broadstuff

Spotify is being sued for alleged patent infringement already - Techdirt:

just a couple weeks after entering the US market (finally), Spotify is being sued by PacketVideo for patent infringement. I knew the name PacketVideo sounded familiar... and then I remembered. A decade ago it was considered one of the hottest startups on the planet for trying to figure out ways to do streaming video on mobile phones

Now its not that their patents are probably any use, you understand, that is not the game - but by threatening a lawsuit it delays Spotify, costs them a lot of money and hassle....and thus creates an opportunity for PacketVideo to be paid to go away:

Once again, we see patents being used as a tool to shakedown companies who were actually innovative in how they executed, with a ridiculously broad patent that contributed zippo to the actual state of the art.

This is big business in the US now, in fact ex Microsoft CTO Natan Myrhvold's company Intellectual Ventures is dedicated to buying and enforcing such patents (and more - it tries to create patents around emerging areas, not for use but for the purpose of suing others). There was a rather good program on This American Life in the US last week on this issue:

"....people at companies that have been approached by Intellectual Ventures don't want to talk publicly.

"There is a lot of fear about Intellectual Ventures," says Chris Sacca, a venture capitalist who was an early investor in Twitter, among other companies. "You don't want to make yourself a target."

Sacca wouldn't say if Intellectual Ventures had been in contact with any of the companies he's invested in.

"I tried to put you in touch with other people in this community to talk to you about this and they almost uniformly said they couldn't talk to you," Sacca told us. "They were afraid to." IV has the power to "literally obliterate startups," Sacca says."

The irony is software patents have emerged despite the US Patent system supposedly not being allowed to patent algorithms! The US is trying to reform this now, but the proposed changes are deemed to be inadeqate and would come too late for Spotify anyway.

They'e just waitin' for the Shakedown....

EarlyBird Report saying that European VCs have better results than US ones (see above presentation), but I think it is misleading - as GigaOm points out,the reasons are not necessarily great for European entrepreneurialism:

Because venture money is scarce in Europe, on the other hand, companies have to compete harder for funding — which keeps the value of investments down. At the same time, it also means that VCs can cherry pick the very best investments and focus on backing real winners — which keeps their hit rate high. It’s a combination that creates a more efficient ecosystem, for investors at least.

This is encapsulated by a quote in the report from the head of Deutsche Bank Private Equity, who says that “European venture capital is a cottage industry characterized by an insufficient number of private investors with the capacity and willingness to invest in venture capital, mainly due to past disappointments and the resulting lack of confidence which still inhibits the European venture industry today.

I recall looking at this issue for McKinsey in the mid 1990's, and I don't see that - big picture* - much has changed. Its still the same cottage industry propelled by the laws of niche markets, but not maximising the total entrepreneurial potential value in Europe, just the returns to VC investors. The truth is that a startup is still more likely to get funded in the US, and get a higher valuation and more money.

What I have never understood is why the market hasn't become more competitive, and its still not even economically efficient as it is not maximising the total potential surplus from European entrepreneurialism - if it were a real "Free" VC market in Europe then nearly everything with a positive possible return would be funded - and some real turkeys of course.

The outcome is usually that European companies eventually go Stateswards or get bought by larger, faster growing US ones, and there is a dearth of European champions. For the European VCs its great, for Europe's own wealth creation, less so.

A more efficient market - definitely (within the narrow definition used). A more effective one - probably not.

*By this I mean that even though it has changed structurally, from an outside point of view - as an overall industry sector - it still quacks like much the same duck.

Google+ won't let Brands have pages, and this is upsetting the e-Marketeers, poor things - an Open Letter from Danny Sullivan :

Hey Google, I'd say I know you're all new to the social game and should be forgiven that you have messed up with how to handle brands here so badly. Except, you're not new.

For one, you know that Twitter and Facebook both support brands, and that there would obviously be demand for this here. You failed to implement that support. Bad on you.

I know it's all "field trial," but that's not really an excuse, given that you knew -- had to know -- this would happen.

Worse, you gave no clue that Google Profiles were suddenly changed to bar non-humans from using them. Before Google+ came along, this wasn't a problem. I know. I remember Google Buzz, when plenty of brands, including our own +SEL on Google Buzz account, started up.

No one said a word against this. No one told us not to do it. So when Google+ happened, no one had any idea the rules had changed - and especially changed for Google Profiles which are a superset of Google+.

IE, plenty of profiles that have nothing to do with Google+ but which are for businesses were suddenly made outdated.

I know you have great plans to have super wonderful business profiles eventually. But if you're going to only let a "tiny" number of businesses operate before that, then you taint them and yourselves with favoritism.

At least when you announced applications for business profiles, there was a sense that anyone interested would have some type of a fair shot. Now that's gone.

Don't try to put the genie back in the bottle. Restore the business profiles you have closed. Drop the rule you silently added that blocks business profiles. Let businesses use profiles here just as regular people do. Works just fine on Twitter. Then upgrade those accounts when you're ready

Two things we would note - one serious, one not:

(i) Facebook also tried the same approach initially (Broadstuff blog was thrown off Facebook when they tried to persuade advertisers that all avatars were individuals) but eventually gave in to the lure of lucre, no doubt Google will do the same - once it works out how the House wins the game.

(ii) In the interim we suggest Brands followthe example set in the book Jennifer Government,and force all their employees to change their surnames to the company name and take out Google+ accounts. We eagerly await Google+ accounts from Johnny Reggae Reggae Sauce, Jenny Colgate-Palmolive, Steve Microsoft and Charles Schwab (now that's clever -naming your company after yourself - such anticipation!). In fact one could go further and change name to actual products too - Dave iPad, Toni .

Spot the serious one

...and just beware of the unfortunate combinations - you know, the Wayne King, Mike Hunt etc equivalents (examples in the comments section please, there will be points, and points mean prizes)

Demand Media is trying to censor blogs that record its suckiness* - Forbes :

There’s something perversely flattering about having an entire website devoted to your supposed terribleness. But Demand Media is evidently not enjoying the attention from Demand Studios Sucks, a blog maintained by refugees, malcontents and other critics of the so-called content farm. This week, as Demand’s market capitalization fell below $1 billion for the first time since it went public in January, the company’s lawyers sent a cease-and-desist letter to the proprietors of Demand Studio Sucks, and temporarily succeeded in getting its internet service provider to take down some internal documents it didn’t want posted.

We thought the Demand Media business model sucked pre IPO, and still do, but its nice to see these sort of shark practice businesses get their own remora-blogs.

One of the lessons of the New Media is your critics are always with you......... and like remoras,they won't go away easily.

*Suckiness - a business that sucks at sucking suckers'

Since setting up this blog we have railed against the myopia of Planet Mobile in general and of Nokia (read here) - the Olde Guarde mobile phone makers and the elements in the Mobile Telcos that have fought tooth and nail against Mobile IP and decent IP devices. (The well powered, user friendly smartphone was technically possible some years before Apple brought the iPhone out, all it required was the will) so it is with no surprise we note Nokia is hitting the wall of its own self-created obsolescence - PaidContent:

Nokia today reported an operating loss of €487 million for the quarter, a decline of €782 million from the same quarter a year ago, when it made an operating profit of €295 million. The declines seen at the handset maker were near-total, represented by a string of negative percentages down the balance sheet.

That doesn't even begin to cover the disaster that is Smartphones:

In sales, smart devices saw a decline of 33 percent, to €2.368 billion from €3.503 billion a year before; in volumes that worked out to a 34 percent decline to 16.7 million units. In comparison, Apple sold nearly 34 million units and the combined Android makers sold around 37 million, according to figures from analyst Benedict Evans.

The "Microsoft Effect" had better be felt, and fast then..... if they want to have anything left of the JV and all the $ they are pumping into it. But they can't carry on doing "more of he same" - our own view is that they are better off putting their young turks in charge, rather than carrying on with the current management team.

Putsch Technology in other words......

Had a look at Google+ reviews briefly, reminds me of Friendfeed but as it would be done by guys whose previous successes were Buzz and Wave. Anyway a lot of the A listers seem to be spouting the same shill saying much the same as they did about Friendfeed , so the Broadstuff review is to be honest and to rehash our Friendfeed Review of 2008 and replace Friendfeed with Google +:

Fred Wilson* notes, re Google+ and the new new forum:

But it means I have to log into Google+ every day now and check out what people are saying and weigh in. Which I've been doing in the past couple weeks. And that increases the chances that I'll comment on someone else's posts at Google+.

So now, in addition to this blog, my tumblog, and twitter, I have to pay attention to whats' going on in Google+. So it's gone from being an aggregator of attention to a demander of attention. Good for them. That's the way to play the game on the web.

But I would like to see them get those comments portable in some way. Or I'd like to see someone aggregate those comments.

I love the last line's implications - I need another aggregator to aggregate the stuff this aggregator is aggregating so I don't have to visit yet another website

Fred also quotes Umair Haque**:

Umair, who is so right so often, said:

The real point is: Google+ is a next-gen, open version of Facebook's social feed.

Sorry guys, I'm being a bit slow here - which bit of the "yet-another-proprietary-service-that-I-have-to-have-an-identity-and-a-social-graph-in" is the next-gen, open version here?

Or is it that it pumps out stuff in that hate-object of the Web 2.0 faithful, email?

* Fred didn't say it this time round....but pick any sensible pundit you like.
** Ditto Umair

Anyway, I reckon this review will stand the test of time as well as the Friendfeed one did - with one eddition - Friendfeed never got an iPad app at launch.

We (triumphantly, yet reluctantly) crank the Broadstuff Bubble-O-Meter to Level 6 (see above) in July, based on the news from Betabeat that yet again. as in 2006/7, Lawyers, Consultants, MBAs and Bankers are leaving for startups.

“I can’t tell you the whole idea.” The Internet entrepreneur on the other end of the phone sounded panicky. “It’s going to sound ludicrous and ambitious, more ludicrous and ambitious than most.”

The voice belonged to a 27-year-old Stanford law student—“just about the oldest you can be where I cannot remember not having a computer”—who was in New York last week to talk to people about his new concept for a website.

He gave a few vague descriptors that could apply to half the start-ups in New York.

“I definitely don’t want it in the newspaper,” he said. “I’m worried that even little sign posts toward what I want to build are dangerous.”

When the Tech world moves from collaborative to competitive it means (silly) money is entering the game in large wodges, and get rich quick dreams are right behind. As Betabeat notes:

Cheryl Yeoh was working as a management consultant for KPMG, an 8:30 a.m. to 8:30 p.m. gig that kept her in Scotch tastings and Michelin stars, when she realized sometime in the middle of April that she needed to do an Internet start-up for something. Anything. The idea was secondary. What mattered was making something amazing that could reach not just hundreds of people or thousands, but millions. “I knew I could do something greater,” she told Betabeat. “Every time I met someone who told me, ‘Oh, I’m a founder of so-and-so,’ or whatever, I don’t care what company it was, every time they said that I thought, oh my gosh, why am I not doing this, I know I can start something, I know I can do something.

Those who were around last time will remember this mindset only too well, as Betabeat alo notes:

Whether it’s due to The Social Network or the new wave of billion-dollar tech I.P.O.’s, lately it seems like everyone has a start-up. Betabeat first noticed it in our own neighborhood, the tech-tending East Village, home of Foursquare. On a recent weekend, we overheard an entrepreneur talking about pitching investors over brunch on St. Marks and glimpsed another demonstrating his website’s Twitter integration to a friend at Ninth Street Espresso. We tried to eavesdrop on a bearded, 40-ish fellow ranting about his start-up to a friend in Tompkins Square Park around 9 p.m. on a Wednesday and caught the words “convertible note.” The trend has invaded our building as well. The Goldman Sachs engineer on the second floor wants to join a start-up. He asked us about tech events.

Another strong predictor is the increase in the number of startup recruiting events (production of startups is key to meeting the increasing amount of dumb money entering you see....)

Evidence of the city’s start-up fever can be seen on Meetup.com—the New York-based, dot-com-era start-up that became a hub for local techsters—where the number of recurring tech events has wildly accelerated: Startup Lunch, 104 members; Dumbo Tech Breakfast, 641 members; UWS Startup Meetup, 164 members; the NYC Startup Garage, 208 members; NYC Startup Weekend, 337 members; the NYC Lean Startup Machine, 1,553 members; the New York Technology Bathhouse Meetup, 25 members.

And then there is Twitter - $800m in, of which half is to cash out the existing investors....

In a move reminiscent of one done by Facebook in 2009, Twitter is close to completing $800 million funding deal that will include a second part in which around $400 million of the total will be used to cash out current investors and also employees.


......


That is especially important since the company is not likely to go public for at least a year or more. And, while it could also be sold to a bigger company such as Google, that is also not in Twitter’s immediate future.

Its not Twitter we are looking at for stage 7, though...

The Circle of Bubblelife says there is one every minute...... just don't invest the 401(K) this time round!

I assume everyone has been watching the unravelling of News International with some fascination, and all the little birds we know (and Rebekah Brooks) are telling us there is still more stuff to come....

However, the real long term question is this: how did power corrupt the organisation? On what planet do youh ave to live to have a world view that thinks hacking the phones of dead children is OK.

Befehl ist befehl, as they said at Nuremburg*

But that is not it - the real reason is "because they could", it was inevitable that in the pressure for results,to perform,to climb the greasy pole,that one person would go for this option - and so long as they don't get caught, the corporate game theory says they keep on winning (and even if they do get caught, the payoff for hacking may still be better than the punishment - we shall see)

I was reflecting on this with news today that Facebook is"becoming a News Organisation", and in a hard competition with Google+ (Forbes):

Facebook has a war on its hands, and Mark Zuckerberg knows it. Practically overnight, Google+ has gone from a rumor to a thriving community with over 10 million members. With some 700 million members of its own, Facebook is thinking less and less about how to grow that number and more about how to get current users to live more of their lives within its virtual walls. One answer it has come up with: asking a select number of news outlets to produce “Facebook editions” — basically, app versions of themselves that can be read and consumed right there on Facebook.

Add to that the article that there is a war on social network counting going on....Search Engine Land

Whether on purpose or not, Google and Twitter are having a little back-and-forth this week about the size of their social networks — or, maybe more accurately, about the activity levels on their social networks.

Google+ has X amount of users and the +1 button gets served Y times per day. Twitter delivers N tweets every day and saw P new signups just yesterday. It’s all quite reminiscent of the early/mid 2000s, when all of major search engines made a sport out of bragging over the number of pages they’d indexed

My take on Facebook's corporate culture is that they are not exactly angels, and Google long ago stopped "doing no evil". Twitter is still an unknown quanity.

But the user data they have access to makes the stuff that News International could get from mobile phone hacking look like a cupcake party confessions session.

And as the competitive pressures intensify, there will probably be the same corporate game theory emerging..... so even if everyone there today are saints,the corporate sleazeball would still triumph - one hopes that these companes put practices in to prevent it, or even better (and probably necessarily) US and UK regulators look at the NI event as a wake up call to put measures in place to prevent social network user data hacking.

Or else we will be saying "we told you so" in a few years time....

*Give us a break - Broadstuff is 4 years in and we only now invoke Godwin's Law .

The story so far - no sooner had News of The World announced its role as an ablative coating for News International closure, than various parties were quick to proclaim Facebook, Twitter and Mumsnet as the causes of its collapse.

Mumsnet? I hear you ask - WTF is that? Well, no less a luminary than the Times (another News International paper) in fact accused Mumsnet of breaking the News Of The World - Editor Roger Alton (See video above) accused Mumsnet:

“the comfortable middle-class mothers of MumsNet sitting down to their fair-trade tea and organic shortbread biscuits I hope are very pleased with the Twitter campaign they organised, getting advertisers not to advertise in the News of The World. They’ve done as much as anybody to close this paper and put 200 reporters, photographers, editors and young people just starting their careers out of work.. These yummy mummies have done as much as anybody to put them out of work. I hope they’re feeling pleased with themselves.”

Of course, as many people on Twitter pointed out at the time, he omitted to mention Andy Coulson or any other News Corps employees, or even the phone hacking issue - no surprises there given his newspaper's propensity for censoring of comments that they didnt like, even behind its paywall from paying subscribers.

There were the standard paeans to Facebook and Twitter of course, and we have commented on those sort of things many times before, but MumsNet is a new one so we did a bit of digging (so you lazy lot don't have to) - and its quite interesting, so allow us a little diversion first.

For those who don't know it, the foundation narrative runs something like this:

Mumsnet's two founders met at an ante-natal class in 1999 when they were both pregnant with their first children. Frustrated at the lack of decent information about parenting, they set up a website for new mums to be. At the time one founder hadn't even sent an email, let alone considered setting up a website. But, having spotted a gap in the market and keen to strike a good work/life balance, they set about creating Mumsnet. It was their high profile court battle with Gina Ford in 2006 which gifted Mumsnet the sort of publicity money couldn't buy. (Ford, author of The Contented Little Baby Book, took issue at some of the forum members' heavy criticism of her childcare methods and went for libel against the site. The case was eventually settled out of court with an apology to Ford). But it generated a lot of press and they came out of it quite well. It has burgeoned as a service since then.

But be that as it may, when you have a look at Mumsnet the way it works is in fact merely another Social Media system that aggregates the voices of many people, who can then agitate for a campaign in a certain direction, much like Twitter or Facebook. But it does seem to campaign as an organisation too, something Twitter and Facebook don't do (if you discount privacy lobbying, of course...). Now the Times clearly has form on them already, arguing in 2010 that it's the Founders who are driving the agitation and that "there were bullies hiding behind it's skirts":

"what started life as a gentle, mutually supportive online community of mothers seems to be turning into something different as it grows up. A decade after its birth, Mumsnet sometimes seems more like a bitchy, opinionated teenager than a sweet 10-year-old.

......

Flattered by suggestions that their 850,000 members could swing the general election, Mumsnet’s savvy co-founders, who set up the website after meeting at an antenatal class, have gone into PR overdrive in the past year, recruiting a dazzling array of big-name politicians for heavily publicised live webchats....

...[The Founders] Roberts and Longton are using the huge collective influence of Mumsnetters to push for changes in areas that matter to mothers."

The clue to their influence is more in the size of their user base, over a million now and of the more educated middle class mums (i.e. the sort who are less backward about coming forward), which gives them their power. Its critical role in reaching women made all parties in the last election very keen to be seen on it, to the extent it was dubbed the "Mumsnet Election". Also, one of the founders being married to a Grauniad Editor clearly doesn't hinder said PR media overdrive

Now the Times clearly has "Ishoos" with Mumsnet, but the Founders' increasing frequency of appearance on TV etc also clearly shows that they are doing more than just letting their membersip kick off in various random directions, and that is where they differ from Twitter or Facebook, which tend to be pure platforms for people to raise issues. In that respect thay are more like the campaigning newspapers of old, using their readership's views (or curating them?) as a base to champion various issues (The Times was once famous for this ironically, being known as "The Thunderer"). This makes them different to Twitter and Facebook, in that those two argue they are truly neutral platforms that allow people to say what they will, whereas the MumsNet founders are clearly more a part of the process, which may cause some problems down the line if someone really takes them to task.

But enough about Mumsnet - what did Social Media actually do?. It's worth looking at the timeline (in 10 easy stages):

1. Up until the last week or so, there has been a slow drip feed of revelations coming out, but all small enough and slow enough that various traditional means of assertive PR (paying policemen, possibly even buying off police enquiries, getting politicians to look the other way etc) had sufficed. Dedicated journalists and bloggers have been stitching things together, but the news that celebrities had their phones hacked to get at their lurid (or not) sex lives didn't really exercise the public mind.

2. The "Tipping Point" was the story broken by Nick Davies, a Guardian Journalist*, that they had also been hacking the phones of murdered schoolgirls, even deleting messages. A wave of revulsion wept the nation, and this was followed by news that they had also hacked the phones of soldiers killed in Afghanistan and their famlies. This is where Social Media first came into play, rapidly disseminating these stories ahead of the traditional Media/PR/Political circus that News International controlled, so NI were left putting the screws on gates long after the horses had bolted.

3. Social Media (Twitter, Facebook, MumsNet et al) drove a number campaigns of revulsion, turning News Of The World into a "Toxic Brand". When the story started to surface in the USA, it was easy to count the furore in the Social Nets, Advertisers became concerned and shied away, and then started to pull their support.

4. News International then closed News of The World, the storyline being that it was a toxic brand and so no longer a viable business. This was picked up by all the media, but the blogosphere was probably the most cynical about it straight off compared to the (sue-able) mass media, which played a more straight bat.

5. A campaign started, to drive protest responses to the public listening exercise on the News International takeover of BSkyB, this was flashed across Twitter and Facebook and elsewhere (I can't see it on Mumsnet though) and c 156,000 responses were received (normally a few hundred are received) forcing the embattled Media Secretary to announce an indefinite delay and OfCom to muse on whether News International were "fit and proper" to own it. This impacts on whether they are fit and proper to own anything, and in the long term this is The Big Story..

6. As with the Egyptian Revolution however, it was Television that put the real boot in. On Thursday night the very influential (and hugely watched) BBC Question Time programme kicked off with the question that had been on Twittter all day "Is the closure of the News Of The World just a cynical attempt to insulate News International from the fallout over phone hacking" (as quite a few of tjhe people in charge at the time now hold bigger jobs in the News International empire, and the real agenda is getting the BSkyB deal done). Hacked actor Hugh Grant was on the panel, and played his best role ever - that of an eloquent, elegant and aggrieved hacked actor (see video here) - while the panel's usual cadre of politicos and journos wriggled on the various News International petards thay had hoisted themselves on over the years. Question Time has its own Twitterstream (#bbcqt - we covered it some time ago) and this was ticking over like a geiger counter.

7. Roll forward to Friday morning an Opposition leader Ed Milliband went live on TV, crossing the Rubicon and going against News International on prime time TV (it has been an open secret in UK political circles for at least a decade that Murdoch is a kingmaker). The Prime Minister managed another wriggly politico petard performance, but by now Twitter was in overdrive and he was sliced, diced and dismissed in minutes. Twitter was the main conduit throughout the day, pointing to analyses across the UK and US as they emerged, but by now the 24 hour TV channels and mass media were on the case and were bearing the main story load.

8. On Friday afternoon, NI UK supremo Rebekah Brooks (who had been News Of The World editor at the time of the hackings of Millie Dowler, one of the dead girls's phone) held an off -the-record meeting to the sacked News Of the World employees, which was of course recored on various "User Generated Media" sources such as Audioboo and instantaneously disseminated on Twitter and Facebook, and picked up by the 24 hour TV news channels as it happened, including her comment that worse was yet to come.

9. On the BBC flagship political programme Newsnight on Friday night, another hacked actor, comedian Steve Coogan, gave another virtuoso performance (see video here) to millions of watchers (and more tuned in as it flashed across Twitter). Again, mainstream media carrying the load, Social Media carrying the signal.

10. Roll forward to Saturday, now the story is across all the mass media, and the Twitter #notw hashtag is still spinning like a geiger counter, the latest campaigns are to boycott not just the News Of The World but the Sunday Times tomorrow. Facebook has campaigns a-plenty as well, it would seem. Carl Bernstein (yes, that one) has weighed in on the UK's Watergate. Also by Saturday, the Googlebots have indexed all the media so it is fairly easy to pick up on the story. Oddly enough, according to Twitter the #Icantgoadaywithout hashtag is the biggest trending, but as I watch its not turning over as fast as #notw, so quite how they define "trending" I don't know.

And Mumsnet? well, on the main demi-political sections, the "Chat" and "Am I Being Unreasonable" boards, the biggest stories (apart from the perennials) are ""Message deleted by Mumsnet"" and "To start a Friday night drunk"

(To be fair, there are a few discussions of News Of The World related topics on Mumsnet but they are quite small volumes comparatively - but given they were accused of breaking News Of The World, they are clearly very influential....).

In conclusion then, Social Media is a messenger. It was not able to unearth or set up the target (that took courageous analytical journalism), but was excellent at running faster than the opposing media blocking plays, was excellent at alerting, aggregating and activating simple mass responses (boycott NOTW! boycott the Advertisers! Sign the petition against BsKyB takeover!) and pointing to alternative analyses. However, to really have mass impact it has required prime time TV with well known personalities to drive the agenda. My take on the Arab Spring ongoing story is that Socisal Media is also not that good at setting up alternative structures, its better at protesting against existing ones.

And Tomorrow? Well, we shall just have to see.....but one thing is for sure, adding Social Media to the mix has allowed small, nimble media to run rings around even interests as vested as the Tory party and News International. The real proof will be how quickly the investigations start (the Government is procrastinating) and what happens to BSkyB.....

*Nick wrote "Flat Earth News" which in my opinion is The seminal book on modern media