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Posts Tagged ‘Gerbsman Partners’

Article from SF Gate.

“Facebook tapped a major public relations firm to plant negative stories about archrival Google’s competing services, the social-networking giant acknowledged after being effectively caught red-handed by an online news site.

The episode highlights the increasing friction between two of the most prominent companies in Silicon Valley as they battle over talent, acquisition targets and now public perception. It also underscores the growing importance of strategic communications in the competitive arsenal for information companies, whose success depends on winning the trust of users.

But largely, it’s an embarrassing backfire for Facebook, as the clumsy PR stunt has grabbed attention instead of the issue the company was hoping to spotlight.

“This allows Google to appear to be the good guys and Facebook the bad guys,” said Carl Howe, analyst with the Yankee Group.

In recent weeks, public relations firm Burson-Marsteller reportedly shopped around stories that raised privacy concerns about Google’s Social Circle service to influential voices, including USA Today reporters and privacy blogger Christopher Soghoian.

The plan began to unravel after Soghoian posted the pitch online, revealing that Burson had offered to help write and place an opinion piece in the Washington Post, Politico and elsewhere. USA Today followed up with a story suggesting the firm was engaged in a “whisper campaign” to spread negative news about Google and concluded that the claims were “largely untrue.”

The mystery remained about which client was behind the PR effort until the Daily Beast reported that Facebook, when confronted with evidence, had fessed up.

Facebook mostly defended its actions Thursday, saying no “smear” campaign was “authorized or intended.”

“Instead, we wanted third parties to verify that people did not approve of the collection and use of information from their accounts on Facebook and other services for inclusion in Google Social Circles,” the statement read. “We engaged Burson-Marsteller to focus attention on this issue, using publicly available information that could be independently verified by any media organization or analyst. The issues are serious and we should have presented them in a serious and transparent way.”

Social features

Google has increasingly been weaving social features into its services, notably adding “social search results” that include things like the public Twitter updates from a person’s connections that might be relevant to a given query. Google pays Twitter for that information feed.

The initial pitch from Burson claimed that Google is also scraping data from sites like Facebook, MySpace and Yahoo, and revealing secondary connections – say, the friends of your friends – without the permission of users. Google didn’t respond to inquiries from The Chronicle.

Facebook has been on the receiving end of plenty of privacy criticism itself for, among other things, increasing the amount of information that is accessible without asking permission from members.

Burson both defended and apologized for its role in the incident. The company said it was raising fair questions, but acknowledged that the approach “was not at all standard operating procedure and is against our policies, and the assignment on those terms should have been declined.”

The fact that one tech company was pitching negative stories about another comes as little surprise to many journalists, but for the general public, it sheds a glaring and unflattering light on how parts of the industry operate. Big-league public relations is often a bare-knuckle affair, focused as much on bashing rivals as lauding oneself or clients.

Not uncommon

Different companies operate according to different standards, but it’s not uncommon for major businesses to attempt to draw the eyes of journalists to the questionable practices of rivals, by highlighting issues they might not have noticed or sharing damning documents.

“It is a staple of the political and public relations world to not only tell the attributes of your own client, but to voice the demerits of one’s opposition,” said Sam Singer, president of Singer Associates Inc., a crisis PR firm in San Francisco.

The major reason this incident became big news is that Burson didn’t disclose the client it was working for, a violation of standard industry practice, he said. The ethics policies of the Public Relations Society of America state that members shall: “Reveal the sponsors for causes and interests represented.”

Journalists readily take the off-the-record bait, often without disclosing the source of the information, because the information helps them produce scoops or uncover new angles.

Reporters shouldn’t dismiss such information out of hand, because sometimes it’s the only way it can be obtained, but they shouldn’t simply run with it either, said Joe Skeel, executive director of the Society of Professional Journalists.

“It’s like any tip you get anywhere,” he said. “It’s incumbent on every journalist to check out the facts and make sure it’s credible before going forward.”

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Article from GigaOm.

“Microsoft confirmed that it has agreed to buy Skype for $8.5 billion and plans to integrate it into a wide array of products, from Kinect and Windows Phone 7 to Lync, Outlook and Xbox Live. The deal caps a sudden turn of events for Skype, which had previously been the target of interest from Google and Facebook, but then attracted attention from Microsoft. Om first broke the news about Microsoft’s interest in Skype, and last night nailed the purchase price. With the deal, Microsoft is taking a product that eBay couldn’t integrate well and will try and use it to compete against Google, Apple, Cisco and others in the collaboration and communications space.

Microsoft said Skype will become a new business division with Skype CEO Tony Bates assuming the title of president of the Microsoft Skype Division. The company said the acquisition will enhance its work in real-time communications, which includes Lync, Outlook, Messenger, Hotmail and Xbox LIVE. And it expects it to bring in new revenue and provide more benefits to both consumers and enterprise customers.

“Skype is a phenomenal service that is loved by millions of people around the world,” said Microsoft CEO Steve Ballmer in a statement. “Together we will create the future of real-time communications so people can easily stay connected to family, friends, clients and colleagues anywhere in the world.”

For Skype, the deal allows it to extend its reach and introduce new ways to communicate, said Bates. Microsoft said Skype currently has 170 million connected users and logged more than 207 billion minutes of voice and video conversations in 2010. For all its popularity, however, Skype has had trouble making money and posted a $7 million net loss in 2010.

Microsoft will have a big job on its hands in trying to make Skype work — in part because at $8.5 billion, it is Redmond’s biggest acquisition ever. As Om points out, Skype could give Microsoft a boost in the collaboration market and improve its Windows Phone 7 offering. It could also be an intriguing video-calling combination for Kinect, the gesture-based system for the Xbox. But big acquisitions also have a history of failure, so it remains to be seen whether Microsoft has the ability to turn Skype into a money maker — especially considering its other online efforts haven’t seen much success.”

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Steven R. Gerbsman, Principal of Gerbsman Partners, will be a guest speaker at the Center for UC Berkeley Executive Education Venture Capital Executive Program taking place May 16-20, 2011.

He will speak on the topic Maximizing Enterprise Value of Under Performing Deals on Thursday, May 19 over lunch, 12:00-1:15 PM.

The program is designed for investment professionals, economic policy advisors, and entrepreneurs striving to gain advanced, results-oriented training in the venture capital process.

For more information, please visit: http://executive.berkeley.edu/programs/vcep/ and http://executive.berkeley.edu/programs/venture-capital-training/speakers.html.

About Gerbsman Partners

Gerbsman Partners focuses on maximizing enterprise value for stakeholders and shareholders in under-performing, under-capitalized and under-valued companies and their Intellectual Property. Since 2001, Gerbsman Partners has been involved in maximizing value for 68 technology, life science and medical device companies and their Intellectual Property and has restructured/terminated over $795 million of real estate executory contracts and equipment lease/sub-debt obligations. Since inception in 1980, Gerbsman Partners has been involved in over $2.3 billion of financings, restructurings and M&A Transactions.

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By: The Advanced Medical Technology Association (“AdvaMed”), prepared by Josh Makower, M.D., consulting Professor of Medicine, Stanford University and Founder, President & Chief Executive Officer of ExploraMed Development. Article reposted from The Coelyn Group.

OneMedPlace recently reported that “Growth in the life sciences industries will greatly depend on how the FDA responds to growing complaints that they are stifling medical technologies.  Companies have seen a vast difference in the approval processes in Europe vs. the U.S.  A study released by Stanford University indicated that the cost of bringing a technology to market is dramatically lower in Europe.”

The Advanced Medical Technology Association (“AdvaMed”) recently released the report, prepared by Josh Makower, M.D., consulting Professor of Medicine, Stanford University and Founder, President & Chief Executive Officer of ExploraMed Development, LLC; et al, “FDA Impact on U.S. Medical Technology Innovation,” which garnered responses from more than 200 companies concerning their experiences in working with the FDA.  Participants were also asked about their experiences working with European regulatory authorities in order to offer a comparison between aspects of the two dominant regulatory systems.

“In general, survey respondents viewed current U.S. regulatory processes for making products available to patients as unpredictable and characterized by disruptions and delays,” the results summary states.  Forty-four percent (44%) indicated that part way through the premarket regulatory process they experienced untimely changes in key personnel, including the lead reviewer and/or branch chief responsible for the product’s evaluation.  Thirty-four percent (34%) of respondents also reported that appropriate FDA staff and/or physician advisors to the FDA were not present at key meetings between the FDA and the company.”

The report goes on to highlight that those factors contribute to significant delays in navigating FDA regulatory processes, with premarket process for 510(k) pathway devices (of low-to moderate risk) taking an average of 10 months from first filing to clearance.  Devices requiring a clinical study for low- to moderate-risk devices before making a regulatory submission, the premarket process took an average of 31 months from first communication to being cleared to market while, in comparison, it took an average of 7 months in Europe.

For higher risk devices seeking premarket approvals, responding companies indicated that it took an average of 54 months to work with the FDA from first communication to being approved to market the device.  In Europe, it took an average of 11 months.”

Beyond the time gap comparing FDA and Europe approval processes, the survey also showed that the average total cost for a low- to moderate-risk 510(k) product from concept to clearance was approximately $31 million, with $24 million spent on FDA dependent and/or related activities.  For a higher-risk PMA product, the average total cost from concept to approval was approximately $94 million, with $75 million spent on stages linked to the FDA.

According to the report, these statistics result in a “significant, measurable cost to U.S. patients in the form of a device lag.  Respondents reported that their devices were available to U.S. citizens, on average, nearly 2 full years later than patients in other countries, due to delays with the FDA and/or company decisions to pursue markets outside the U.S. before initiating time-consuming, expensive regulatory processes in their own country.”

Stephen J. Ubl, President & Chief Executive Officer of AdvaMed, says, “This report is a wake-up call for those who want to promote medical innovation and preserve American jobs.  A regulatory environment that is marked by needless delays and inefficiencies makes it harder for medical innovation to thrive and companies to survive.  These delays particularly hurt small companies and their ability to produce next generation technologies.”

To read the full report go to: http://www.advamed.org/NR/rdonlyres/040E6C33-380B-4F6B-AB58-9AB1C0A7A3CF/0/makowerreportfinal.pdf

Ultimately, growth within the life sciences will continue at a quick pace during the next few years, with development of R&D pipelines, alliances, and partnerships being a key factor for success.

As the economy continues to chug back to full force, the only obstacle appears to be the differing of opinions between the medical device manufacturers and the FDA.  Perhaps if they come to a meeting of the minds, these growth projections will not just be projections, but will be the reality of a growing field that is quickly, and effectively, delivering what the U.S. healthcare system requires.”

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Article from SFGate.

“Yahoo sold its bookmarking service Delicious to YouTube founders Chad Hurley and Steve Chen, part of a plan to offload underperforming sites.

The service will become part of Avos, a new Internet company, Hurley and Chen said Wednesday in a statement. Hurley is the chief executive officer of the new business.

“We’re excited to work with this fantastic community and take Delicious to the next level,” Hurley said. “We see a tremendous opportunity to simplify the way users save and share content they discover anywhere on the Web.”

Sunnyvale’s Yahoo, more than two years into a turnaround by CEO Carol Bartz, is selling off businesses and trimming staff to generate more profit. Earlier this year, it announced plans to cut about 1 percent of its staff, after a decision to eliminate about 4 percent, or about 600 jobs, in December. The strategy helped first-quarter earnings top analysts’ estimates this month.

“As we have said, part of our product strategy involves shifting our investment with off-strategy products to put better focus on our core strengths and fund new innovation,” Yahoo said in an e-mailed statement. “We believe this is the right move for the service, our users and our shareholders and look forward to watching the Delicious technology develop.”

The YouTube founders plan to “aggressively hire” to improve the service, making it easier to use. Hurley and Chen are relocating Delicious to San Mateo, near where they started YouTube.”
Read more here.

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