Netflix to Pay $1 Billion to Add Films to Streaming Service
A quick update for those following along with our Netflix Case.  CNet reports that Netflix has significantly increased spending on streaming: $66 million in the June ’10 quarter vs. $9 million during the period a year ago, and that figure’s slated to go way up.  Starting Sept. 1^st, Netflix gains the rights to stream films by Paramount Pictures, Lions Gate and MGM.  To make the deal happen, the firm’s Chief Content Officer says Netflix is taking a “huge pile of money” and diverting it from postage & DVDs by mail, to “pay it to studios and networks”. The total figure may top $1 billion over several years. The three-studio deal is actually made with Epix, an HBO-like premium cable outfit that holds the studio rights.  The Netflix pact will allow tiny Epix (which isn’t on Comcast or DirectTV) to break even in its next fiscal year.  Still holding out on Netflix is HBO, a power-player that has the rights to Fox, Universal and Warner films locked up for at least the next four years. It also looks like HBO is ready to go toe-to-toe with Netflix in streaming.  The big daddy of premium cable just launched HBO Go, a rival streaming service. As an aside to our Eagle readers, HBO’s parent, Time Warner, has a new Chief Executive, Jack Griffin, a Boston College alumnus

Facebook, Google Square Off on ‘Places’
Mashable offers a field guide to Facebook’s new location-based service hub, called ‘Places’ (and TechCrunch points out that the logo (right) for Facebook Places looks an awful lot like ‘a four in a square’, heh heh). Roughly a quarter of Facebook users access the site via mobile devices, suggesting the site already has a huge, potential head-start in enveloping this market (see slides & commentary from our Facebook Case for how the firm has enveloped other markets, such as photos).  Places can be used to ‘check in’ and share a location with friends, find out where friends have ‘checked in’, and discover places nearby.  Places will also play with other location-based apps. Foursquare, Gowalla, Booyha’s MyTown, and Yelp are all initial partners with Facebook Places, but eventually other developers will be able to access certain Facebook Places data. Facebook has placed users in charge of what location-based data is released, with the default set to share with ‘Friends only’.  A ‘People Here Now’ setting will show if any of your friends are also that location (e.g. who else is at the game). Business owners can also issue a verifiable claim to mark their ‘Place’ at a given location, sending updates to people who ‘Like’ that page, and more.

Also curious – other potential competitors are using the “Places” name, too. “Twitter Places” launched earlier this year, and “Google Places” launched last September.  In Google’s version is Maps-based, offering street-level images, and customer reviews of nearby locations. All of these efforts are really about local advertising.  Businesses with fewer than 100 employees spent $35-40 billion on ads in 2009, and both Facebook and Google covet that coin. Borrell Associates thinks these online services could generate over $4 billion in ad sales by 2015.

BusinessInsider says Facebook will be THE platform hub for location services, with other services hanging off Facebook’s platform.  BI also thinks Google & Twitter are non-players in social location & that Google’s chances of succeeding in social get further away each day.  Interesting how one announcement changes things.  Just a few weeks back (when FB was suffering privacy outrage in the tech press echo-chamber), some thought a Google social network could be timed right.

How to Make an ATM Spit Out Money (Video)
A chilling yet hillarious video (and a great accompaniment for the Security Chapter) from the recent Black Hat security conference shows that ATMs are just computers, with their own vulnerabilities. The video shows how Barnaby Jack, head of research at IOActive Labs, installed software over the air using a known vulnerability, then used a fake ATM card to take out money. Jack also used the same software to steal credentials of other users, allowing the withdrawal of cash from their bank accounts.  In another hack, Jack opened an ATM using a universal key purchased online, accessed the motherboard, and used a USB drive to change the display and play music while the ATM spit out money, Vegas jackpot-style.  Don’t try this at home, kids!

Oracle Sues Google – Says Android Violates Java Copyrights
When Oracle’s purchase of Sun Microsystems closed last January, the world’s largest database firm gained a treasure trove of open-source code, including MySQL, OpenOffice, and Java. Oracle exec Larry Ellison (who had a cameo playing himself in Iron Man 2) has sent shudders among those reliant on Oracle-owned, broadly adopted open source products, by suing Google, claiming Android infringes on Oracle’s Java intellectual property. Google’s Android is now the #3 smartphone OS worldwide and #1 in the U.S., so the suit is a big one within just this context; however any ruling may have widespread implications throughout markets reliant on open-source code.  Computerworld claims “How Oracle Sees Open Source Ma Not Be How You See Open Source”. We’ll see what the courts say.

A123 Spins Out Power Storage Firm 24M
Last spring our students & alumni enjoyed a talk by David Vieau, CEO of publicly traded battery firm A123 Systems, a key player in power systems for the electric vehicle market. Now one firm has become two.  Energy storage system producer 24M Technologies has spun out of A123 Systems. 24M raised $10 million in Series A funding from Charles River Ventures and North Bridge Venture Partners. 24M brought in an additional $6 million via the Department of Energy‘s Advanced Research Projects Agency – Energy grant program. Look for 24M to develop batteries that can store more juice for less cost.

Brands Friending Social Gaming
Last March, Microsoft gave away “Farm Cash” to users who became Facebook “fans” of Bing (Microsoft claims 70% of these users then visited Bing at least once the next month). Honda will promote its sporty hybrid CR-Z on the “Car Town” social game by Cie Games.  The game will feature Honda billboards, Honda commercials running on screens inside the game, and a virtual Honda showroom.  McDonalds has apparently inked a deal with Zynga’s Farmville, and Disney recently committed as much as three quarters of a billion dollars to acquire Playdom, the firm behind Social City and Sorority Life. Social games have clearly gone mainstream. In another example of how social gaming is changing the rules, this summer during the World Cup, EA’s Playfish social game unit (acquired last year for $300 million + a $100 million earnout) launched, the free EA Sports FIFA Superstars,  on Facebook. The free, social-game launch occurred before EA made the console version of the game available.

At FreshDirect, A Reinvention After Crisis
Those seeking to dive deeper into Fresh Direct, a case we regularly cove rin class, may be interested in some recent depth offered by the NYTimes.  It seems a few years back, the firm had great difficulty retaining customers and had severe operational problems, plus a 2008 immigration audit led to the loss of some 200 employees almost overnight.  However, in the follow-up piece it looks like data-driven & process-focused technology allowed the firm to zero-in on quality problems, strengthen customer retention, and boost reorder rates among its best users. Thanks to Prof. Jim Gips for sending these to me!

MacCalvin Romain, BC Undergrad IS Major, Speaks at TED!
In the world of geekdom, there may be no higher honor than to be invited to speak at a TED conference.  Those who speak are coronated as the best of the best – the world’s finest thought leaders.  To be considered worthy of a speaking invite is a closet dream of CEOs, authors, politicians, and (dare I say) faculty worldwide.  Past speakers include the founders of Google, Bill Gates, Steve Jobs, and Al Gore.  So when I went to catch up on TEDxBoston videos and saw one of our IS majors, MacCalvin Romain, speaking (and announcing his BC ties), I got chills. MacCalvin opened and closed the talk with John Werner of Citizen Schools.  With students like this it’s no wonder we continue to rise in the rankings.  Well done, MacCalvin!

From Boston College Mascot to Venture-Backed CEO
It’s also a very good day when the Wall Street Journal covers a business founded by a former student. Bill Clerico was profiled by the journal in a story describing how the firm initially established connections with BC Trustee Peter Bell of Highland Capital Partners.  Bell’s firm has invested $7.5 million in WePay and he’s now a board member of the group payments service.  WePay was founded by Clerico (a former BC TechTrekker) and Rich Aberman (also a Boston College Presidential Scholar).  The service is growing like gangbusters and boasts other A-list investors, including Ron Conway (a Google & Facebook Angel), Max Levchin (co-founder of PayPal and Slide), and Paul Graham (whose Y-Combinator selected WePay for incubation in 2009). The firm even powered will.i.am‘s campaign, which was featured on Oprah!  Way to go Bill, Rich, and Peter!

Appswell Powers GE’s Challenge
Appswell, a Cambridge firm that crowdsources ideas for apps, then builds them, has just snagged a huge client at the launch of its business services unit – General Electric. Appswell will power GE’s Ecomagination Challenge, a $200 million contest aimed at generating ideas in renewable energy, smart grid technology, and eco-friendly building techniques. Some BC ties in the deal –Appswell CEO Dan Sullivan is a BC alum, and GE CEO Jeff Immelt spoke at May 2010 commencement (and delighted the geeks in attendance when he claimed to have crowdsourced ideas for his speech by inviting Eagle at GE to comment via his blog). Appswell also baked inside the Boston-based TechStars accelerator program, and Shawn Broderick, founder of TechStars spoke to the BC Venture Competition crowd in Fall 2009.

Clouds, big data, and smart assets: Ten tech-enabled business trends to watch
McKinsey’s most recent list of things to pay attention to comes complete with suggestions for additional reading.

And it’s nice to get a bit of buzz for our own efforts, too.  The Boston Globe mentioned my textbook with Flat World Knowledge in the lead story on the front page (I have to confess it was fun to share that with the family over breakfast – thanks, Globe!). And BusinessWeek covered our classwork in Social Media (although for the record, our own social media rockstar, Prof. Jerry Kane, is teaching our social media class this Fall).

Version 1.1–Information Systems A Managers Guide To Harnessing Technology
The latest version of my textbook is out, free online, and it just $29.95 in print. The new version contains updates to all chapters, extensive additions to the Social Media chapter, a new introduction chapter, chapters on Information Security, Understanding the Internet and Telecommunications, and more. Over 100 faculty have adopted the text in just the first year, including those at top business school programs CMU, Emory, Maryland, Michigan, Texas, USC, and more. Thanks to all who have shared this work with our colleagues! Faculty can request a free, print desk copy from Flat World Knowledge. Print copies can be ordered online.

Twitter, Twitter, Little Stars
BusinessWeek reports that there are more positions open for social media professionals then there are people to fill them. There are also a lot of snake oil salesman, and B.S. practitioners. Consider the bonehead move by a Ketchem PR exec speaking at FedEx headquarters in Memphis, who, during his visit, tweeted under his Twitter handle @keyinfluencer, “True confession but I’m in one of those towns where I scratch my head and say ‘I would die if I had to live here.’” Needless to say someone at FedEx caught the tweet and the incident blew up in a media firestorm, requiring an embarrassing apology from this “professional”. The rules of social media engagement are broadly stated as “amplify the affection, creatively disarm the reasonably disgruntled, ignore the unhinged.” But getting beyond platitudes requires a mix of art and professional skill. Those looking for a good primer should check out the chapter “Peer Production, Social Media, and Web 2.0” in the new edition of my book, especially the section on “Get S.M.A.R.T.”, Creating the Social Media Awareness and Response Team. Social Media professionals should also be aware that Twitter has launched a new promotional tool, where ad partners can send promotions through the @EarlyBird account. First adopter? Disney in two-for-one promos for the film The Sorcerer’s Apprentice.

Google Stays in China, And Baidu Keeps on Winning
Looks like Google has struck a compromise with the Chinese government. Now those who visit Google.cn are presented with an additional link for Google.com.hk, the firm’s Hong Kong site. Although Hong Kong is now technically China, the “One Country, Two Systems”, policy means Hong Kong firms aren’t subject to Beijing’s censorship rules.  Still, Google has a way to go before it catches up with Baidu, the dominant search engine in China. Baidu has a 64% share of the Chinese search market, more than double the share of second-place Google. Baidu’s stock is also up 82% this year, compared with a 21% drop in GOOG, and a 19% drop in the value of shares of Chinese portal Sina.com. Overall, Baidu is still much smaller than Google, but the Chinese search giant does expect nearly half a billion in profit this year on sales of $1.2 billion, an 84% increase over last year’s take.

Some more Googley tidbits that may be helpful for those teaching with our Google Chapter.  The PPC Blog offers a neat InfoGraphic on How Google Works (The Gory Detail).  And after the failure of Buzz and Orkut to make much of a dent in social, there are persistent rumors that Google is preparing its own Facebook clone.

Reminder. Facebook is Really, Really Big
Reuters and AllThingsD: report that Facebook’s 2009 revenue was higher than most prior estimates, pegging the figure at between $700 million and $800 million, with a solid net profit, in the tens of millions of dollars.  There’s a lot of buzz about this Fall’s Facebook movie, “The Social Network”.  However, the work it’s based on “Accidental Billionaires” by “Bringing Down the House” author Ben Mezrich, has been widely criticized for being over fictionalized.  I’ve read it and had difficulty getting past what were obviously large blocks of dialog that was either made-up outright or could not have been relayed word-for-word.  I did, however, greatly enjoy the Facebook accounts in Sarah Lacy’s  great 2008 book “Once You’re Lucky, Twice You’re Good”, and I hope to soon get into David Kirkpatrick’s “The Facebook Effect”, which I’ve posted an excerpt to, in an earlier WiG

Cisco CEO John Chambers Speaks at BC’s CEO Club
We’re hugely honored that the head of the world’s largest networking firm spoke at the Boston College Chief Executive Club.  The link above is to a summary and video of the event. Cisco continues to expand in Massachusetts, with Boxborough its hub for mobile tech.

Some, Like Netflix, Like It Hot
Our Netflix Case is a student favorite, and here’s some updated data: Netflix continues to be a competition crusher.  It’s iPad app is on fire, it’s iPhone app will be out, soon, subscribers are up to 15 million, and profits rose 34% in the prior quarter. 61% of customers are streaming.  That said, Wall Street is deeply divided on the future of the stock, if not the firm, and there’s likely a good case to be made that the stock (which has more than doubled this year)  is overvalued. Meanwhile the news is grim at Blockbuster (the CEO remained upbeat in an interview with FastCompany).  When shareholders refused measures to lift the stock price above $1 per share (the NYSE minimum), BBI was delisted.  Blockbuster has also missed some $42.4 million in debt payments. Looks like the video store chain is circling the drain.

Grumby – A Fun Summer Read
All-Star Hedge Fund Manager and frequent WSJ contributor Andy Kessler has spoken with my students many times in the past, and I’ve assigned his business books as required reading in my courses. Kessler’s business books are excellent, and I am a huge fan of his first work of fiction, the Silicon Valley Startup tale, Grumby. It’s great summer reading. Below is the review I wrote for Amazon. Grumby is available for Kindle and the iPad, and should be out in hardcover, soon. Congrats, Andy, on another great book!

“Grumby is the best novel about startups since Douglas Coupland’s Microserfs – a funny, crackling tale with real business and tech industry insider knowledge. A must read for the “TechCrunch” crowd, you’ll find yourself hunting to match up many of the novel’s characters with their real-world counterparts in a way that a prior generation did while reading “Bonfire of the Vanities”.

Kessler’s business books and columns pop with humor and rich story telling and fans will find the best traits preserved in his first fiction book. Dialog-driven, and tech-centric, the book strikes the perfect and tough-to-achieve balance of geek-speak and business jargon without alienating those who can’t sling code or read a balance sheet.

Grumby also provides a rollicking speculation on where key tech industry trends – Moore’s law, the cloud, offshore labor, open source, peer-produced content, and others – might lead. While I often find business books and business novels a disappointment, Grumby is that rare, satisfying gem and is a must-read for anyone interested in a vicarious rocket-ride through the startup, tech, VC space.”

Morgan Stanley’s TechTrends
I always enjoy Mary Meeker’s stats-rich Internet Trends reports.  Here’s the latest 53-slide opus from the June 2010 CM Summit.

Our App Happy World
Another fun Infographic from OnlineMBA.

Kindle Now Outselling Hard Covers
Amazon says that Kindle books have outsold hard covers for more than a quarter, and during the last month Kindle sold 9 Kindle titles for ever 5 hardcover books.  Tipping point or fuzzy math?  I don’t see the trend contracting any time soon.

Risk It When You’re Young
BC Alums Bill Clerico & Rich Aberman continue to knock ‘em dead at WePay.  They are the go-to guys for Entrepreneur Magazine’s advice for would-be collegiate startup moguls.  And they also got a shoutout in the Bucks Blog of the New York Times.  Way to go, guys!  The site really is astonishingly elegant – if you collect money from a group (roommates, your kid’s soccer team, for a club, office party), you really need WePay.  Spread the word!

June is Innovation Month in New England
Innovation in New England is experiencing a renaissance, and this month, a gaggle of events spotlight our awesomeness, while offering great networking and top-notch learning. Although this blog post comes out half-way through the month, there are still lots of fantastic events to attend, including the Boston Biotech CEO Conference, the InnoBeer Boston Meet-Up, EurekaFest, the Global Pitchfest, the XSITE Summit on Innovation, Technology, and Entrepreneurship, the Momentum Summit (How Startups Get Big), Health IT and the Cloud, and more.

And Eagles – let’s finish the month with Tech on Tap, the Boston College Technology Council networking event held at the Hotel Indigo Watch City Brewery in Waltham (NEW VENUE), Wed., June 30th, 6pm-8pm.  If you’re a 21+ yr. old student, or alumnus or parent, e-mail bctc@bc.edu to get on their mailing list.  Hope to see you there, and at any of these other great events!

Boston College Venture Competition Produces Startups
Sophia Monroe ’11, Hanyin Cheng ’12, and Meredith Malm ’12, all alums of Undergrad TechTrek ’10, were interviewed in this video piece for the San Francisco Chronicle.  Sophia will be helping steward the Boston College Venture Competition (BCVC) next year.  Sophie, Hanyin, and Meredith were volunteering at TechCrunch Disrupt, one of the premier tech conferences on the East Coast.  We’ve got TechTrekkers interning with True Venture startups in the Valley, at Polaris Dogpatch Labs in NYC, at SCVNGR in Boston, and with WePay (co-founded by BCVC co-founder Bill Clerico, and which recently enjoyed an Oprah-powered boost).  Look for BCVC ’09 winner WakeMate’s product to ship this summer, and keep an eye on PIQC.net (the ’10 winner). In just a few short years, Boston College has become a sort of Miracle Grow for startups!

Behind Foursquare and Gowalla: The Great Check-in Battle
Dennis Crowley (@Dens) founded Dodgeball, and sold it to Google in ’06.  Despite being GOOG’s first notable acquisition after its IPO, Dodgeball never broke 75,000 users and was shuttered by the Search Sovereign in 2009. Crowley tweaked the idea and launched Foursquare at South by Southwest in 2009.  Now at over 1 million users, Foursquare is the darling of the social media moment.  Crowley has made the covers of Wired UK (left) and New York Magazine (see “Tweet Tweet Boom Boom” for a profile of the increasingly hip NYC startup scene).  Now with deals from Starbucks, Bravo, The History Channel and others, Foursquare looks ready for breakout success.  The Wired article also profiles Gowalla, but I don’t see evidence that Gowalla has traction with our students or with those bestowing geek-cred.  There are of course competitors.  As Wired points out, “reward-based achievement games have begun to blossom as a means of encouraging specific behavior: plusoneme.com gives “gold stars for adults” for displaying “strengths” such as “kindness”, “listening” and “generosity”, ChoreWars makes weekly household duties less dull by framing them as a medieval-style grail quest”.  Here in Boston we’ve got RunKeeper, which has made fitness social. But right now location looks like Foursquare’s game to win or lose.  The service still has little to offer those who aren’t constantly out and about and ready to be social, but with some tweaks, Foursquare has the potential to be a killer location-based promotions and loyalty program platform (look to what Tasti-D-Lite is doing for an early indication on where this could go). Rumor has it the firm has turned down acquisition offers as high as $120 million.  Get the model right, Dens, and your firm could be much, much bigger. By the way, now that I’m on sabbatical, my Foursquare mayorships (Boston College and Fulton Hall among them) are up for grabs.  By the time I return in January we’ll see if Foursquare has evolved to hipster-fun to must-have, or if it really is, as initially envisioned, “Friendster for Mobile”.

SCVNGR – About Having Fun, Not Just Checking In
On a local note – be sure to try SCVNGR (pronounced Scavenger).  As we’ve profiled, the profitable Boston-based, Highland Capital & Google Ventures-backed startup has A-list clients, and our students use the service as part of orientation.  New challenges this summer should bring huge fun to those interested in location-based gaming, and a Builder is now live.  Check ‘em out!

Open Source: An Open Door for Hackers?
Not only do I get to work with great students (see above), I get to be part of one of the nation’s best IS research groups. Case in point: the work of Prof. Sam Ransbotham (an ’09 Google Grant winner) was recently profiled in MIT’s Technology Review.  By examining 400 million intrusion detection system alerts with known attributes of the targeted software and vulnerabilities, Prof. Ransbotham’s research supported the assertion that flaws in open-source software tend to be attacked more quickly and more often than vulnerabilities in closed-source software.  Dynamite in the classroom, Ransbotham previously ran his own international consultancy, is recognized as a leading scholar on IS security issues, and is the chief user of our campus’ Linux cluster.  While we’re on the subject of BC IS Dept. media coverage, check out Prof. Jerry Kane being profiled by PBS’s Miles O’Brien.

The Killer iPhone 4
iPhone 4 will start at $199, will offer a 5 megapixel camera with LED flash and 5x digital zoom, optional iMovie for on-the-fly HD video edits, a front-facing camera, “Facetime” video conferencing software, a new ultra-high resolution “retina” display (960×640 vs. 480×320 on previous models), longer battery life, a wrap-around antenna (better reception?), thinner body, voice control, a gyroscope (look for cooler games), iBooks integration (syncing across devices), and the iOS4 (complete with Apple’s incantation of multitasking). It’s still tied to AT&T, but there are enough enhancements (check out Apple’s website for more) to please most iPhone addicts in need of an upgrade.

Dark Side Arises from Phone Apps
The WSJ poses a scenario where hackers in the Droid store could issue an app that harvests bank account information.  The FBI and Air Force already bar employees from downloading apps on smart phones issued by the agency. Android’s open marketplace, with ‘reactive’ barring of apps is considered to be the most vulnerable App marketplace, but even Apple’s closely-monitored iPhone walled garden has had issues.  The game Aurora Feint was pulled from the App Store in summer ’08 when it was discovered that the app was uploading contact lists to the developer’s website. Apple has since banned or pulled several apps over security concerns. So while the tech industry echo chamber continues to grill Apple for its tight control over App Store approval, the vast majority of users don’t find apps overly restrictive.  My bet is they would, however, think twice if app-related breaches became more common place.

Tabnabbing – a New type of Phishing Attack
This article on Mashable features a chilling demo of a browser exploit dubbed “Tabnabbing”.  In the video, created by Firefox Creative Lead Aza Raskin, malicious code changes the content of a tab and the page associated it as soon as a user clicks another tab.  Return to the tab and you may see a familiar screen like a gmail, Facebook, or bank login.  If you don’t look at the URL, you could be duped and your pseronal info could be harvested.  A great demo for those teaching with our Security and/or Telecom chapters.

A New Type of Phishing Attack from Aza Raskin on Vimeo.

A Manager’s Guide to the Internet and Telecommunications
Ever wondered how the Internet works?  Check out the first draft of the Internet and Telecom Chapter that’ll be polished and released in the July 2010 version of my textbook.  Do share with others!

What Can You Do with HTML5? Check out Apple’s Showcase
Apple’s Safari-only (for now) demos highlight some impressive examples of things you can do using only HTML5, including snazzy effects involving Video, Typography, Gallery, Transitions, Audio, 360, and VR.  Remember, HTML is an open standard, so what you see in Safari today should be available elsewhere.  For more on HTML5, see the InfoGraphic: “What is HTML5 And Why Should We All Care?”

One Tablet Per Child
For two years straight, the former President of the One Laptop Per Child effort, Chuck Kane (who has also taught finance at BC) has been kind enough to speak to my classes.  We’ve also got several students interning with OLPC this year. Chuck’s talk this past spring mentioned the non-profit’s new tablet platform.  Here’s a sneak peek, as offered by Technology Review.  The projected $75 device looks like a stunner.

Is This a Facebook You Can Trust?
Facebook revamped its privacy settings in the wake of a huge dustup following the firm’s April service rollout.  GMSV reports the new settings are four fold involving:

• A one-click option to set most of the privacy controls, while retaining the ability to set them individually.
• The ability to hide your list of friends.
• The ability to block apps from getting your information.
• Retroactive application of new privacy selections to older content

And here’s a video from AP.  The site also offers a great recap of media opinion on the changes. Privacy is important, but the mass Facebook exodus was a non-event. A recent episode of the podcast This Week in Tech offered comments by Cory Doctorow with a great analogy – privacy is like smoking.  The impact is often so far displaced from the action, that it’s easy to act irresponsibly since you don’t see the consequences until much later.  As a faculty member, I think the Facebook privacy debacle has been positive in that it’s increased awareness of what can be exposed.  Anyone active with social media may one day discover that some of their public posts don’t reflect them in best light (“sharer’s remorse”).  But as someone who’s written a case on Facebook, visited the firm’s HQ on several occasions, and has extensively studied the firm, I think any ‘echo chamber’ talk of Facebook’s collapse over privacy gaffes is bogus (The “Quit Facebook” campaign was a dismal failure).  The site’s simply too powerful, important, useful, and let’s face it, fun for it to vanish.

More for those teaching with or studying Facebook: In our Facebook Case we talk about the firm’s envelopment strategy.  As a hub of all things social, Facebook is able to turn on features and immediately gain significant traction.  Facebook used this to become a dominant messaging platform, to become #1 in online photos, and is poised to expand into many other areas, including document sharing, e-mail, and more.  Facebook has recently acquired a group IM service ShareGrove, and TechCrunch reports that Facebook Video is now bigger than CBS, Hulu, Microsoft, and Viacom.

Google’s Latest Launch: Its Own Trading Floor
With $26.5 billion in the change purse, Google’s sitting on the tech world’s third largest cash pool.  Microsoft & Cisco are bigger, although at least one other report put Apple at $40 billion. Oh yeah, and you probably heard – Apple’s worth more than Microsoft. So Google opened its own trading floor to try to push returns north of the 2.5% it was expected to have earned on cash last year. And its hired Wall Streeters from Goldman, JPMorgan Chase, and others.  According to BusinessWeek, The “crew works in a recently remodeled finance building on the company’s corporate campus in Mountain View, Calif., complete with a rock climbing wall, massage chairs, murals of tropical sunsets, and bamboo wall panels. In a second-floor space accessed by key card—the trading room—the Wall Street vets tap out trades at desks with six computer screens.”  Most treasury software is crummy – but code written by Google’s geeks to give the ex-Wall Streeters working for Sergey and Larry the best systems in the biz. Most firms know can see only 60-70% of their position value in real time.  At Google finance jocks have a 98% real-time picture.  So finance majors, do you *really* want to work 100+ hr. weeks on Wall Street? As for what Google’ll do with all that cash, expect more M&A.  And Google’s not in its shopping spree.  IBM said it’d spend $20 billion over five years doing deals. And with billion dollar coffers commonplace among top-tier tech firms, we’ll be seeing high profile buyouts in the industry just about every week, for the next few years at least.

Google Quietly Brings Twitter Feeds to Display Ads
A new Google ad format is being rolled out. The new “Twitter-enabled” ads feature a Twitter bird in the left-hand corner, the advertiser’s latest tweet, and a “Follow on Twitter” button that allowing users to follow the advertiser without leaving the page.  C’mon, Google, open up that change purse and buy Twitter.  You already bought one of Twitter co-founder Evan William’s startups (Blogger) and you need a stronger social media strategy.  Twitter’s the right fit and you’ve got the coin.

How Starbucks Used Social Media to Get 1 Million to Stores in One Day
Right now there’s no bigger company embracing social media than Starbucks, and for the past two years I’ve been able to give our grad students a front-row seat for insights from the gurus behind this effort.  As our students learned, Starbucks brought in over 1 million users via last year’s Free Pastry Day.  They’ve also had 80,000+ ideas suggested via MyStarbucksIdea.com, they are the biggeset firm on Facebook, they were the in the first crop of adopters in the Twitter “sponsored tweets” advertising platform, and their Foursquare campaign (discounts for mayors, a “Barista” badge) is by far the service’s largest. You’ll also soon be able to use Facebook to reload friends’ real-world Starbucks cards, moving the virtual gifts economy into the real-world realm. Cool!

Intel’s New CPU Chip Is More Super Than Yours, With 50 Cores Aboard
You won’t have 50 cores in a desktop, but the 50 core “Knights Ferry” chipset along with development tools will arrive later in 2010.  Look for room-sized supercomputers to boil down into something you’d slip under a desk. Oh, and thanks to Intel Hudson for hosting a visit with me, Amy, and Joanne from Career Services.  I hope to send more of our best & brightest your way!

BC iPhone App
The new app, available for free via the iTunes App Store, has 16 modules that include a campus map, monitors of BC twitter feeds, even a rendition of “For Boston”, the BC fight song! Download it here.

Most Beautiful College Libraries
Bapst is ranked the most beautiful university library in the U.S.

The expert (above link) includes a great ethics in business tale of how the young Zuckerberg was moved to tears, left weeping in a men’s room floor by the pressure to take massive coin in a way that would violate the trust of an early investor and mentor. Check it out!

Facebook Open Graph: The Definitive Guide For Publishers, Users and Competitors
ReadWriteWeb offers a nice overview of the sweeping new Facebook features announced during the Spring ’10 f8 conference.  Here’s a crib-sheet to some of the most important points:

• Login with Facebook: It’ll be easier for site developers to use your Facebook login credentials instead of requiring separate accounts for their sites. Third party sites that use this feature can allow you to see your Facebook buddies who are also members of their service. Login is HUGE – it’s a lubricant for web experimentation, and an adoption and innovation accelerant – think “I wasn’t gonna try this site, but I can use my Facebook ID? OK, I’ll give it a shot”.
• Recommendations: once you’re logged into that new site, you can see what your friends have done there. A visit to Facebook-linked Yelp allowed me to  see recommendations my friends had made, rather than just the musings of strangers.
• Like button: Click a “Like” button on a third-party site and your endorsement will squirt back to your news feed. Now any site can take advantage of Facebook’s viral sharing to spread the word (yeah, I know, I’ve got to find time to add “Like” throughout my site – coming soon). Facebook claimed it would serve over a billion Like buttons in the first 24 hrs. after the announcement. Of course, many news sites changed “Like” to “Recommend”.  After all, do you really want to “Like” a story about a tragic but noteworthy event?
• Feed & Stream Integration: Not only will your activities feed back into Facebook’s News Feed, but activities performed by your Facebook friends can show up on other services.  See what your friends are listening to on Pandora.  See comments they’ve posted on CNN. This is key – stuff in News Feed scrolls away and is forgotten.  Now shared data can be pulled up and shown on a site, offering value when and where it’s needed.

Also noteworthy is the announcement of Docs.com, a beta effort allowing Facebook users to share and collaboratively edit Microsoft Office documents online.  Cloud collaboration is supposed to be a Google space, but Facebook may very well be the greatest market envelopment machine the Net has ever seen.  Facebook swallowed photo sharing even after Google (Picasa), MySpace (Photobucket), and Yahoo! (Flickr) collectively spent well over $100 million in that market.  Facebook now owns chat, Facebook “Like” looks like it’s on Digg/Del.icio.us turf, and rumored efforts in payments, e-mail, and music show Facebook may have designs on businesses as diverse as PayPal, Hotmail, and iTunes. See the “Facebook Encroaches All” slide (#6) from this Spring’s Facebook lecture for a quick recap.

Implications: As Fred Wilson pointed out, past links can replace (or enhance) search. Now anyone in the pure search biz is at a potential strategic disadvantage. If Facebook partners with a firm, rivals should shudder. Facebook could also become a collaborative filtering engine.  And although no ad platform was announced, it’s gotta be in the works.  Most of these new Facebook API and platform initiatives are currently offered to firms for free.  That creates a a huge free-rider problem with Facebook fronting the cost of the back end services with no direct compensation from others. If Facebook can serve ads across the broader network of firms leveraging its service, and split the take, it could become a devastatingly effective ad platform.  Look at the model from Twitter’s new ‘sponsored tweets’ ad platform, which will eventually feed to other services via Twitter APIs, as a model.

Commentary: Zuckerberg’s brilliance includes the character strength to avoid selling out too early.  We’ve seen so many great, early social media efforts fizzle under the boot of acquisition.  But by sticking to his vision it looks like Facebook is ready to step forward and become the very center of social life on the web, extending its reach into other sites, feeding you personalization and allowing you to feed content back to the Facebook mother ship.  This’d never have happened had Zuck taken the $10 million offered after Facebook was up for just a semester, or the billion+ offered by Viacom, Yahoo, and others. That’s more than luck & conventional alpha-geek smarts – it’s the hallmark of a true visionary.

7 Tools, Apps, and Mashups that Use Facebook’s New Features
Want to see how some firms are tapping into the new “Open Graph” features of Facebook? Check out Mashable’s roundup of what developers launched in just the first two days.  You can see what’s trending, what your friends are sharing, and what folks can see about you.  Also here comes a new term ‘Like fraud’- being tricked into ‘liking’ something other than what was conveyed by the surrounding text.

Does Privacy on Facebook, Google, and Twitter Even Matter?
When Google launched it’s Buzz social network it really screwed up.  By scanning Gmail and automatically adding a user’s most frequently e-mailed contacts to Buzz, the service exposed their contact list to others, immediately surfacing conversations that many did not want to share.  Would-be whistle blowers had reporters in their public Buzz contact lists, so did job seekers who e-mailed the competition, and two-timing spouses were also outed.  That’s why we teach students to think beyond technology, and instead consider entire systems, including how each new rollout impacts people and procedures beyond the ‘cool’ (see Technology ≠ Systems half way down).  In contrast to the Buzz screwup, Google’s rollout of ‘interest-based ads’ last year was widely praised.  Google was late to the ad personalization party, but dove in when it acquired DoubleClick.  When Google announced it would track activity across web sites you visit in order to deliver more relevant ads, the firm also included with these ads a single link to an Ad Preferences settings center.  Only one in fifteen visitors ended up removing interest-based ads.  Four more changed the ads they’d be served, the other ten left things unchanged.  FastCompany calls this the paradox of privacy, saying “we want some semblance of control over our personal data, even if we likely can’t be bothered to manage it”.

Commentary: This may be important for Facebook.  The roll-out of services mentioned above was followed by inquiries from four U.S. senators, concerned that it was so difficult to opt out of the new initiatives.  Other problems exposed live chat sessions and pending friend requests to others – ouch! (video)  Facebook may well become the center of recommendation & personalization, but the service will also have to be very clear about respecting user privacy and empowering users to hit the kill switch if something freaks them out.  And a phased roll-out of new services may be better than allowing initial glitches to draw ire and fuel calls for regulation.

Whoops — Facebook Is Once Again Overhyped

Blodgett’s piece in Business Insider throws a bit of cold water on the current Facebook excitement.  I am now a firm believer that Facebook is the most important firm on the web, but the sobering chart above illustrates how much work lies ahead of Zuckerberg & Co.  One key insight worth repeating:  Monetizing people communicating is tough.  Monetizing people looking to buy things isn’t.  For more read “Attention Challenges: The Hunt vs. The Hike” in our Facebook Case (scroll about 1/8^th down).

Social Media Revolution 2
Eric Qualman has done an excellent series of videos for his widely acclaimed book Socialnomics.  Here’s a refresh from a version that made the rounds on the web last year.

Also, here’s the Social Media ROI video, which was posted online last Nov., but which I had missed http://socialnomics.net/2009/11/12/social-media-roi-examples-video/.

Netflix Earnings Rise as Subscribers Climb
Some up-to-date figures for our Netflix Case: Subscribers are up to 14 million, 55 percent of customers stream video, the firm’s share price broke $100 (priced to perfection, always a tough bar to meet), and churn is at a record low.  Roughly 1 million users streamed Netflix over their Wii consoles in just the first few weeks the Wii-link was offered (I’ve tried it, it works great).  Still, as we pointed out in the last WiG, studios are propping up Blockbuster, allowing them earlier access to videos than Netflix.  And WalMart’s VuDu effort got the right to stream Avatar well before Netflix, Amazon, and iTunes (for VuDu, it helps to have Walmart’s scale in selling physical DVDs).

Get S.M.A.R.T. – the Social Media Awareness and Response Team
When Jerry Kane, Rob Fichman, John Glaser, and I published our “Community Relations 2.0” paper in Harvard Business Review last Fall, we’d developed a broader framework for what we call SMART – the Social Media Awareness and Response Team.  I’ve written up a draft primer on the topic which I will include in the edited update to my textbook (new version out this summer).  I’ve also posted slides with what I hope were some really compelling examples.  Enjoy!

21 Twitter Tips from Socially Savvy Companies
Adapted from the book Engage by Brian Solis, this is a great roundup of real-world examples of how firms are using Twitter.  While many of the examples are familiar to my students there are some really great new ones, like the ‘secret word’ coupons tweeted by California Tortilla and Albion’s Oven (using BakersTweet), which tweets when goodies are piping hot.

Tweeting Cows
So we’ve seen the tweeting oven, Tweets during brain surgery, tweeting washing machines, tweeting plants, and KickBee – the device that allows babies to tweet from the womb.  Now we’ve got cow udders sending out milking updates.  Watch out, Kutcher.  There’s serious competition headed your way!

How LinkedIn Will Fire Up Your Career
Key advice for graduating students and internship seekers alike: As this Fortune cover story points out “If you don’t have a profile on LinkedIn, you’re nowhere”, and “if you’re serious about managing your career, the only site that maters is LinkedIn”.  LinkedIn has been profitable since 2007 (1/3 of the revenue comes from premium subscriptions, 1/3 from advertisers, and 1/3 from corporations using the site’s firm-focused features).  It has well over 60 million users, and it’s the first place many firms are going to hunt heads.  After all most LinkedIn members have jobs so they must be good! Public profiles also may lead to less resume fraud (everyone could see if you’re a fake). One LinkedIn believer is Accenture.  The firm will hire will hire 50,000 this year and almost all hiring will be done online. Accenture’s Head of Global Recruiting claims the firm spends upwards of $150,000 for each exec recruited through a headhunter.  LinkedIn’s a powerful challenge to that biz.

Student Run Search Engine Takes First Place

Big congrats to TechTrek alums David Toliopov (A&S ’10) and Shahbano Imran (A&S ’09), winners of this year’s Boston College Venture Competition.  Their PIQC.net (pronounced pixie) offered a drop-dead live demo of the promise of the semantic web – showing how the service can allow users to interrogate structured data through a luscious interface.  This is definitely one to watch!

Creator of PHP Joins WePay
More on BCVC – the event’s co-founder, TechTrek alum Bill Clerico, continues to roll on with WePay, the startup he’s launched with fellow BC Eagle Rich Aberman. WePay recently hired Rasmus Lerdorf, the creator of the PHP language (a linchpin of the LAMP open-source stack).  As TechCrunch points out, this is huge news.  Along with the A-List seed funding the firm has received, this underscores the esteem some of the brightest in the Valley have for the firm. Look for an impressive API rollout later this year.  WePay everywhere!

Spring 2010 Podcasts
I”ve posted podcasts for my Spring 2010 Computers in Management class.  Slides & other teaching materials are online at http://gallaugher.com/chapters.  Enjoy!  If you like them, do write & share your thoughts.

Micro Donation – Mega Impact
Alums – The Heights just pointed out that both Notre Dame & Holy Cross have higher giving percentages than we do.  Those percentages influence many of the rankings calculations used by national publications.  BC is once again running an alumni challenge.  Eagles, please consider supporting your alma mater.  A support challenge is underway with a May 31st deadline. We’ll keep pushing to advance the value of your degree, and we’ll work to deliver post-graduation value, as well.

◊     ◊     ◊     ◊

WiG readers, thanks again for your patience!  This semester I’ve taught 6 sections (the normal is two), I’ve advised several campus groups, and pushed forward my own research work, all while rolling out an update to my online textbook (BTW: HUGE thanks to all the schools that have adopted the textbook! It’s been great hearing from students & faculty worldwide).  It’s been a challenging semester and I’m very much looking forward to my Fall 2010 sabbatical!

BC alums

Apple Introduces iPhone OS 4.0
Less than a week after the iPad started showing up in stores, Apple announced an update to the iPhone/iPod Touch/iPad OS.  The developer preview is available now, the OS will be officially released this summer, with an iPad version to follow in the Fall.   Some highlights: Apple sold some 450,000 iPads in the first five days. Users downloaded a quarter of a million iBooks and a million iPad apps on iPad Day One. 3,500 iPad apps were in the App store within days of launch.  The WSJ offers a neat rundown (and video) of some of the cooler iPad apps that hit this first week. Jobs showed the Netflix & ABC apps that support high quality streaming. Many suggest enthusiasm for the new Netflix iPad app sent Netflix stock up to an all time high. Uber-VC Kleiner Perkins loves iPhone Apps so much they’ve doubled their iFund for app developers to a cool $200 million.

As for iPhone apps, Jobs announced the App Store has broken the 4 billion download mark, with over 185,000 apps now available. 50,000 of these are game & entertainment titles, compared with 2,477 for the Sony PSP and 4,321 for the Nintendo DS. iPhone’s browser usage market share is 64%.  Everything else added together is half the iPhone. Over 50 million iPhones  have been sold to date. Count iPod Touches and there are 85 million devices running iPhone OS.  As Jobs says “If you’re a software developer, that’s a plum market to go after”.

As for the new OS, it delivers over 1500 new APIs for developers & 100 new user features. Multitasking is implemented in a way that requires developers to ‘bake’ this into apps. While this requires developers to modify their existing apps, it allows Apple to avoid the sluggish phone performance & battery drain that would occur if a full app ran natively in the background.  Developers will be able to stream audio (e.g. Pandora while you do other things), VoIP (Skype, which across all platforms now connects 1 in 9 international calls on the planet, was demoed, complete with inbound call notifications while phone is locked), location (for turn-by-turn instructions), and various notification services.  For developers, upgrading apps should be easy.  Pandora (which now adds over 30,000 new listeners a day just on the iPhone & delivers 25% of streaming minutes over the device) took just one day to make the app fully background aware. There are other bonuses: wallpaper, a unified inbox, folders, iBooks (which, like the Kindle, sync across devices to keep your place & bookmarks), and enterprise features (it was reported that 80% of Fortune 100 firms are using iPhones).

iPhone OS’s new Game Center features add social gaming (challenge friends), automatic matchmaking (find opponents with similar abilities), leaderboards, and achievements.  But the big bombshell was likely iAd – Apple’s new mobile advertising platform. Apple maintains that apps, not search, is where ads are going to work on mobile.  Some more stats on potential: the average iPhone user spends over 30 mins every day serving apps on their phone: an app every 3 minutes, 10 ads a day (like a TV show), over 100 million devices, is a billion ad/day opportunity!  In app (as opposed to quick-through & leave the experience) ads are the goal & Apple showed several mock ups of what to expect. Jobs showed a ToyStory 3 ad that popped up in an app, offered a game, video clips, downloadable wallpaper, theaters where movie was playing, and allowed you to buy an app-game from within the ad – all without leaving the original app. Apple also showed Nike ads with video, the ability to flip through a product catalog, integration with NikeID custom shoes, and more – very slick (see the last 5 mins of keynote linked in this headline). A Target ad also showed how an app can be used to build a shopping list, buy stuff within the app, deliver coupons, and send info via e-mail. Jobs later acknowledge the importance of Highland Capital-backed Quattro Wireless (purchased for $275 million in January), saying “We tried to buy this company called AdMob and Google came in and snatched them from us. We bought this other much smaller company called Quattro and they’re teaching us”.  Our students had an opportunity to hear from BC Law Alum and Quattro CEO (and now Apple VP) Andy Miller last November at the Highland offices (thanks to Highland Partners Prof. Peter Bell and Dan Nova!).  It was right after Google’s AdMob deal – an incredible time to hear from a CEO in the midst of the hottest deals in tech, and another example of the special opportunities our alums help provide for our students!

Facebook CEO in No Rush to ‘Friend’ Wall Street
The Wall Street Journal claims Facebook isn’t over-anxious for an IPO.  Some interesting tidbits: Facebook’s 2010 revenues are estimated to land between $1.2 and $2 billion.  As our Facebook Case points out, network effects have kept Zuckerberg in remarkably strong control of the firm.  He owns 25% of the stock and controls 3 of 5 board seats. As Facebook grows, the firm has switched away from options and instead grants RSUs or Restricted Stock Units to employees.  This allows Facebook to keep under the important 500 shareholder limit, preventing them from additional financial disclosure filings. And as we covered during our ‘Globalization lecture‘ this week, Russian investment firm Digital Sky (DST) made a large private investment in Facebook last year, buying $100 million shares from existing employees and investing another $200 million in new coin for a measly 3.5%, a $10 billion valuation that barely dilutes Zuckerberg’s holdings.  Well played, Mark!

H.P. Sees a Revolution in Memory Chip
Memristors or memory resisters will enable new types of high rise-style “stackable” chips (of the type mentioned in our Moore’s Law & More chapter).  These devices can be used both for processing and storage, maintaining what’s in memory even in the absence of electricity. Researchers think that within three years they’ll have a memristor competitor to flash memory that stores 2x as much storage as flash should at that time. Today’s most advanced transistors are of the 30 to 40 nanometers variety. H.P. now has working 3-nanometer memristors (by contrast, a biological virus is about 100 nanometers).  Getting his full geek on, “Kurzweil-style”, HP Scientist Dr. Leon Chua says “Our brains are made of memristors,” (referring to how synapses work). “We have the right stuff now to build real brains.”

A Personal Cell Phone Tower
Major US mobile network providers will begin offering a sort of personal cellphone ‘tower’ that looks more like a wifi hotspot.  Such so-called fentocells will provide capacity inside buildings or in other areas of poor service.  Fentocells are small enough to be installed just about anywhere, including on telephone poles, street lamps, in old phone booths, and indoors (see photo at left).  Some anticipate this technology may one day provide a 10x boost of 3G speeds.  AT&T will start selling what it calls “MicroCells” this month, offering ‘5 bar’ coverage in a roughly 5,000 sq. foot footprint for approx. $150, $49 if you have a broadband or in-home calling plan, and free if you subscribe to both (kudos to Moore’s Law & scale economies, which pushed these costs down from around $500 two years ago). Sprint offers it’s Airave, billed as a mini cell tower, for $99. Verizon’s “network extenders” are $250. Such devices could have a big impact on places with spotty mobile coverage, like NYC, San Francisco, and Chestnut Hill!

Fresh Direct Goes to Greenwich
The Fresh Direct case (scroll down to ‘Different is Good’) has long been a staple in my classes.  The firm has 600,000 customers in the Greater NYC area, will pull in $300 million in revenue this year, and it’s iPhone app brings in 2.5% of sales.  The firm is so dominant – with lower prices, greater selection, and vastly better margins, that roughly one in three groceries in NYC closed within five years of Fresh Direct’s launch.  Now communities surrounding Greenwich, CT can in on the culinary awesomeness as FreshDirect moves East.  The firm says its raising private money for a new expansion. Here’s to hoping it’s Greater Boston!

Twitter’s Ad Plan: Copy Google
Twitter users rarely visit the site. Most active users post and read tweets using one of the dozens of free applications provided by third parties, such as Seesmic, TweetDeck, and Twirl.  If users don’t visit Twitter.com, that lessens the impact of any ads running on the site.  This creates what is known as the “free rider problem,” where users benefit from a service while offering no value in. The new ad scheme would encourage software and service partners to accept ads for a percentage of the cut, and this could lesson the free rider problem.  Another issue: when users don’t visit a service, it also makes it difficult to spread awareness of new products and features. In a sign that Twitter is reaching out to capture more of its distribution channel it’s just purchased the parent of popular client Tweetie and plans to give the Twitter client away for free.

Fox & Sony Throw Blockbuster a Lifeline
Bummer for Netflix – Fox and Sony are allowing the near-bankrupt Blockbuster to have access to many movies at DVD release day.  Netflix has to wait 28 days post-DVD-release before it can distribute content from the major studios.  Perhaps the studios want a strong rival in the DVD-by-mail space.  There really is no credible competition to Netflix in this space, and I’m not convinced it’ll do much to help Blockbuster in the long term – the firm’d be lucky to survive a bankruptcy restructuring.  Netflix’s success is yet another sign of the winner-take-all / winner-take-most impact when tech runs roughshod over old business models.

Death of a Printer Salesman
We’ve got Software as a Service (SaaS).  How about Printer as a Service?  HP has a growing division offering pay-per-use products that it will keep stocked & healthy.  So far the services business has grown to the point where HP manages 19 billion pages per year. The total value of all managed print services contracts stands at about $5.5 billion, a figure big enough to warrant its own breakout from other printer operations.

Google and Partners Seek TV Foothold
The NY Times says that the search sovereign is developing an open, Android-based platform called Google TV, aiming to bring Web content and services to the living-room screen with the help of hardware manufacturers and software developers. On board already, according to the report, are Intel, which has been looking to get its Atom chip into next-generation TVs; Sony, seeking a jump on its competitors; and Logitech, tapped to work on peripherals, including a keyboard-equipped remote.  Extending Google ad strength to the TV could just be the multi-billion dollar opportunity needed to keep GOOG stock moving up and to the right, even after paid search ads hit their inevitable maturity. As we’ve learned with our TiVo discussion, the key will be securing distribution channels (currently dominated by set-top boxes).  While many of us use ‘TiVo’ as a verb for recording television, few really use TiVos.  There are 1.5 million TiVos and 30 million DVRs. The question is – are TiVo’s patents strong enough to make it an acquisition target? TiVo (which lost over $23 million last year) has, as of this writing, a less than $2 billion market cap That’s just a snack for Google ($24 billion in cash), Apple ($40 billion), or Microsoft ($40 billion) – all who might need to license those patents for genuinely slick TV UI.  TiVo would like to be the Google of television, but I think Google would also like to be the Google of Television.  If TiVo’s IP is a gateway to implementation (and holding it would dumb down rivals), then we might just see that ‘verb’ snapped up by one of the many firms that wants to deliver your smarter TV.

Buzz Kill: FTC Urged to Investigate Google Privacy Flap
When Google introduced it’s Buzz social networking features earlier this year, many users were horrified that their most frequently used Gmail contacts were automatically added to Buzz, allowing others to see who you’re communicating with.  As one report explained, “Suddenly, journalists’ clandestine contacts were exposed, secret affairs became dramatically less secret, and stalkers obtained a new tool to harass their victims. Oops.“  Digital Daily recounts the growing complaint list against Google Buzz. In February, the Electronic Privacy Information Center asked the FTC to investigate, claiming Buzz violated U.S. consumer protection law. Then, outgoing Federal Trade Commissioner Pamela Jones Harbour said Buzz’s rollout was “irresponsible” and accused Google of attempting to “stretch the privacy envelope.” Eleven U.S. lawmakers are now asking the FTC to investigate Buzz, too.  Let this be a lesson on how not to do an IT rollout.  Gotta keep the ‘people’ and ‘procedures’ side of any information system top-of-mind, especially when privacy and sensitive data is concerned.

How I’d Hack Your Weak Passwords
Creepy – read it & see how an expert would hack into your accounts.  Then change your passwords, stat!

IS faculty, we’ve also received assurances from BusinessWeek that starting in 2011 the magazine will begin including IS in specialty program rankings.  Here’s hoping that our program, with it’s 3 fold increase in majors in 3 years, award-winning field studies, and venture programs that continue to spew startups, will rate.

Setting the Stage: Technology, The Manager, and the Modern Enterprise
Chapters continue to roll out for our free online textbook.  The first draft of the newly released first chapter, still in unedited .pdf form, covers much of the material used in our ‘first class’ of the semester.  The chapter begins framing how tech has radically reshaped the business landscape during the past decade, it underscores that the tech revolution is championed by the young, it shows how every managerial discipline has become more reliant on tech, and career opportunities are introduced.  The latter part of the chapter summarizes the book’s other 13 themes.  Faculty can request a free, printed version from Flat World Knowledge.  Edited versions of the other chapters in version 1.1 are already online.  And look for another complete update & refresh this summer, available in August for Fall semester courses.

Can Twitter Make Money?
Twitter may now be profitable – Technology Review reports that the $25 million deals with both Microsoft and Google that deliver real-time Twitter results to both search rivals was enough to push the firm into the black.  And Yahoo will also start featuring Twitter integration across its various services.  Google & Bing recognize that real-time information can be critical when news breaks – ‘the crowd’ now reports well ahead of the media filter or conventional systems.  Consider the Jan. 7^th Mountain View tremors (Grad TechTrek just missed the quiver).  Google had quake-confirming results from Twitter about 8 minutes before anything registered from national seismic monitoring services (video: Twitter & Google execs talk real-time search).  The Yahoo! deal offers additional advantage – encouraging visitors to Yahoo to tweet the site’s content as well as consume what Twitter serves up. While we’re still not sure of what a commercially successful Twitter will look like, the service has spawned a huge eco-system of thousands of apps and related products.  StockTwits sifts through tweets that discuss stocks. Bit.ly leads the URL shortner race key for squeezing links into 140 characters (Have you tried the service’s analytics? Very cool to track activities around your post). YFrog & TweetPhoto embed photos, while TwitVid and others do the same for video. TweetDeck and Seesmic provide easy tweeting tools that also filter out content (like creating a column for mentions or keywords, like the #cs021 hash tag we’re using for my “Computers in Management” course).  CoTweet – the service most widely used by corporate Twitter accounts (allowing multiple users to an account, analytics, and timed tweet releases, among other benefits), was recently acquired.  Of course, such clients also present a problem for Twitter since it means the service is used by many who rarely visit Twitter.com (known in management circles as the free-rider problem).  That also makes measuring Twitter more difficult.  Page views and unique visitors – metrics used by conventional websites, are pretty much meaningless for Twitter.  Even counting the number of tweets doesn’t tell the full story, as many people are using Twitter not so much to post, but to observe & filter (Twitter’s goal is to become the ‘pulse of the planet’).  Still, with 75 million users and climbing, Twitter is now pushing ahead of the nay-sayers who once claimed the service was a mere fad.  Course note: savvy observers can spot our Fall 2009 speaker, Twitter investor (and BC alum), Spark Capital’s Bijan Sabet in the Tech Review photo montage.  The talk was yet another example of how our alumni continue to help keep classroom learning cutting edge (thanks again, Bijan)!

Foursquare Introduces New Tools for Businesses
The location-based combo bar game, scavenger hunt, and promotional tool, Foursquare, continues to gain legitimate corporate partners while upping the quality of its tools for firms seeking to use the platform for customer engagement.  New corporate tools allow firms to view a dashboard of Foursquare visitors including patterns and demographics (see cool dashboard pic from the NY Times).  Corporate users can even reach out to users – say welcome new users or offer specials to win-back those who haven’t stopped by in a while.  Foursquare has since inked deals with Zagat, the New York Times, HBO, Warner Brothers, the History Channel, Bravo, and a slew of Conde Naste publications (the latter just in time for socializing hipsters attending Fashion Week).  And now social media powerhouse Starbucks is in, too.  Check in to five separate Starbucks locations and you get the nifty ‘Barista’ badge at the left.  The badges are fun, but turning Foursquare into a loyalty program is the real trick, and many are doing just that.  While I still think Foursquare has to sanitize its offerings to be more family-friendly (yes, I’m talking about ‘that’ badge), corporate partnerships are a very good sign.  A bunch of the Undergrad TechTrek crowd became Foursquare fans over spring break, and it was neat to see specials pop up throughout San Francisco and Mountain view (e.g. ‘free appetizers for the 5^th check in’, or the mysterious ‘stop in and find Shlomo for a free drink’ which, for the record, we didn’t do with the under 21 crowd).  Foursquare has lots of competitors (Gowalla being the biggest), and Twitter and Facebook are rolling-out location-based tagging for tweets / status updates. All this suggests the geotagged mobile web is about to have its mainstream coming out party.

Video Interview with Jeff Smith of Smule
The kind folks at Smule spent time with our TechTrekkers, sharing their insights on becoming one of the standout successes of the app economy.  The firm’s hits include Ocarina, Leaf Trombone, and the wildly successful “I Am T Pain” (which, I have to admit, I was delighted to ‘require’ as part of ‘course materials’ for TechTrek this semester).  While our visit was hosted by a BC MBA alum who serves as VP of Development, all may enjoy this interview with Smule CEO Jeff Smith.  The video offers fascinating insights an App Store vs. Android.  Smith makes the point that Android is not a single deployment platform in the way the App store is.  Features and hardware differ by phone, so Android app developers are really faced with ‘write once, test everywhere’. Android has also been tougher to monetize, and the cost to build for the platform is estimated at 2x to 3x. Smith estimates that going from iPhone to iPad will be a single digit percentage of work (2-3%).  We also learned I Am T-Pain simply couldn’t be made for existing Android handsets due to abstraction layer (iPhone apps can directly access hardware, and T-Pain’s Auto-Tune mimicry taxes the handset to the limit – the abstraction layer on Android slows things down too much).  Apps themselves are now channels, with Smith reporting in the video that some 500,000 songs have been sold through the T-Pain app. Rockin’!

Android Gains as Windows Mobile Plunges
While iPhone continues to dominate and Blackberry has long-established leadership, Android is blasting ahead of old timmers Windows Mobile and Palm.  Comscore reports that Backberry and iPhone gained subscribers, but Android saw the biggest jump, from 2.8% to 7.1%. Windows mobile is still ahead of Android, but it fell from 19.7% to 15.1% share.  Google also continues to expand its repertoire of offerings, buying photo editing site Picnik (which curiously is Flickr’s default photo editor), snapping up DocVerse (a startup that allows users to collaboratively edit Microsoft Office documents online), and is launching a location-based shopping service that shows if local branches of firms like BestBuy, Sears, and Pottery Barn have an item in stock that you’re looking for (a blue dot will indicate local availability).  Some high-ranking Googlers clearly see mobile as important to the firm’s future.  Google Europe Boss John Herlihy recently said “In Three Years Desktops Will Be Irrelevant”.  Bold.

The Science of Building Trust with Social Media
Mashable continues to produce really great content – ranking them right up there with GigaOM and TechCrunch for quality tech-industry online-only content. This super read offers four quick-takes on how to do it right with social media.  See Southwest’s honest response on the Kevin Smith blowup “I’ve read the tweets all night from @thatkevinsmith – He’ll be getting a call at home from our Customer Relations VP tonight.”, VeggieGrill’s shout out to a blogger that essentially says, ‘you’ve got great ideas & we’re doing it, here’s where you can try’ – blogger eventually goes on to praise & advocate.  Governer Schwartzenegger goes YouTube to praise a tweeted idea that he should ‘sign used cars’ the state is selling to get more money, while the Domino’s President’s YouTube response is played back with ‘believability ratings’ (he rates high).  Learning to communicate via new media is now a key skill – see article for suggestions on how to best construct response in the age of social media dialog.

Wal-Mart Buys VuDu: Jumps Into Video Streaming
This may also be interesting for faculty using the Netflix Case: Wal-Mart’s on-again, off-again competition with Netflix is on again.  The Arkansas retail giant (and regularly ranked Fortune 1 behemoth), has spent a reported $100 million to buy video streaming service VuDu.  This seems like a very risk move.  WalMart goes up not only against red-hot subscription video service Netflix, but also against Apple, Amazon, Google, studio-backed Hulu, Microsoft, and many others.  Not sure I’d put my cash on the Sam’s Club sibling in this race.

Want a Job? Get a Computer Science Degree
I’d add “Information Systems” to this list – our business / technology blend remains hugely valuable.  But the numbers clearly indicate that those who geek up continue to have great prospects and bulky starting salaries despite a down economy.  Yes, tech is once again cool on campus. For the record, while NetworkWorld quotes schools crowing about 5% enrollment boosts and 87% job placement, we’ve consistently done better on both accounts in BC’s IS Dept. I’d welcome a chance to share our success with NetworkWorld!

Fast Company’s Most Innovative Firms
Interesting to compare the Fast Company list with the Top Innovator’s List from MIT’s Technology Review. A123 makes the list – BC Tech Council members, the CEO of A123 will be speaking at this spring’s dinner.

Behind the Scenes at Facebook’s Grown Up HQ
It was great to spend time at the new Facebook digs in both January and March of this year.  For those who didn’t make our field study, here are some slides, courtesy of Fast Company (BTW: Facebook tops the Fast Company innovative list).

Notes On Leadership
In a guest post for TechCrunch, Ben Horowitz (partner at Andreessen-Horowitz, co-founder with Andreessen of OpsWare, and one of Andreessen’s execs at Netscape), writes on successful Valley leadership, citing former BC Football Coach and Intuit Chair Bill Campbell, Apple’s Steve Jobs, and Intuit’s Andy Grove. It’s a great list with spot-on criteria.  But I think Horowitz might think it’s not possible to ‘teach’ the Campbell trait because he’s never been to BC.  This isn’t a chalk-and-talk,  textbook & lecture skill, to be sure.  But at a university dedicated to the education of “men and women for others“, with a deep commitment to volunteerism as well as ‘cura personalis’ or development of the person, I think BC’s as close as any come to creating Campbells as anyone can be.  We’ll try to send you a few of BC-led startups, Ben, and you can see for yourself

Apple Introduces $499 iPad Tablet
Apple’s numbers are pretty amazing.  Last quarter the firm’s revenues were $15.6 billion, net income was over $3.7 billion, and while there’s some allowance for accounting changes, there’s little disputing these were far and away the best numbers in firm’s history. When Jobs took the stage to announce Apple’s latest creation, he first brought us up to speed on other numbers: Apple has now sold over a quarter billion iPods, 75 million iPhone/iPod Touch devices, and by revenue the firm is now the largest mobile devices company in the world.  The App Store celebrated its 3 billionth download, it hosts 140,000+ apps, and Apple runs 284 retail stores that hosted 50 million visitors last quarter.  You don’t have to be a fanboy to be staggered by those stats.  Steve Jobs has without a doubt executed the most breathtaking corporate turn around in modern business history.

Up next is the iPad, a 9.7” (diagonally), 1.5 lb, half inch thick, touchscreen tablet with Wi-Fi and Bluetooth.  Most notable, the device has a 10 hour battery life that can sit one month in standby mode, it sports an ARM-based A4 chip Apple designed itself, and models start at $499 for a 16GB version, running up to $820 for a 64GB 3G version that’ll cost another $30/month if you want the AT&T US unlimited data contract. (also see FastCompany’s cheeky iPad By the Numbers).

Apps will make the device.  While the iPad demoed didn’t run Flash (vital for most web video), super-slick demos showed a special NY Times newspaper viewing app, a racing game from EA, and an Apple-hosted iBookstore launched with titles from Penguin, Simon & Schuster, HarperCollins, Hachette Book Group and Macmillan.  Apple will even offer $9.99 versions of its iWork apps, Pages (word processing), Keynote (presentation), and Numbers (spreadsheet).

What’s the market for this?  For all the talk of Apple selling closed systems, there are 140,000+ apps, so it’s open enough for lots of innovation.  And now those experienced developers have a lot more screen real estate to work with.  iTunes will become a major conduit for video (a far better experience than iPhone movies).  But I really look forward to using this as a magazine & note-taking replacement.  I spend a lot of time reading online text, but more often than not I print stuff out, read it on the train or someplace more relaxing than a compute rdesk, then transcribe highlighted notes.  Laptop work isn’t well suited for casual, comfortable, non-desk settings. It is hard to imagine wanting to type on the iPad, but I don’t want it for email – I want to use this as a research tool that fits in where I want to work (although voice input would be nice).  iPad may be the killer device that ergonomically mimics and improves what we do with ‘dead trees’.  If App developers recognize the unique ergonomic experience of the pad as especially better for some tasks than a laptop or phone, iPad innovation will flourish.

Inside Apple’s New A4 Chip
The fingernail sized A4 that powers the iPad is a system-on-a-chip, integrating the microprocessor, graphics, memory controller, and other functions on one piece of silicon.  The smarts came from Apple’s 2008 acquisition of 150 man chip firm PA Semi and it’s notable because as Apple puts it, this is the first time has used an Apple-branded chip.  Many speculate the chip has ARM smarts inside (like nearly all smartphones sold today), but TechReview says no one has corroborated this yet.  There are advantages in having your hardware & software so tightly tied together.  Expect higher speed and more finely tuned power control.  We already see this as an innovation catalyst on the iPhone.  The reason you don’t have “I Am T-Pain” on Android is that Google’s mobile OS has an abstraction layer that slows down code.  With Apple devices developers hit the hardware unencumbered by intermediate layers necessary to run the OS on various devices.

Amazon, Apple and the book publishers: When Elephants Fight
The eBook market also got a taste of what the new post-iPad competitive landscape looks like when Amazon agreed to ‘big six’ firm Macmillan’s demands to raise eBook prices above $9.99.  Amazon originally pulled the ‘buy’ button from Macmillan titles (both digital and print), but eventually backed down. The January keynote suggests Apple’s iPad bookstore will offer publishers higher prices.

Commentary: Some see this as a victory for publishers, but I’ve got to think that long-term it’ll be the market and not the publishers who set prices.  Look to textbooks to be the first impacted.  Pardon the self-serving plug, but I’ll use my own book as an example.  The leading “Intro to Information Systems” books sell for $180 list.  There is absolutely no justification for a book to be that expensive – none.  My own, competing text is free online and $29.95 in soft-back version.  Demand was so strong we had to do a print run in August for beta-testers.  The Jan ‘10 release includes info too fresh for other publisher timelines (e.g. Facebook’s cash flow positive #s, the rise of Farmville).  A conventionally published text cannot yet offer that level of currency (expect at least one more update of my textbook book before the start of the Fall ’10 semester).  Content owners (e.g. authors) will either use innovative publishing models like Flat World (my current publisher), or they’ll go direct. I use a publisher now because they offer me things I’m not good at: editorial, layout, graphics work, hosting, distribution, marketing, and revenue collection. But ALL of those things are WAY cheaper in a digital world.  No one wants to dance on the grave of publishers – good people will lose their jobs as this industry collapses – but we’ve seen this game play out before.  At some point digital distribution will be preferred and pricing and format pressures will force market changes while the giants struggle to stabilize their markets or avoid free fall.

Amazon’s Amazing Fourth Quarter
Don’t count Bezos out – he is the undisputed god-king of e-commerce with naysayers constantly left with egg on their face.  Amazon reported revenue rose 42 percent to $9.52 billion, with earnings at $384 million. The numbers crushed analysts’ expectations. And while eBay also posted good quarterly results, Amazon keeps gaining. Amazon traffic jumped by 9.8% from a year earlier, while eBay’s traffic dropped 2.5%. The Kindle was a wild success with eBooks flying through the ether.  Says the firm: “When we have both editions, we sell 6 Kindle books for every 10 physical books”. The figure is only for paid books — add in all those free Kindle titles and you’ve got an even higher number

So in our recap we’ve got eBay competing with Amazon competing with Apple competing with Google. Auctions, retail, computers, and search are compressing into one bit-based singularity riding on the gravitation pull of Moore’s Law, cheap bandwidth, and slick software.  Everybody in this fight is still big and profitable.  The 2010’s are gonna be interesting!

Well the Wall Part of the Paywall Seemed to Work
Print publishers have been waffling back and forth between squirreling content behind a paywall or letting it roam free and hoping ad revenues make up the difference.  GMSV offers an analysis of recent experiment by the Long Island-based paper, Newsday. In Oct. the firm moved to a $5 a week paywall with print subscribers getting free access, as do subscribers of Optimum Cable (Cablevision owns both the paper & the cable). The firm spent $4 million on a redesign and relaunch to coincide with the rise of the paywall.  So how many subscriptions were sold since launch? “35. You read right — thirty-five.” The print crowd had better pray the Kindle/iPad/Android Tablet war is good for them.

Foursquare Rewards Social Networkers for Location info

James Cameron may be King of the World, but I’m Mayor of Fulton Hall!  At least I am via Foursquare – the hard-to-describe location-based social networking game (here’s a video describing the service, from the WSJ).  And now the site’s beginning to catch on with retailers, using the game as a sort of loyalty program and coupon mechanism.  The Modmarket eatery in Boulder offers free pizza to users who check in 10 times, and a free drink to the restaurant’s current ‘mayor’ (a distinction earned by ‘checking in’ at a location more than others).  Fatburger offers secret menu deals to those who flash proof they’ve checked in via Foursquare.  And Bravo has just announced a deal whereby the TV network will offer players special badges and other prizes when visiting some 500 locations based on the network’s shows “The Real Housewives,” “The Millionaire Matchmaker,” “Top Chef,” “Kell on Earth,” “Top Chef Masters” and “Shear Genius.”  But while Foursquare is a hipster hit, it may need to grow up.  Some of the surly language associated with one badge in particular will certainly limit the game’s broad appeal unless the firm grows beyond its too-cool-for-school roots. I mean, who wants to see THAT tweeted and Facebooked out? Don’t the Foursquare folks realize anything posted to the Net lingers like an unerasable graffiti tag attached to one’s rep?  C’mon, guys!

Lessons from the Nexus One Launch
It was so fun to be on Google’s campus with our grad students on the day the Nexus One launched.  The phone is beautiful, and Android has risen to have more buzz attached to it than RIM’s Blackberry (this must really get Microsoft’s goat, since Redmond’s been chipping at the phone business for years, only to be elbowed aside in the zeitgeist by Sergey and Larry’s pocket push).  BusinessWeek does a post-mortem on the launch and offers some showmanship and marketing advice to Big GOOG.

Google Reveals Chinese Espionage Efforts
Back in 2006 the New York Times ran an excellent story called “Google’s China Problem and China’s Google Problem)”.  I’d regularly recommend this to our students, as it shows what a real managerial ethical dilemma is like.  James Fallows, a guy who knows a lot about both China and Google, brings the tension up to date in an excellent piece in for The Atlantic.  On one hand, censorship turns the stomach of any free-speech Googler. It’s wrong – period.  Speaking freely gets dissidents jailed, clearly not within the “Don’t Be Evil” rubric.  But history also shows that more access to information has pushed dictatorships, particularly those in East Asia, toward more open, welfare-improving democracy – Taiwan, S. Korea, and even Singapore are offered as examples. For years Google agreed to censor results in China in the hopes that being a force in country would result in quicker, more positive outcomes over the long-term than being away. But when Google called China out as the source for a broad-based hacking attack on the accounts of suspected dissidents, the gauntlet was thrown down.  Now folks are wondering if Google’s Beijing office (which our students visited last May) will be shuttered.

From a technical perspective, the hack was shockingly bold. TechCrunch McAfee’s worldwide chief technology referred to the operation as the “largest and most sophisticated cyberattack we have seen in years targeted at specific corporations” and referred to the attack as a “watershed moment in cybersecurity” that the event has “changed the world”. Another quote: “They are in fact the equivalent of the modern drone on the battle field. With pinpoint accuracy they deliver their deadly payload and once discovered — it is too late. … All I can say is wow. The world has changed. Everyone’s threat model now needs to be adapted to the new reality of these advanced persistent threats”.  Security is front-and center important to today’s manager.  Here at the Heights, BC’s own Prof. Sam Ransbotham (himself a recipient of a Google Grant), will be teaching a new managerially-focused information security course next year.

Netflix Sets Q4 Subscription Record
Man, it’s gotta be embarassing to be a stock analyst covering Netflix.  The firm was widely downgraded in mid January only to shock with blowout numbers and get upgraded less than two weeks later. The Netflix Q4 numbers are stunning. Netflix now has a market cap of $2.8 billion, Blockbuster (BBI) is valued at less than $70 million. Profits are at an all time high, the firm added 1.1 million subscribers, the most of any quarter in its history, subscribers at year end 2009 hit 12.3 million, and the firm expects them to be above 16 million by the end of 2010. Valuations are pretty frothy for a firm with $31 million in Q4 profits, but analysts are now wondering if it’s even possible for Blockbuster to turn around.

While major studios have long worked with Netflix, they’re, for more than a year now, become increasingly concerned with the drop in DVD sales.  Netflix has agreed not to rent the Time Warner studio’s movies for the first 28 days after they go on sale. In return, Netflix gets titles for a reduced fee, and gets more movies to offer via its growing Web streaming service. Netflix CEO Reed Hastings has said he expects the firm to ship DVDs until 2030.  And if you own a Wii you’ll soon be able to stream Netflix titles directly to your TV!  Plus check out this really fun interactive graphic from the New York Times – that shows rental patterns across dozens of zip codes. Oh yeah, and those buyout rumors are back.

Mobile Giving Foundation Processes over $35 Million for Haiti
In the days following the quake in Haiti, the Internet was flooded with appeals to donate via mobile devices, say by texting HAITI to 90999.  The three-year-old Bellevue, WA-based non-profit The Mobile Giving Foundation claims to have raised over $35 million in relief funds from these instant giving efforts that later show up on a user’s wireless bill.  Eagles looking to get involved should check out BC’s Haitian Relief Page.

The Light Bulb Goes Digital
Traditional incandescent light bulbs are being phased out in Europe and Australia, and they depart the US beginning in 2012.  While most stores are filled with the twisty-bulb fluorescents, the likely heir is almost certainly LEDs. Expensive now, LEDs have more in common with the manufacture of your laptop than with the Edison-era bulbs that likely fill your home today.  But move over Moore – it’s Hatiz’s Law that applies here – LED efficiency increases twenty fold in a decade, while costs drop ten fold.  Another bonus – they lack the mercury that’s found in “twisty” bulbs. While GE, Osram, and Philips are kings of conventional bulbs, look to new players like Samsung, Panasonic, and LG to get in on a transition wave as jolting as the switch from film to digital.  Today’s LED bulbs are about twice as efficient as the fluorescent ‘twisty’ bulbs, and they’ve have a 3 year payback.  That’ll only get better as tech improves.  Starbucks & Wal-Mart are among the big firms making the switch today. And the same light output sucks about 80% less juice. How’s that for some Green Tech!

Best Companies to Work for in America
Another tech firm tops the list.  NC-based SAS is the world’s largest privately-held software firm.  But even without stock options, the firms perks are so sweet and employees so happy that even legendary Google modeled their efforts after the tar heel geek shop.

Best and Worst Jobs
Tech jobs snare two of the top three “Best” jobs in a recent study.  Geek up, my friends!

A Different Kind of Capitalism
The NPR program “Speaking of Faith” has done a wonderful series on the challenges of world economic development.  The Jan. 28, 2010 program features Acumen Fund CEO Jacqueline Novogratz, discussing how well meaning conventional aid is ineffective, and how her agency is helping create bottom-up entrepreneurs among those earning $4 or less a day. This is a ‘must listen’ segment for any business student, as well as for anyone trying to sharpen their global citizen thinking to identify real ways to empower the poor. The site has lots of supplemental content, an extended interview with Novogratz that goes beyond what aired, and links to other stories in their international development series. Also note Novogratz’ memoir “The Blue Sweater” has been in hardback for nearly a year and will be in paperback this month.

Why Playfish Sold to EA
Electronic Arts bought the London-based gaming firm for $300 million in November, marking the first move by a major game firm into the app-based social gaming category.  Playfish’s CEO Kristian Segerstrale points out that the sale makes sense since established firms with brand recognition are likely to make big, bold, and impactful moves into the space.  Need justification for the statement?  Look at the Top Grossing Apps link within iTunes (note iTunes will launch when clicked).  As of this writing, 8 of the top 10 top grosser were from large, established firms.  And big game firms were behind six of the offerings.

Are You Fun to Follow?
I feel weird putting this up here because my tweets… well… aren’t really all that good.  I’m sure I step over that ‘not so tough to find line’ and often seem overly self-promoting (happens when you’re passionately pushing a project).  And I’m a shameless booster for BC (my apologies to our friends at other universities who read this blog & follow online. Again, I don’t have much separation between professional and personal enthusiasms).  But I really do admire those who tweet well.  The secret virtuoso behind @BostonCollege is exceptional at striking the right mix of friendly, fun, personal, human, and sharing information that BC’s friends (er ‘followers’) would be most interested in.  @Starbucks does a similarly good job – despite being a gargantuan brand, the tweets seem deeply authentic with a genuine desire to be helpful. A recent piece from BusinessWeek describes good ‘tweets’ as capturing one’s world’s details in ways that others will find interesting and fun”. Read the link above for more tips.

The WePay flagship service is a must for anyone who has had to manage group payments (TechTrek’s using the service to collect diner money).  Setting up an FDIC-insured account is as easy as establishing an Evite invitation (The Bancorp Bank invisibly handles the back-end, while WePay charges modest fees for transactions).  The site sends out ‘bills’ and follow-up notices, so treasurers are out of the ‘nag’ game  Users can share transaction history with approved folks so the audit trail is visible to all and deadbeats are exposed. Payment can be through credit card, bank transfer, or even check. WePay will even arrange for a debit card associated with the group. The interface is strikingly elegant and the market is potentially huge.  WePay will streamline the treasury function of student clubs, sports teams, celebration pitch-ins and more.

Gotta love how TechCrunch sums this up “WePay looks like it could be a winner. The company is solving a problem that nearly everyone has had to deal with, and they’ve got a proven way to make money doing it. Look for their launch [in early 2010].” WePay represents the second BC-affiliated business coming out of this year’s Y-Combinator class (’09 BCVC winner WakeMate was announced late last year). Another fun fact reported by Kirsner, WePay’s new offices are the former digs of rather successful firm with Massachusetts roots – Facebook.  Thanks, Scott, for the BCVC and Facebook shout out!  More evidence that The Heights has become a hothouse of innovation. Go Eagles!

Honest Hollywood, Netflix is Your Friend
Netflix spends about $240 million buying DVDs, and the firm’s 58 distribution centers process approximately 2.2 million DVDs per day.  Studios let Netflix purchase most of those titles well below what they’d charge Walmart, and in many cases studios get a cut of the subscription take based on a title’s success with Netflix subscribers  But licensing content for the “Watch Instantly” streaming service has been a challenge.  Firms are demanding all sorts of compensation schemes, making some titles unprofitable to license if not impossible to obtain (see the Netflix case).  That’s left the firm with only 17,000 mostly weaker titles available for streaming, vs. the 100,000+ titles available on physical DVDs.  But a Netflix deal with Starz brought the cable channel’s upper-tier content (Spiderman 3, Ratatouille) to “Watch Instantly”.  Studios are eyeing this warily – it looks like an end-run around their attempts to milk coin form every stage and every distribution channel in the release window.  And many studios, in part, blame the rise in subscriber services on the fall in DVD purchases.

Netflix is on track to earn some $111 million on sales of $1.67 billion, a 22% gain over 2008. Even more impressive, NFLX is up 90% this year.  So much for the analysts a few years back who once claimed it was ‘an ice cube melting in the sun’.

And “Watch Instantly” is growing.  42% of its 11.1 million subscribers have tried the service, twice as many as last year, and a host of firms are building streaming into TVs and DVD players.  Netflix insists it needs deals like the one it cut with Starz to compete with the deep pocketed rivals, Amazon and Apple.  But now Warner Brothers and other studios want Netflix to accept the same deal Hollywood has with the cable companies. That’s an expense of about $4 each time a new movie is watched, with studios taking 65% to 70% of that coin. Bonus: Want a look inside a Netflix Warehouse?  Check out this video shot during USA Today’s visit to the firm’s Fremont, CA facility.

SCVNGR Raises $4 Million From Google Ventures
Budding BC entrepreneurs were treated to an electrifying talk from SCVNGR CEO Seth Priebatsch last fall at the offices of Highland Capital.  BC Alum & Highland Partner, Prof. Peter Bell is on SCVNGR’s board, and Bell will be joined by Google Venture’s Rich Miner (our Fall ’08 TechDay headliner).  The $4 million round is a big endorsement of SCVNGR’s location-based gaming model.  Some of you know the firm from participating in QUEST for Innovation, but the firm’s platform has been used by over 400 clients including Boston College, Princeton, Yale, MetLife, and HSBC, with a whopping 91% client repeat rate.  TechCrunch reports ” the startup has crossed “well over” $1 million in revenue in its first full year in business, with monthly revenue up 40% month over month for the last six months. And it’s now cash-flow positive. In other words, it’s one of the first location-based game companies that’s making money.”  Even more fun, the funding round closed on CEO Priebatsch’s twenty-first birthday. Students looking to get in on more killer talks like Highland Day should reach out to Jenna Kazarian in the BC Information Systems Academy, and check out BCVC.

Spredfast Manages & Monitors Social Media Efforts
Early in December, Social Agency, a five-person startup based in Austin, TX, launched a Web-based software package called Spredfast that helps companies manage their social media campaigns. The software not only measures audience size and engagement but also allows coordinated planning and automated posting across multiple social media platforms.  The web-based service tallies up how many people view an organization’s Twitter, LinkedIn, Facebook, YouTube, and Flickr updates, and can also track posts managed by blogging platforms, that include Moveable Type, WordPress, Blogger, Lotus Live, and Drupal. Spredfast will also measures audience interaction, such as the volume of post comments, link clicks, or retweets.  This leads to all sorts of potentially valuable intel to expose the ROI on social media campaigns.  Technology review quotes Scott McCaskill, Social Agency’s co-founder, saying the service allows organizations to see “whether all the time put into doing those things is really helping build brand or product awareness, which kinds of content are most successful, what days and even times of day result in the most traffic or new followers/friends”. The software’s metrics show the best times to post updates, and Spredfast allos firms to test strategies and schedule blog posts, tweets, Facebook updates, and other campaigns.

eBooks: Averting a Digital Horror Story
Amazon claims the Kindle was the firm’s most gifted item ever, that earlier in the fall the device led Amazon sales across all categories in BOTH total dollar sales and unit volume.  Whoa! And with all those eReaders getting unwrapped on Dec. 25^th, Amazon announced that on Christmas the firm sold more eBooks than the dead-tree kind.  But publishers are starting to grumble that Amazon has droped the price of some digital best-sellers to as little as $7.99, vs. the roughly $35 list many hardcovers command. Publishers Hachette and Simon & Schuster are even threatening to delay the release of some digital versions for several months to avoid undercutting higher-priced hardback sales. Some publishers are experimenting with non-Kindle versions for platforms as diverse as the Nintendo DS, while others are offering digital extras like video clips.  Donna Hayes, CEO of Romance publisher Harlequin, offers a contrary view, claiming eBooks (currently at 6% of firm sales) have actually grown the firm’s business and bottom line.  Inside of three years since iPhone launch, I’d estimate that over half of my students carry a smart phone.  eBooks will eventually crush the $180 textbook market and blow open opportunities for open content.  I expect that by the time the class of 2015 arrives, everyone will carry some form of sophisticated eReader to class.

Facebook COO Sheryl Sandberg Gets Disney Board Seat
Steve Jobs may be the mouse house’s #1 share holder, but now Disney will get even geekier with a dash of social networking from Facebook’s COO.  This ‘most powerful woman in business’ is the right hand (wo)man of Mark Zuckerberg and sits on Starbucks’ board.  Disney has had a strong presence on Facebook (screenshot in our Facebook chapter), and owns its own kiddie network in Club Penguin, among other geek cred. Facebook recently hit #1 in US Web traffic. Look for Sandberg to vault even higher on Fortune’s Most Powerful Women list in 2010.

Top Ten IPO Candidates for 2010
The TechCrunch list includes the amounts raised via the private markets.  Facebook, Zynga, LinkedIn, Glam Media, Demand Media, Gilt Groupe, Etsy, Yelp, Tesla, and Skype make up the list.  Incidentally, Zynga’s CEO Mark Pincus was recently interviewed on Charlie Rose. For those curious about last year’s IPO market, the WSJ offers a quick rundown.

How a 40,000+ Employee Company Trains Employees in Social Media
Telstra, the Australian telecom giant, makes social media training mandatory for all the firm’s employees.  A smart move given the breadth of incidents in ’09, from the Dominos gross-out to the Cisco Fatty incident.  The firm’s entire social media training guide is now online. Telstra’s policy emphasize the basics, of “The 3Rs” – responsibility, respect and representation, but it provides a great foundation for any firm grappling with how to deal with social media, an out-of-bottle genie that ain’t going back in.

Google focuses attention on the Here and Now
How to search Google?  Type, of course, and if you use the mobile app, you can speak your query.  But now using Google Goggles (demo video) you can take a photo of a landmark, store, or a product, and Google Goggles will attempt to use computer vision algorithms to identify the subject, then return relevant search results. More than 100,000 businesses will get a special QR bar code decal for their door. Snap a pick with your phone & the businesses Google Place site will pop up in the browsers. Android phones with GPS will also get a “What’s Nearby” link.  You may have also noticed the ‘real time’ web feeds that started showing up recently.  Parnterships with Twitter, Facebook, and MySpace have allowed Google to index the freshest feeds from these services, displayed about half-way down the search results page.

Google to do Rich Media Ads in Search
The Search Sovereign will also be rolling out video and picture advertisements in search. The chart shows why (expanded in article) – Rich Media / Video ads are simply far more effective at driving purchase intent (and hence, they’ll command top dollar). Google has experimented with promoted videos, call-to-action overlays, and pre-roll ads, and (as we mentioned last week) has partnered with TiVo in order to get access to data on TiVo’s 1.58 million subscribers, in order to refine television ad serving (yes, Google does that, too).

Boxee Unveils Public Hardware Beta
Earlier this semester BC Alum Bijan Sabet of Spark Capital shared time with our MI021 students.  Investments include Twitter, Tumblr, and Boxee, which unveiled a new, beta version of its open-source software, a platform that promises to be a net video integration hub.  Using a simple menu system, you can browse by content partner (Netflix, Major League Baseball, Wired, but Hulu continues to sit this out), plus play music and videos from the service or your PC.  Users can drop all this content into a single queue, even lining up video uncovered and bookmarked while web surfing  Also announced, the Boxee Box, a <$200 set top box to be demoed at CES & available Q2’10.  NYU’s Tisch School of the Arts showed results of a Boxee Apps contest, including Qurious, which shows all sorts of data when action is paused – actors, the music that’s playing, and more.

The Rise and Fall of MySpace
Rupert Murdoch spent $580 million for MySpace because “young people are watching less television and reading fewer newspapers”.  And the deal initially looked killer.  MySpace once was the most trafficked web property, and the firm quickly inked a billion dollar ad-deal with Google.  In 15 months following the acquisition revenue grew 50 fold.  But the firm is now in free fall.  It’s cut 40% of its staff, closed International offices, and now is about 1/3 the size of Facebook.  This Financial Times’ piece reads like an autopsy of what happens when media folks lack the tech-chops and strategic vision to plot and execute. Look at the old media guys who got burned in vision & execution: Terry Semel (Yahoo), Gerry Levin (AOL/TW), Barry Diller (IAC).  Looks like the real winners are the geeks (Jobs, Brin/Page, Zuckerberg).

Comcast-NBC Deal – The Future’s in Content
Comcast has a pipe into about a quarter of the homes in the US. Now it’s got one of the big four networks, a host more cable channels, and a major movie studio. The $13.75 billion Comcast ponied up for a controlling stake also puts it in the theme park business.  Curious this happens during the same week that another big pipe & content deal, AOL/Time Warner, broke up for good.  All suspect a better result for the Philly-based cable giant.

Intel Hopes 48 Core Chip Will Solve New Challenges
It’s an experimental chip, but it boasts 1.3-billion transistors and 48 core, offering up about 10 to 20 times the processing power found inside current Intel processors. And it can operate on as little as 25 watts, or at 125 watts when running at full tilt.  That’s about the juice required by just two household light bulbs. With a chip like this, you could imagine a cloud “datacenter of the future which will be an order of magnitude more energy efficient than what exists today”. Caveat – it’s not a product, but it does hint at what may come. Intel will give dozens of these systems to industry and academic partners so they can work on the real trick — figuring out how best to program the thing.

Game On: Time Inc. Shows of Tabletized Sports Illustrated
AOL may be gone, but Time Warner is showing off the future of the magazine.  Check out this super-slick must-view concept video, showing the ‘magazine’ of Sports Illustrated delivered via a theoretical tablet.  Video is embedded and the static content becomes a rich multimedia experience. Look for games, in-tablet advertising purchasing, integration with fantasy leagues, and more.  It’ll be fascinating to see what happens to production costs in this model (they’ll go up), distribution costs (they’ll plummet), and ads, subscriptions, and other revenue models (the Google rich-media #s above bode well).

Beware Social Media Snake Oil
Some cautionary examples on the over-selling of Social Media from BusinessWeek.  Social Media isn’t a cure-all, but it is an inevitable dynamic firms will need to engage with.  For insights on crafting the Social Media Awareness And Response Team (SMART), see the Nov. HBR article, and slides & podcasts from our MI021 Social Media lecture (apologies for the rapid pace – we were time-crunched by semester’s end).

Best Buy Wants Your Junk
Of course, Best Buy is a believe in Social Media.  The CEO post questions to an employee site called “Water Cooler”, tracks consumer sentiment on Facebook and Twitter, and tweets as BBYCEO (claiming all this helps him in the role of “Chief Listener”).  Since March, Best Buy has also started taking your e-Waste.  Consumers can bring in up to two items per day per household (appliances & TVs bigger than 32” aren’t eligible for free recycling).  Best Buy will share revenue with contracting recycling partners.  It’s not yet a profit center, but the firm hopes to eventually break event (remember there are more precious metals per-pound in electronics than in mined ore).  The real winner is in generating foot traffic – drop off the junk & load up with new stuff from the register.  Best Buy also purchased DealTree, a website to help you sell off your old gear to make room for the new.

Inside the App Economy
Two year old Zynga, the parent of the wildly popular Facebook app game Farmville (as well as Mafia Wars, Texas Hold ‘em, and many other titles) is now a profitable, $100 million business. At 60 million players last month, Farmville now hosts roughly 20 times the actual number of farms in the US. The game’s $5 virtual sweet potatoes alone brought in $500,000 in just 3 days.  These ‘cloud-delivered’ games can squirt out bug fixes, updates and new features each time you log on.  They spread virally.  And they appeal to a wider swath of the population looking for a quick, casual gaming fix rather than the full-on commitment of  World of Warcraft. While Zynga offers its roughly 500 employees Googly perks like an on-site masseuse and free food, others are also ranking the in dough.  That goofy T-Pain iPhone app?  A million dollar business! The market looks so tasty that EA bought app game firm, PlayFish, for $300 million (plus a $100 million earn-out). iTunes app downloads are now over 2 billion, and while Kleiner’s $100 million iFund to fuel app development was an early leader, RIM now boasts a $150 million Blackberry apps fund, and Verizon promises $1.3 billion to invest in apps & related technologies. Eagles looking to get in on the App economy might take Prof. Muller’s mobile app development class this Spring.

YC-Funded WakeMate Helps You Kiss Groggy Mornings Goodbye
We knew ‘em as WakeSmart – three time entrants into the Boston College Venture competition (video here).  Last year they won.  And last week they launched with a coming out party on the nation’s top tech blog, TechCrunch.  BC’s Greg Nemeth is on leave to start the firm (so is his co-founder, Yalie Arun Gupta – the team also won Yale’s competition just weeks after their BCVC victory).  The $50 wristband / mobile phone app combo leverages a science called actigraphy to identify the optimal wakeup time.  WakeMate “monitors your sleep patterns for the 20 minute window prior to that and sounds your alarm when you’re in the lightest sleep mode, which can help eliminate that groggy feeling you sometimes wake up with”.  Sleep treatments are a multi-billion dollar industry, with estimates suggesting some 70 million Americans suffer from sleep disorders.  Blatant plug for our students – perhaps this is a nice holiday gift for your groggy loved ones?  Mine’s on order.  And a shout out goes to the super-hard working BCVC team!  How great to see in just our third year that BCVC has become a conduit for Y-Combinator and TechCrunch launch coverage.  Way to go, all!

Google & Tivo Make a Deal
TiVo will share anonymized viewing data with Google. Google gets accurate second-by-second data on “which TiVo users of which types are watching which content at which times”. In return, TiVo will get revenue, courtesy of Google’s TV Ads service. By examining which ads people are watching, and how long they watch them before hitting fast forward or changing the channel, Google would be able to help advertisers design more personalized promotions and ones that keep user attention for longer. Important and valuable stuff, as research from our BC colleagues Adam Brasel and Jim Gips shows.  A recent Wired article highlights their research, demonstrating that “many DVR users watch ads anyway, and that even fast-forwarders are exposed”.

Google Redefines Disruption: The “Less Than Free” Business Model
A post by Benchmark VC Bill Gurley and expanded on here by Tim O’Reilly are must-reads for those interested in market disruption, the ‘free’ economy, and standards.  Look at what’s happened in the market for providers of turn-by-turn navigation data.  Nokia paid $8 billion for the #1 firm NavTeq, then GPS-firm TomTom paid $3.7 billion for #2 data provider TeleAtlas. What’d Google do?  Grow it’s own equivilent service to give away free to their partners.  Google even kicked things up a notch by offering Street View.   As Gurley points out, “if a disruptive competitor can offer a product or service similar to yours for ‘free,’ and if they can make enough money to keep the lights on, then you likely have a problem.”  Well with $22 billion in cash, Google can do a lot more than keep the lights on.  “Google’s free navigation feature announcement dealt a crushing blow to the GPS stocks. Garmin fell 16%. TomTom fell 21%.”  Now who controls the dominant standard for future apps?  If you’re a startup with a burn rate, will you pay Nokia or TomTom or use Google’s freebie?

Huawei Rattles Telecom Equipment Industry – Rises to #2
The Chinese networking provider Huawei has been a staple example of our class discussions on globalization for several years now, and the firm continues to be on a tear.  Sure it’s easy for a Chinese firm to grow in the red-hot local market, particularly as the security-conscious Chinese government favors home-grown solutions over the stuff made in the West.  But the non-China biz accounted for 75 percent of Huawei’s $18.3 billion in sales last year.  Profits last year rose to $1.2 billion. Impressive for a firm many insist has close ties with the Red Army (an issue that may, ahem, raise a red flag with foreign governments).  Huawei is now a provider to 36 of the world’s top 50 mobile operators, “including Telus in Canada and Cox Communications, Leap and Clearwire, a WiMax operator majority owned by Sprint Nextel, in the United States.”  This year Huawei sales bolted past Alcatel-Lucent and Nokia Siemens, and the firm even scored the L.T.E. upgrade for Norway’s Telenor – a huge coup given the rollout is right in the backyard of European giants Ericsson and Nokia Siemens.

Community Relations 2.0

The folks at Harvard Business Review have given us a limited number of free digital reprints of our social media article from the Nov. ’09 issue.  I’m happy to send copies to those who are interested, with the infomercial caveat that you should “act while supplies last”.