Industry Standard Unique Content

Playboy's CEO: We're profitable online

Ian Lamont — Wed, 20 Aug 2008 18:11:26 -0700

Playboy Chairman and CEO Christine Hefner has criticized "misstatements" in an Industry Standard analysis ("Playboy's Second Life sim buzzes, even as real-world brand falters") that suggested the mens-oriented publisher is having difficulties positioning its brand and products online.

Hefner, the daughter of Playboy founder and editor-in-chief Hugh Hefner, left a comment at the bottom of the article that said Playboy Enterprises had "significant increase in online ad sales for the quarter," and that there was an increase in online profitability in the second quarter.

However, Hefner acknowledged there was a decrease in overall revenues for the quarter, due in part to an investment in a redesign and upgrade of Playboy.com, as well as the "strategic decision" to license the company's e-commerce and catalog operations.

In Playboy's Q2 2008 earnings conference call, Hefner said pay site revenues have declined, and the ongoing redesign project would "continue to negatively affect online results through the remainder of this year." Playboy's overall Q2 revenues fell 14 percent to $73.4 million compared to the same quarter last year.

More news, commentary, and predictions from The Industry Standard:

Special Feature: The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail
Special Feature: Where are they now? The Industry Standard tracks down 10 dot-coms from the Web bubble of the late 1990s

CO2Stats offsets the Internet carbon footprint

Chris Tompkins — Wed, 20 Aug 2008 15:43:41 -0700

Y-Combinator is once again showing off their most recent early-stage startups at Demo Days this week, with companies offering varied solutions to problems on the web like metrics, content creation, hosting, polling, and even internet connected appliances. But of all of Y-Combinator’s promising startups, only CO2Stats showed a competent yet passionate desire to solve a world-wide problem using the power of the web.

By power of the web, I literally mean energy. CO2Stats hopes to leverage the growing energy consumption of the Internet to increase the demand for renewable energy.

Its founders’, Alex Wissner-Gross and Tim Sullivan, claim that the Internet’s total carbon footprint is now larger than the entire aviation industry. C02Stats solution to this problem was to create a way for websites to purchase renewable energy credits to offset that large footprint.

The company is similar to VeriSign, in that their main public-facing element is a badge customers can place on their website. But instead of guaranteeing that the site is SSL secured, CO2Stats’ badge shows that the host site runs on green power credits. The badge goes far beyond simply branding a site to be “green,” and represents that the website is actually purchasing renewable power to offset the amount of energy being consumed by both their servers as well as their customer’s computers.

How does CO2Stats power web servers and the customers who visit them? Tim and Alex explained to me (and on their website) that the first step was to research and compile a world-wide database of geographic energy sources, a process that took six months. When someone surfs to a CO2Stats-badged website, scripts record the location of the user and match them to their corresponding geographic energy source in the database. For example, if a visitor is from Virginia, the database would register a coal-based energy user had visited the site. The scripts then details how long that person spent on the site, their total power dedicated to loading and browsing it, and even the approximate window size to estimate the monitor’s power consumption. That data is then run through the database and outputs a corresponding number of green power credits are purchased to offset the energy used by that individual. Clicking the badge will then display how many pounds of C02 are offset through the program.

In order to make a profit off this renewable energy market, CO2Stats purchases green power credits in bulk from Sustainable Travel International and NativeEnergy. Bulk purchases allow for a profit margin over the fixed monthly rates the CO2Stats charges based on total page views. A site can purchase the badge at a fixed monthly rate based on page views brackets (under 5 million, 1 million or 500k), while CO2Stats manages purchasing green credits required to offset the site.

Tim and Alex believe that renewable energy’s hope lies in being adopted by high technology firms first, then trickle its way down to the average user. The badge method CO2Stats is uses allows companies to purchase the renewable energy, while consumers and surfers can enjoy the peace of mind that their surfing is carbon free.

More news, commentary, and predictions from The Industry Standard:

News: Y Combinator Demo Day: CO2Stats, Posterous and others show their stuff
News: Discover Your Solar Savings at Roofray
News: Expanding green IT

LDS church rumored to have offered for Facebook

Cyndy Aleo-Carreira — Wed, 20 Aug 2008 12:48:37 -0700

This latest mind-boggling Facebook rumor comes to us by way of Brady Brim-DeForest, and claims that the Church of Jesus Christ of Latter-Day Saints has made an unsolicited offer for Facebook. It's an offer that would seem completely out of left field unless you stopped to think about the amount of relationship stored in the Facebook database, including family relationships. That type of data might appeal to the religious organization, which has an enormous genealogical database of its own.

Even if the church does have the cash on hand to make a reasonable offer, there are other companies out there that would make more sense, including the popular Web 2.0 site Geni, a combination social network and genealogy tool. Brim-DeForest double-checked with his sources, however, and updated his post:

"My inquiry a couple of hours ago to an old college friend who works for one of the interested parties has indicated that there is more at play here than meets the eye, and definitely more than just a kernel of truth to this rumor."

More news, commentary, and predictions from The Industry Standard:

Prediction: Facebook acquires Friendfeed
News: More musical chairs: Facebook’s Benjamin Ling returns to Google
News: ProfNet is now on Facebook, and PR Newswire employees love it!
News: Facebook plans to move its offices south in Palo Alto, to California Ave

Hulu pushes more than 100 million streams in July, starts advertising

Jordan Golson — Wed, 20 Aug 2008 12:06:17 -0700

Online video venture Hulu streamed 105 million videos in July according to Nielsen's VideoCensus. Hulu, a joint NBC Universal-News Corp. operation, hosts high-quality free streaming movies, TV shows and clips. The site includes full episodes of popular shows like The Daily Show with John Stewart, The Simpsons, Family Guy and The Office. Hulu also has a limited selection of full-length movies, mostly older ones like The Karate Kid and Ghostbusters, but also some more recent features like Sideways and Master and Commander.

Since it launched last March, Hulu has mostly grown through word-of-mouth and media coverage, but now AdWeek reports that Crispin Porter + Bogusky will run a $50 million account for Hulu, with ads on "NBC and News Corp. properties as well as outside media outlets."

The site has been more successful than some analysts thought it would be. Hulu was originally thought to be mostly an alternative to YouTube where NBC and News Corp. could post clips and be in full control of content and, more importantly, advertising revenue. Instead, the site has become a destination for a younger audience which is tied much closer to the free-wheeling on-demand Internet, rather than the schedule of traditional broadcast television.

TechCrunch's Mike Arrington, a fierce Hulu critic, lavished praises on the site in June when Hulu started offering full episodes of The Daily Show with John Stewart and The Colbert Report, from Comedy Central.

Because Hulu is now streaming full episodes of The Daily Show With Jon Stewart and The Colbert Report, from Comedy Central. No more Tivo. No more dealing with BitTorrent. I can just log in and watch the show in 480p, and that makes me very, very happy.

More news, commentary, and predictions from The Industry Standard:

Special Feature: The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail
Special Feature: Where are they now? The Industry Standard tracks down 10 dot-coms from the Web bubble of the late 1990s
Special Feature: The Industry Standard's Top 25 B-to-Z List Blogs

Rumors of iTunes music subscriptions fly again

Jordan Golson — Wed, 20 Aug 2008 11:19:55 -0700

Here we go again. A pair of Mac sites, TUAW and MacDailyNews, both received anonymous tips today outlining how an iTunes subscription music store might work -- and both are plausible enough to be true. That said, given the rampant speculation and misdirection that exists in the Mac rumor world, this info should be taken with a non-trivial grain of salt.

MacDailyNews says the service will be called "iTunes Unlimited" and offer 50% of the songs currently on the traditional U.S. iTunes store through the program at launch. The subscription will be for one year and be available through iTunes or a retail box, similar to how MobileMe/DotMac is sold. iTunes Unlimited would launch, initially, on the U.S. store only. The subscription would cost $129.99 on its own, $179.99 with MobileMe or $99.99 for existing MobileMe subscribers. The site claims a late September announcement with late October rollout, just in time for the holiday season. TUAW received (almost certainly from the same source) a similar report.

Last March, The Financial Times reported that Apple was in negotiations with music companies that would give Apple's customers access to the entire iTunes music library in exchange for a modest fee -- or a premium on iPods and iPhones that would guarantee unlimited music for the lifetime of the device. Executives familiar with the negotiations told the FT that "they hinged on a dispute over the price the computer maker would be willing to pay for access to the labels' libraries."

Nokia has a similiar "all you can eat" model on some of its phones, and reportedly pays $80 per handset to labels. The Financial Times claimed that Apple had offered $20 per device, leaving a wide gap between the two sides. One exec said "it's who blinks first, and whether or not anyone does blink."

Nothing ever came out of the report, though I suspect it was accurate. In the past, Jobs has claimed that customers want to "own music," in response to competitors offering music via a monthly subscription service, but don't let that put you off. For years Jobs shot down the idea of iPods with video or an Apple-branded cell phone -- until they suddenly appeared on stage at an Apple event.

As I wrote in March, Jobs "doesn't care one bit about digital-rights management software ... that record labels insist on. And he knows that most consumers don't care about the issue. He just wants to sell iPods, and his customers just want to buy them."

Jobs just needs a hook to keep iTunes -- and the iPod/iPhone ecosystem -- on top. Selling music players with "all music included forever" would give Apple an edge that no competitor could match.

Think you know what's going down? We've set up a prediction around the "iTunes Unlimited" introduction. Place your bets and let us know what you think in the comments below.

More news, commentary, and predictions from The Industry Standard:

Prediction: Apple announces subscription service for iTunes by October
Special Feature: The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail
Special Feature: Where are they now? The Industry Standard tracks down 10 dot-coms from the Web bubble of the late 1990s
Special Feature: The Industry Standard's Top 25 B-to-Z List Blogs

ProfNet is now on Facebook, and PR Newswire employees love it!

Jordan Golson — Wed, 20 Aug 2008 09:31:37 -0700

Peter Shankman's upstart Help a Reporter Out mailing list and PR Newswire's ProfNet both attempt to link up journalists looking for sources with PR professionals and others looking for good press, albeit in slightly different ways.

HARO actually got started as a group on Facebook, before Shankman transitioned his roughly 600 members over to the mailing list format he uses now. The HARO page on Facebook now counts more than 1,100 fans, without any actual promotion on the HARO mailing list.

Help a Reporter Out (HARO) then became a free service for all involved with dozens of journalist queries going out to more than 23,000 subscribers every day. PR Newswire's ProfNet is free for journalists, but can cost thousands of dollars a year for potential sources.

In an attempt to show the company "gets" social media, PR Newswire has created a fan page for "ProfNet: The Expert Connection" on August 12th. ProfNet has a whopping 37 fans and nearly half of them -- 18 of 37 -- are members of the PR Newswire Association network on FB, meaning, of course, that they actually work for the PR Newswire.

Here's my question: is ProfNet charging folks to be a fan on Facebook, like they do to actually use the service? You'd think a company that was built to -- you know -- network people, would be a little better at it.

More news, commentary, and predictions from The Industry Standard:

e-Bullion update: Fayed's lawyers say feds seized $24 million in assets

Ian Lamont — Wed, 20 Aug 2008 09:27:34 -0700

A motion filed by the lawyers for e-Bullion's co-owner James Fayed claims that FBI and IRS agents seized "bank accounts, business records, property and precious metals holdings" worth $24 million on August 5, according to a new report on the Ventura County Star website. The motion also requests that the government release $300,000 to preserve electronic evidence, including e-mails, audit trails, transaction histories and other electronic records and data, says the Star. (Note: There is an update and a copy of the motion at the bottom of this article.)

Fayed is in jail, awaiting trial on a federal charge of operating a money transmitting business without a license. He is also a suspect in the July 28 murder of his estranged wife, Pamela Fayed, in a Los Angeles parking garage.

August 5 is the date that e-Bullion's account services were taken offline for "routine maintenance." The report in the Star does not mention e-Bullion, only an associated gold-trading company owned by James Fayed, Goldfinger Coin & Bullion. However, Fayed described the strong connections between e-Bullion and Goldfinger in an earlier court filing, and e-Bullion's services are heavily promoted on the Goldfinger website. The Star report says the motion states that the cost of maintaining "Internet servers and [the] computer network system" totals $100,000 per month, including staff-related costs. It further claims that crucial evidence on the system is at risk because of the seizure, and suggests this information would be lost if it were to go down.

The motion also states that the target of the federal investigation might not have been James Fayed and his gold-trading businesses. This could be a reference to the alleged scam outlined in a government memorandum filed earlier this month. The document says e-Bullion was used to transfer money belonging to victims of a massive "Ponzi scheme" in 2006, but does not accuse Fayed of devising the scam.

The Industry Standard is attempting to verify the information described in the Star report, and to determine whether the alleged seizures on August 5 are related to e-Bullion accounts being disabled on the same date.

Update: Paul Huebl has posted the motion cited in the Star article on his website, and you can also view it on the second page of this article. The "[Proposed] Order Granting Application for Release of $300,000 to Preserve Exculpatory Evidence" blames the ongoing e-Bullion.com shutdown on the FBI and IRS search and seizure warrants executed on August 5.

The $24 million cited in the proposed order includes gold and silver from Goldfinger's vaults that is "held for the benefit of thousands of e-Bullion customers." It further reveals that 466,300 user accounts have been created on e-Bullion since 2001, although it is not clear how many of those accounts were active as of August 5.

According to the motion, Fayed is offering to assist law enforcement authorities in investigating past and future transactions for evidence of criminal activity. It notes that in the past Fayed has "cooperated with inquiries" from the SEC, the FTC, U.S. Attorney's offices in several states, and various other federal, local, and state agencies.

The document warns that "disclosure of this indictment would certainly cause disruption, if not a complete shut-down, of the relevant Internet sites and would, accordingly, likely destroy any possibility of a proactive, ongoing investigation of very important targets."

Huebl has further analysis of the motion and the murder investigation on his blog. Mark Herpel of DGC Magazine has also written an analysis of the situation.

The court document follows:

Fayed money motion - Upload a Document to Scribd

More news, commentary, and predictions from The Industry Standard:

Picture This: KillerStartups is no longer a killer

Cyndy Aleo-Carreira — Wed, 20 Aug 2008 08:21:42 -0700

The KnightKnetwork noticed that upstart TechCrunch product CrunchBase may be cutting into the audience of the go-to site for start-up profiles: KillerStartups. Google Trends data shows CrunchBase on the upswing and KillerStartups on a steep decline. Alexa shows some optimism but who's looking at Alexa for good data anymore?

More news, commentary, and predictions from The Industry Standard:

Special Feature: The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail
Special Feature: Where are they now? The Industry Standard tracks down 10 dot-coms from the Web bubble of the late 1990s
Special Feature: The Industry Standard's Top 25 B-to-Z List Blogs

Optional Gmail "feature" really an exploit fix

Cyndy Aleo-Carreira — Tue, 19 Aug 2008 22:55:33 -0700

Last month, Google rolled out an SSL feature for Gmail to thwart an exploit brought to them a year ago and later publicly presented at the recent Defcon conference, according to Hacking Truths. There was no announcement for the new feature, and it was offered as an option, which I'm willing to bet was largely ignored.

Gmail is a perpetual beta, but should still bear some responsibility for its users' security. If they really did have a year to issue a fix, and left it to an optional "feature" with no explanation to their users, they've pushed that responsibility back to their users without even a basic explanation of the protection it provides. If you click the "learn more" link, the text provided by Google actually sounds like it's discouraging users from enabling the feature, stating:

"Please note that selecting 'Always use https' will prevent you from accessing Gmail via HTTP (Hypertext Transfer Protocol). In addition, it may make Gmail a bit slower. If you trust the security of your network, you can turn this feature off at any time."

More news, commentary, and predictions from The Industry Standard:

Prediction: Gmail announces free, unlimited storage space
News: GMail outage provides weapon for cloud-haters
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Picture this: Gmail is down

Electronic Arts and Take-Two: Are they the next Microhoo?

Cyndy Aleo-Carreira — Tue, 19 Aug 2008 19:13:39 -0700

Electronic Arts (EA) seems to be taking its takeover tips from Steve Ballmer and company. Is it possible that EA wasn't watching the Microhoo fiasco? Chris Morris at Forbes seems to think the similarities are becoming apparent.

While not as high-profile as Microsoft, EA is a huge player in the industry, with marquee titles on PC (The Sims franchise), console (Madden), and casual gaming (Pogo) platforms. With the merger of Activision and Blizzard, EA needs an acquisition (or two) to regain its spot at the top of the leaderboard for gaming companies. Take-Two, with its Grand Theft Auto (GTA) franchise, would be a decent acquisition for EA, but GTA is fading, and Take-Two's long-rumored Duke Nukem Forever has been the most infamous piece of vaporware in gaming.

Like Yahoo, Take-Two feels that it's worth more than the $2 billion EA offered and has done everything it can to avoid being acquired. Also like Yahoo, Take-Two went chasing after EA when EA said it wasn't renewing the offer.

At some point, the cat-and-mouse game becomes tiring, both for the companies as well as those following the proceedings. At the end of the Microsoft-Yahoo negotiations, Yahoo was left battered, with employee morale low, executives jumping ship, and stockholders unhappy. Is that really where Take-Two wants to be?

EA claims it's walking away since there's no way the deal would be finalized in time for the holiday shopping season. Take-Two suddenly coughed up some of its financials in hopes EA will simply up the bid. In the end, though, will Take-Two be left looking for a new direction?

More news, commentary, and predictions from The Industry Standard:

Prediction: EA acquires Take Two by end of August 2008
Analysis: Scrabble discovers loyalty a better draw than licensing
News: EA drops bid for Grand Theft Auto publisher, but joins talks

PR and propaganda: Spinning Liu Xiang's Olympic burn-out

Cyndy Aleo-Carreira — Tue, 19 Aug 2008 16:36:19 -0700

Watching Chinese hurdler Liu Xiang's withdrawal from the 110-meter hurdles at the Beijing Olympics was painful, even for American viewers. The hurdler, who won gold in the event at the 2004 Athens Olympics, was China's first big track and field star, and it seemed the entire country was hoping he could repeat his gold-medal performance on his home turf.

Photos taken at the stadium showed sobbing fans, and the first reactions seemed to be deep sorrow and national pride disappointed. CN Reviews had a story about a CCTV journalist who broke down mid-broadcast and had to stop to compose herself, unheard of in a country where the media is strictly regulated, and reporters are controlled by the pre-approved text on the teleprompter.

After the reports of Chinese mourning, however, a few stories began to leak out painting a bleaker picture. The Daily Yomiuri reports that Chinese Internet forums lit up with negative posts, referring to Liu's withdrawal as a "cowardly act" and "1.3 billion people hurt -- a new world record."

I spoke with Chinese-American blogger Elliott Ng of CN Reviews about the two disparate reactions, and he alerted me to a rumor that may be even more sinister: that bloggers and media outlets have been ordered to spin the withdrawal. As blogs like Cup of Cha protest the negative reactions described by The Daily Yomiuri, the New York Times appears to confirm the rumor that the Chinese government had its propaganda machine out in force, forbidding criticism of Liu or investigation into his withdrawal.

What remains clear is that China is disappointed that their lone track star wasn't even able to compete, much less win a gold medal. Both the angry and sorrowful reactions are most likely real, but the online reaction may be shaped by a government determined to put forth an image of national pride in their heroes, without recriminations when they fail.

Photo of Chinese hurdler Liu Xiang by Eckhard Pecher from the World Athletics Championships 2007 in Osaka. Used under the Creative Commons Attribution License.

More news, commentary, and predictions from The Industry Standard:

Analysis: Users run circles around NBC's Great Olympics Firewall
News: Michael Phelps is king of the Web as well as the pool
News: Sun uses Olympic fever to promote Zembly
Picture This: Facebook loves Michael Phelps
Video: IOC backs off DMCA take-down for Tibet protest

Picture this: Facebook v. MySpace -- Presidential Edition

Jordan Golson — Tue, 19 Aug 2008 16:35:06 -0700

MySpace and Facebook are both important places for presidential outreach in this election year but one site links the candidates to many more fans than the other. Barack Obama logs almost 1 million more fans on Facebook than friends on MySpace and McCain has almost 3 times as many fans on Facebook than MySpace.

This is especially interesting because MySpace is still bigger than Facebook in the United States, though grabbing millions more monthly visitors. But even behind, Facebook is significantly more popular among the political set:

Are the billions being spent on the "last mile" worth it?

Jordan Golson — Tue, 19 Aug 2008 11:27:46 -0700

Verizon is spending $23 billion on its fiber-to-the-home, or FTTH, initiative. The service, called FiOS, will ultimately reach 19 million homes in Verizon territory, roughly half of the company's total customer base. Verizon's total estimated cost per customer? Around $4,000.

Verizon's FiOS is a particularly expensive high-speed data solution because it involves running fiber lines directly to an optical network terminal (ONT) on the side of the house, replacing the old-school copper network interface device (NID). Not only must technicians run fiber line through individual neighborhoods on the existing telephone poles (or underground), but whenever a new customer signs up for FiOS service, a tech must physically install the ONT. This process is time- and labor-intensive, but it sets up the customer with a very high-speed connection which could last them for years.

AT&T has a "competing" service called U-verse which attempts to do much the same thing -- but cheaper. Instead of running fiber all the way to the home, replacing all existing copper infrastructure, the company installs network terminals called VRADs which can supply a few hundred homes in individual neighborhoods. Then, AT&T techs use the copper lines already running to individual houses to go "the last mile." As a result, CapEx spending on retrofit installs is significantly cheaper than what Verizon is doing -- possibly more than 50 percent cheaper. On new installations, AT&T runs fiber all the way to the home in the same way that Verizon does for all FiOS installs.

Verizon's scheme is very expensive, but is -- theoretically at least -- more future proofed than AT&T's. Whereas AT&T's VDSL/copper wire solution works well enough for today's data needs, 25Mbps (50 Mbps is occasionally available depending on distance) falls short when compared to the data Verizon can push. Verizon's FiOS can theoretically be cranked up to 2.4Gbps/1.2Gbit on the newest equipment. Once Verizon has run fiber to a customer location, it won't need a speed upgrade for many years.

Though AT&T's install is cheaper per home, Verizon is OK with the additional spending. "The network ... is pretty future-proof," according to Verizon SVP Robert J. Barish. Not everyone approves of Verizon's scorched earth capital expenditures. Craig Moffett, an analyst with Sanford C. Bernstein told the New York Times "If I were an auto dealer and I wanted to give people a Maserati for the price of a Volkswagen, I'd have some seriously happy customers." Moffett claims Verizon will have blown $6 billion on the FiOS project after squeezing as much revenue as it can out of it.

David Barden of Banc of America Securities thinks Verizon is better off for the additional spending, and new investors will reap the rewards. He told the Times, "the 2008 investors owe the 2003 investors a debt of gratitude because the 2008 Verizon is in a vastly better competitive position than it otherwise would be."

As for AT&T? The company's step-by-step approach allows it to spread the capital expenditure spend over time. Its current U-verse product is good enough to compete with FiOS and Cable offerings available now and leaves AT&T the option to run fiber the last mile at a later date, when fiber prices may be lower. John Donovan, AT&T's CTO thinks the smarter choice is to get as much life out of existing copper lines as possible. He told the New York Times, "the ideal way to deploy technology is on the last day as fast as possible, because it gets more capable and cheaper every day."

Time will tell which plan -- Verizon's or AT&T's -- is better, but one thing's for sure. They aren't competing directly, so for the consumer, it doesn't really matter. If you live in Connecticut, you get AT&T. If you live in Massachusetts, you get Verizon. Your choice between the two is made based on geographical area. The only place the two companies are actually competing is on the stock market -- and the marketplace of ideas.

(Writer's note: Much of the sourcing for this article came from meetings I've had with AT&T, plus a pair of New York Times articles. Verizon's FiOS: A Smart Bet or a Big Mistake?, and A Bear Speaks: Why Verizon's Pricey FiOS Bet Won't Pay Off)

More news, commentary, and predictions from The Industry Standard:

Special Feature: The Digital Home of 2013: 10 consumer technologies that will succeed, and five that will fail
Special Feature: Where are they now? The Industry Standard tracks down 10 dot-coms from the Web bubble of the late 1990s
Special Feature: The Industry Standard's Top 25 B-to-Z List Blogs

Picture This: Apple's less than extensive iPhone upgrade notes

Jordan Golson — Tue, 19 Aug 2008 11:20:53 -0700

This morning, iTunes prompted me to update my iPhone operating system to version 2.0.2.

"OK, great!" I thought, hoping that some of the crashing problems I've been having will be fixed. Of course, being an Apple product, I have no idea what has been changed beyond one cryptic note: "bug fixes".

I guess iPhone users should just hope for the best, eh?

AP sees the future of online news, but misses monetization

Cyndy Aleo-Carreira — Tue, 19 Aug 2008 11:16:15 -0700

Recovering Journalist had an excellent summary of a surprising report from the Associated Press. It's shocking that such an organization, which has taken its fair share of grief from the online community over its aggressive DMCA claims, should have such insight into the future of online media and how to attract a younger, more tech-savvy audience.

The AP report, titled "A New Model for News," details findings from interviews and trend studies of 20-something Generation Y news connoisseurs. Some of the findings won't be a surprise to anyone (did you know young people don't read newspapers?), but the suggestions for new models of producing and distributing news to these young people are.

Without regurgitating the entire report, the models proposed are certainly things that could turn the news business around and prop up sagging newspapers. The problem, however, is that any and all of these tactics will probably work for driving audience share, but all of this free content that's forcing the change doesn't have a sustainable business model. It's all based on the former newspaper model, which was subscribers + news stand sales + ads. Without paid subscribers and news stand sales, there's a hole in the model they haven't filled yet.

The AP has suggested some potential avenues for growing a user base, but offers no suggestions for monetizing the content being produced and distributed. It's not enough to move to all these new models until there is a huge culture shift that includes reducing some of the staff bloat, moving news faster, and letting go of the traditional thought process that led the AP into the public relations issue with Drudge Retort. New models require new thought processes as well, and it isn't clear from the report that the AP is there yet.

More news, commentary, and predictions from The Industry Standard:

Analysis: Do journalism practices need to change for digital media?
News: AP's Jim Kennedy discusses blogs, Fair Use
News: AP targets bloggers over story excerpts
Q&A: Attributor discusses Fair Use, DMCA take-downs

Muxtape falters: another online music site falls to RIAA

Cyndy Aleo-Carreira — Mon, 18 Aug 2008 17:55:00 -0700

It's a rough time to be in the online music business with Pandora seeming close to extinction, and other Web radio companies in jeopardy if SoundExchange manages to get royalty rates for Web airplay raised.

Muxtape has apparently already had a run-in with the RIAA, and is currently down while it "sorts out a problem with the RIAA." The latest competitor to Muxtape is 8tracks, which has a similar model to Muxtape, although the tracks on each mix aren't listed individually. 8tracks swears it's completely legal based on royalty payments and using the compulsory license for webcasting in the Digital Millennium Copyright Act. With Muxtape on the ropes and Pandora in trouble, are 8tracks and other music services worried?

More news, commentary, and predictions from The Industry Standard:

Prediction: Pandora cheats death, converts to subscription model
News: The outlook for Pandora looks grim
News: Tweens, teens increasingly turn to MySpace, iTunes, and P2P networks for music

Phayul.com features the Olympic news you aren't hearing

Cyndy Aleo-Carreira — Mon, 18 Aug 2008 16:34:06 -0700

Amid the rumors of underaged gymnasts and an Opening Ceremony that was a virtual chimera, there is actually a good deal more news that isn't making the glossed-over and gussied-up network coverage. While China is doing its best to put on a great show during the Beijing Olympics, Phayul.com is doing its best to uncover all the news about Tibet and China that mainstream outlets aren't.

For instance, were you aware that Tibetan citizens who wished to compete in the Beijing Olympics had to renounce their Tibetan citizenship and register as a Chinese athlete in order to compete? Many athletes in exile refused to do this, and instead, participated in the Tibetan Olympics according to an article from Al Jazeera found by Phayul.com. There's also an AP article pointing out that the Chinese government didn't approve even one of the 77 applications submitted by those who wanted to hold protests during the Olympics. I must have missed that in all the hoopla over Michael Phelps.

Phayul.com has a decidedly anti-Chinese stance, including an ad on the front page when I visited calling the Beijing Olympics the "Genocide Olympics" complete with a version of the familiar Olympics rings redone as a horror logo, including dripping blood. However, for those of us who've seen nothing but the very sanitized (and prime-time optimized) NBC coverage of the Olympics, Phayul.com may be the best aggregator for news from and about Tibet.

More news, commentary, and predictions from The Industry Standard:

Analysis: Users run circles around NBC's Great Olympics Firewall
News: Michael Phelps is king of the Web as well as the pool
News: Sun uses Olympic fever to promote Zembly
Picture This: Facebook loves Michael Phelps
Video: IOC backs off DMCA take-down for Tibet protest

Picture This: Facebook loves Michael Phelps

Jordan Golson — Mon, 18 Aug 2008 13:03:02 -0700

Facebook is celebrating Michael Phelps's record run at the Beijing Olympics with a banner at the top of every U.S. user's News Feed. The notice, "Congratulations to Michael Phelps and all of the U.S. athletes", links to Phelps's Facebook fan page which currently counts more than 800,000 Facebook users as fans.

DPI discussion highlights a Net Neutrality weak spot

Ian Lamont — Mon, 18 Aug 2008 13:00:29 -0700

Argentina's Department of Justice recently sent a notice out to all ISPs operating in the country -- including several American firms -- ordering that they cut off domestic traffic to bwin.com.ar, a gambling site which has been found guilty of operating without a license.

No big deal. Just have the ISPs block the site's IP address, right?

Wrong. In this case, the request proved to be difficult for one of the American ISPs. It's not just the fact that bwin.com.ar may change its IP address to evade the block. Another issue, says a source at the ISP, is its network architecture also encompasses a neighboring country in South America. Some users outside of Argentina would be impacted, even though they are outside of the jurisdiction of Argentina's legal system.

So what to do? The source, who requested anonymity and asked that the ISP's name not be printed, tells The Industry Standard that legal and technical staff began to work out the best way of handling the Argentinean order. Someone floated an alternative: DPI.

DPI stands for Deep Packet Inspection, a controversial technology that looks for specific characteristics among the contents of individual network packets carrying Internet traffic. If an inspected packet meets a certain criteria, rules can then be applied to decrease its priority or take some other action. In this situation, DPI could look for packets whose HTTP GET requests contain the Argentinean gambling domain and block them.

The DPI approach would be troubling on a number of levels. First, any ISP using DPI is going beyond a government mandate to simply block traffic to a particular site. The ISPs would actually be peering inside their customers' Web traffic without their knowledge.

Second, DPI can be used to defeat Net Neutrality, which, in theory, is supposed to give equal treatment to all Internet traffic, no matter the source or contents involved. In the United States, Net Neutrality is a hot-button issue among surfers who fear the erosion of the relatively free and equal browsing they enjoy today. ISPs could use DPI or some other scheme to deny their customers access to certain types of content or even specific files, or charging them more to access them.

The staff at the American ISP who received the Argentinean order are well aware of these issues. However, DPI will not be implemented in this case -- it requires a significant hardware investment that the ISP is not willing to make.

Still, our source says some of the ISP's engineers who support Net Neutrality are uncomfortable with the DPI discussion. Even though DPI won't be used this time, it will probably be considered in the future as a way to take offensive or illegal sites offline. These engineers suspect that a DPI implementation on the ISP's network may very well come about as the result of a foreign court order or some other overseas need. This could potentially pave the way for an American rollout, depending on how Washington acts on the Net Neutrality debate. Says the source, "This is one of those technologies that makes it possible to turn Net Neutrality on its head."

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Briefly: Fayed pleads not guilty in e-Bullion case

Ian Lamont — Mon, 18 Aug 2008 11:56:44 -0700

e-Bullion co-owner James Fayed has pled not guilty to a federal charge of operating an unlicensed money transmitting business, according to the CBS affiliate in Los Angeles. Fayed was ordered to return to court on September 15 for a status conference.

However, Fayed was not released from detention, as the U.S. Attorney's Office claim that he is a flight risk. In addition to the federal charge, he is also considered a suspect in the July 28 murder of his wife and former business partner, Pamela Fayed.

The federal trial is scheduled to begin on September 30.

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Do journalism practices need to change for digital media?

Cyndy Aleo-Carreira — Mon, 18 Aug 2008 11:51:11 -0700

In the days of print, archives of past news articles were only accessible via microfiche or an expensive subscription to an online archive service like Lexis-Nexus. Now, when most articles are published and stored online, later to be indexed by Google, anyone's history in print is easily subject to search. An error or misreport attached to an individual's name can last much longer than the original week in print in a newspaper. A former student at Seattle Pacific University has brought this issue into the public spotlight, requesting an archived article in the university newspaper about a dropped attempted sexual assault charge be removed.

Standard journalism practice has long been to never issue a retraction unless the story is wrong, and due to the nature of print, issue it as a secondary article. The shift to online journalism, however, changes the playing field for both media outlets as well as those profiled in articles.

Shakespear Feyissa was profiled in the Seattle Pacific University's student newspaper 10 years ago, when discussing alleged discrimination after he was suspended indefinitely from the school, even after charges of attempted sexual assault were dropped. Now, according to the Seattle Times, Feyissa wants the article removed from the student newspaper's Web archive, and the editors are refusing to budge. For Feyissa, who finds references to the article in top results on search engines for his name, the reports of a case that was dropped is a blight on his record resulting in women Googling and refusing to date him. As a lawyer, clients looking to hire him may balk at being represented by someone who was accused of attempted sexual assault.

The Online Journalism Review from the Annenberg School for Communication is tackling this new issue in a article questioning whether or not editors should remove content online. The standard response of "we don't pull stories" was based on a print paradigm. The ease of internet searches digging up old content might demand a new way of retracting or updating articles -- especially when charges of a crime are usually big news but dropping those charges are not ranked as high.

One commenter on the Online Journalism Review piece noted that Japan already has policy in place for dealing with this issue; the regional daily that he works for pulls all crime-related articles after a year. Another commenter suggests going back and adding an addendum to any story where the charges were dropped or the accused was acquitted, but how realistic is this in the fast-moving online news space? It's easy to miss follow-ups to any story, especially if you aren't the original reporter.

There is a generation coming up who may face the same situation as Feyrissa, either with things users wish they'd never posted or situations users found themselves in that they wish would disappear. Would it really be a violation of journalism ethics to pull stories after a period of time, since that would include those found guilty as well as those found not guilty? Is it acceptable to add an update to the article for those found not guilty or whose charges are dropped? Or should we rely on the relatively new industry of social media monitoring and SEO techniques to simply bury stories we find unacceptable?

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Slinkset takes a niche approach to reddit-style aggregators

Ian Lamont — Mon, 18 Aug 2008 06:44:31 -0700

User-moderated news aggregators such as Digg and reddit have made a huge impact on the way people find and consume news, blogs, video, and other online content. A recently launched Y Combinator startup called Slinkset offers anyone an opportunity to create a niche aggregator for public or private use. Examples include an Apple-focused aggregator and typehype, which highlights resources related to fonts and typesetting. The Industry Standard recently spoke with founders John Baunach and Brett Gibson about Slinkset's current feature set, and where they hope to take the service in the future.

The Industry Standard: When did you start developing the service?

Baunach/Gibson: January 2008.

TIS: Why aren't Digg, reddit, and existing niche services like Sphinn and FSDaily enough?

Digg and reddit have proven how useful this medium is, but they're clearly not for everyone. Sphinn and FSDaily attest to that fact, but required more technical know-how to get up and running than most people have. We want to address the rest of the ideas, individuals, groups and organizations around which social news communities could naturally coalesce.

We aim to do this by making it really easy to get sites up and running and by giving our site admins as much ownership as possible while still hosting the sites ourselves. In our efforts to foster independent communities we think it's an advantage that we don't have a "main" slinkset social news site that our smaller ones feed into. We've been able to design customization features from the ground up without having to worry about how they will effect a larger offering of our own.

TIS: When did it launch?

We had a soft launch for feedback in March. We went back to work after we were funded by Y Combinator and had a larger public launch on July 14th.

TIS: If I create a niche aggregator how is content brought in? What restrictions can a Slinkset site admin place on visitors and registered users?

Content can be posted via user submission or auto posted via RSS. Site owners can choose to make their sites public, private or editorial. If the site is private only users the owners have invited can see the content or submit. If the site is editorial anyone can see the content, comment and vote, but only the site admins and those they designate as editors can submit links. If a site is public anyone can see the content, vote, comment or submit. In any case site owners can choose to ban any user or kill any link they don't like.

TIS: Can the algorithm be tweaked in terms of the stories that rise to the top -- for instance, by extending the time period that determines front page placement, or giving more point power to highly ranked users?

Our software currently allows for this, but we have yet to expose it through the UI. It is something we hope to get to soon, but for the time being users have to contact us to change how their site's ranking works.

TIS: What's the business model?

We believe there is room to charge for premium features much the way that Ning currently does with their social networks. We are also looking into business applications for our software, so far mainly as an internal communication tool or for customer outreach (e.g. a site for ranking feature requests).

TIS: Plans for the future?

Right now we're mainly focused on continuing to build the features our current users want. See http://features.slinkset.com/.

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iPhone owners: Don't hold your breath for "push" apps

Jordan Golson — Mon, 18 Aug 2008 03:35:11 -0700

One of the more exciting developments of the iPhone 2.0 announcement at WWDC in June was Apple's "push notification" technology, which will, when it's released, allow inactive applications to send audio alerts and pop-up notifications to a user similar to text messages. Applications like Twitterrific and AIM would have been the most frequent users of these notifications on my iPhone.

When this feature was announced, Apple promised it would ship to customers by September. The Push Notification API was "pushed" to developers at the end of July, but now it has been delayed for "further development."

A bit disappointing for sure -- no one likes to miss ship dates -- but we all know what happens when Apple pushes out software that isn't ready (see: Me, Mobile). 9to5Mac estimates the feature will be released with iPhone OS 2.2, "probably around Macworld" in January 2009.

All I know is, AIM is lame on the iPhone because I can't stay logged in 24/7, like I could on my old Sidekick. Come on Apple, amazing IM-on-phone technology is years old. Make it work!

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Briefly: Patent office declines Dell's trademark of "cloud computing"

Jordan Golson — Mon, 18 Aug 2008 03:08:02 -0700

The US Patent and Trademark Office has denied an application by Dell to trademark the term "cloud computing." According to Sam Johnston, the USPTO has declared "cloud computing" a generic term that is "incapable of functioning as a source-identifier for applicant's services."

The ruling is officially titled a "non-final determination", which leaves open the option for Dell to appeal the ruling, but a brief look at the Trademark Office's ruling suggests Dell doesn't have much ground to stand on.

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Briefly: Xbox 360 outsells PS3 in Japan

Jordan Golson — Mon, 18 Aug 2008 02:34:17 -0700

Microsoft's Xbox 360 outsold Sony's Playstation 3 for the first time earlier this month. The Xbox sold 28,116 units in Japan in the week ending August 10, versus 10,705 units of the PS3 on the back of Namco Bandai's "Tales of Vesperia" title launch.

Both consoles badly lagged behind Nintendo's Wii, which sold 41,044 units according to Ascii Media Works reported by Reuters. "Tales of Vesperia", an Xbox 360 exclusive role-playing game, will launch in the States on August 26.

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