To protect the Internet against regulation, top Internet companies — including Google, Facebook, Amazon and eBay — are coming together to create The Internet Association, a lobbying group expected to launch in September.
“Those firms face a slew of regulatory issues that directly affect their businesses: privacy legislation, online sales tax reforms, cybersecurity and proposed anti-piracy and copyright laws,” reports The Washington Post.
Michael Beckerman, former deputy staff director of the House Energy and Commerce Committee, will be the group’s appointed CEO.
“The Internet isn’t just Silicon Valley anymore, the Internet has moved to Main Street,” Beckerman said in a press release. “Our top priority is to ensure that elected leaders in Washington understand the profound impacts of the Internet and Internet companies on jobs, economic growth and freedom.”
Columnist L. Gordon Crovitz suggests that the idea of the government launching the Internet is an urban legend.
“The myth is that the Pentagon created the Internet to keep its communications lines up even in a nuclear strike,” he writes in the Wall Street Journal. “The truth is a more interesting story about how innovation happens — and about how hard it is to build successful technology companies even once the government gets out of the way.”
“The creation of the Arpanet was not motivated by considerations of war. The Arpanet was not an Internet. An Internet is a connection between two or more computer networks,” wrote Robert Taylor via email in 2004 (Taylor ran the ARPA program in the 1960s).
While Vint Cerf developed TCP/IP, the Internet’s protocol, and Tim Berners-Lee gets the credit for hyperlinks, Taylor says it was Xerox PARC that created the Ethernet — the precursor to the Internet.
Ethernet, which allowed the links between different networks, was the technological breakthrough that not only allowed Xerox to link computers to share copiers, but later formed the basis for the Internet.
“Then, in 1979, Steve Jobs negotiated an agreement whereby Xerox’s venture-capital division invested $1 million in Apple, with the requirement that Jobs get a full briefing on all the Xerox PARC innovations,” explains the article. “‘They just had no idea what they had,’ Jobs later said, after launching hugely profitable Apple computers using concepts developed by Xerox.”
“It’s important to understand the history of the Internet because it’s too often wrongly cited to justify big government,” concludes Crovitz. “It’s also important to recognize that building great technology businesses requires both innovation and the skills to bring innovations to market. As the contrast between Xerox and Apple shows, few business leaders succeed in this challenge. Those who do — not the government — deserve the credit for making it happen.”
Trapit’s personalized Web search is now available for the iPad. Trapit launched in 2011 as a way for Internet users to customize Web searches in a Pandora-like style. Its free iPad version makes the most of touch interface design and personalization.
“Trapit was spun out of the same DARPA-funded project that spawned Siri, and uses the same AI technology, just applied to search discovery rather than a virtual personal assistant,” reports Digital Trends.
The review suggests that while Trapit works as a novelty as a browser app, it “really makes sense” for tablets and stands out based on its personalization and superior sources.
Trapit differentiates itself from other apps such as Flipboard and Zite that use social media to customize news feeds, by recognizing that users do not necessarily want to read what their Facebook friends are interested in.
As users read stories on Trapit, they can choose to save, share, or thumbs up/thumbs down the stories. This allows Trapit to personalize news based on the interests of the user rather than the interests of their friends. Additionally, Trapit pulls content from 120,000 sources (more than Google News).
Overall, the review notes a positive step for mobile search and personalization for tablets. “You’re kept within the Trapit app the entire time; links, video, photos, sharing — nothing will pop you out of the Trapit experience — a nice, fluid approach,” comments Digital Trends.
Thursday will be an important day for Facebook, when the company releases its first earnings numbers since going public.
“The stakes could not be higher,” suggests The New York Times. “Facebook made its initial public offering in May with an eye-poppingly high valuation, but its share price has stagnated since then. Advertising, largely in the United States, accounts for the bulk of its revenue, and the company is under intense pressure to show that it is growing fast enough to justify its high value.”
“Since the public offering, Wall Street has tempered its expectations for Facebook’s advertising revenue, and shares closed Friday at $28.76, down from their initial price of $38,” notes the article.
Facebook’s greatest asset is the personal data it collects from its 900 million users. However, Google takes in about $40 billion in annual revenue from advertising — 10 times Facebook’s current advertising numbers.
“Advertisers need more proof that actual advertising on Facebook offers a return on investment,” explains eMarketer analyst Debra Aho Williamson. “There is such disagreement over whether Facebook is the next big thing on the Internet or whether it’s going to fail miserably.”
The behavior-tracking Facebook Exchange and targeted banner advertisements on gaming site Zynga are among the social network’s latest efforts in this space.
“Orbitz, the travel company, is among the advertisers that are trying Facebook Exchange,” explains NYT. “If it sees a consumer looking for, say, a business hotel in New York, Orbitz can place an advertisement for New York hotels on that user’s Facebook page, with the hope that the user will return to the travel site and make the booking.”
If Twitter plans an IPO in a year or two, the micro-blogging service must first answer criticisms that the company can’t grow beyond tech geeks and narcissists. It seems Twitter CEO Dick Costolo aims to do just that by making the service more useful.
On the to-do list is creating a presence around major live events to help users to understand all the message blasts, improving the ability of third parties to organize Twitter posts around small events, and making it easier for companies to build off Twitter just as developers make applications for Facebook or Apple.
However, these add-on services are required to be unique, not simply imitations of what Twitter already offers — a qualification that seems slightly enigmatic.
The updates could also threaten media partners like NBCUniversal, the Wall Street Journal suggests.
“Twitter’s goal of making sense of the tweet flood could put the company into more direct competition with media companies that also edit and prioritize news and information, and sell ads to people who come looking for the information,” notes the article.
However, Costolo downplays the potential competition, describing Twitter as a “technology company in the media business.”
When Google acquired Sparrow last week, the creator of the successful email app, many customers were concerned that the app won’t be getting any new features, that the anticipated iPad version won’t be coming out, and even that the Sparrow crew won’t be working on their own, preferred projects.
The Verge takes a look at the perspective of other app developers and asks whether it may be time for a new distribution model.
“Sparrow did everything right. They built an incredible email app with broad appeal and released it into the hottest software market the world has ever seen. And yet it was a financial flop,” wrote David Barnard, the founder of App Cubby. “The age of selling software to users at a fixed, one-time price is coming to an end,” disrupting consumers’ desire to get “more and more value from software while paying less and less for it.”
Marco Arment of Instapaper agrees the current climate explains Sparrow’s decision to sell: “In the reality of our fast-paced, boom-and-bust industry, even very strong support from customers may not be enough for many companies to stay in business,” he wrote in a post.
“The Sparrow guys have homes, and families,” wrote developer Matt Gemmell. “They have every right to cash out and take new jobs. They’re winners.”
If Barnard is right and the one-time fixed price is on its way out, could new app start-ups have a better chance of going it alone and being profitable?
“Surveys of U.S. travelers confirm tablets are still all about about consumption of content,” reports ReadWriteWeb. “That has big implications for tablet makers and apps developers.”
One recent survey of 1,200 people conducted by Cloud Nine Media provides some insight into how people are using their tablets. Most importantly, content consumption remains dominant over creation, which challenges the notion of tablets as laptop killers and suggests possible areas for expansion.
“When asked what they do on the tablets themselves, the largest block (36.6 percent) of respondents said they were conducting online searches, followed very closely by checking e-mail (32.1 percent). Social network activity (13.3 percent), playing games (8.4 percent), and listening to music (4.1 percent) were the next favored activities,” explains the post.
Additionally, many respondents admitted to using their tablet just to kill time.
A related survey by Consumer Intelligence Research Partners also found only 21 percent of new iPad owners use their tablet for business.
“Those figures should serve as a signpost for tablet app developers as to what kinds of things most people are doing with their tablets,” the post says, adding that the business-oriented Microsoft Surface tablet, “may either kick open a door to a new opportunity, or crash into the reality that most people don’t really want to do serious work on a tablet.”
During its quarterly earnings call, Apple announced that there are now more than 650,000 apps in the App Store, an increase from 600,000 in April of this year.
Apple CFO Peter Oppenheimer notes that 250,000 of those apps were developed specifically for the iPad.
What does this mean for the developers? “Apple paid out approximately $5.5 billion to developers. This is a huge jump from the $4 billion figure Apple reported in April. iOS 6 — with its deep Facebook integration — and the new iPhone, which is expected in September, should only bolster these numbers,” writes TechCrunch.
“To get a little perspective, Google’s most recent numbers in the Google Play department are at 600,000 apps,” explains the post. “That number is from June, and Google has been slowly closing in on Apple, so it’s possible that the two app stores are pretty neck and neck.”
Apple’s quarterly numbers are out and not quite as booming as anticipated. The company reported “earnings of $9.32 per share ($8.8 billion total) on $35 billion in revenue,” reports The Verge.
“It’s a $1.5 billion gain over last year’s profit in the same quarter, but missed analyst estimates of $10.37 earnings per share,” notes the post.
“We’re thrilled with record sales of 17 million iPads in the June quarter,” commented Apple CEO Tim Cook. “We’ve also just updated the entire MacBook line, will release Mountain Lion tomorrow and will be launching iOS 6 this fall. We are also really looking forward to the amazing new products we’ve got in the pipeline.”
Sales of the iPhones took a predictable dip as consumers are choosing to wait for the iPhone 5’s expected fall release.
“Apple’s major new hardware release this quarter was the MacBook Pro with Retina display, but the new laptop didn’t move the needle much on Mac sales: just four million, about a two percent increase over the year-ago quarter,” reports The Verge.
Not surprisingly, sales of the new iPad and the discounted iPad 2 remain strong.
In its Q2 2012 earnings report, Netflix reports that its subscriber base for domestic streaming is 23.94 million, up from the 23.41 million it reported for Q1.
As continues to be the trend, numbers are going up for streaming services and down for physical DVD rentals.
This is true for Netflix, which “added more than 530,000 domestic streaming subscribers in the quarter but reported a decline of 850,000 subscribers to its domestic DVD service,” according to CNET.
“While that means the total number of Netflix’s net U.S. subscriptions shrunk by 320,000, the company still managed to increase the number of U.S. subscribers by 420,000,” explains the article. “The difference between subscriptions and subscribers is that ‘unique subscribers’ counts people and not the types of accounts. So, for example, if people dropped their DVD subscription they might have remained as a streaming customer and weren’t counted among the ‘net new subscription additions.'”
Netflix CEO Reed Hastings has suggested that DVD subscriptions would drop. He’s right, of course, but “what’s shocking is that customers aren’t moving over to streaming at the same pace they’re dropping their DVD subscriptions,” notes the article.
According to CNET: “Netflix reported a profit of $6 million, or 11 cents per share, for the second quarter on revenue of $889 million,” marking a 91 percent decrease in profit from last year’s $68 million earnings.
“We have yet to see Hulu Plus or Amazon Prime Instant Video gain meaningful traction relative to our viewing hours, but as we continue to build a domestic profit stream they are likely to increase their efforts to gain viewing share,” says Hastings. “Redbox Instant by Verizon, once they launch, will face a big challenge to break into the top 3 of subscription streaming services.”
Coinstar subsidiary Redbox is finally getting closer to making its streaming service a reality.
“In February the DVD vending company announced a partnership with Verizon that would finally usher the Walmart staple into the 21st century,” and provide a streaming option for customers, reports Engadget.
According to the press release: “The venture’s services will offer all of the convenience, simplicity and value of Redbox new release DVD and Blu-ray Disc rentals combined with a new content-rich video on-demand streaming and download service from Verizon.”
Sources indicate that “Redbox Instant by Verizon” will enter an internal alpha this week, meaning it will begin to test out and fine-tune the service. A beta program is expected in the coming months before the service goes live sometime later this year.
“For consumers eager to have an alternative to Netflix, Amazon, Hulu, and HBO Go, the news is bittersweet in its hurry-up-and-wait nature,” notes Fast Company in a related post. “Redbox Instant will be a subscription-based service, as executives at both Coinstar and Verizon have indicated, but the company will still not provide any insight into subscription rates, studio content, or how the physical and digital parts of the service will be combined.”
The joint venture will be managed by newly appointed CEO Shawn Strickland, who formerly served as a vice president for Verizon FiOS.
Six months after losing its longtime chief marketing officer Leslie Kilgore, Netflix has announced a replacement: former Warner Bros. executive Kelly Bennett.
Kilgore left during a tumultuous time at Netflix, during which subscribers were denouncing the company for splitting up its DVD and streaming services and implementing a rate hike as part of the restructuring.
“While the moves were driven by Netflix CEO Reed Hastings, the company’s communication with its customers proved to be the company’s real downfall,” suggests TechCrunch. “Recently, the company has been in the midst of a turnaround, but it was still in need of a new marketing chief.”
After nine years working at Warner Bros. and experience on international campaigns to promote films, “Bennett is well-positioned not just to help Netflix rebuild its brand in the U.S., but could also be instrumental in the company’s international expansion,” according to TechCrunch.
“Kelly has been a pioneer in developing incredible digital campaigns for some of the biggest box office hits in recent years,” said Hastings in a press release. “We are delighted Kelly is bringing creative and marketing expertise to Netflix as our streaming business becomes increasingly global and our focus intensifies on commissioning high-quality original programming for our more than 26 million members.”
Expanding upon its eCrime Unit founded in December 2011, California Attorney General Kamala Harris has announced the creation of the Privacy Enforcement and Protection Unit.
“The Privacy Unit will police the privacy practices of individuals and organizations to hold accountable those who misuse technology to invade the privacy of others,” explained Harris in a statement.
“The creation of the Privacy Enforcement and Protection Unit reflects growing concern among regulators at both a state and federal level that privacy in the information age hasn’t been adequately addressed,” reports InformationWeek.
“A series of online privacy controversies such as Google’s bypass of privacy controls in Apple’s Safari browser earlier this year and Apple’s compilation of unprotected location data on iPhones last year have piqued the interest of lawmakers,” adds the article.
The department aims to protect consumers by enforcing laws of online privacy, identity theft and data breaches — in addition to non-tech issues related to health, financial privacy and government records.
“Harris was responsible for working with Amazon, Apple, Facebook, Google, HP, Microsoft, and RIM to form an agreement earlier this year that requires app developers to include privacy policies in an effort to promote transparency,” reports The Verge.
“The Attorney General’s office will meet with these companies soon to ensure their compliance with the California’s Online Privacy Protection Act, and has said that the state will sue companies and developers who don’t take the policy seriously,” notes the post.
Amazon is expanding its digital media R&D efforts with a new 47,000 square-foot facility in Central London.
The company is bringing together design and development teams from streaming rental firm LOVEFiLM and Pushbutton (which creates digital media interfaces for Amazon’s platforms) at its Digital Media Innovation Hub.
According to Amazon, the main goals for the Hub are “the creation of interactive digital services for TVs, game consoles, smartphones and PCs; the development of the digital media experience on Amazon websites around the world; and the building of services and APIs that power that digital media experience.”
SlashGear explains that digital media is the “cornerstone” of Amazon’s Kindle products that are “primarily intended to encourage users to buy or rent more content.”
“That same strategy is tipped to be at the heart of Amazon’s upcoming smartphone,” notes the post. “The handset would be Android-based but heavily reskinned, ousting Google’s own content stores in favor of Amazon’s own media and app distribution.”
YouTube is cleaning up its act. The popular video site will now push users to use their full names when commenting or uploading. The site will also ask users to display the identity associated with their Google+ account.
For those users who decline to use their full name or Google+ identity, Google pushes for an explanation, requesting users to select from options such as “my channel name is well-known for other reasons.”
“Making commenters use their real names and Google+ accounts was the obvious first step toward bringing civility to YouTube, which Google is eager to polish into a venue more attractive to business owners, advertisers, and creative filmmakers,” writes Wired.
“It’s easy to imagine that offering Google+ YouTube accounts is just a first step toward hiding, and eventually eliminating, comments from anonymous accounts,” notes the post. “Such simple steps would do more to improve the perceived quality of YouTube content than any upgrade to surround sound or high-definition video.”
“Of course, forcing people to own their identities can help to elevate the discourse on YouTube videos, which is definitely in dire need of a makeover,” adds BetaBeat. “But can a community that has relied on anonymity for so long really be convinced otherwise?”
“However, we realize that using your full name isn’t for everyone,” notes the YouTube blog. “Maybe people know you by your YouTube username. Perhaps you don’t want your name publicly associated with your channel. To continue using your YouTube username, just click ‘I don’t want to use my full name’ when you see the prompt. Stay tuned for more ways to use this username in other Google products and services in coming months.”
