RealNetworks, Inc. (NASDAQ:RNWK) is opening up a new feature for Rhapsody, their iTunes competitor.  Prior to launching this feature, Rhapsody offered subscribers streaming copy-protected audio for a monthly fee and the file format was incompatible with iPods and iPhones.  But now Rhapsody will be selling DRM-free MP3s a la carte and they will be compatible with the iPod and iPhone manufactured by Apple Inc. (NASDAQ:AAPL).

Customers will be able to access 30 second samples of each track.  Most of the tracks will be around $0.99 per song and $9.99 per album.  Rhapsody currently has about 5 million songs provided by Universal Music, Sony BMG, EMI, and Warner Music.

To appease the demands of music labels, Real will provide “a strong emphasis on the digital album with merchandising centers for ‘new album releases,’ ‘old favorites,’ and ‘who’s on tour.’”  Labels prefer to sell full albums rather than individual songs.

As part of the launch, Real offered the first 100,000 users to sign up for the MP3 store a free album.  Real commands about 1% of the online music download market.

[Source: AppleInsider]

Youku.com is a popular video sharing website based in China.  This website is known for hosting full movies, but has blocked certain regions from being able to play them.  Youku has raised $30 million in funding from Maverick Capital, Brookside Capital, Sutter Hill Ventures, Farallon Capital, and Chengwei Ventures.  Youku also received a $10 million loan for equipment from Western Technology Investment.

“This investment will enable us to advance the company’s rapid growth, expand our sales and marketing network, and most importantly, accelerate our monetization process as the online video market matures and consolidates in the coming year,” stated Victor Koo, President/CEO of Youku.com Inc. in a press release. ”With the new funds, we will be deepening our service to users, advertisers and media partners to give them the best and largest platform in China to distribute video content online.”

Youku receives 100 million unique visitors per month and each users spends about 300 minutes per month on the site.  Youku is the #6 largest site in China in terms of the amount of time that is spent on the site.

“We are happy with Youku’s success and its progress in monetization,” stated Len Baker, Managing Director at Sutter Hill. “The Youku team has clearly demonstrated its excellent execution capability, and we believe Youku is in the right position as online video takes off on a massive scale in China.”

Youku has also recently partnered with Universal, China Film Group, Beijing TV, EMI, Huayi Music and several other media firms. 

Youku’s last round of funding was $40 million.  That investment was provided by Sutter Hill, Brookside Capital, Chengwei Ventures, and Farallon Capital.

Related Link:
Youku.com
Information Source:
PEHub

Google Inc. (NASDAQ:GOOG) is working wtih Seth MacFarlane on a new cartoon advertising project.  This coming September, MacFarlane will be launching a new series called “Seth MacFarlane’s Cavalcade of Cartoon Comedy” which will only be available on the Internet.

Google will be syndicating the cartoon comedy series through AdSense. Instead of a static ad, Google will be laying out a video for the cartoon series on select websites that target the intended demographics.  The videos will have ads embedded within them.  The project will be in two minute clips in a series of 50 clips.

“We feel that we have recreated the mass media,” stated Kim Malone Scott, Director of Sales & Operations Google’s AdSense division.

The division of Google that handles these distribution services is called Google Content Network.  Google provided MacFarlane with data regarding how long people tend to watch web videos before moving on to new content.

MacFarlane is the founder, voice actor, screenwriter and producer of Family Guy and American Dad.  These two programs air on FOX.  One of Family Guy’s most famous characters is Glen Quagmire.  Quagmire is known for saying “Giggity, Giggity, Giggity” when he finds himself attracted to a woman.

Seth MacFarlane spoke at Harvard for Class Day a couple of years ago.  The speech is available on YouTube.

[Source: NYT]

COMSCORE, Inc. (NASDAQ:SCOR) released a statistic a couple of days ago regarding searches for Apple Inc. (NASDAQ:AAPL) iPhone products.  This past April, “iPhone” was searched 1.5 million times, “iPhone update” was searched about 151,000 times, and “iPhone Web Apps” was searched about 118,000 times.

“Apple iPhone G3″ was searched 43,000 times and “Apple iPhone 3G” was searched 60,000 times.  This occurred two months before WWDC, the event where the Apple iPhone 3G was revealed and confirmed.  Now that the iPhone 3G is official, I wouldn’t be surprised if these search numbers double for the month of June.

“Speculation had been rampant in recent months that Apple CEO Steve Jobs was getting ready to introduce a 3G iPhone at Apple’s annual Worldwide Developers Conference on June 9, and indeed he did just that,” stated Dan Lackner, Senior VP at comScore. “Search is frequently a harbinger of purchase intent. The increase in volume of iPhone searches demonstrates just how heavy that interest has been for the next generation of Apple’s popular phone – even when its existence was still just a rumor.”

Below is a list of iPhone-related searches in April 2008:
1. IPHONE (1,488,000)
2. IPHONE UPDATE (151,000)
3. IPHONE WEB APPS (118,000)
4. IPHONE MMS (101,000)
5. IPHONE 2.0 (75,000)
6. IPHONE 3G (60,000)
7. IPHONE 2 (59,000)
8. IPHONE G3 (43,000)
9. IPHONES (38,000)
10. IPHONE SPEAKERS (35,000)

About 88% of these searches were made on Google itself.

[Source: iTWire]

Liz Gannes Of NeeTeeVee has recorded the below video of how YouTube started all the way up until they were acquired.
Some of the interesting points in the video are:
- YouTube initially used ServerBeach’s $129/month unlimited data plan
- YouTube didn’t have a presentation when presenting to VCs on Sand Hill Road… just product stats
- YouTube had about 8 people working for free before funding. Hurley just told them that they’d work it out after funding.
- Making the decision to be acquired was tough. They could have pushed for more funding, but it would have been threatening a lot of other services. Google helped them refine their model.
- The day that they were acquired, YouTube moved offices. The press showed up at the old office.

When Digg first introduced shouting capabilities, I ruled it out as a stupid feature because I thought it was nothing but e-mail spam.  In many circumstances it is still spam, depending on the users that you allow shouts from.  But now I have realized that shouts have value to them.

Eye-For-An-Eye / Frienemies
I treat digg shouts as an eye-for-an-eye system.  If you digg my interesting stories, I digg back your interesting stories.  Simple as that.  Now you have to be careful with who you add as friends.  I’ll call the bad friends “frienemies.”  Frienemies are the ones that send you shouts in your inbox and you digg the interesting stories that they send, but they don’t reciprocate.  You have to become skillful at identifying who the frienemies are right away and remove them from your friends list.

This can be monitored after submitting articles and finding out which of your friends dugg your story and which of your friends have not within 48 hours.

(more…)

In May 2007, Last.FM was acquired by CBS for $280 million.  Based on that acquisition price, major active shareholders in Napster Inc. (NASDAQ:NAPS) argue that the company should be worth just as much if not more.  The shareholders that have been pushing for management shifting and strategy changes at Napster are Perry H. Rod, Thomas Sailors, and Kavan P. Singh. 

Napster actually has over 700,000 paying customers, yet their market value is zero (market cap of about $69 million minus their saleable assets).  The reason why Napster is trading low is because of a “lack of confidence in governance” stated the shareholders.

Last.FM was a private company with a close-knit community of users when they were acquired.  Napster is a public company that was a has-been music sharing site in the early 2000’s back when it was making Metallica and Dr. Dre mad and Shawn Fanning was one of the most well known people in the tech industry.  CBS acquired Last.FM because they were ramping up their Radio services and even signed a partnership with AOL.  Last.fm currently has over 21 million active users in 200 countries. 

Should Napster be worth close to $280 million?  I’m not an active shareholder, but I’d have to say no because their user-base just isn’t that big. 

[Source: paidContent]

“The new media content space and specifically animation, is growing at an explosive rate,” stated Andreas Stavropoulos, Managing Director at DFJ. “aniBoom created a disruptive model harnessing the power and reach of digital distribution to generate tremendous opportunities for animated content created by a massive network of independent professionals around the globe.”

aniBoom, an animation social network for creative minds to collaborate on cartoons has raised a big round of funding at $10 million Series B.  AniBoom is based in Israel and the funding was led by Draper Fisher Jurvetson.  DFJ Tamir Fishman Ventures and previous investor Evergreen Venture Partners also participated in this round.  aniBoom raised $4.5 million in February 2007. 

aniBoom was started in 2006 by Uri Shinar.  Uri is also the CEO of the company.  aniBoom wants to become the YouTube of animation according to TechCrunch.

aniBoom has over 4,000 independent creators across 70 countries.  These artists are all working together to help making a music video for songs on Radiohead’s “In Rainbows” album through a contest.

“In teaming up with DFJ and DFJ Tamir Fishman Ventures, we are proud to partner with one of the top venture firms in the world,” stated Uri Shinar.  “aniBoom is the innovator of the now very hot virtual digital animation studios and animation incubation model, and to see the major media and entertainment powers following suit is a strong endorsement of our vision.”

Aniboom is located at www.aniboom.com

 

One of the latest rumors regarding Apple Inc. (NASDAQ:AAPL) is that the company will be introducing a free Application that will enhance the iPhone or iPod Touch experience.  Essentially the application will allow your iPhone or iPod Touch to act as a remote control for the iTunes player on your Mac or PC.

The speculation about the rumor came about when Apple pre-released a version of iTunes 7.7 for developers.  In the Readme file that came with the software, part of the statement read the following:

“Use iTunes 7.7 to sync music, video, and more with iPhone 3G, and download applications from the iTunes Store exclusively designed for iPhone and iPod touch with software version 2.0 or later. Also use the new Remote application for iPhone or iPod touch to control iTunes playback from anywhere in your home — a free download from the App Store.”

The application will most likely work over a Wi-Fi connection network.  What makes this rumor even more plausible is that Apple filed for a patent that would allow a portable media player to act as a remote.

[Source: MacRumors]

Songkick is a website that does everything to help you find concerts.  They can find concerts near you by having you entering your location.  They can e-mail you alerts when concerts come up.  They’ve got a plugin that helps you find concerts of the artists that you have in your iTunes, Winamp, iTunes, and Windows Media Player libraries.

“We’re always adding more listings because we want to make sure we have every single concert in existence—no matter how obscure the band or tiny the venue,” states the company’s About page. “We even index bands’ MySpace pages to make sure we have all their dates.”

Songkick is based in East London and was founded by Ian Hogarth, Pete Smith, and Michelle You.  The investment was provided by several personal investors.  One of the investors is Saul Klein, founding partner of The Accelerator Group.  Y-Combinator provided Songkick with their initial funding.

The company website is available at: www.songkick.com. VentureBeat broke the funding news.

[image credit: Economist]

“We’ve really achieved the ideal of what I wanted Microsoft to become.”
-Bill Gates (June 2008)

Tomorrow is Bill Gates’ last day as a full-time employee at Microsoft Corporation (NASDAQ:MSFT).  That same night, there will be a “roasting” of the Microsoft Chairman.  The Microsoft Chairman will be working full-time at the Bill & Melinda Gates Foundation, established in 2000 by Bill and his wife.

In June 2006, Warren Buffet pledged about 10 million shares of Berkshire Hathaway Inc. (NYSE:BRK.B) every year over several years.  The investment will go towards reducing poverty and improving education in areas where it is needed the most.

Gates leaves at a time where Vista has been struggling to impress individuals and corporations alike, Google is dominating search marketshare, the Zune hardly took away marketshare from Apple, and there has been an increase in demand for Macs.  Gates is also leaving shortly after Yahoo! turned down an acquisition from them and decided to depend on Google Inc. (NASDAQ:GOOG) for an advertising outsourcing deal.

As Gates parts ways from the company, the company will lay in the hands of Steve Ballmer, Craig Mundie, and Ray Ozzie.  Ozzie will be software architect, Ballmer will remain CEO, and Mundie will be responsible as chief research and strategy officer.  Gates will ensure that the three stooges don’t mess anything up as he will remain the company’s biggest shareholder and Chairman.

Microsoft first started when Bill Gates contacted Micro Instrumentation and Telemetry Systems and became their supplier of Altair BASIC.  Then Microsoft partnered with IBM to give them DOS and receive a commission for every IBM computer sold with it.  The “partnerships” that Microsoft made with companies is the reason why Bill Gates is the third richest man today and why Windows continues to dominate 90% of the operating system marketshare.

Bill Gates shook the world as he became the youngest self-made billionaire, revolutionized the PC, and is respectfully leaving it all in the name of the philanthrophy.  And that is still something to aspire towards for today’s younger generations.

Update: Listen to Bill Gate’s farewell speech at Seattle PI.

LinkedIn and Facebook together are now worth roughly $16 billion based on valuations given to them after funding.  Since Facebook and LinkedIn have not been acquired by public companies, I cannot help but wonder what they would say during an IPO of their own.  What would they say is their contributions to society or what are they doing to solve world problems?

The only joy I get out of Facebook personally is that I can mass upload photos that I take on my digital camera and tag my friends.  As a matter of fact, that is Facebook’s most popular feature because over 14 million photos are uploaded per day between their 80 million users.  YouTube solved a similar problem, but their emphasis was on videos only.

Is Facebook’s contribution to society “being a place to mass upload photos for your friends to see?”  Or is Facebook’s contribution to society “being a storage of personal information on your friends?” It seems like that they are all over the place.  Facebook self-describes themselves as a “social utility that connects you with the people around you.”  Their most popular feature makes me want to compare them to Shutterfly, but the way they describe themselves makes me want to compare them to Classmates.com or Match.com.

Facebook is one out of the top two sites in Alexa’s Top 10 sites that do not belong to a public company.  The other sites in the top 10 include Yahoo.com (Yahoo! property), Google.com (Google property), YouTube.com (Google property), Live.com (Microsoft property), MSN.com (Microsoft property), MySpace.com (News Corp. property), Wikipedia, Blogger.com (Google property), and Yahoo.co.jp (Yahoo! property).  Wikipedia is the other company that is not public, but the open source encyclopedia does not walk around sporting over a billion dollar valuation.

The aforementioned companies, Yahoo!, Google, Microsoft, and News Corp. all have a pretty clear purpose and are constantly innovating otherwise their shareholders would get pissed.  Their innovations all revolve around their core services.  Yahoo! and Google have an emphasis on finding information quicker, Microsoft makes software that computers need to run on, and News Corp. distributes media all over the world.

Ford and GM’s valuation combined is about the same as LinkedIn and Facebook combined.  What makes this disturbing is because we know that those two automotive companies have done more to advance our society today than a couple of social networks.  The Richter Scales music video points it out too.

Perhaps there’s something I’m not seeing about LinkedIn and Facebook that makes their valuations worth it, so I encourage you to help me understand in the comments.  This is not intended to bash social networks, it is only to provoke discussion.

Microsoft Corporation (NASDAQ:MSFT) is rumored to be acquiring Powerset.  Powerset is a semantic search engine company that raised over $12.5 million in funding a couple of years ago with a valuation of $42.5 million.  Powerset at one point claimed that their technology had a few steps up on Google Inc. (NASDAQ:GOOG): the ability to decipher the full meaning of phrases while searching.

Two years later, Powerset’s first product was a Wikipedia-search feature.   

I’m sure Powerset could have come up with a better way to show off their technology.  Powerset’s Wikipedia search just doesn’t seem exciting.  Especially since Wikipedia already has a built-in search engine and Google works even better for finding things on Wikipedia.

Powerset is now ready to flip though.  They’ve specifically hired Allen & Co. to help them find someone to buy them for a price that is about $100 million or more.   Is Microsoft actually going to pay that price?  We’ll find out next month.  VentureBeat broke the news of the acquisition rumor.

Related Links:
Powerset website
TechCrunch
VentureBeat

I often times write blog posts about companies that raise money and immediately think to myself, “how could a company with an idea that an elementary schooler can come up with raise this much?”  I’m In Like With You is no exception. 

The site even boasts how many hours have been wasted on the site on each game: over 2 million on Draw My Thing itself.  I have to admit that the design of the site is pretty sweet, but $1.5 million for a site with a few Flash games is pretty substantial. 

What are they doing with the money?  Founder Charles Forman will be expanding the I’m In Like With You team starting with Poojitha Preena from Skype as the company’s COO.

The funding was led by Spark Capital.  Baseline Ventures, Betaworks, Ron Conway, and Marc Andreessen also participated in this round.  This is I’m In Like With You’s first round, but they received seed funding last year too.  I’m In Like With You used to be a social network for flirting before they switched to online gaming.

I’ve tried a couple of the games and they were sort of fun, but I became bored pretty quickly.  Sometimes the experience can be unpleasant because chatroom bots and send mass messages that prevent you from being able to communicate with other users.

I think I’m In Like With You is an interesting idea, but how will it continue to make itself useful to society in the long-run?  That’s the 1.5 million dollar question.

The website is located at: www.iminlikewithyou.com/

 

  
Judge James Ware of U.S. District Court for the Northern District of California has made a ruling in Facebook’s favor.  Facebook has agreed to pay an undisclosed amount to the owners of ConnectU through an acquisition. 

The settlement roots back to an accusation that Mark Zuckerberg and other founders in Facebook stole the idea for Facebook from the ConnectU team.  The ConnectU team consists of brothers/Olympic rowing hopefuls, Cameron and Tyler Winklevoss and Divya Narendra.  The tentative settlement was made this past February, but then ConnectU delayed to the settlement due to an accusation that Facebook failed to provide crucial documents for the case. 

ConnectU also settled to not make further claims against Facebook.

“The ConnectU founders understood the deal they made, and we are gratified that the Court rejected their false allegations of fraud,” stated a Facebook representative. “Their challenge was simply a case of ‘buyers remorse,’ as described by the Boston Court earlier this month.”

Mark Zuckerberg used to work for the Harvard Connection, a company founded by the ConnectU before creating TheFacebook.com.

[Source: Reuters]