Sometimes it is obvious where the world is headed, but some people and industries become frozen in place and time. They are like the duckbilled dinosaurs happily munching on the still-abundant plants around them when the meteor strikes instead of the small furry mammals underfoot who take cover every day by natural habit. In the print newspaper industry, it’s the same story. Everyone wants to wall off the Web and keep grazing on declining ad revenues.
A week ago, I wrote a post based on a conversation I had with Silicon Valley entrepreneur and investor Marc Andreessen in which he made the case that print media companies would be better off shutting down their print operations now (“Burn the boats”) and move forward unencumbered into the digital age, no matter how painful that may be. That suggestion hit a deep nerve, and continues to do so.
Just yesterday, Allan Mutter, who writes the blog Reflections of a Newsosaur, took exception to Andreessen’s advice. By his estimate, in 2009:
Print-driven newspaper revenues still are running at better than $30 billion a year. It doesn’t take a certifiable Silicon Valley genius to see that no business can walk away from some 90% of its revenue base without imploding.
Mutter’s indignation is typical of the response to the article, even among enlightened newsosaurs. But that is exactly what Andreessen is saying. As I noted in my original post, he is quite aware that “at risk is 80% of revenues and headcount” (or 90%, if you take Mutter’s numbers).
Yes, the Internet media business is much less lucrative than the print side, and may never replace it in terms of the revenues it generates. But Andreessen’s point is that the meteor is on its way and the sooner that media companies start looking for cover, the more likely they are to survive.
He is not trying to be an alarmist. He’s just a realist. In the technology industry, similar disruptions happen all the time. The companies that survive are the ones that adapt and jump onto the next wave of technology before the one they are on finishes cresting. So the real question is one of timing. How long will it take that $30 billion print business to go to $20 billion, $10 billion, or zero? No doubt, it will take years, probably decades. But how long do print media companies wait before they leave their old business behind?
The people who read print newspapers and magazines are getting older and older, while advertisers always chase the young and impressionable. That audience is already on the Web. And they are no longer satisfied with getting all of their news from one or two trusted sources. They get their news from all over the place: newspaper sites, TV news sites, blogs, Twitter, Facebook. More and more, the news is coming to them through their friends and the various streams they consume. The old days of cross-subsidizing political news with ads from the Travel and Auto sections are over.
The longer media companies wait, the bigger disadvantage they will have when they cross over to the other side and find a whole new host of competitors who never had any print legacy businesses to protect. Those competitors right now are blogs and online news hubs who are still furry little rodents in the underbrush, but who won’t stay little forever. The sooner print media companies cross over, the sooner they can be on pure offense. Their online strategies and business models won’t be crippled by any allegiance, or need to protect, to the old print business. If they wait until their online revenues become 25 or 50 percent before they fully commit, it will be too late.
But that is probably what will happen. Media companies are still surrounded by $30 billion worth of leaves that look mighty good.
Photo of duckbilled dinosaur fossil by Ed Schipul .
We’ve talked a lot this week about the so-called “Location War” brewing at the SXSW festival in Austin, Texas starting tomorrow. That war will happen, but actually, there are likely to be a lot of winners because a few of the location-based services should be able to leverage the exposure to gain usage after the conference. Those with real bloodlust should probably be watching another war: AT&T versus everyone in Austin on their network.
AT&T’s struggles to stay up last year are well-documented. CNN recently ran a piece about how AT&T hopes to avoid a similar fate this year. But actually, “struggles” is way too kind of a word. If you were at SXSW last year and happened to be on AT&T’s network — like, say, if you had an iPhone, like many festival-goers did — it was an absolute nightmare. You couldn’t make a call. You couldn’t send a text. Data? Ha. At a few points early on I seriously wondered if I had forgotten to pay my bill and AT&T had simply shut my phone off — except that it was happening to everyone.
AT&T has a funny word for the failure, they like to say it was “unprecedented.” As in, the usage of its network was at levels previously unseen, as a strong percentage of the over 10,000 festival goers (just the interactive part) were using iPhones. Well guess what? Word is that is year, there will be some 15,000 people there for the interactive part. As Samual L. Jackson’s character, Mr. Arnold, says in Jurassic Park, “Hold on to your butts.”
I’m leaving for Austin tomorrow and I’m terrified of what the AT&T situation will be when I get there. So much so, that I have a back-up plan (which Sprint sent me just in time to test out during SXSW after reading some of my rants against AT&T). With attendance up as much as 50% from the previous year, the number of iPhones in use is sure to be through the roof as well. Did I mention that just about every location-based service known to man is launching an app at the event and hoping every single one of those 15,000 people use it all the time? And based on the early signs, they intend to.
You’ll remember that after Mr. Arnold says the above line in the movie, he’s savagely ripped limb from limb by a velociraptor.
But there may be hope for AT&T. They’re clearly well aware of the failure last year, and did try to solve the issue to minimal effect towards the end of the conference. I asked a company representative what they’re planning to do this year, and they have a plan of attack.
Much of what they sent me is fairly technical, but basically, they now have a system around the Austin Convention Center (where SXSW takes place) that’s the equivalent of 8 cell sites, with 50 antenna nodes to cover the whole venue. Also, they’ve greatly expanded network capacity, moving from one radio network carrier to three, boosting the spectrum available for phones to use. They also say they’ve expanded the capacity of the so-called “high quality” 850 MHz spectrum, which works better indoors because those signals can go through walls more easily. They also have the new HSPA 7.2 software installed at all of the 3G cell towers now. But don’t be confused: that doesn’t mean their network has been upgraded to 7.2 Mbit/s speeds (sadly, at the peak, it’s still half that in almost all of the country), it just means that the upgraded software is in place and should be more reliable and efficient.
But there’s more. AT&T has brought in two Cells on Wheels (the so-called COWS that they brought in to help last year), and also a third rooftop temporary cell site. Each of these are equipped with both 3G and WiFi networks to help alleviate overall network strain. AT&T says these three cells are placed in optimal positions around the city of Austin where they expect the most strain.
All of that sounds great, but I’m still terrified. Why? Because I live in San Francisco. AT&T has known for months that the network is awful here, and while there have been baby steps taken to improve it in some areas, more often than not, it’s still awful. Take tonight, for example. So if AT&T knows it’s bad here, but still can’t seem to fix it, why should I believe Austin will be any different? I don’t. I’ll just have to hope I’m wrong.
Or I’ll have to kick back, relax, and take joy in the bloodbath as iPhones are magically turned into glistening bricks being hurled in anger left and right. As I boot up the Sprint Hotspot, of course.
There are no shortage of location-based services launching this week at SXSW in Austin, Texas. Many of them allow you to “check-in” places to let others know you are there. So how do you differentiate between then and decide which to use? Well, here’s one good way.
CauseWorld, is a free iPhone and Android app that lets you check-in places, but it has an added real-world bonus: big brands give money to charity when you do so. And this week at SXSW, CauseWorld is teaming up with TechCrunch to offer double point (which they aptly call “karma”) when you check in to one of over 50 venues around Austin (I’ll paste the full list at the bottom of the post), including the Austin Convention Center (where SXSW is held).
We’ve covered CauseWorld, which is the first offering from the soon-to-launch ShopKick, a few times now. It’s a great product because it takes an area that is red hot right now, location-based check-ins, and converts it into good deeds in the real world. For example, if you check-in at a store, you may earn 20 karma points. As you continue to accumulate these, you can turn them into real dollar donations for causes such as water in Sudan or trees in the Amazon. Brands such as Kraft Foods and Citi are currently giving the donations based on what users choose to trade their karma points for. The best part is, you don’t even have to buy anything — you simply check-in at various venues and earn the points. And again, this week at SXSW, checking-in with the app at a bunch of venues will earn you double karma points.
And like any good service with a gaming element, there’s a leaderboard to show who has donated the most karma points. And yes, checking-in can earn you badges, such as the TechCrunch one show in this post.
So if you’re going to be in Austin for SXSW this week. Or really, if you just want to do some good with your mobile device, check out CauseWorld. Find it in the App Store here, or in the Android Market (on your Android device).
Below find the 54 participating double karma Austin check-in spots:
Back in November of last year, the location-based social event service Hot Potato launched at our Realtime CrunchUp. Today, they’ve taken what was a solid service, and made it a lot better with a number of upgrades.
First and foremost, there is a new iPhone application that just went live in the App Store. With a completely revamped user interface, the app makes it easier than ever to find and participate in events. Perhaps more importantly, it makes it really easy to create new events — and notably, the service has the nicest third-party Foursquare integration I’ve ever seen. When you click on the button to create an event, you can still manually enter a location, but if you happen to be around the venue, you can simply pick it from Foursquare’s list of venues with the click of a button. This drastically simplifies the event creation process since the venue metadata is already there.
This new app will be crucial for the SXSW festival in Austin, Texas, which starts tomorrow. If you’ve been reading TechCrunch over the past week, you’ve undoubtedly seen that just about every location-based service has an app they’re unveiling. And another service based around planning events, Plancast, just launched their app this evening. But Hot Potato offers the best of both worlds as it allows you to both plan future events, and interact with ones currently taking place. The new app makes it very easy to chat about the event, and upload photos and videos.
And they’ve cleaned up the stream of information around these events. There is now a filter to show everyone commenting, or just your friends. There are also now number indicators to show unread items. And the check-in process has been simplified thanks to big green buttons that make it obvious.
Also new for SXSW is Twitter integration. On a case-by-case basis, Hot Potato will be pulling in tweets about certain events at SXSW, using a filter to make sure only relevant ones show up. You’ll be able to do things such as filter those tweets to show only those by people you actually follow, which will make them potentially much more meaningful to you. You can also reply to tweets thanks to integration of Twitter’s API. And you can share tweets from within the app that will show up as retweets on Twitter.
Another new features is Calendars — something which each Hot Potato user now has. Obviously, you can add the events you wish to be a part of to your calendar, but people you are friends with on the service can also add you to other events as well. The app also now features Push Notifications now (on top of revamped email notifications).
On top of the new app, Hot Potato has rolled out a completely revamped website with just about all of the same functionality of the new app (as well as the new look and feel). And at the highest level, Hot Potato finally has its own social graph, which can pull in friends from the usual suspects: Facebook, Twitter, your address book, etc.
And here’s something that should really help Hot Potato this week: each time someone checks-in to a SXSW event with Foursquare, that service will recommend they also join the event on Hot Potato. Clicking on the accompanying link provided in the Foursquare app with open the Hot Potato app and let them join the event with a click (if they have an account). As you might expect, you can also check-in to a venue on Foursquare within Hot Potato. With Foursquare likely to be one of the key apps used by conference goers, this cross promotion is simply huge.
On top of all of this, the service now has its own full API, so others can use and interact with their data.
Simply put, all these updates are full of win, and make a good app even better. And remarkably, they’ve managed to cram in all these new features while at the same time simplifying the overall experience.
As I’ve made abundantly clear over the past several days, just about every service that has anything to do with location is launching something at the SXSW festival which starts tomorrow in Austin, Texas. Don’t believe me, here’s a small sampling (Foursquare, Gowalla, Loopt, Whrrl, Plancast, Brizzly, Twitter). So, how are you going to wrap your head around all this location data? SimpleGeo has an awesome way.
Vicarious.ly is a real-time location-based stream of information presented in a nice visual way. While the plan is to eventually launch one for many different cities around the U.S. and eventually the world, the first one is based around Austin, for SXSW. To make it, SimpleGeo partnered with BlockChalk, Brightkite, Bump Technologies, Flickr, Fwix, Foursquare, Gowalla, and Twitter to pull all of their location data and place it both in a constantly-updating stream, and put data points on a Google Map at the top of the page. These data points are represented by the logos of the various companies, so it’s easy to follow visually.
Those concerned about the privacy implications of this need not worry, Vicarious.ly doesn’t pull actual user names from the companies mentioned above. Instead, they simply note that “someone” checked-in at a venue. They do, however, give the venue name, which is a hyperlink. So if someone just checked into Stubb’s Bar-B-Q in Austin on Gowalla, you’ll see a link back to the Gowalla page for that venue. Likewise, if someone uploads a geotagged picture to Flickr, you’ll see a thumbnail of the picture in Vicarious.ly’s stream, and clicking on it will take you to that picture’s Flickr page.
It’s fairly amazing to see just how much activity there is even today, the day before the conference starts. Tomorrow and the weekend should be insane. “The amount of real-time, location-based information we’re indexing is staggering. We wanted a powerful way to showcase that, so we built Vicarious.ly and targeted the launch to coincide with a massive gathering of geeks,” co-founder Matt Galligan says about the project.
You’ll note just how much of the activity are check-ins from either Foursquare or Gowalla. Those two are likely to be the two main competitors in the location war that will take place this weekend. (If you’re surprised not to see tweets in the stream, it’s a bug that SimpleGeo hopes to squash tonight).
For more on SimpleGeo, which has a powerful set of tools to easily provide geolocation infrastructure for other companies (such as the new hot startup, StickyBits), check out this and this.
In January, private company stock marketplace SecondMarketpublished data on private company stock sales that they helped complete in 2009. And February’s report showed the transactions that took place in January, which showed a strong demand for consumer products and services startups. The majority of transactions in January were sales of Facebook stock. SecondMarket just released its February report, which you can download here.
Transactions more tripled in February, from $13 million in sales to $43.8 million in sales last month. A full 48% of the transactions were sales of Facebook stock, compared to 38% in January. And last month, we reported that sales are being completed for as high as $40 per share (or a $17.6 billion valuation). But we learned this week that Facebook CEO Mark Zuckerberg is in no rush to take the company public. LinkedIn took 18% of the transactions, and sales of both Twitter and Zynga stock were each 15% of the total. LifeLock rounded the group out with 4% of the total.
The transactions concentrated mainly in consumer products and services (85%) and media and entertainment (15%). Similar to January’s trends, Facebook, LinkedIn and Twitter attracted the most transactions on SecondMarket.
On the buying side, Facebook led the way with one-third of all buyside demand followed by Twitter (7%) and LinkedIn (5%). Interest in Zynga (3%) also rose in February. On the seller side, ex-employees of start-ups stepped up their selling activity in February, comprising over 80% of sales, the highest percentage in the past nine months.
Noticeably missing from the report was Tesla, which filed for a $100 million IPO in late January.
Google has Google Trends, Twitter has trending topics, and now so does Wikipedia. Pete Skomoroch, a Senior Research Scientist at LinkedIn and blogger at Data Wrangling, built a trending topics page for Wikipedia. The homepage ranks the top-25 Wikipedia articles with the most pageviews over the past 30 days, as well as the fastest rising articles in the past 24 hours.
Some of the most popular Wikipedia articles in the past month include ones on the Perseids meteor shower, Danish physicist Hans Christian Ørsted, director John Hughes, and G.I. Joe: The Rise Of Cobra. These are quite different than the types of search trends you would find on Google trends or realtime trending topics on Twitter. Even the trending topics over the past 24 hours (District 9, Woodstock Festival, Usain Bolt, Gina Carano) are quite different than the hot searches on Google. And, no, I have no idea why Perseids was the top trending topic last month, it is usually visible in the summer.
You can search for any topic, and the you will get a chart showing pageview trends, along with the actual article placed in an iFrame below the chart. It’s as good a way as any to explore Wikipedia. The site is built on Cloudera’s version of Hadoop.
Sonos, the Santa Barbara, California based startup that develops of wireless multi-room music systems, is taking a new round of financing from London-based Index Ventures, we’ve heard from multiple sources. Partner Mike Volpi, a forcer Cisco exec who found himself in the middle of a huge drama last year around eBay’s Skype spinoff, will join the board of directors of Sonos.
Volpi will bring real expertise to the Sonos board. As recently as 2007 he ran an $11 billion routing and access products busines for Cisco. He clearly knows how to sell products at scale.
Sonos has been around since 2003 and has raised some $40 million from private angel investors and BV Capital. Until last year the company sold very high end music products that users loved passionately, but the mutli-thousand dollar price point for a complete system made mainstream penetration difficult.
But in 2009 Sonos began selling a new product, the S5 music system, that users control via their iPhone. The S5 is just $400 and has driven “massive growth” says the company.
Like Flip last year, Sonos likely had a choice between selling now or raising new money for major expansion. Flip sold to Cisco. Sonos, it seems, is taking more money, but adding an ex-Cisco exec as well. Perhaps they’ll get their cake and eat it, too.
Sonos wouldn’t comment on this story. But we believe the deal will close and be announced in the next week or two.
Gowalla version 2.0 for the iPhone just hit the App Store today. With it, you’ll notice a few different things. First and foremost, the overall look has been updated from a sort of Army green, to a more subtle light green that is much easier on the eyes. More significantly, the toolbar has been reworked so that now social activity is front and center when you load the app, while your own activity is the last tab. Both of these changes are things I’ve complained about since day one with Gowalla, so they’re certainly welcome. But that’s not why I’m excited for the app. I’m excited because it takes the idea of the check-in and extends it.
Specifically, you can now add pictures and comments to check-ins in Gowalla. This makes for a much richer social experience both using the app and the website (the data goes over there as well). As founder and CEO Josh Williams describes in the video below, there were a lot of people who wanted to talk about the social activity on Gowalla, but previously they had to text message or email their friends to say something like “hey I saw you check-in at the restaurant, want some company?” Now, that type of dialogue can take place all within the app.
Now, others have tried to add additional layers to check-ins in the past. Why I think it works with Gowalla 2.0 is because they keep it simple. The application is extremely handsome (since the beginning, everyone is quick to note how good the designers are working for the team) and intuitive. There are only a few basic things you can do, and all are obvious from the main screen. You can either check-in at a venue, comment on your friends’ check-ins (with the new chat bubble in the stream), look at the spots around you, see trips (pre-planned venue excursions), or look at your own activity.
Previously, with Gowalla, I thought the focus was too much on their virtual items. Those are now tucked away in your Passport (your profile). They’re still important, and will be increasingly so for Gowalla’s revenue model (trading virtual goods for real-world items), but they’re not in your face, confusing users.
All that said, there are two downsides still to the service. First, the social activity stream includes everybody that your friends with. With Foursquare, the people currently in the same city as you are highlighted; Gowalla doesn’t do that. I suspect that will be very annoying to my friends not going to Austin this week for SXSW. Their stream will be a constant reminder that they’re not there — and they likely could care less about my check-ins, since they can’t possibly come and meet me.
The second downside is that Gowalla’s API remains read-only. That means while other services can pull out Gowalla’s data, they can’t put anything back in. That means there will be no Gowalla apps besides the ones they make (at least for now). Williams explained the rationale behind this as Gowalla wants to stay in control of the user experience (a rather Apple-like argument). That makes some sense, since there are all these virtual goods that will be flying around, and it will be hard to make sure every third-party app is implementing them correctly. Also, Gowalla is much more strict about its location-based check-ins then say, Foursquare. They’re so strict, in fact, that it’s been an issue in the past (and in some cases, still is), with people not being able to check-in places they’re actually at because the GPS is wonky. At the same time, this helps a lot with gaming the system, and that will be increasingly important as Gowalla strikes deals with partners based around check-ins.
Listen to Williams talk more about the new app, as well as his thoughts on AT&T’s network, some SXSW specials, rivals, and yes, even the news that Facebook is apparently looking at federating some of Gowalla’s (and Foursquare’s) data for its own location offering. He also notes that with the new release, Gowalla is expanding the idea of checking-in to be more of a bucket of elements now, including images and comments. Interesting. (Sorry in advance that I shot the video vertically on my iPhone — gotta stop doing that.)
Newly independent Aol is still struggling with the fate of Bebo, the social network they acquired for $850 million in 2008.
No one argues that Aol underpaid for Bebo. And the social network has fallen from 22 million monthly unique visitors when it was acquired to just 14.6 million today (Comscore worldwide). But even so, Bebo clearly has some value on the open market.
Despite that value, Aol’s best financial option for Bebo will likely be to abandon it rather than sell it, say corporate tax experts we’ve spoken with.
Here’s why – complicated corporate tax rules will let Aol write off the full purchase price of Bebo if they declare it worthless and abandon the asset. With Aol’s effective tax rate of around 45%, that’s $380 million and change in their pocket in taxes that they’d be able to avoid.
A sale of Bebo would almost certainly be less attractive. If someone were to pay them $100 million for the service, which is optimistic, Aol could still offset the remaining $750 million as a tax loss. But it could only apply against long term capital gains, and Aol doesn’t have any to offset against. They’d have to carry that loss forward and hope for future gains to offset it against.
One corporate tax attorney we spoke with wouldn’t discuss Aol specifically, but did confirm the logic of the approach. Bryan Smith, a partner at Perkins Coie, says “Without getting into any specific facts or companies, it will often be more attractive for a U.S. corporation to simply shut down a subsidiary and claim a deduction for the worthlessness of the stock against ordinary income instead of selling the stock at a distressed price and taking a capital loss, which may only offset capital gains.”
If Aol were to abandon Bebo they couldn’t pull any of the assets of the company back into Aol, say the experts we’ve spoken with. Otherwise it becomes a non-taxable liquidation. If Aol had debt or preferred stock on the books with Bebo, though, they could pull out assets to offset that liability.
We’ve talked a lot this week about the so-called “
There are no shortage of 
Back in November of last year, the location-based social event service 
In January, private company stock marketplace 
Sonos, the Santa Barbara, California based startup that develops of wireless multi-room music systems, is taking a new round of financing from London-based 
Regular readers will know my love for all things location. In particular, these check-in location-based services fascinate me, mainly because I see them as 
Newly independent Aol is still struggling with the fate of 
