01 PM PST

I love asking companies if the timing of events is on purpose or purely coincidental. Not only do they almost always say that it’s purely coincidental, but they often try to claim that didn’t even realize a rival was also doing something when they made their plans. Sure.

Next week will feature another such situation. Earlier this week, News Corp. and Apple sent out press invites for an event to unveil the new iPad-only app, The Daily. And then this evening, we’ve just received an invite to a Google event to show off the latest version of Android, Honeycomb. The one meant for tablets. And guess what? They’re on the same day.

Sure, the events are on different sides of the country (though word is that News Corp./Apple had originally wanted to host their’s in the Bay Area too). And as such, the iPad event will be slightly earlier than the Android event (8 AM PT versus 10 AM PT). That doesn’t matter. The key is that controlling the news that day will be paramount for both sides. And Android just press-blocked the iPad.

The events are timed and situated in such a way that it would be absolutely impossible for a journalist with invites to each event to go to both. And while Google is being nice enough to host a live stream on YouTube (something which News Corp./Apple will almost for sure not do), it will still be a pain to extensively cover both. You’ll basically have to choose.

Normally, it would be all iPad next Wednesday. Now it’s likely to be more Android-controlled. And don’t think there’s nothing to the fact that Google is showing off a “taste” of Android shortly before the iPad 2 is expected to be unveiled.

War.



AnyLeaf Aggregates And Delivers Personalized Grocery Store Deals

Posted: 28 Jan 2011 03:58 PM PST

For decades, my mother and grandmother have both religiously scanned the weekly coupon books and circulars that arrive in the weekend newspaper. While clipping coupons can be tedious, grocery stores’ weekly deals can often take out a significant chunk of change of the weekly food bill. Of course, as print couponing becomes obsolete, many consumers are looking to the web for deals at their local grocery stores. Today, Y Combinator-backed AnyLeaf is launching its intelligent grocery deal aggregator to the public.

AnyLeaf scours local grocery store sites in the San Francisco Bay area and aggregates all the deals from these stores, including CVS, Lucky, Nob Hill, Raley’s, Safeway, Target, and Walgreens. You simply enter your zipcode and email address, and AnyLeaf will send you a weekly email with deals from the local grocery stores near you.

And what sets AnyLeaf apart from other grocery store deal aggregators is that it applies an intelligent algorithm to sourcing deals for users. You can specify that you don’t want to see deals on specific food items and products, and after your start interacting with AnyLeaf’s site, the service will start recommending similar items to those you have chosen to see deals for. And AnyLeaf collects historical prices for food items and will also show you how steep a discount is compared to past discounts from grocery stores.

For now AnyLeaf is limited to the Bay area but plans to expand to other cities in the near future. For any Trader Joe’s fans out there, AnyLeaf doesn’t aggregate deals from the popular grocery store chain because the company doesn’t post sales publicly on the Trader Joe’s site.

Personally, I would pay more attention to grocery deals at the stores where I shop if I received comprehensive lists of weekly deals via email. I’m keeping my fingers crossed that Chicago is AnyLeaf’s next expansion!



The Future of Search: Who Will Win The Spam Wars?

Posted: 28 Jan 2011 03:52 PM PST

Sometimes, all it takes is a little spark to set off a major forest fire. That is what seems to have happened with my New Year's Day post on Why We Desperately Need a New (and Better) Google. Over the last two months, there has been an avalanche of articles echoing my post (and a few before it from notable people like Jeff Atwood), including New York Magazine, Business Insider, GigaOm, TechCrunch, CNN, and The Wall Street Journal.

I had a feeling that this would get Google's attention. And I had the same concern as when I challenged the Russian government, once, in a Bloomberg BusinessWeek article about Skolkovo (a new tech park). I feared that Google would either blacklist me or do its equivalent of putting me in a Gulag—deliver even more spam when I search websites.

But I was delighted to get an e-mail from Amit Singhal, the head of Google's SEO team. His message was exemplary for those wanting to learn how to handle a PR crisis. Here is part of what he wrote:

I read your post on TechCrunch yesterday and was quite disappointed by the fact that Google search failed your students at their task. My team and I treat every such failure as an inspiration to improve Google. Would it at all be possible for me to get a few queries from your students for which our algorithm failed? We will debug every aspect of our system for those queries.

He went on to invite me to visit Google to show me how they run the search system and listen to any other criticism I had to offer.

I took Amit up on this and spent hours with him; with Matt Cutts, who heads Google's webspam team; and with their lead developers. They were incredibly open and honest. They acknowledged the deficiencies of Google search, shared ideas on how they plan to fix them, and asked for feedback.

I raised concerns that "content farms" are turning the web into a massive garbage dump, that many sites are simply replicating the content of others like TechCrunch, and that Google has no incentive to stop this because it gains advertising revenue from the spammers.

The Google developers assured me that there is a very high Chinese Wall between them and the business side of the company; that they have been instructed by Google's executives to do only what is in the interest of users—to keep improving quality of search results and the user experience. They said they understood the issues and had many solutions to the technical problems. I questioned whether the spam problems could even be solved algorithmically; whether the only solution was a curated web-search model like that of Blekko and DuckDuckGo. They convinced me that they could, and would, win the battle.

Matt said he would post a blog, which he did, on Jan 21. In it, he explained that Google had already made improvements to make it harder for "spammy on-page content to rank highly"; had radically improved its ability to detect hacked sites, which were a major source of spam in 2010; and was about to implement a change that would directly address the issue of sites copying others' content. Most importantly, he acknowledged that something had to be done about the "content farms," and said that Google would.

Not surprisingly, Matt's blog led to another avalanche of media coverage. As it turns out, the biggest content farm of them all, Demand Media, was set for an IPO this week (on Jan 26).   Savvy bloggers and journalists began to question whether it could sustain its profits without Google's support. The Wall Street Journal asked Did Google Just Make Demand Media Less in Demand?, and GigaOm wondered Did Google Just Declare War on Demand Media?

Nonetheless, Demand Media had a spectacular IPO. Its investors reaped huge bounties, with the company achieving a market cap of $1.7 billion—valuing it higher than the New York Times. So the public markets rewarded junk over quality. And they called Google's bluff.

Where does that put us? Do we have to watch the web become one big toxic waste dump—as the spammers rake in billions of dollars? Or will Google indeed save the day?

There is an event on Tuesday, Feb 1, called Farsight 2011: Beyond the Search Box, to discuss these questions. It will be live-streamed on TechCrunch (watch for a post by Jon Orlin on that day) and is being organized by BigThink, a public online forum for intellectuals (people like Gary Kasparov, Jimmy Carter, Malcolm Gladwell, Salman Rushdie, Nouriel Roubini, and Paul Krugman). BigThink has thousands of videos on its site, which 1.5 million people watch every month.

I am emceeing the BigThink event and moderating a panel with three big players: Matt Cutts from Google; Harry Shum, Microsoft Corporate Vice President who heads Bing development, and Rich Skrenta, founder and CEO of Blekko.

Here are some questions that I plan to ask the panelists. Please share your comments below and suggest additional questions. I can't promise I'll cover all the topics you raise, but I will bring up as many as I can.

1. How will they save the web? Is it possible for search engines to separate the wheat from the chaff—tell the difference between content produced by regular people and large-scale junk produced by the spammers?

2. How are the engines really different? Most people can't tell the difference between Google and Bing. Where is the magic?

3. What lies ahead? What is the future of search?

I have no doubt that this will be a very lively and informative event.  There are also other great presentations such as:

  • Jaron Lanier, named by Time Magazine in 2010 as one of the 100 most influential people in the world, speaking about the need for a new sustainable revenue model for search.
  • Esther Dyson, in an address entitled "The Future of Search is a Verb," speaking about how we want search to help us do something—a set of many verbs.
  • Demos from Blaise Agüera y Arcas, Architect of BING maps at Microsoft; and Luc Barthelet, Executive Director of Wolfram|Alpha.

I hope you'll tune in.

Editor's note: Vivek Wadhwa is an entrepreneur turned academic. He is a Visiting Scholar at UC-Berkeley, Senior Research Associate at Harvard Law School , Director of Research at the Center for Entrepreneurship and Research Commercialization at Duke University, and Distinguished Visiting Scholar at The Halle Institute for Global Learning at Emory University. You can follow him on Twitter at @vwadhwa and find his research at www.wadhwa.com.



Meetup Feels The Wrath Of The Crowd After Radical Changes

Posted: 28 Jan 2011 03:35 PM PST

Meetup, a long time go-to place to create local online groups, has undergone a major re-launch in the past day. However, it may have missed a trick: not consulting the meetup organizers who pay through the nose for the service. There now appears to be something of a revolt going on amongst some organisers, who are vociferously protesting about the changes.

The reaction of annoyed organisers and members has turned into two, count-em, Twitter hashtags: #newmeetup and #meetuporganizersunite.

Alternatives to Meetup like BigTent are being touted, as is GroupSpaces – a startup which last year raised $1.3 million from the likes of Index Ventures and Angels like Dave McClure and Chris Sacca. It is is already gunning for "FormerMeetupOrganizers" with its own group and a blog post on the subject.



Ask a VC: John O’Farrell Gives Tips on Deal Making, Advice to Would-Be VCs (TCTV)

Posted: 28 Jan 2011 03:18 PM PST

This week’s Ask a VC has a different twist, since we had a different kind of VC on the show, John O’Farrell Andressen Horowitz’s guru on business development and deal-making.

The questions you asked O’Farrell are below. As usual, feel free to watch the whole show or use the links to skip ahead to your question.

“Have you ever invested in a single employee startup? Would this be a situation in which you guys would make a deal?”

“If you are managing a fund, has the timeline for ROI gotten shorter as a result of this unstable and uncertain environment? Also, what are your thoughts about an entrepreneur allocating a percentage of funds raised to remain outside of bonds, equities, and currency denominated assets until the
funds are necessary, instead remain in a physical commodity?”
attention or credit in many startups?”
“How can I build the right team to start a VC firm if I don’t have any VC experience, but do have a good eye for talent? Who would I need to recruit to help me run the firm without losing all control of it myself?”


Google To Give A Better Taste Of Honeycomb Next Week At Press Event And On YouTube

Posted: 28 Jan 2011 03:18 PM PST

About an hour ago, Ina Fried over at Mobilized posted that Google would be hosting an event next week to show off the latest version of Android, codenamed “Honeycomb” a bit more. Sure enough, an invite has just landed in our inbox.

The invite reads:

A Taste of What’s New from Android

You’re invited to an Android event at Google headquarters in Mountain View on Wednesday, February 2. Please join us for an in-depth look at Honeycomb, Android ecosystem news and hands-on demos.

It will take place from 10 AM PT to 1 PM PT, but the event itself will be about 90 minutes, with the rest of the time used for demos.

More importantly, the entire event will be streamed live on YouTube at this URL.

This event follows Google’s recent release of a preview version of the SDK for Honeycomb. And back in January, they released a preview video of the new OS.

No word on who will be on hand to show off Android 3.0 at this event yet, but Andy Rubin is a safe bet. More interesting will be if soon-to-be CEO Larry Page shows up as well.

More: War Maneuvers: Android Event Will Battle iPad Event For Press Love On February 2



Twitter Alludes To WikiLeaks And #Egypt In Call For Freedom Of Expression

Posted: 28 Jan 2011 02:39 PM PST

Probably sick of countless press emails asking for an official stance on the countless controversial hyper-mediated events like WikiLeaks and the Tunisan and Egyptian uprisings now being amplified through Twitter, co-founder Biz Stone and Twitter General Council Alexander Macgillivray have co-written the polemic “The Tweets Must Flow” essentially arguing that freedom of expression is a human right.

Key takeways:

*“On a practical level, we simply cannot review all one hundred million-plus Tweets created and subsequently delivered every day.”

*“We keep the information flowing irrespective of any view we may have about the content.”

*“While we may need to release information as required by law, we try to notify Twitter users before handing over their information whenever we can.”

*We’re hiring.

Stone and Macgillivray did not explicitly mention any one particular incident in the post but obviously hinted at recent news events with pointed language like “some tweets may facilitate positive change in a repressed country,” (Tunisia, Egypt) and “While we may need to release information as required by law, we try to notify Twitter users before handing over their information whenever we can” (which is exactly what the company did recently when the DOJ asked for data from WikiLeaks supporters).

Emphasizing Twitter’s transparency, Stone and Macgillivray state that Twitter has been submitting all tweet removal notices to @ChillingEffects which is releasing them through @ChillFirehose. @ChillingEffects is a project lead by the EFF, Harvard, Stanford and other universities meant to raise awareness of online rights and protections with regards to copyright issue, etc . They also mention that Twitter has a Twitter list devoted to “Freedom of Expression” which includes the ACLU, IP Justice and internet monitoring service Herdict.

Twitter’s Sean Garrett tells us that the post is the result of a year of mulling over important geo-political issues that Twitter is now an unlikely player in, “We thought it important for us to explain our principles for both big things like being blocked in China to much more specific decisions like a DMCA request over a single Tweet. Recent big global events vividly demonstrate the implications of this approach.”

Indeed, the Twitter legal team now lead by Macgillivray has found itself in all sorts of unprecedented legal situations as the service scales, anything from a Courtney Love libel suit to a subpoena from the Pennsylvania Attorney General.

Biz Stone has written on Twitter and activism before, in response to Malcom Galdwell’s assertion that there is no such thing as  Twitter activism (I can’t wait to see what Gladwell has to say about the past two weeks). And while this is the first time I’ve seen Macgillvray write on Twitter issues, something tells me it won’t be the last.


.



Video: Experiment Shows Cord-Cutting Simply Too Difficult For Average Families To Grasp

Posted: 28 Jan 2011 01:59 PM PST

Here's more evidence that regular people have zero time for things like Google TV, Boxee, and Roku, if only because they're too complicated for their own good. Hill Holiday, a "caffeine-fueled ad agency," asked five Boston-area families to participate in a cord-cutting experiment. For one week each family was asked to forgo traditional cable TV in favor of one of the following devices: Apple TV, Google TV, Boxee Box, Xbox 360, and Roku. These devices, of course, are the premier devices for people looking to break free of their cable company while still being able to enjoy television. And how did it turn out for these five families?

Read More



All Electric Bike Makers, Zero Motorcycles, Raise Another $2.4 Million

Posted: 28 Jan 2011 01:36 PM PST

A Santa Cruz-based electric motorcycle manufacturer, Zero Motorcycles, raised another $2.4 million in private equity, according to a new SEC filing.

Earlier this month, California’s Scotts Valley Police Department started using the company’s Zero DS bikes in urban patrols. According to a company press statement, its Zero DS has a range of up to 50 miles (80 km) and is highway legal, safe for off-road bike paths, and drives quietly due to its all-electric drivetrain, making it potentially advantageous for urban law enforcement.

In late 2010, Zero Motorcycles expanded sales of its all-electric bikes to Australia. The company is selling its products in 32 countries today, including the U.S., Switzerland, Germany, Italy, the U.K. and Canada.

Last summer, Zero Motorcycles attained a U.S. patent for a battery interconnect system that reduces the amount energy wasted in the form of heat around the power packs that go into their bikes.

Zero’s competitors include fellow American startups Brammo and Mission Motors, and major bike companies like Honda and BMW that have committed to put out all-electric models, too.

In 2008, Zero Motorcycles raised about $8 million, and in 2010 the company raised another $7.1 million in what appear to be several expansion rounds, bringing the company’s total equity raised to about $17.5 million today.

TechCrunch has requested details about how Zero Motorcycles will apply its latest financing round of $2.4 million. The company did not offer an immediate reply.



Reserve Bank Of India Restricts PayPal Payments To Merchants To Under $500

Posted: 28 Jan 2011 12:52 PM PST

This is sure to cause a backlash among Indian online merchants. Due to restrictions from the Reserve Bank of India, PayPal has amended its user agreement for Indian merchants, imposing a number of restrictions on merchants using PayPal as an online payments mechanism. Now Indian merchants will not be able to accept payments via PayPal that are above $500 per transaction. As stated in PayPal’s blog post announcing the change, “For purchases or payments above this transaction value, you will have to use an alternative payment method.”

The fact that Indian merchants won’t be able to receive payments above $500 per transaction is a big blow to entrepreneurs in the country. As one anonymous developer tells us, “we’re fucked.”

And PayPal is requiring that any payments into merchants’ accounts cannot be used to buy other products has has to be transferred to and Indian bank account with 7 days from the receipt of confirmation from the buyer in respect of the goods or services.

It’s important to note that these restrictions aren’t being imposed by PayPal, but rather by the Reserve Bank Of India. The restrictions will take effect on March 1, 2011.

This isn’t the first time the RBI has imposed restrictions on PayPal. Last year, PayPal had to suspend personal payment transactions from and to India temporarily, when the RBI concluded that PayPal was not in compliance with all relevant regulatory requirements. Shortly afterwards, PayPal removed the ability for Indian merchants to withdraw funds from accounts electronically in compliance with regulatory instructions.

And some think this is the beginning of the end of PayPal in India.



OPENMESH Is Seeking Alternatives To Egypt-Style Internet Blackouts

Posted: 28 Jan 2011 12:47 PM PST

Galvanized by the unprecedented Internet shutdown in Egypt, angel investor Shervin Pishevar has launched OPENMESH a forum for people who want to discuss ways of preventing governments from blocking communications networks. The site (which is admittedly sparse at the moment) was up within hours of Pishevar tweeting out his ideas, designed and built by followers @Laksman and @garyjaybrooks.

Pishevar, whose Twitter account has served as a mini-#Egypt /#Jan25 news source since the protests started on the 25th, explains the inspiration behind the site.

“The idea is that if the government takes down the backbone for the internet in a country (like Egypt has done), takes down the mobile cellular networks and potentially the fixed line communications line there has to be other ways for people to communicate. Some of these ideas include coming up with ad hoc mesh networking solutions in a city or nation to support peer-to-peer communications.

You could have simple ideas like people communicating over bluetooth on their mobile phones (even if the mobile network is shutdown) as has happened in Iran and now Egypt. You could have WIMAX pumped in via ships in international waters powered by satellite internet connections pointed to nearby cities. You could have mobile routers in backpacks, cars and rooftops all interconnecting to create a further mesh solutions.”

Currently there are few alternatives apart from dialup if a government forces ISP providers to suspend service, but that shouldn’t be the case in the future. “The last bastion of dictatorship is the router,” says Pishevar.

If you’re interested in volunteering or getting involved in any way you can visit OpenMeshProject.org or tweet @Shervin.



David Karp: “Tumblr Is Growing By A Quarter Billion Impressions Every Week”

Posted: 28 Jan 2011 12:42 PM PST

Tumblr is growing like a weed, but “the last four or five months totally overshadow everything that came before it,” founder David Karp tells Chris Dixon in a taping today for TCTV (watch the video above). “We are growing by a quarter billion impressions every week,” he revealed. Last week Tumblr did 1.2 billion impressions, or pageviews, and it is adding 250 million every week. Just think about that for a second. Over the last 30 days, that came to 4.2 billion pageviews.

If you are wondering why Tumblr’s been having so much downtime lately, just take a look at the comScore chart below, which shows its own estimate of 2.5 billion pageviews for the month of December, up from 335 million from the year before. All of that is coming from 19 million unique visitors per month globally, according to comScore. (Karp’s numbers are based on his own internal Google Analytics and they are for a slightly different time period, he also notes that Tumblr reports directly to Quantcast).

Karp admits that the company was “unprepared” for that kind of hockey-stick hypergrowth, but with a new $30 million round in the bank, he says his team is working round the clock to keep scaling and catching up with all the sudden demand. Karp says the growth is coming in part from college students, who really took to the service only since September, 2009 or so and, more recently, international growth in Europe, Japan,and Brazil. He also tells me separately that 65 percent of those pageviews come from Tumblr users looking at their Dashboards (which shows the stream of posts from other people on Tumblr they follow).

The video above is an excerpt from a longer conversation with Chris Dixon for his TCTV show Founder Stories (formerly Startup Sherpa). We will put up more excerpts and the full interview next week, in which Karp explains why the two people he looks up to the most are Steve Jobs and Willy Wonka.



Gowalla Begins Connecting The Dots On Travel

Posted: 28 Jan 2011 11:27 AM PST

Now that Facebook has entered the space, Google appears to be ready to take it more seriously, and Foursquare is gaining some real traction, the other players in the location field need to start defining their roles. Of the other players, Gowalla has been doing some interesting stuff around check-in aggregation. But their more interesting play may be around travel. And a small change today points to that.

As you can see on place pages for various airports, Gowalla has begun connecting your travels from destination to destination. So if you check it at SFO then five hours later check in at JFK, they know that you were on a cross-country flight and create a new graphic to showcase that, complete with your miles traveled. Below that they tell your friends about your journey. And they’re even able to see if you had a layover at another airport.

Is it a small feature? Of course. But again, it does point to some of the interesting things Gowalla could do with location in the travel space. Other recent features they’ve launched, such as Highlights, also showcase this. With Highlights, you can make a list of your favorite things a city. This is based around pre-set topics, so there’s a best place for “People Watching” and a best “Watering Hole”, for example. But you can only have one set place for each topic, and so obviously, the emphasis here is to name things in your home city. But imagine if they turned this on for vacations, so you could leave recommendations to your friends?

They’re sort of doing this with the ability to leave notes at venues around the world, which entices your friends to go visit and check-in there so they can unlock the message.

Another small addition to the Gowalla website is that they now show you a map connecting your most recent check-ins. Again, this could be interesting from a travel perspective. Imagine being able to give someone a link visually showcasing where you when on a recent trip.

Some of these concepts are things that startups like TripTrace and others are working on as well. But Gowalla has the benefit of being a pretty widely used (and very solid) mobile application already. In other words, they already have the great tool to populate this data. Now it’s just a question of what they’ll do with it.



YouTube New Ideas Week, ‘YouTube For Kids’, & The Quest For The Awesome Cup

Posted: 28 Jan 2011 11:27 AM PST

Talk to any large company in Silicon Valley and they’ll be the first to tell you that they foster a culture where innovation is everywhere and engineer imaginations can run wild.

Unfortunately, that’s often just a complete fabrication from the company’s marketing department. But even at companies that really do try to encourage innovation, it’s often tough for engineers to pull themselves away from their workload so that they can tinker on a side project.

That’s an issue that faced YouTube several years ago. No, YouTube doesn’t just pay lip-service to innovation — the company, like its parent Google, allocates a good chunk of time for developers to work on their own projects. But oftentimes engineers simply didn’t take advantage of their 20% time, so YouTube came up with an answer: instead of trying to get its engineers to spend one day a week on side projects, it decided to launch a biannual event where they spend a whole week crafting whatever they can think up.

Earlier this month, YouTube invited me to talk with a few team members about this so-called New Ideas Week and how it got started. They also shared some projects that are currently in the works and got their start during the Week — things like a new version of YouTube built from the ground up for children, and a new Qik-like mobile service for live streaming.

YouTube Director of Product Management Hunter Walk kicked things off by talking about some of the underlying reasons why New Ideas Week exists in the first place. He says YouTube’s goal is to maintain an environment where engineers can test things out, without having to worry if one of their experiments is going to kill their career. The first way to do this is to insulate employees from the “slings and arrows” thrown by partners whenever there is a change to the site. Walk says Engineers are told to test out their ideas with 1% of the site’s users without having to request approval — provided they “don’t do something that would put me in prison”.

From an infrastructure standpoint, YouTube has set up a system that allows engineers to plug-in and monitor their experiments without having to reinvent the wheel. There’s an internal dashboard that displays the current status of each of dozens of active experiments — I managed to catch a glimpse of one, but it was a mundane experiment having to do with YouTube’s lightweight international site. My keen eyes failed me, but Walk did mention an interesting fact about the experiments: at any given moment there is a percentage of users on YouTube who see no advertising at all, which serves as the site’s control group.

Next, I spoke with Oliver Heckmann, an Engineering Director based out of Google’s Zürich office. Heckmann was actually responsible for the formation of New Ideas Week in 2008, after he noticed how little 20% time he and his fellow engineers were getting to actually use.

The results from the first week, he says, “weren’t that great.” But the idea took hold, and the results from the second week, six months later, were much better. This was when a YouTube engineer built a new feature for YouTube’s player that would automatically detect black bars in uploaded footage and adjust the aspect ratio to minimize them.

Of course, there are duds — ”most of the ideas in there are bad”, says Heckmann. For example, one engineer noticed that a huge number of videos on YouTube feature the uploader’s messy bedroom as the backdrop. So, the team tried to build a system that could detect motion and replace the background with something else (Apple’s Photo Booth does something very similar). Unfortunately this didn’t really work. “The demo was awful because background detection is not perfect” Heckmann says. “An imperfect beach in Hawaii is not as good as a messy room”.

YouTube for Kids

More recently, these Weeks have led to some bigger initiatives. The most interesting (at least, that I heard about) was a fully revamped version of YouTube designed specifically with children in mind. Heckmann says that children tend to use YouTube differently than adults, and obviously there is content on the site that kids shouldn’t be exposed to. What’s worse, sometimes kids stumble across this content accidentally because of the way the site’s automated suggestions work.

To remedy this, YouTube is building a version of the site that’s been reworked to have absolutely no text, save for the YouTube logo. Videos that do appear will be based off of whitelists, so there won’t be any chance of accidentally stumbling across something unsavory or scary. At this point it sounds like the project still has a ways to go (it was initially created during a New Ideas week last summer), but it’s on the way.

We also briefly discussed a second product that got its start during New Ideas Week: Qik-like live streaming. YouTube has recently been putting a lot of effort into offering live streaming capabilities to content partners, and it’s going to begin allowing them to stream content directly from their phones.

The Awesome Cup

I closed out the day with John Harding, another Engineering Director for YouTube (he’s based out of their San Bruno office). Harding had the privilege of unveiling one of the team’s internal secrets: a trophy that gets passed around the engineering team that’s called “The Awesome Cup”. You can see it in the photo above.

It’s pretty self-explanatory — any time someone does something especially awesome, they’re awarded the cup. It then sits on their desk until they deem that one of their coworkers does something equally awesome, at which point they hand it off. Previous tasks that reached this level of awesomeness include the revamped Watch page and the audio comment preview feature, which was based on an xkcd comic.

Harding also talked about a few of the products that came out of YouTube’s most recent New Ideas Week, which was in December. One subtle but important feature concerns YouTube Leanback — the version of YouTube that’s seen on Google TV. Before now Leanback would only stream one piece of content at a time (the same way YouTube proper does). But now it will actually start buffering the next clip in your queue while you’re watching the first, so there’s no lag when you flip to the next video. He says that in all, around 25 projects were conceived during the last Week — but, unlike Heckmann, he couldn’t think of any that were especially bad. Something about loving all his children equally.

YouTube isn’t the only company that holds special events to spark developers’ creative juices. Facebook is well-known for its all-night hackathons, which have given rise to some of the site’s most important features, including Facebook Video. Of course, many of Facebook’s ideas aren’t so great either — one fateful hackathon led to the creation of Facebook Fax, which let you fax photos to friends. Which, if memory serves, they used to punk me.



BlueTunes Finds A Savior In Online Storage Provider MiMedia

Posted: 28 Jan 2011 09:44 AM PST

Earlier this month, I reported on the imminent shutdown of BlueTunes, which provided a solution to upload locally stored music to the cloud. Turns out someone sorta kinda threw BlueTunes a lifeline right before it hit the deadpool.

Online storage startup MiMedia has reached an agreement with BlueTunes for its users to become subscribers of its online music storage offering, and more.

The transaction closed earlier this week. Terms were not disclosed.

Erik Zamkoff, MiMedia founder and CEO, says BlueTunes users will be provided with the same functionality they previously enjoyed, while also enhancing their ability to store and access not only music but also photos, videos and other files via the cloud.

Former blueTunes users will be able to access their data via the MiMedia website (using their blueTunes username and password) starting January 31.



TV Tune-In Lets Big Media Jump On The Audience Interactivity Bandwagon

Posted: 28 Jan 2011 09:11 AM PST

There is a growing trend of companion applications to television shows that bring a second screen to interactivity with TV shows and movies. Apps like GetGlue, Miso, and Tunerfish all add a second platform where users can check-in to a show, earn points and rewards for participation, and interact with social networks. A new player is about to launch in the space that adds a white-label platform for audience engagement for television shows. TV Tune-In, developed by Rogue Paper, is a real-time, companion viewing and mobile app development platform for media companies to help drive viewership, conversation and interactions for television shows and content.

TV Tune-In’s CMS allows media companies to develop branded iPhone and iPad apps for television shows and channels. The apps aims to attract fans around live viewing of their favorite show, event, or sports team. Users can actively comment, Tweet and Like their favorite show, chat with friends, play trivia games, watch exclusive video content, photos and more. As users interact with the application, they can earn rewards like virtual badges. One compelling feature for TV Tune-In is the ability to time-shift interactions and commentary in case you aren’t watching a show live.

The idea behind the platform is that media companies can launch their own interactive “second screen” experience, as opposed to forming deals and partnerships with other startups. And TV Tune-In has struck two high-profile deals with big-name media companies to create branded iPhone and iPad apps for popular television shows (Rogue Paper declined to name the partners but will announce the deals in the next few weeks).

Founded by Sima Sistani and Stephanie Boyle, Rogue Paper has assembled an impressive group of board members including Twitter CEO Dick Costolo; Antonio Lucio, CMO of Visa; Walter Delph, VP at NewsCorp Digital; James Finn, Head of Innovation and Business Strategy at O2/Telefonica and Doug Mandell.

TV Tune-In may be on to something. While apps like Miso and GetGlue grow in terms of users, media companies could provide a similar interactive experience in-house. Licensing TV Tune-In’s platform has the potential to be a cost-effective way for a television content company to access fans and develop and control their own second screen and interactive mobile applications.



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