Month: December 2007

Ah, the weekend — when we get to lounge around in our pajamas with a cup of coffee, reading the thrilling back-and-forth, he-said/she-said tales of Web 2.0. This week’s installment brings us back to the gang at Blognation UK, the TechCrunch-style blog that Sam Sethi set up after he was given his walking papers from TechCrunch UK. If you recall, the last episode saw Blognation writer Oliver Starr (ex of MobileCrunch) post a 3,000-word screed about Sethi and how he was (allegedly) a lying scumbag. In case you’re interested, Sam has a sort of mea culpa here.

Now, Mike Arrington has posted a document that purports to be a “term sheet” from a venture fund called Secora, which Sethi claims is investing almost $500,000 for a quarter of Blognation. But there are some odd things going on with this term sheet — the dates appear to be wrong, and it looks as though it might have been prepared long before Blognation came apart at the seams. Not to mention that it’s difficult to believe anyone in their right mind would invest given the lawsuits that are flying.

In addition, a commenter on TechCrunch posts this illuminating excerpt from Secora’s annual report:

“The Board has subsequently carried out due diligence on a privately owned media and entertainment business… during the due diligence process it was determined that the financial results of the target business were significantly below expectations upon which the price had been based.

Several attempts were made to renegotiate the deal on terms that were acceptable to the Board and that could be recommended to shareholders, but without success. As a result it was concluded that the transaction would not be in the interests of Secora shareholders and should be aborted.”

Even if that doesn’t refer to Blognation (which is hard to believe) the rest of the report suggests that Secora itself is having financial difficulties, and therefore the odds of it deciding to put $500,000 into a struggling blog are not great. But that’s not the weirdest part: the weirdest part is that Sam Sethi appears to have posted a comment on TechCrunch using someone else’s name, which Debi Jones (another ex Blognation writer) then responded to.

This one is entering the Soap 2.0 hall of fame for sure. In any case, all this should make for a fun Le Web conference, since Sethi apparently was hoping to have a united front of Blognation bloggers show up and fly the flag. Doesn’t sound like that’s going to be happening any time soon.

My friend and online marketing wizard Leigh Himel has a great post today on Facebook, in the wake of a New York Times story about how a Montreal company (Weblo, which also runs a kind of virtual world by the same name) is helping Facebook users run ads on their own profile pages — something the social network officially doesn’t allow.

Leigh compares this phenomenon to the advice from the I Ching about how a network (i.e., Facebook users) should behave when confronted by an obstacle. She has the entire network-related excerpt on her blog, but I think the following excerpt is the most appropriate:

“5. Despite the importance of the obstruction, if the network is totally committed to the task it will attract collaborators with whom success may be achieved. (Resulting in: Unpretentiousness).”

How Facebook responds remains to be seen — but as Louise Story points out in the Times piece, it’s not going to look good if the social-networking site starts clamping down on its users so soon after the Facebook Bacon debacle.

Update:

Glad I added all those sarcastic caveats to my description of Valleywag below — it seems someone at Facebook played Owen Thomas like a fiddle, and the rumour about Zuckerberg cashing in isn’t true. Owen’s attempt to talk his way out of having been played is here. I still think it would be a smart thing to do though, even if it isn’t actually happening.

Original post:

According to the scrupulously honest and eminently reliable folks at Valleywag, young Mark Zuckerberg has taken an early cash-out from Facebook, by selling some of his stock in the company’s latest financing round. The gossip site says he picked up a not-too-shabby $40-million as part of the deal with Microsoft.

As Valleywag’s Owen Thomas notes, this isn’t how VC financing typically works. And it’s not how founders of startups typically work either — many hang on long after they could have maximized their return, either because they aren’t allowed to sell any shares or because they don’t want to make it look like they are losing faith.

But why shouldn’t Zuckerberg get a little something for his effort — and take advantage of the market’s valuation frenzy? He still maintains a huge stake in the company. I think it’s a smart move.

So it seems that Coca-Cola is still trying to find the magic combination of virtual world and aggressive marketing that will produce the magic results it seeks. The New York Times has a story about how the carbonated sugar-water behemoth has launched an abomination marketing effort called Coke Island in the virtual world known as There Inc. (a competitor of Second Life, but without all the flying penises).

As PaidContent points out, Coca-Cola has been down many a virtual marketing road — including the launch of its own world, known as Coke Studios, about five years ago. Although it claims to have attracted millions of members, it can’t be doing that well, since the company is effectively transporting (or teleporting) the entire shebang into There.com. Customers will apparently be able to use virtual Coke coupons to buy merchandise for their avatars and that sort of thing.

From the look of the screenshots on Mashable, you can wander around the island — shaped like a giant Coke bottle — and sit on giant Coke-logo benches and so on. I just have one question: who in their right mind thinks anyone is actually going to want to do this? Is there some kind of Kool Aid that gets passed around at the meetings where they come up with this kind of idiocy?

It reminds me of the scene in the movie Big — the one where Tom Hanks makes a wish as a young boy and is turned into an adult for a few months, and finds work at a toy company. A rival at the company is trying to compete with Tom’s brilliant Transformer-style toys, and says he has one that’s better because it turns into a giant skyscraper, at which point Tom says: “It turns into a building? What’s fun about that?”

Wandering around a giant Coke-shaped island with Coke logo benches and trading in virtual Coke coupons? What’s fun about that?

Updates from Michael Learmonth at Silicon Alley Insider and from Adam Ostrow at Mashable show that ABC’s election-coverage deal with Facebook isn’t exactly setting any records in terms of participation from members of the social network. Learmonth says that the application has just over 10,000 daily users, and Mashable says it only has a little over 8,000 — about 3 per cent of the total who signed up.

So what does this mean? It could mean nothing. Maybe the application just sucks, or maybe it doesn’t really take advantage of Facebook and how a social network operates — I took a look at it, and while it allows you to support a particular politician and read the news, it doesn’t do a whole lot other than that. The ABC Politics page is more useful, in the sense that you can join in debates (vote on issues) and follow ABC reporters. Several of the questions asked have close to 10,000 responses, which isn’t bad.

Maybe 8,000 to 10,000 people is a respectable number for signups to the ABC app (although it doesn’t look like much next to the 50 million people who are on Facebook). Or maybe it’s too early, and not enough people are aware that it’s even there. One other explanation, of course, is that the social network “is made up of kids who would rather play Xbox and “poke” each other than read the news,” as one commenter at Silicon Alley put it.

Is that true? I’m not sure it is, as I mentioned when the ABC app was first announced. Plenty of groups have gotten a fair bit of traction for political concerns and issues (although I’m not sure I would include the “Stephen Colbert for President” group in that). It’s possible that members of a social network like Facebook just aren’t looking for news from established media outlets, but would rather find it somewhere else.

Mike Arrington is between a rock and a hard place this morning: He has some news about a failed Web 2.0 company joining the Deadpool, but it’s a company he co-founded and is on the board of, the classified-ad company Edgeio. Mike and the rest of the board decided to shut the company down — a decision that was probably relatively easy to make, since it had apparently run out of money.

Edgeio seemed like a good idea to me when it launched: A kind of distributed version of Craigslist, in which ads would be pulled from wherever they were — sitting on blogs or whatever, provided they had the right tags — and then aggregated at Edgeio’s site. But like Frederic at The Last Podcast, I never found much of value there, likely because not enough people decided to get on board and tag their posts properly.

It’s interesting to read the comments on Mike’s post, as he responds to some of the obvious questions about the failure of the company, including “What the hell did you spend $5-million on” (Mike says: “Parties, scotch, hookers, blow. You know, the usual) and “Isn’t it ironic that you, the king of Web 2.0, have a company fail because it can’t find a reason to exist?” (“That is indeed ironic,” Mike says).

The unfortunate part is that Mike no doubt has tons of inside info on what happened at Edgeio and where it went wrong, but he can’t talk about it. The only thing he says is:

“In general I’ll say this – it is unwise for a company to spend a lot of money building out infrastructure before a product proves itself.”

Good advice.

I know that the impulse behind it is a valuable one, but I just can’t seem to get excited about the launch of the Business Blog Council, or what should probably be called the Big Business Blog Council. In fact, my thoughts on it run pretty close to Dave Taylor’s — it sounds like a gigantic waste of time to me. Don’t get me wrong, I’m all for businesses getting with the social-media program. But I don’t think getting a whole bunch of gigantic corporations into a room together is really going to help.

I really want to like this idea. Lionel Menchaca of Dell is a super guy — we had him on a panel at the last mesh and I really enjoyed meeting him — and he really gets what social media is all about, as his post on the Blog Council shows. But even if businesses need a secret clubhouse where they can share ideas about blogging, which I’m not sure they do, I still don’t see why it has to just be for big businesses. Why not all businesses?

I know, I know — people keep saying that businesses like Coke and Dell and Cisco have different needs because they are bigger. But I’m not sure I buy that. What difference does it make whether you have 100 employees or 10,000? Both companies will still have to think about disclosure and legalities and all those kinds of things. Much as it pains me to admit it, I think Scoble is right — just get out there and start doing it.

The biggest risk with something like the Big Business Blog Council — apart from it just reinforcing how big businesses don’t really get it, as Mark Hopkins points out at Mashable — is that it turns into something that starts with the word “cluster” and rhymes with the word “duck.”

The mesh team — that’s Rob Hyndman, Stuart MacDonald, Mark Evans, Mike McDerment and yours truly — are doing our best to come up with some really great content for the next mesh conference in May, but we wanted to ask you for some help as well. Many of you helped by telling us what you wanted after mesh 2007, and now we wanted to get some of your thoughts about 2008.

Ever since the first mesh conference — which kind of snowballed out of a conversation that the five of us had one night over beer and steak at The Paddock restaurant in Toronto — we’ve been fortunate to have a whole pile of smart and resourceful people helping us with ideas and execution, and we wanted to expand that group to include pretty much anyone with a great idea for a panel or a speaker or a concept.

Rob has posted some more thoughts on the mesh blog. The bottom line is that if you have anything at all to suggest — ways we could improve over last year, or just a wild idea you have for next year — please drop a comment either here or on Rob’s post. Mesh on!

Some people might say the moon landing, others might choose lasers or the internal combustion engine — I think this just might be the pinnacle of human scientific achievement: playing Tetris using the windows of what appears to be a 20-story apartment building, controlled (they are Finnish, after all) from someone’s mobile phone.

[youtube https://www.youtube.com/watch?v=0ddJrPKXfHM&rel=1&w=425&h=355]

There’s a longer video with lots more effects on the Mikontalo Lights website. I have no idea what is going on because I don’t read Finnish. If anyone can enlighten me, please do so in the comments.

Is being “open” the new black? Now AT&T — jealous of all the free publicity that Verizon has gotten for opening up its network to any mobile device — is trying to get some mileage out of the idea too, by telling USA Today that it is more open than anyone else (unless you want to take your iPhone somewhere else, of course — they’re still pretty closed to that).

Of course, as Ryan Block at Engadget and Rafat Ali at MocoNews and Mike Masnick at Techdirt point out, the carrier hasn’t done anything to become more open; all it is referring to is the fact that GSM phones have a personal SIM card that can be taken out and put in any other phone (including an iPhone, as many Canadians have discovered to their delight), and that handset can then be used on the network. Presto — open. Nice try, AT&T.

I’m not seeing it yet — at least not in the Facebook messages I’ve gotten so far today — but Mike Arrington says that Facebook is now sending messages straight to you in your email, instead of making you click through to read them. This might seem like a small thing, but it is probably the single biggest irritation to me when using a social network such as Facebook, or Ning, or any one of a half dozen others that do the same thing.

What it says to me every time a social network does that is: “I know I could just send you the message, but I’m forcing you to click through because I’m desperate for the page views.” It’s a thumb in the eye every time you get one of those messages, and I can feel the irritation building as I click through like a sheep — knowing that when I respond, my friend will have to do exactly the same thing to read my reply. This change means more to me than allowing me to opt out of Beacon.

As plenty of people probably know by now, Gawker has lost several senior staff members over the past week or so, including managing editor Choire Sicha (which is pronounced “Cory Seeka” in case you’re wondering — I know I was) and writer Emily Gould. There is plenty of commentary around about why they left, including some coverage at Women’s Wear Daily, and from my friend, the lovely and talented Rachel Sklar at The Huffington Post.

What I found interesting was that both Sicha and Gould said that it was the style of writing at Gawker that they couldn’t take any more. In the WWD piece, for example, Sicha says:

“I just feel like, now that everyone sort of operates at the speed we do, who’s actually going to do the stuff that takes some time or some reading?…Everything has become knee-jerk like we are.”

And Emily Gould says:

“Whatever Gawker originally set out to do, it kind of did, and now it just feels over… I don’t want to say the meanest thing or the most shocking thing possible anymore, because it gets so old and so soul-killing. There is stuff I really care about. I’m not interested in tearing it down as much as describing it.”

Could this mean that the quick-shot, snarky remark or sarcastic rejoinder is not the be-all and end-all of Web media? I hope so. Not that sites like TMZ or The Superficial and Gawker aren’t fun — but everything can’t be them. In case you’re interested, there’s more coverage of the Gawker situation in the New York Times, including a nice roundup here.

At Portfolio magazine, media writer Jacob Bercovici says Gawker is a “monster” that has turned on Denton and is eating him, and Vimeo founder Jakob Lodwick has some helpful tips for Nick Denton. For his part, Jason Calacanis compares Denton to Grendel and Gollum (why don’t you just say what you really think, Jason?).

First of all, let me just say that I don’t know Sam Sethi of Blognation — never met him, wouldn’t know him if I tripped over him, and haven’t heard anything pro or con about him since Mike Arrington sacked him (or he resigned) at TechCrunch UK last year. Even then, I had no opinion on the man. For all I know, he could be a prince of a guy, or he could be a complete jackass and liar who routinely slaughters kittens.

Even if the latter is the case, however, I’m not sure that writing the kind of hate letter Oliver Starr just wrote makes a lot of sense. According to the former Blognation writer, Sethi is a lying scumbag who continually promised money from some fictional venture-capital outfit and then failed to deliver on several occasions. And it’s not just Starr who feels that way — there are corroborating comments from two other former Blognation writers, Nicole Simon and Debi Jones.

For those who are interested, Sethi has responded that Starr left Blognation months ago, and therefore he’s not up to date with what’s going on — the imminent arrival of said VC funds being just around the corner — and there’s an implication that some money was paid out to staff, but Starr just didn’t happen to be one of them. Tom Raftery has more.

All that aside, I have to wonder what Oliver gains by writing a 3,000-word screed against Sam Sethi — and then not only posting it on Blognation (where it was quickly removed) but also on his own blog, and entreating readers to take screenshots, mirror the content on their own blogs, and otherwise maximize the public humiliation that Sethi is likely to encounter. Send ’em home in bodybags, in other words.

From the sounds of it — and Mike Arrington notes that he and Sethi didn’t part on friendly terms, so it’s not surprising he would post an unflattering email — Sam Sethi is more than capable of sabotaging his own relationships with VCs, rather than having Oliver jumping in to help. In any case, why play all this out in public? I’m not sure Oliver is doing himself any favours by taking the scorched-earth approach.

It’s like deja vu all over again, as baseball legend Yogi Berra reportedly said. Just as the Facebook news feed pushed the bounds of what users felt was appropriate in terms of privacy, and caused a backlash that eventually led to a mea culpa (Latin for “I screwed up big-time”) from CEO Mark Zuckerberg, Facebook’s new Beacon Web-tracking “feature” has done almost the same thing — except that it pushed the bounds of privacy as a way of serving advertisers’ interests, not users’ — and sure enough, here comes the mea culpa.

In addition to taking the blame for blowing it, Zuckerberg says that users will now be able to opt-out of the entire feature completely, with a simple click. And it seems as though Marky-Mark may have learned a thing or two about taking the heat: in the case of the news feed, the Facebook CEO at first tried to laugh off concerns and told people that they needed to chill out a little (I’m paraphrasing). This time he takes it on the chin right up front:

“We’ve made a lot of mistakes building this feature, but we’ve made even more with how we’ve handled them. We simply did a bad job with this release, and I apologize for it.”

Maybe all of these new features and the frenzy surrounding them are God’s way of teaching Mark Zuckerberg humility 🙂 In any case, I don’t want to say that I told you so, but I kind of saw this coming. I expected that Facebook would push the envelope of what people were comfortable with, and that as a result of that the company would change its new service.

As nice as it might be to see Mark taking the hit and apologizing, however, you have to wonder: how many more times are they going to get whacked for similar ventures? I think Om Malik has a good point: if Facebook is a social network, then why not ask users what they would or wouldn’t be willing to tolerate before you roll out a new service?

A free music-download service on your mobile? Cool. Nokia’s new “Comes With Music” offer? Dumb. The details are sketchy so far, but it sounds like Nokia has done a deal with Universal Music to offer downloads of the record company’s catalogue for free, with the cost of the music built into the price of the phone. So far, so good. Unfortunately, it sounds like the files are also DRM-laden, and thus crippled.

According to The Register, the songs will be playable only on one PC (not Mac or Linux) and on a Nokia device, and that’s it. While they will not expire — as music downloaded with some other services does — you can’t burn them to CD or play them anywhere else, although there are hints that burning might be allowed for a fee. Seamus McCauley says that such moves say one thing to him: “uncomprehending death spiral.”