Castro's Blog

Pageviews are obsolete

Evan William, the CEO of Odeo (a Pluggd competitor), recently blogged about how pageviews are an obsolete metrics. The post mentions web site hits as a previous metric that eventually become obsolete. The post is very similar to my post from a few months back, Alexa is Web 2.0 entery #1, where I mention the negative consequences facing innovative start-ups due to the use of Alexa by potential partners, investors, the press, etc.

Evan probably cares about this for the same reasons I do. Odeo's site, like ours, enables users to listen to podcasts from a web page using a flash player. So a user can actually spend a considerable amount of time, perhaps hours, on our respective sites without generating much in the way of pages views. By any measure, a user who spends this much time on a site is a very engaged and valuable user. Unfortunately, the lack of 'pageviews' creates the false impression that the site lacks user engagement.

The user of Ajax has become very popular because it enables web developers to create richer user experience for their users. However, Ajax typically reduces 'page views' because the user stays on a single page while multiple asynchronous calls execute. Here is another case where a site may have engaged, happy, and valuable users, but the site will ultimately be penalized by the press, investors, partners, advertisers, etc., because they created a better user experience.

The final insult involves RSS and widgets. Where users can incorporate content from a web service without actually visiting the site to generate page views. With the profilleration of feeds and these widgets, this again penalizes innovative start-ups. Actually, I think the notion of a portal is also becoming obsolete because of widgets and RSS. In fact, I don't think of Pluggd as a portal. I think of Pluggd as a Nexus that brings things together, both aggregating, and syndicating content and functionality.

Since Alexa uses a browser toolbar installed on the client, it could easily be modified to monitor HTTP traffic to account Ajax traffic. Also, the Alexa client could track the time spent on a site to account for scenarios like listening to audio or watching video. Another option, would be for companies like Hitwise that partner with ISPs to measure traffic to add relevant metrics that are more appropriate for this next generation of web service.

Pluggd Selected to Present at DEMOfall 2006

Pluggd has been selected to present at DEMOfall 2006. This is a huge honor for us. TiVo, the Palm Pilot, and Java are all products that launched at DEMO. Lately, some of the leading Web 2.0 sites like Riya were launched at DEMO.

We will be launching a new product that we are really excited about. We just can't talk about it yet. You see, as part of the DEMO conference we've been asked to keep things quiet until the actual event.

"Pluggd has been invited to join this elite group because 
the company has developed a solution that helps people 
find and enjoy digital content. In a crowded market, 
Pluggd's technology is not only unique and compelling, 
but has the potential to change the way we interact 
with Web content." - Chris Shipley

Check our Drew's post about this on the Pluggd Blog.

Two other Seattle start-ups have been invited, Cozi and Jookster. Here is the John Cook article.

Here is the press release announcement.

Also, the annoncement is now on Digg. So fellow Diggers, show us some Digg love. :-)

Google Launches Hosted Office Applications

This has been rumored for some time, but it's official now. Google is rolling out Google Apps for Your Domain (terrible name) that allows businesses to use gCalendar, gMail, gTalk, and web page creation tool.

The gTalk and web page creation tool aren't particularly interesting to me. But email and calendar are very interesting to me.

Frankly, since we've started Pluggd, we've struggled to find email and calendar solutions that work for a company of our size. Even though our company is primarily comprised of engineer types, we didn't want the hassle of hosting our own email server. Partially this was a cost issue (not wanting to pay for Exchange), but primarily this was a focus issue. We wanted to use our cycles to make Pluggd a great product and not waste cycles of "IT work."

We're currently using webmail.us since it comes with our contract with RackSpace, but we don't love it. It is slow, lacks key features, and has very poor search capabilities. However, our biggest pain is around shared calendering. We want a simple tool that we can use across our team and with the partners, contracters, etc., that are external to Pluggd, but we work with regularly. We haven't found an easy or cost effective solution for this.

I use gmail and gcalendar personally, and I am excited about moving Pluggd to these services. There is a real pain point and Microsoft, despite Office's dominance, has not found a way to address this pain.

I've actually started using Writely lately, and have found it surprisingly adept at dealing with all my needs. The ability to collaborate online and export to Word, PDF, etc., were the key features that have put me over the edge.

I've recently switched from MS PowerPoint to Keynote. So I'm almost completely weened off Microsoft Office. Frankly, this is something I never thought would happen. Moving from Windows to the Mac - fine. Leaving MS Office, for a knowledge worker like myself, was just not something I ever thought would happen. Seems a lot more plausible, and perhaps even likely, now.

Don Dodge, a Microsoft employee, has a post that points out MS Office Live apps, but I don't buy it. The apps he points out are things like Customer Manager, but not the basic core functionality that Google is offering. I think he is missing the point. Perhaps MS Office Live comes out with a bunch of great alternatives to what Google is offering. I have a hard time seeing MS doing anything that directly erodes a $10 billion/year revenue stream. Even if they do, how long with it take before they actually ship something. We'll see. But for now, we're going to give the new Google Apps a test drive.

Newsome.org accurately points out the obstacles for enterprises adopting these types of hosted services.

As I have said many times, corporate America is not going to embrace online applications and storage for a long time- privacy, security, fear of a bad decision, and confidentiality requirements ensure that. But the more individuals and small businesses that opt for Google's free alternatives, the bigger Google's toehold is- both in the office productivity space and in connection with its master plan to be the keeper of all of our data.

However, small and medium sized businesses will eat this up.

Microsoft to Provide and Sell Ads on Facebook

The New York Times is reporting that Microsoft has reached a 3 year agreement with FaceBook to provide advertising on the social networking site popular with college students.

Microsoft has recently lost out to Google on several opportunities, AOL and MySpace, to provide advertising on high profile sites. These types of deals are critical to Microsoft's ability to create a viable alternative to Google's AdSense. They need high quality and high volume advertising slot to attract advertising to their ad platform. It's a chicken and egg problem.

I actually think this is a great win for Microsoft. FaceBook seems a lot 'smarter' than MySpace, e.g., FaceBook provides APIs shortly after MySpace screws the eco-system. Smart. Very Smart. Overall, I think FaceBook will continue to grow.

Here is some coverage from elsewhere in the blogosphere:

Inside Microsoft

"Microsoft and Facebook say that talks only picked up in the last week, no doubt taking on an air of importance after the MySpace deal. In fact, Facebook’s entire business strategy seems to be to point to MySpace and say, “Hey, we deserve that, too!” After MySpace was bought for $500 million and started to look like a bargain, Facebook reportedly pointed to that and claimed it deserved no less than $2 billion. Of course, thanks to this ad deal, Facebook might not need to be bought by anyone anymore (and MySpace is looking mighty stupid for selling out as early as it did)."

Don Doge on The Next Big Thing

"Financial details were not disclosed but Microsoft VP Steve Berkowitz said “not comparable to the MySpace deal because we focused on the right economics for both parties.’’

FaceBook COO said Owen Van Natta said Facebook chose Microsoft because the company’s technology and approach are a better fit. 'We think they have a real understanding of the need to take a fresh approach to advertising and social media.'"

Sony Acquires Grouper for $65m

Sony Pictures has acquired video startup Grouper for $65m. The deal was initially denied by Grouper. However, it has no been confirmed and reported on several blogs and onling magazines. The acquisition price was very high.

Grouper has three products offerings:

• An online video sharing site
• A video editing client
• A P2P networking client used to distribute video in a closed network (not yet released)

Grouper claims 8 million unique users while ComScore reports 554,000 unique users. Pretty big difference. I wonder if this is due to a difference between web based users and users of Grouper's client software. Grouper does have some unique functionality, e.g., such as the ability to leave video comments on a video. This feature is demonstrated nicely in a funny video showing Grouper beating up on their competitors I found on Howard Lindzon's blog who also posts about the acquisition.

Grouper was founded by veteran entrepreneur, Josh Felser, who previously ran Spinner.com which was acquired by AOL for $320m in 1999.  Grouper raised $5.25 million from Duff Ackerman & Goodrich LLC,  T-Venture, and angel investors

TechCrunch does a nice job comparing Grouper's per user valuation (it's much higher) against similar recent acquisitions iFilm and Atom Entertainment. Some bloggers (and here is another  and another) believe Sony overpaid. Mike Arrington suggests that Grouper's larger per user valuation may be due to the value of their P2P client.

Here is the press release.

Thanks to Brian Goffman, from Madrona Ventures, for bringing this to my attention.

AOL's CTO Resigns

Reports have surfaced that AOL's Chief Technology Officer has resigned due to the the inadvertent release of search data for 600,000 customers. In addition to the CTO, two employees in the research group responsible for tracking user search data have also left AOL.

AOL has formed a 'task force' to ensure this type of thing doesn't happen again. I feel bad for the employees. One the one hand, the fact that AOL held some folks accountable is a good thing. On the other had, we don't really know what happened here and I can't help but think some of these folks were merely convenient scape-goats.

Unless AOL treats their internal corporate data the same way they treat user data, we'll never know.

http://www.eweek.com/article2/0,1895,2006360,00.asp

txtGroups Mentioned by Under the Radar Blog

Under the Radar Blog recently profiled txtGroups, a social SMS service that allows people to easily text predefined groups of people (e.g. family, team, podcasting meetup, etc.). Amal is a local Puget Sound entrepreneur that I met at Seattle MindCamp 2.0 a few months back. A genuinely nice guy who helped diagnose a server problem we were having with Pluggd.com in the early days without us even asking him for help!! Well, if that is any indication of the quality of service provided by his company, then it is a winner and worth trying out.

Amal is also a big famous for having RFIDs implanted in both his hands. He uses them to open doors, log in to his computer, and things of that nature. If you would like to have your own fun with RFIDs, check out Amal's book RFID Toys.

Office 2.0 - Under The Radar with Mike Arrington

I attended the Under the Radar Office 2.0 event last night in Palo Alto. The event focused on companies innovating in the online productivity and collaboration space. The event was hosted by TechCrunch's Mike Arrington, who made the event both informative and entertaining. He did a reall nice job.

The panelists were:

• Etay Gafni, Director, Technology Innovation Center - SAP
• Ismael Ghalini, IT|Redux & CEO - Intalio
• Peter Rip, Managing Director - Leapfrog Ventures
• Sam Schillace, Software Engineer - Google/Writely

What is Office 2.0?

Peter Rip views Office 2.0 as hosted productivity and collaboration apps. Productivity at the personal level and then collaboration at the group level. Believes Office 2.0 service represents a threat to existing business model, some of it likely will be freeware, and some larger enterprises will not adopt 2.0 services due to security concerns.

Sam Schillace from Writely/Google doesn't like comparing features, performances, etc., of Office 2.0 services to legacy desktop apps. Thinks it is more interesting that Office 2.0 apps focus on smaller problems and enabling new scenarios. He thinks Office 2.0 services will eventually catch up on the features, richness, etc., but it will require another generation of browsers before this can happen.

Etay from SAP thinks this trend is interesting because the people making purchase decisions are the ones using the services. This is unique because in most businesses IT makes decisions at a business level on what tools employees can us. He then described this as a problem because people will be operating is silos using isolated apps. I'm not sure I buy this completely, it sounds like he is giving the standard large enterprise vendor anti-best of bread speech.

Ishmael Ghalini from IT|Redux believes most people don’t need all the bells and whistles of client productivity applicatin like Office anyway. Who needs Microsoft Word’s high end capability unless you are writing a book. It is connectedness, remote access, cost benefits, etc., of these hosted Office 2.0 apps that will drive users to switch because the benefits of outwheigh the benfits of the bells and whistles.

Ishamel claims that he hasn’t used Microsoft Office and hasn’t had a document file on his desktop for 9 months. Wow! I'm going to have to give some of these services a try.

Comparing the Companies

WetPaint (presented by CEO Ben Elowitz)

• WetPaint is for clubs, hobbies, fans, etc., who are looking for ways to collaborate and create an online community
• This is a huge market opportunity representing billions of pageviews per month (note to folks to start-ups trying to get funding, data points like this are important to investors)
• Ben did an excellent job of positioning WetPaint against blogs, social networking sites, and existing wikis. In essence, WetPaint enables non-techies to share personal experiences and create communities
• I was very impressed with the serivce. It was very fast (so many start-ups overlook this). The editing toolbar is very familiar and easy to use. No downlaods, flash, applets, etc.
• Some impressive features include how easy it is for users to add links and images. Even though I'm technical, I find that I sometimes forget the codes to use to do similar things when using a traditional wiki.
• WetPaint is free and add support. Ben did a nice demo. I didn't see any way for users to include audio/video. WetPaint seemed a little more consumer oriented that the other Office 2.0 companies.
• All the panelists commented on how nicely WetPaint is designed and executed (I totally agree).  Sam commented that he couldn't find the site he created from the WetPaint homepage  (I am not convinced this is a typical user scenario). Peter agrees the product is better than most others in the space, but stressed the need for WetPaint to gain distribution to grow the business. Wikia is considered the primary competitor (CEO is former eBay exec Gil Panchina).

Collective X (presented by CEO Clarence Wooten)

• CollectiveX was started to solve his own problems. He joined a social group and found that he couldn't take every single person out to lunch to understand the objectives and goals of other group members.
• Groups (alumni groups, professional groups, social groups) lack the tols to sustain and engage members
• The bio is auto-created as a result of answering some short questions.
• Key connections can be shared in a more private manner (unlike LinkedIn). For example, you know that some has a connection with a senior level executive at Motorola but you don't know exactly who
• Nice group calendar, nice design, good use of Ajax
• Base service is free, but premium features required a subscription
• Clarenced declined to disclose the number of paying custmers, but indicated they have thousands of groups and users
• Peter Rip thinks it is a well executed product. Really likes it. Thinks Google is a risk because they can pull together writely, gCal, etc., into a competing product
  • Clarence indicated that CollectiveX isn't about real-time collaboration, and more about asynchronous coordination (A very good point)

Echosign

• Echosign is all about using the Internet to solve the basic problem of 'signing documents'
• Works by sending Echosign email, which is turned into a PDF, then Echosign allows people to 'sign' the document. I think this service solves a problem I've personally delt with at Pluggd, but think the UI could be improved. It's bit complicated.
• Launched in January of 2006. 125 enterprise customers. Thousands of small business customers.
  • Service is free when used for fax signature replacement
  • $12.95 a month for the Pro version
  • Entertrpise service provides visibility across groups of people. The Enterprise version starts at $20/sender per month
• Typical users are part of sales, HR, contracts administration, compliance
  
  • Provides contract status visibility to sales managers across their teams
  • HR departments use it for offer letter signatures

Zoho

• My laptop battery died, so my notes here are a bit light
• Zoho offers a suite of hosted productivity applications across document creation, presentation creation, spreadsheets, CRM, etc.
  • The breadth of functionality available in the Zoho suite was incredible impressive. I was wondering how the heck a little start-up built out so much functionality so quickly. I learned that Zoho is owned by a large company (400+ people) that writes network management software, and Zoho is a project within that company. Apparently, they have over 100 people working on Zoho. Definately not a start-up in the typical sense.
• Components and data are easily shared across documents. For example, a chart can be easily created using their presentation software and used in a document created by their MS Word replacement service.
  • What I find amazing is how drop-dead simple this was to do with Zoho, while I am somtimes driven to pulling my hair out when trying to use Office products to do this.
  • It gets better, with Zoho, updates to a component (e.g. a chart) are automagically updated in any document that referrences the component. Another thing MS Office can't easily do.
• Zoho included scripting functionality. This was pretty impressive, although I'm not sure how much it is really going to be used.
• Overall, I left thinking I should give Zoho's software a shot.

Netvibes Raises $15m

Netvibes will announce a $15 million investment from Index and Accel ventures (Index previously invested in a prior round).

NetVibes is an Ajax 'webtop' that allows users to aggregate RSS content and include 'gadgets' of content/functionality from external web sites on their Netvibes homepage. Netvibes is the leader in this space followed by PageFlakes (backed by Benchmark Capital). Large players such as Microsoft (Live.com), Google, and Yahoo are also in this space.

A $15m investment is significant. By comparison, Bebo, has recently raised $15m but they have a more clearly defined business model and more users. So I'm wondering how Netvibes could justify a valuation that must range between $40 million (on the absolute low end) to $60 million. Currently Netvibes is not running ads on their site and the service is free.

The only revenue stream I am aware of is charging the 3rd party developers who create Netvibes gadgets to promote them within the gadget directory. I learned this in conversation with Netvibes about creating a Pluggd gadget. I'm not sure this is a great approach as it will only incent developers to support competing platforms.

Windows Live Writer

Microsoft announced the release of the Windows Live Writer blog posting tool. The client side tool allows users to compose blog posts offline and post them to MSN, er, Live Spaces, and other popular blogging platforms (e.g. Blogger, Typepad). Live Writer sports the following features:

• WYSIWIG Authoring - the ability to switch in and out of HTML mode as well. Not a huge deal, other client side blog posting tools have provided this for a long time.
• Photo Publishing - along with the ability to do some basic image manipulation.
• Map Publishing - ok, this is cool.
• Write SDK - lets developers enhance writer to post additional content, e.g., embedded audio/video players, images from e-commerce sites, etc. This is also cool and smart.

Here are my observations:

• This is actually kinda a big deal. Not because the tool is so innovative, it does a few clever things and it is very well executed, but it is a year or so late. Still the Live Writer team derserves some applause cause it is very nicely done.
• The reason this is a big deal is because Microsoft actually shiped a simple stand alone app. Somehow theser guys managed to ship without this product forced into integrating with Internet Explorer, Works, Word, etc., there is no big unifying MS strategy here. It even supports non-MS products like Blogger (yeah - owned by Google). This means, that as a shareholder, I may have some sliver of hope that my MS shares might actually increase in value.
• If Microsoft continues to do this consistently, then there is reason to get excited. I suspect this sort of thing will be few and far between. Even with Sinofsky removing an entire level of middle management (which was desperately needed).
• A few months ago, I might have complained about the lack of a Mac version for Live Writer, as TechCrunch does, but since my MacBook Pro runs Windows I don't have to.

Here is some coverage from elsewhere:

• ZDNet's Web 2.0 Explorer expects to see this type of functionality in Office Live.
• LiveSide.net has a bunch of nice screen shots.
• There are a few more screen shots on TechBlog.
• You can find some firest impresssions on Inside Micrsoft. Along with screens shots from Vista.