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Archive for the ‘Strategy’ Category

Viacom copyright suit against YouTube dismissed

Posted in Board Of Intellectual Capital, internet, Market research, Marketing, mobile 2.0, Strategy, Technology, Web 2.0, tagged , , , , , , , , , on June 24, 2010| Leave a Comment »

Here is an article from SF Gate.

“A federal judge dismissed Viacom Inc.’s landmark copyright lawsuit against YouTube on Wednesday, a major victory that potentially reinforces legal protections for a wide array of online companies.

The decision doesn’t necessarily spell the end of a legal drama that’s already played out for more than three years, because the New York media giant promptly promised to appeal the decision. If ultimately upheld, it may also make it more difficult for content creators to protect their work in the digital era.

The $1 billion suit was widely viewed as a test case for the safe harbor provisions of the Digital Millennium Copyright Act of 1998. The law states that Internet sites, hosts and providers generally aren’t legally liable for the behavior of their users, as long as they remove infringing or illegal content when properly notified.

In this case, YouTube users allegedly uploaded tens of thousands of unauthorized copyrighted clips from Viacom-owned television shows like “The Colbert Report” and “South Park.” The owner of MTV and Comedy Central sued YouTube in March 2007, arguing that the San Bruno company knew the clips were posted without permission and failed to take them down.

In court filings, Viacom argued that YouTube fueled its meteoric rise by fostering piracy, and cited a series of e-mails that suggested its co-founders were well aware of copyrighted material on the site. Largely because of YouTube’s rapid growth, Google Inc. bought the company less than a year after it was formed for $1.65 billion.

Obligations met

In the 30-page summary judgment issued Wednesday, however, Judge Louis Stanton of the U.S. District Court for the Southern District of New York rejected Viacom’s argument that YouTube had an obligation to remove material because of a “general awareness” that unauthorized content was posted on its site. He said the protections of the digital copyright act aren’t dependent on a publisher monitoring its service, as long as it responds appropriately when notified of copyrighted content by rights holders.

He added that YouTube had met these obligations, noting that when Viacom asked that it take down about 100,000 videos in early 2007, virtually all of them were removed by the next business day.

In granting YouTube’s motion for summary judgment, Stanton essentially said Viacom’s legal arguments were too weak for a trial to proceed.

“In the main, it’s a victory for innovation,” said Jennifer Urban, director of the Samuelson Law, Technology & Public Policy Clinic at UC Berkeley. “It’s a victory for the companies that are creating new kinds of technologies … that allow people to speak and create on the Internet.”

She added that it clearly places the onus on content owners to track and request the removal of unauthorized uses of their works, which is precisely what worries many media companies. Monitoring the Internet for infringing uses of large catalogs of movies, television shows and music is an enormous and never-ending challenge.

“We believe that this ruling by the lower court is fundamentally flawed and contrary to the language of the Digital Millennium Copyright Act, the intent of Congress, and the views of the Supreme Court as expressed in its most recent decisions,” Viacom said. “We intend to seek to have these issues before the U.S. Court of Appeals for the Second Circuit as soon as possible.”

Content partnerships

Since the case was filed, YouTube has entered a series of partnerships with major content companies. It appeased them largely by building a sophisticated tool that detects and identifies copyrighted media.

The Viacom suit covered content on the site only before the Content ID tool was put in place in late 2007. The media company participated in tests of the system, providing thousands of content files, according to documents that were unsealed in the course of the lawsuit.”

Read more here.

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The New Blueprint for Successful VC Funding

Posted in Board Of Intellectual Capital, Economy, Gerbsman Partners, internet, Investments, Market research, Strategy, Technology, Venture Capital, tagged , , , , , , , , , , , , , , , , on June 11, 2010| Leave a Comment »

Here is a good read from Yahoo.

“Jeffrey Bussgang likes crazy entrepreneurs. Twitter’s Jack Dorsey, LinkedIn’s Reid Hoffman and Sitrris Pharmaceuticals’ Dr. Christoph Westphal all share what Bussgang, a partner with Boston-based Flybridge Capital Partners, calls paranoid optimism. He defines it as an almost-arrogant belief in a world-changing idea mixed with a healthy fear of competitors. “You rarely see those two words together, which is why I like them,” Bussgang says. “They really distill the essence of the great entrepreneurs.”

He should know. Before he was a venture capitalist, Bussgang co-founded Upromise, now part of Sallie Mae and the nation’s largest private source of college funding contributions. In his new book, Mastering the VC Game, Bussgang offers a blueprint for entrepreneurs hoping to get funded: Be a paranoid optimist.

But even that may not be enough, given the state of today’s venture capital market. Total VC dollars invested fell 39 percent between the first quarter of 2008, before the recession began, and the first three months of 2010, according to data supplied by PricewaterhouseCoopers and the National Venture Capital Association.

VC firms have gone tight-fisted, and limited partners–the investors who supply capital to private equity funds–are skittish, afraid of being burned again after suffering a decade of negative returns. Mix in a contentious debate over the taxability of profits derived from successful venture capital investments, otherwise known as carried interest, and entrepreneurs are being forced to clear hurdles not seen since the 1980s, says Roger Novak, a partner with Novak Biddle Venture Partners in Bethesda, Md. “I think we’re going back to the old days, and better companies are going to be born.”

In other words, venture capitalists are being more discerning about where and with whom they invest. Here are three ways to make sure your business passes the sniff test.

  1. Create the Market
    Much of that time was spent planning and talking with prospects; the founders didn’t want to build a solution before defining the problem, which they believed was big. Advertising affiliate networks were losing revenue each time a customer clicked on a digital ad but completed the transaction by phone. RingRevenue would fill the gap with technology, but only if affiliates could agree on the concept they had in mind.

    “Before we were going to commit all of our time, career, dollars and resources to it, it was important to [know] enough about the customers and their needs that we could feel good that we were getting it right the first time,” Spievak says.

    Each meeting brought changes to the design. But by asking prospective customers for feedback and then building to spec, RingRevenue created its own market. “We wanted to make sure that we understood the formula for growth, that we had satisfied customers and a scalable model,” Spievak says. Investors were impressed. RingRevenue closed a $3.5 million initial round of venture capital funding in June of 2009.

  2. Get a Big Idea
    If there’s a model for the sort of crazy entrepreneurs Bussgang admires, it might be the team at PhoneHalo. The company’s wireless technology plugs into a smartphone, making it a hub for preventing computers, iPads and other networked equipment from getting lost or left behind. But the vision for what it could be is much bigger.

    “Imagine that everything that’s valuable to you in your life is always connected to the network. And imagine down the road if every item in your refrigerator was somehow talking to the network so when you were low on milk, if it goes through PhoneHalo’s infrastructure, it can update a to-do list right as you’re in the grocery store, all on the fly,” says CEO Jacques Habra. Crazy? Sure, but according to Bussgang, the ability to press forth in the face of naysayers is what makes a great entrepreneur.

    PhoneHalo was still shopping for venture capital funding as of this writing. And yet Habra and co-founders Christian Smith and Chris Herbert are confident they’ll eventually find the right VC partner.

    “Since this is our baby, it’s easy to feel rejected and bruised by a no,” Habra says. “In reality, that time with an investor is hugely valuable: If you ask the right questions and apply the feedback to your business unemotionally, you make the company that much more investable and likely to succeed.”

  3. Work Your Network
    Finally, the venture capitalist who doesn’t know you isn’t likely to partner with you. “They see so many referred-in deals that it just doesn’t make sense for them to spend much time on the ones that come in over the transom,” says Spievak.

    He and his team were approached by potential venture capital investors in late 2008, during the height of a global financial meltdown, in part because backers of his earlier venture, publicly traded CallWave, earned back 30 times their investment following a 2004 public offering.”

Read more here.

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Google puts Apple on notice over mobile ads

Posted in Board Of Intellectual Capital, Community, Economy, Gerbsman Partners, google, Investments, Market research, Social Networks, Strategy, tagged , , , , , , , , , , , , , , , , , , , , on June 10, 2010| Leave a Comment »

Here is an article from SF Gate.

“Google Inc. executive Mike Steib is courting customers such as Progressive Corp. and touting tools that let marketers create the snazzy, interactive ads that rival Apple Inc. has been using to snatch mobile-ad business.

“We have a significant investment in mobile, and competition is going to push us to be really, really good,” Steib said in an interview the day Google closed its $750 million acquisition of AdMob, which places ads on mobile programs and Web pages.

As Google’s head of mobile advertising, Steib leads the effort to build his company’s next $1 billion business from sales of ads on wireless devices – and lessen its dependence on Web-search ads. With a team based in a former cookie factory in Manhattan’s Chelsea neighborhood, Steib is striving to persuade advertisers they will win over more consumers by working with Mountain View-based Google than with Apple.

“It’s safe to say Google will respond to iAd and respond very strongly,” said Michael Collins, chief executive officer at Joule, a mobile-ad agency that’s part of WPP Plc. “They have too many assets to pull from, too many arrows in their quiver.”

Staying ahead may not be easy, now that Apple is luring advertisers to iAd, a service that places ads inside applications that run on its iPhones and other mobile devices. Apple has sold more than $60 million in advertising on iAd since it was announced in April, CEO Steve Jobs said at a conference Monday. That represents about half of the mobile display-ad market for 2010, according to JPMorgan Chase & Co.

Tension between the companies escalated Wednesday when AdMob accused Apple of barring developers from using Google ad services to create ads for the iPhone – a move that may threaten AdMob’s ability to get revenue from the device.

This year, AdMob and Google together may generate more than $100 million in U.S. mobile-ad sales, according to IDC in Framingham, Mass.

Apple won business as Google awaited a green light from the Federal Trade Commission for its $750 million AdMob acquisition, announced in November, Joule’s Collins said.

Introducing iAd “gave Apple the opportunity to suck all the oxygen out of the room,” he said. “Apple is on a tear these days with the iPhone, iAd, the iPad.”

As sales of smart phones rise, more users are viewing ads on handheld devices in addition to – and sometimes instead of – computers or televisions. Spending on mobile ads in the United States is expected to reach almost $500 million this year, from $220 million in 2009, according to IDC.

In the next three years, as much as one-third of global digital ad spending will be devoted to mobile, according to Alexandre Mars, who oversees mobile ads for Publicis Groupe SA.

“You’re seeing advertisers who see mobile marketing as a significant business driver,” said Steib, who joined Google in 2007 from NBC Universal. “This is a big part of the conversation.”

Google’s strategy includes creating tools that help developers embed videos and make ads more interactive, similar to what Apple’s iAd can do. Google also wants to sell more ads tied to a user’s location and deliver coupons for nearby deals, said Steib, Google’s director of emerging platforms.

The company is keen to make money from delivering coupons for nearby businesses and selling ads alongside a tool that lets customers take photos of an item and search for it on the Web, said Steib.

That way, a bistro could offer free appetizers to a nearby customer who’s searching for a place to eat, and the user could later see where to buy a bottle of the wine paired with dinner. The restaurant and wine seller would pay Google for the ads.

Google and AdMob together had 21 percent of the U.S. mobile ad market in 2009, said IDC analyst Karsten Weide. Quattro Wireless, which Apple acquired in January after losing out on AdMob to Google, had 7 percent.

‘Short-term disruption’

Steib says iAd may create “short-term disruption.” Still, Google can contain the fallout in part because it has experience letting customers manage campaigns on multiple Web sites and it can change ads on the fly based on performance, said Steib, who himself is an avid user of Apple products. He owns about a dozen iPods, iPhones and the new iPad.

Bank of America Corp. went from buying an occasional mobile campaign to paying Phonevalley, the agency run by Publicis’ Mars, a $1 million annual retainer. Google’s AdMob is among the ad-placement companies used by the financial institution, the largest U.S. bank by assets.

“We did take a hard look at iAd and we passed on it,” said Kathryn Condon, a vice president of digital marketing at Bank of America. She said she’s not convinced it will provide more value than AdMob and the other companies the bank uses.”

Read more here.

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Silicon Valley Gears Up for Acquisitions as Economy Improves

Posted in Board Of Intellectual Capital, Economy, Gerbsman Partners, Intellectual capital, Investments, Market research, Strategy, Technology, Venture Capital, tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , on April 12, 2010| Leave a Comment »

Here is some interresting news from Bloomberg.

“Silicon Valley companies looking to put their cash to work may drive a wave of mergers this year, bankers and venture capitalists say.

Companies are eager to make acquisitions because many of them have cut research budgets, says Robert Ackerman, founder and managing director of Allegis Capital in Palo Alto, California. That means they’re not as able to fall back on their own ingenuity to fuel growth. More businesses are relying on acquisitions to find their next new product or service, he says.

“The product cabinet is bare, but the market continues to move forward,” Ackerman said. “Wherever you see innovation sprint ahead, companies will have a product deficit, and will look to fill it.”

Google Inc., based in Mountain View, is currently one of California’s most acquisitive companies, buying at least five businesses in 2010. It agreed to buy Picnik Inc. last month, acquiring online photo-editing tools. Its purchase of DocVerse provided it with software that lets people share documents over the Internet. The value of the deals wasn’t disclosed.

The state’s largest single deal this year was Shiseido Co.’s purchase of San Francisco-based Bare Escentuals Inc. for about $1.7 billion.

California deal-making plummeted after 2007, when more than 2,670 transactions totaled almost $254 billion. So far this year, there have been about 530, worth $16.7 billion. That’s a higher number than in the first three months of 2009, although the value was greater in that year-ago period, at about $30 billion.

McAfee, Tibco

Local acquisition targets include Santa Clara’s McAfee Inc., Tibco Software Inc. in Palo Alto and Cupertino-based ArcSight Inc., according to Brent Thill, an analyst at UBS AG in San Francisco. McAfee and ArcSight both make programs that protect data, which could be more valuable as cyber threats mount. Tibco’s software helps programs of all kinds share information.

Goldman Sachs Group Inc. also cited San Francisco’s Salesforce.com Inc. and Palo Alto-based VMware Inc. as possibilities — though those companies aren’t the most likely targets, the firm says. Salesforce.com makes online customer- relationship software, while VMware sells so-called virtualization programs, which help computers run more than one operating system. Representatives from all the targets declined to comment or didn’t respond to messages.

Deal Volume

In Northern California, there were 45 deals involving venture-backed startups during the first three months of 2010, according to the National Venture Capital Association. That was the highest number in any quarter in at least five years.

More than 50 companies in California have at least $1 billion in cash and equivalents, which they could use for acquisitions. They’re led by a Bay area trio: San Francisco’s Wells Fargo & Co., with $68 billion; Cisco Systems Inc. in San Jose, with $39.6 billion; and Cupertino-based Apple Inc., with $24.8 billion, according to Bloomberg data.

“There’s a lot of cash on people’s balance sheets, so I think it’s a great time for startups,” said Kate Mitchell, managing director at Scale Venture Partners in Foster City, California. “They see that the faster, better, cheaper venture- backed companies are still growing, and they’re not spending on R&D, so they can be accretive.”

The value of deals in California topped out at $378.1 billion in 2000 during the Internet bubble, when there were more than 2,200 transactions. It took five years for the number of deals to surpass that earlier peak, and the dollar amount has never come close to recapturing the dot-com era’s glory.

Internet Bust

While the latest recession was the worst economic slump since the Great Depression, it actually wasn’t as devastating to California deal-making as the dot-com collapse. After having easy access to venture money and initial public offerings in the late-1990s and 2000, money dried up. The M&A industry hit bottom in 2002, when just 1,505 transactions accounted for $95.3 billion.

The deals crept back up over the next four years, peaking again in 2006 and early 2007. There were 665 in the first quarter of 2007, valued at $59.8 billion. That’s more than three times the number reported last quarter.

Tor Braham, head of technology mergers and acquisitions for Deutsche Bank AG in San Francisco, says mergers are ready to surge again for two reasons.

Pressure’s On?

“Private-equity funds have raised a lot of money before the financial crisis and there’s pressure on them to spend it before those commitments expire,” he said. Also: “Sellers want to get their deals done this year, before the expected increase in capital gains tax rate.”

Private-equity firms raised $538 billion in 2006 and $587 billion in 2007, just before the recession, according to the Private Equity Council in Washington. Capital-gains taxes, meanwhile, could rise above 20 percent for people earning more than $250,000 under budget proposals before Congress.

In the first quarter, Deutsche Bank advised Techwell Inc. in its $370 million takeover by Intersil Corp. The bank also worked with Nimsoft Inc. in its $350 million acquisition by CA Inc., and Francisco Partners on its sale of Numonyx BV to Micron Technology Inc. for about $1.3 billion.”

Read the full article here.

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Alliance to boost startups, hire more grads

Posted in Board Of Intellectual Capital, Business models, Economy, Investments, Market research, Strategy, Technology, Venture Capital, tagged , , , , , , , , on February 25, 2010| Leave a Comment »

Here is an article from SF Chronicle´s tech section worth reading.

“Intel Corp. and 24 venture capital firms will invest $3.5 billion in U.S. technology startups over the next two years, as part of a broad initiative to boost the nation’s competitiveness and create jobs.

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