Geek News and Musings

Technorati Lays Off Another 10 Percent Of Employees

Blog search engine Technorati has laid off close to 10 percent of its staff, or 4 employees in its PR, engineering and general admin areas. The company’s CEO, Richard Jalichandra confirmed the layoffs. He says they were necessary for the company to continue on the path towards profitability. The reduction will leave the company with 37 employees. Technorati suffered an earlier round of layoffs last September, letting go 6 people and also implemented pay cuts for remaining staff. We’ve added this to the layoff tracker.

Jalichandra maintains that the blog search engine is growing and layoffs were necessary to “fine tune” its business model to eventually become profitable. Last fall, Technorati acquired AdEngage to join the company’s newly formed blog advertising network, Technorati Media. Jalichandra says that while the timing of launching an ad network a few months before the market crashed wasn’t optimal, quarterly ad revenue has grown by 6.5 times since the launch of Technorati Media last June, when presumably its revenues were negligible.

Jalichandra also says that Twitter and Facebook are changing the blogosphere—but in a good way. He says that Twitter and Facebook are just other platforms on which blogs can gain visibility, and Technorati is beginning to track activity on those platforms as well. For instance, here’s a link to Jalichandra’s Twitter page on Technorati. Nevertheless, traffic to Technorati itself over the past several months has flattened at about 5 million unique visitors worldwide, and is declining in the U.S., according to comScore.

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Comcast’s OnDemand Reaches 11 Billion Views, Nearly Twice The Number Of iTunes Music Downloads

Comcast has reached the 11-billion views milestone for its On Demand video services since the launch of the feature 6 years ago. The cable operator threw out some interesting factoids to help measure the magnitude of its milestone.

Comcast points out that 11 billion views is nearly two times the total number of music downloads (6 billion) sold on iTunes since its launch six years ago. The company adds that 11 billion views is four times the total number of Big Macs sold in the US (3 billion) over the same time period and 30 times the total number of Harry Potter books sold around the world (375 million copies). Yeah, it’s a lot. But it’s less than how many videos are watched on the Web in a single month (that number reached 11 billion last April). And it is still a fraction of how many movies and TV shows Comcast cable customers watch on the other 300 channels they get with their monthly subscription.

The cable company also announced that PBS will now be available On Demand in HD. (Don’t knock anything over rushing for that remote). OnDemand gives consumers instantaneous access to more than 10,000 programs each month. Some are free, some cost $3.99. But unlike iTunes songs, you don’t get to keep them.

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South Korea prepares to nuke its technological competitiveness with a three-strikes copyright rule
Joe sez, “South Korea is arguably one of the world’s most internet-connected countries. Regrettably, the corrupt dinosaurs in the Korean National Assembly have just passed a bill in-committee to use a “three strikes” law against ISP connections there. The law awaits approval by the legislature. New Zealand recently defeated similarly-worded ISP laws. A brief prediction from someone who lives in Korea. Korea is like a high-tech ocean miles-wide and one-inch deep. Once the implications are understood, look for this law to collapse under its own bureaucratic deadweight, or to otherwise morph into the usual scofflaw behavior. Consider the following:”

1. Currently, under Korea’s copyright law, there are broad classroom exemptions for educational use of material, without compensation to rightsholders. (Chapter 2, Section 4, Subsection 2, Article 25 ) Look for universities and other public schools to become hotbeds of exemption challenges.

2. PC Bangs (internet cafes) might try to put each other out of business using the new laws. This could result in some cafes using advanced black-box anonymizing services to protect themselves and their customers (not necessarily a bad thing).

3. Korean “netizens” might otherwise protest the new system by seeding government BBS and official websites with infringing links and material, and then use the reporting process to overwhelm the system.

4. This proposed law will push internet services into greater black-market criminal activity. Pirated software can be found everywhere, including software commonly-used by government employees. 99% of Korean software is Windows-based. Korea uses active-X controls for practically everything, meaning the entire country is already prone to security problems.

5. Additionally, the use of the internet for organizing civil protest in Korea has been highly effective: the recent Mad-cow Disease protests (while factually incorrect) reached hysterical proportions, delaying implementation of the US-Korea Free-Trade Agreement. Korea still has national security laws against criticizing the government. Online K-blogger Minerva was arrested because he brought to light the Korean government’s economic manipulations. With an unstable currency and an undercurrent of restlessness among its populace, the government has been greatly embarrassed. Look for this law to be the perfect tool for Korea to once-again shoot itself in the foot.

Three Strikes, Movie Copyright and The Mad Cow Coming Home to Roost (Thanks, Joe!)

Risk Aversion And The Perils Of Selling Too Early (Israeli Startups, Part II)

Right now I’m at an un-conference called KinnerNet. It’s hosted by famed Israel entrepreneur Yossi Vardi and set near the Sea of Galilee. Funny thing: There are a few hundred entrepreneurs here, mostly Israeli. And only one has said something negative to me about my post earlier this week about the poor venture returns for Israeli startups that incited such passionate feelings everywhere else in the world.

No one is arguing that the returns have been good for Israeli companies in the last eight years. But there are some legitimate questions about how Dow Jones (whose numbers I used) slices its data and how the numbers could be quite so low. Since 2001, according to Dow Jones, $10 billion in venture investments have yielded only $860 million in IPO and M&A exits. The study of venture economics is at best imperfect, so it’s quite likely there are several big Israeli exits the numbers are missing. It’s like measuring Web traffic. Most Internet companies will tell you their traffic logs report higher numbers than measurement agencies like Hitwise or comScore.

But the Dow Jones numbers aren’t likely to be off by, say, a factor of 50 or 100. And since the same sources—usually venture firms—give firms like Dow Jones the investment data and the liquidity data, the relationship between the money going in and the money going out is pretty reliable, even if the absolute numbers are not. Put another way, if Dow Jones is missing some exits, they’re likely also missing some investments going into the country. In any case, the returns are down dramatically from the 1990s—period. Be mad at me all you want; those are still the numbers.

The more interesting question—and I think what’s creating such passion around the topic—is why the numbers are down? We’re actually going to do a session on this tomorrow at KinnerNet. It’s also the one question I’ve been asking Israelis pretty much non-stop for the week I’ve been in the country. Two interesting cultural answers have emerged that I wouldn’t have imagined. Both have to do with a phenomenon that’s hurt venture returns in the United States too: Entrepreneurs selling companies too early.

Both Roi Carthy (who occasionally writes for TechCrunch from Israel) and Matthew Hertz, who’s starting a deep-web people search company called Pipl.com, said many Israelis live in the “temporary.” Put another way, when Matt heard I was filling in for Michael Arrington “temporarily” in February, he laughed and said, “We Israelis know temporary is the most permanent state there is. Short-term is a way of thinking here.” (True enough, it’s March, and I’m still here writing on TechCrunch.)

That “temporary” mindset drives the same unabashed courage that makes quitting a job and starting a company so natural for Isreali entrepreneurs. But both Carthy, Hertz and a dozen or so other entrepreneurs I spoke with said there’s a flip side to that: When you live for the short term, and you get a $30 million acquisition offer; you’re more likely to take it. In other words, several entrepreneurs here have described themselves as having a huge appetite for taking risk on the front end; but being risk-adverse when it comes to turning down a huge chunk of money for a $1 billion IPO dream.

In my last book, David Sachs, an American entrepreneur who was the COO of PayPal and has started Geni and Yammer since, put the same feeling another way: Most people in the world would take the certainty of $1 million over a chance they could make $30 million. I’m not knocking that. I’ll sell SarahLacy right now for $1 million. (Takers?) But I tend to think of people who make that decision as being risk-adverse. What was surprising to me, is that people who have a huge tolerance for risk on the front end– literally creating something out of nothing—become risk-adverse when they’ve proven that it’s actually worth something.

I was discussing this idea last night with Nimrod Lev, who sold kSolo to MySpace and has worked in the Israeli Internet scene since its earliest days. He had a different cultural take on the same phenomenon. He said the fun part for Israelis, or at least for him, is solving a hard, technical problem. In other words, “the art of the hack.” Once it’s solved, managing the company, growing revenues, taking on HR problems—all of that is the boring part. He loves starting companies and has been successful at it, but he has zero desire to build one into the next Google. There are a lot of guys like that in the Valley, too, but they’ve also got a huge pool of experienced managers to hand the company off to.

I’ll give Israel another reason that returns have fallen so hard on a percentage-basis. And it has nothing to do with Israeli culture. In fact, it’s something the United States screwed up: Sarbanes Oxley. SarbOx put a chill on small-but-growing companies’ ability to go public on the Nasdaq. The costs of being SarbOx-compliant are so high, that unless you have more than $40 million or so in annual revenues and strong growth, it’s just not cost effective. And other regulations surrounding the Chinese Walls between research and trading mean that small companies get little research coverage and are too thinly traded to really be considered liquid stocks.

This has hurt the Valley, when it comes to returns, for sure. But the Valley also is replete with large companies that buy each other for enough money that investors can eke out enough to keep going. Geographic proximity does help in working these kinds of things out. (You think YouTube didn’t benefit from sharing an investor with Google? VCs actually count this as one of their so-called “value adds.”) A good number of European companies have gotten around the SarbOx problem by going public on the London exchange over the last few years, to the extent where several articles were written about the London Stock Exchange becoming a bigger financial force than the Nasdaq.

So if it was a problem for all startups, why do I bring it up in relation to Israel? Because pre-Sarbanes Oxley, Israel had more Nasdaq-traded companies than any other country. Outside the Valley, they were, by definition, the most vulnerable to the change. Perhaps in the intervening years, it’s not the entrepreneurs that have lost their mojo; there’s just no good financial system for their investors to profit off of said mojo. That’s certainly a hack I’d like to see a smart Israeli pull off because its not just hurting the Israeli startup ecosystem—it’s dragging down returns for investors everywhere.

(Photo by Hans Splinter).

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Artist paints herself having sex with each president of the USA
Artist Justine Lai’s new project is a set of oil paintings of her having sex with every president of the USA, in order.

In Join Or Die, I paint myself having sex with the Presidents of the United States in chronological order. I am interested in humanizing and demythologizing the Presidents by addressing their public legacies and private lives. The presidency itself is a seemingly immortal and impenetrable institution; by inserting myself in its timeline, I attempt to locate something intimate and mortal. I use this intimacy to subvert authority, but it demands that I make myself vulnerable along with the Presidents. A power lies in rendering these patriarchal figures the possible object of shame, ridicule and desire, but it is a power that is constantly negotiated.

I approach the spectacle of sex and politics with a certain playfulness. It would be easy to let the images slide into territory that’s strictly pornographic—the lurid and hardcore, the predictably “controversial.” One could also imagine a series preoccupied with wearing its “Fuck the Man” symbolism on its sleeve. But I wish to move beyond these things and make something playful and tender and maybe a little ambiguous, but exuberantly so. This, I feel, is the most humanizing act I can do.

NOTES ON JOIN OR DIE (Thanks, Frank W!)

Train Operators Around The World Stopping Others From Helping Riders… Due To Intellectual Property
What is it about folks who operate train lines that make them so confused when it comes to intellectual property? They seem to be focused on harming their own businesses in an effort to “protect” intellectual property. If enforcing your intellectual property makes you worse off, then why are you enforcing it? Just today, we received two separate stories of incredibly backwards thinking from those who operate train-lines — which makes you really wonder why some people get so focused on protecting intellectual property that they lose sight of the fact that it’s harming their business.

We’ve already talked about those who run trains in Germany and Australia cracking down on people creating their own iPhone train schedule apps, claiming they violated intellectual property rights of the train operators. This makes very little sense for a variety of reasons. First, it is still quite ridiculous that any sort of factual information can be covered by copyright — but in Europe such “collections” of information can be covered by the database copyrights — the idea that if you put factual information into a “database” that database then deserves copyright protection. Europe has this, while the US does not — and studies have shown that contrary to what copyright supports insist, this increased right has actually hindered the database industry in Europe… but that hasn’t made the law go away.

But, of course, even more idiotic than just the question of copyrighting facts, is the simple point that these apps make it easier for people to ride the trains, which should be exactly what the train operators are encouraging. Thanks to the mantra of certain copyright supporters that “free is bad,” some folks seem unable to think out more than a single step. The fact is, that if people can make a great train schedule app that makes it easier to take the train, then that means more people will take the train, which is where the real money is for train operators. But, of course, the folks who only see one step out, think “wait, we should be making money on that data!” even if it means fewer people take the train, and the net benefit is less.

The latest to make that decision is the UK’s National Rail Enquiries, who forced the creators of the MyRail Lite app to shut down (thanks to Donald for sending this in). MyRail Lite was a free iPhone app. NRE is offering its own app… for £4.99. So in the short-term rush to try to score a bit of money from a small group of people, NRE is making the overall rail system a lot more complex for the majority of people. Short-term thinking at its finest.

Unfortunately, the author of the article, Rory Cellan-Jones, starts out by agreeing that this is dumb, but then seems to change his mind, after reading the silly James DeLong article about newspapers where he (in typical DeLong fashion) insists that the use of “free” is what destroyed newspapers. The arguments are easy to debunk, but Cellan-Jones seems to have fallen for them. But it’s easy to see how wrong it is in this case: the business NRE is transportation. If it gets people from point A to point B more efficiently, it will be able to make more money charging for that service. A free app that makes the process more efficient helps the bottom line. Trying to scrape up a bit of extra cash at the front end, while making the process more inefficient for more people is incredibly short-sighted.

But, that isn’t the most ridiculous story we heard today about trains and intellectual property. Lucretious sends in the news that a group of four very nice women in New York City who have been voluntarily working to make public transportation in NYC more pleasant have been ordered to stop by the Metropolitan Transportation Authority. The women have set up a website, MTAService.org where they provide information on how to make your public transit in NY better. It’s run by four women, who also ride the subways regularly (wearing their own made up uniforms) trying to help provide better service — helping people find where they need to go, or helping mothers with strollers, for example.

But, of course, the MTA has sent them a cease-and-desist, demanding they pull down the information. You can see the trademark worries — even though the website clearly states that the MTA Service Specialists (as they call themselves) are in no way affiliated with the MTA (they note “unfortunately.”) But, rather than the MTA doing the smart thing, and seeing if they can actually associate themselves with these helpful women, the MTA just wants to shut them down. This is short-term thinking again. Sure, there almost certainly is a valid trademark claim here — but if someone actually took the time to sit back and look at the facts of the situation, they would realize that a better response would be to see if they could sign these women up officially to help improve service on the subway. As the women note, they’re just trying to improve the MTA’s service, without costing the city any money at all.

Once again… we see how this aggressive believe in “we must protect our IP!” is actually being used to hinder service improvements, rather than help them.

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Canadian Court Orders Website To Disclose Personal Info Of Posters
We’ve noted, thankfully, that US courts have been quite good about protecting the anonymity of online posters, arguing that anonymous speech is a part of free speech. Other countries haven’t been nearly as good about this, with courts often being quick to demand info on anonymous commenters. It appears that at least one court in Canada falls into that camp as well. Michael Geist highlights how a court has ordered a website to turn over info on anonymous posters. Geist notes that Canadian laws and court rulings normally do support a strong anonymity right as part of privacy rights — but suggests that the court in this case simply wanted to side with the guy suing, perhaps based more on emotional reasons (the anonymous commenters are accused of hate speech) rather than on any true legal basis. As Geist notes, anonymity is not an absolute right, but the bar should be pretty high before a court orders any information to be revealed about anonymous commenters. Unfortunately, that doesn’t appear to be the case here.

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Canadian Court Orders Website To Disclose Personal Info Of Posters
We’ve noted, thankfully, that US courts have been quite good about protecting the anonymity of online posters, arguing that anonymous speech is a part of free speech. Other countries haven’t been nearly as good about this, with courts often being quick to demand info on anonymous commenters. It appears that at least one court in Canada falls into that camp as well. Michael Geist highlights how a court has ordered a website to turn over info on anonymous posters. Geist notes that Canadian laws and court rulings normally do support a strong anonymity right as part of privacy rights — but suggests that the court in this case simply wanted to side with the guy suing, perhaps based more on emotional reasons (the anonymous commenters are accused of hate speech) rather than on any true legal basis. As Geist notes, anonymity is not an absolute right, but the bar should be pretty high before a court orders any information to be revealed about anonymous commenters. Unfortunately, that doesn’t appear to be the case here.

Permalink | Comments | Email This Story

Canadian Court Orders Website To Disclose Personal Info Of Posters
We’ve noted, thankfully, that US courts have been quite good about protecting the anonymity of online posters, arguing that anonymous speech is a part of free speech. Other countries haven’t been nearly as good about this, with courts often being quick to demand info on anonymous commenters. It appears that at least one court in Canada falls into that camp as well. Michael Geist highlights how a court has ordered a website to turn over info on anonymous posters. Geist notes that Canadian laws and court rulings normally do support a strong anonymity right as part of privacy rights — but suggests that the court in this case simply wanted to side with the guy suing, perhaps based more on emotional reasons (the anonymous commenters are accused of hate speech) rather than on any true legal basis. As Geist notes, anonymity is not an absolute right, but the bar should be pretty high before a court orders any information to be revealed about anonymous commenters. Unfortunately, that doesn’t appear to be the case here.

Permalink | Comments | Email This Story

Canadian Court Orders Website To Disclose Personal Info Of Posters
We’ve noted, thankfully, that US courts have been quite good about protecting the anonymity of online posters, arguing that anonymous speech is a part of free speech. Other countries haven’t been nearly as good about this, with courts often being quick to demand info on anonymous commenters. It appears that at least one court in Canada falls into that camp as well. Michael Geist highlights how a court has ordered a website to turn over info on anonymous posters. Geist notes that Canadian laws and court rulings normally do support a strong anonymity right as part of privacy rights — but suggests that the court in this case simply wanted to side with the guy suing, perhaps based more on emotional reasons (the anonymous commenters are accused of hate speech) rather than on any true legal basis. As Geist notes, anonymity is not an absolute right, but the bar should be pretty high before a court orders any information to be revealed about anonymous commenters. Unfortunately, that doesn’t appear to be the case here.

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