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Since early on in its testing phase, I found Joost to be a compelling take on Internet Protocol Television (IPTV). Let me rephrase: I found the idea of Joost to be compelling. It offered free video content on the web in a way that was somewhat similar to a television experience but added the interactivity that the web offers. The service’s problem was in its execution — namely that it required a seperate desktop client to use. That will soon no longer be the case.

Joost will cease making its desktop client and shift strategy to making its content available within the web browser, GigaOM’s Om Malik has learned. The new strategy apparently will call for a browser plug-in that will allow the service to continue using peer-to-peer (P2P) approach to distribute content.

The problem with this shift in strategy now is that there is a major player already doing what Joost intends to do: The NBC and Fox-backed Hulu. Hulu has had a few months head start to gain users and steam and simply kills Joost in terms of content. Whereas Joost has some compelling shows from stations like MTV and Comedy Central, Hulu has the big hit shows from NBC, Fox and others. It has several feature films as well.

Joost still has a small window of opportunity however as Hulu is still only available to web users in the United States.

The other problem is that by using a plug-in, Joost is still limiting its potential audience. A plug-in likely means Joost will be meant to work in Mozilla’s Firefox and Microsoft’s Internet Explorer web browsers. While these are by far and away the two most dominant browsers, not everyone uses them. Further, not everyone is going to want to download a plug-in for them. Hulu doesn’t require a plug-in, just Adobe Flash, which is already standard on almost all computers.

So while this move to the browser is a smart play for Joost, it in no way insures success. The company took a gamble on a desktop client and lost. Joost’s model could also run into problems if other Internet service providers (ISPs) start following Comcast’s lead and putting caps on data downloads.

Still, IPTV is still a young market and Joost has some options. While we’ve known since March that a browser-based version of Joost was in the works, something else that was talked about that I found compelling was the possibility of live sporting events on Joost.

I would also recommend that Joost tries to get on one of the living room boxes such as Roku, quick. I think Joost realizes that, hence why we saw them as a partner on Yahoo’s upcoming Widget Channel, which will bring Internet content to televisions in the living room.

Joost, which was started by Niklas Zennstrom and Janus Friis (two of the men behind Skype), raised $45 million in funding back in May of 2007. The lead investors were Sequoia Capital and Index Ventures. CBS Corporation, Viacom and the foundation of Chinese billionaire Li Ka-shing also participated,

When his fourth Xbox 360 video game console died in April, Chris Szarek wasn’t surprised.

The Chicopee, Mass. gamer was accustomed to the hardware failures that became known throughout the Internet as RROD, or the “red rings of death” which flash when the console becomes inoperable.

A 40-year-old photographer, Szarek was a hardcore Microsoft fan who spent more than $1,000 on his games. But each time one of his Xbox 360 consoles failed, he had to spend time convincing Microsoft’s tech support that they should send him a new console. Each time he got a refurbished console as a replacement (a machine that had been returned to a repair center in Texas, fixed as much as possible, and then shipped back out). When he complained on the Internet and to the media about the shoddy product and poor customer service, people branded him a cry baby and wrote him off as a statistical anomaly. But by the spring of 2008, Szarek was vindicated. There were at least a million or two other people like him.

Szarek’s fourth machine lasted almost two years, experiencing the same short life that many other Xbox 360s suffered. Microsoft replaced these machines for free under the warranty that it announced on July 5, 2007, for defective Xbox 360s exhibiting what it more politely called the “three flashing red lights.” That warranty program cost Microsoft up to $1.15 billion, but the loss of face and loyalty among gamers in the fierce console war with Nintendo and Sony has been immeasurable. Szarek, who became a spokesman for dispossessed defective Xbox 360 owners, played a part in making Microsoft acknowledge its console quality problem.

This is the unauthorized tale of how Microsoft lost its chance to become the leader in the biggest market it has attacked beyond its twin monopolies in Office and Windows software. Rival game console maker Nintendo out-thought the larger players Microsoft and Sony by designing the Wii game console with a clever, intuitive game controller. Even so, Microsoft could have captured more gamers during this product generation, yet the RROD problem held it back. The Xbox 360’s defect problem will go down as one of the worst snafus in consumer electronics history.

Its own worst enemy

Microsoft knew it had flawed machines, but it did not delay its launch because it believed the quality problems would subside over time. With each new machine, the company figured it would ride the “learning curve,” or continuously improve its production. Even though Microsoft’s leaders knew their quality wasn’t top notch, they did not ensure that resources were in place to handle returns and quickly debug bad consoles. There were plenty of warning signs, but the company chose to ignore them. The different parts of the business weren’t aligned.

It reminds me of the German war machine just before World War I, as chronicled by Barbara Tuchman in the classic history book, “The Guns of August.” The German generals were intent on keeping their trains on time; but the leaders overlooked their chances for stopping the war altogether. The Schlieffen plan called for them to strike first. Once the Russians and French mobilized, the Germans had to move into action. They marched off blindly into tragedy.

Likewise, Microsoft’s strategy depended on beating its rivals to market. It couldn’t afford to stop and delay the launch in order to solve its quality problems, or so upper management believed. What Microsoft’s leaders didn’t realize was that getting to market first with a flawed machine would only win them a battle; and it risked the loss of the war.

“They got enamored with the idea of the Microsoft army rolling everything out at the same time,” said one knowledgeable source who asked not to be identified.

The quality problem negated much of the advantage of going first, and it has delayed the company’s plan to aggressively market the console and slash its prices. (Microsoft disputes this point; it cut the price of all three versions of its Xbox consoles by $50 to $79 on Wednesday. And the company believes it will sell more boxes than Sony will. But prices ought to be lower still during this stage of the console life cycle). That has stopped the company from reaching the broader market of consumers that Nintendo has won over. It has lowered its ambitions, hoping instead just to get a clear edge on third-placed Sony. The future profits that the company once hoped for are now likely to wind up in Nintendo’s pockets.

Microsoft’s top game executive, Robbie Bach, president of the Entertainment & Devices group, said at a dinner in July that Microsoft’s own research shows that gamers have largely forgiven the company for defective Xbox 360s. Microsoft has still sold more Xbox 360 consoles than Sony to date. But there is no doubt that the company has lost considerable good will among gamers. Before Microsoft offered free replacements, consumers grumbled that they had to turn to forums, such as those on Ars Technica, to vent and to find solutions to problems that the company didn’t openly discuss. And for a couple of months now, Sony’s PlayStation 3 has been outselling the Xbox 360 in the U.S. for the first time.

“Fundamentally, their thinking shows that they are a software company at heart,” said one veteran manufacturing executive. “They put something out and figure they can fix it with the next patch or come up with a bug fix.”

The terrifying part of the story is that this kind of problem — where technology fails and no one knows what to do about it — can happen to any company. Read the rest of this entry »

Here’s the latest action:

A new web browser power rising? — Google’s new web browser Chrome has already gained some significant traction after just one day in use, according to Hitwise.

Comcast to appeal FCC ruling – The Internet service provider will appeal the Federal Communications Commission’s memorandum on network management — also known as “throttling.” GigaOM has more.

Newspaper sales plummet — The industry’s advertising revenues are off $3 billion in the first six months of this year. They are now at the lowest level they have been in a dozen years.

The Down Jones — The Dow Jones Industrial Average dropped 345 points on Thursday.

Gdgt - Former Engadget editors Ryan Block and Peter Rojas have soft-launched their new site titled gdgt. While it’s no surprise that it’ll be gadget-related, it is surprising that Brian Lam, the editorial director of Engadget-rival Gizmodo will be one of the site’s advisors.

The Blu-ray Netflix box — LG and Netflix have finally come out with more details about the device. It’ll be around $400, will be available in October and will stream in “near DVD-quality,” according to NewTeeVee.

The Internet expands — Traffic on the Internet has grown 53 percent in just the past year. This is actually a slower rate than previously, but is still large growth.

Moore’s new film to get Net-only premiere - Michael Moore, the documentary film director famous for Farentheit 9/11 and Sicko will release his new movie online for free. It’s called Slacker Uprising and will be about the attempt to rally young voters in the 2004 election. CNET has more.

Palo Alto goes international with real estate listings — The San Jose Mercury News has more.

Square Enix withdraws — The video game company had been trying to buy Tecmo. But when Tecmo declined the offer, Square walked away, says Kotaku.

Larry Ellison could be in big trouble — Oracle apparently mishandled evidence in his insider-trading case.

“Grand Theft Auto IV” is on its way to breaking records, despite a feared slowdown in sales.

Take-Two Interactive reported that it has sold more than 10 million copies of the controversial shooting game since it launched on April 29. The game hit the 10 milllion mark as of Aug. 16. Previously, the game had sold 8.5 million units as of May 31. So sales are slowing, but not as much as some feared.The figures are being closely watched because the success of GTA IV will determine how much Take-Two is worth in the ongoing takeover attempt by Electronic Arts.

For the three months ended July 31, Take-Two reported revenues of $433.8 million, more than double the $206.4 million in the same quarter a year ago. Besides GTA IV, “Top Spin 3″ and “Civilization Revolution” helped drive profits to $51.8 million, up from a $58.5 million loss a year ago.

GTA IV hasn’t yet outsold its predecessor, “Grand Theft Auto: San Andreas,” which sold 12 million copies. It remains to be seen whether GTA IV will keep selling or if it will slow down just like a blockbuster movie where a lot of people see it opening week but then attendance trails off.

Meanwhile, the industry continues to watch EA’s bid for Take-Two. EA let its hostilte tender offer expire on Aug. 18 but the companies are in talks about a possible sale. The episodic content for the Xbox 360 version of GTA IV will not arrive within the current fiscal year that ends Oct. 31. But Microsoft has said that the downloadable GTA IV content will be available this year.

A PC version is in the works, while a version of GTA IV, dubbed “GTA IV Chinatown Wars,” will be available on the Nintendo DS in the first fiscal quarter ending Jan. 31, 2009. Other big titles coming include BioShock for the PlayStation 3 and “Sid Meier’s Civilization IV: Colonization.”

Here it is. The first Microsoft advertisement featuring comedian Jerry Seinfeld. It’s not clear yet if this is the one directed by French director Michel Gondry. But I hope not, because it’s really not very good.

The advertisement is Seinfeld and recently retired Microsoft founder Bill Gates spending some time shoe shopping in a mall. I guess the idea is to play off the humorous everyday man video that was put together for Gates’ last day at Microsoft, but this has an odd tone to it. Seinfeld and Gates are like The Odd Couple, but awkwardly odd.

I have a feeling we’re going to be seeing a lot more of these Jerry and Bill segments. Let’s hope their chemistry improves.

At one point Seinfeld says, “Guess what Bill, you’re a 10.” I think I know what they were going for there, but whoever decided to use that line needs to be reminded this is 2008. I don’t think I’ve heard that since Seinfeld — the show — was on their air and Windows 95 was dominating the operating system scene.

I will give them this, using Bill Gates’ mugshot from an arrest for a traffic violation in 1977 on his Clown Club card is kind of funny.

The tagline for this one: “The future. Delicious.” I think this is more “yuck” than “yum.”

What do you think? Watch the video, found via The Raw Feed, below.

(Hat tip to Jay Parkhill.)

The Holodeck is a holographic simulation room made popular by the show Star Trek: The Next Generation. Basically, it allowed humans to interact with virtual environments in the ways we interact with the real world: Our senses. While we’re nowhere near that level of computing yet, Apple has a patent that could be considered an early step.

The patent, dubbed “Multitouch Data Fusion” basically takes the concept of multi-touch computing — that is, using multiple contact points to manipulate something on a screen — and fuses it with other means of input. For example, in the diagram below you can see that multi-touch is fused with voice commands to manipulate the object on screen. While moving or resizing an object with your hands, you could also say something like “change color” or “insert text” rather than having to use a cumbersome menu system and multiple hand gestures to do that.

Biometrics is another interesting interaction. Input based around hand size, fingerprint input, body temperature, heart rate and pupil size could change the way you are interacting with the machine. Something like this could change on-screen controls dynamically to suit your individual needs.

Another example of multiple inputs is gaze vector fusion. This is a fancy term for your computer using a camera (such as an iSight on a Mac) to determine your head position and/or where you are looking on a screen. This might be useful on big multi-touch displays so you don’t have to move your arms all over the place to perform an action.

If you think you’ve seen something like this before, you probably saw the Steven Spielberg film Minority Report. In it, Tom Cruise uses his hands and eyes to manipulate data on a wide range of screens.

An extension of this would be facial expression recognition. Imagine if a computer could do something based simply on your mood (or faked expression). In the filing, an example is outlined in which a user is attempting to do one thing but is doing it wrong and getting frustrated, so the computer tries to figure out what the user actually means to do and adapts. Now we’re really starting to get into some advanced stuff.

Most of this stuff is obviously quite a ways off. In reality, just regular multi-touch technology is in its infancy with devices like the iPhone and Microsoft’s Surface computer. The future looks exciting — and soon computers will be able to tell if you look excited.

[photos: CBS Home Entertainment and 20th Century Fox/DreamWorks]

The nation and even a lot of people outside of the United States were all atwitter last night about vice presidential candidate Sarah Palin’s speech at the Republican National Convention — on Twitter.

In what it’s calling the “Palin Peak,” the micro messaging service has a post today outlining how much traffic spiked during her talk. The verdict? If you thought Google’s launch of its new browser Chrome was big, it has nothing on Palin.

That has to be good news for the service; it shows that while many of the so-called “early adopters” on Twitter were tech elites who are naturally going to talk about tech topics, Twitter is gaining more steam around other topics — like politics and natural disasters. (Interestingly, Twitter doesn’t compare Palin’s traffic versus the much-hyped speech Obama gave the week before.)

It’s also noteworthy that the mainstream media is helping Twitter move to mainstream adoption in a major way. C-SPAN has set up a web page dedicated to showing tweets (Twitter messages) about the political conventions, and updates are sometimes shared on the air. Meanwhile, CNN correspondent Rick Sanchez was using Twitter last week to give updates about Hurricane Gustav. He was also reading tweets live on the air.

The graph below shows hourly activity during a few days this week.

You can find me on Twitter here along with fellow VentureBeat writers Eric Eldon, Dean Takahashi, Anthony Ha, Chris Morrison and Dan Kaplan. Oh, and we have a VentureBeat account (for our posts) as well.

And yes, I ripped myself off on the title of this piece.

(Photo by Chip Somodevilla/Getty Images)

Silicon Valley is famed for being home to youthful entrepreneurs. Usually that means people in their 20s or 30s, but some, like Anshul Samar, haven’t even made it out of their teens yet.

Samar is the 14 year old CEO of Elementeo, an educational gaming startup that we first covered a year ago. The company’s eponymous first game has just begun shipping, following its development by a team of artists around the world. The basic idea behind Elementeo is to combine chemistry facts with fantasy in a board-based card game. Samar runs the company out of his home in the Bay Area.

Now that the game is available (it can be bought here, for $24.95), the company will work on marketing it and creating versions for other age groups. Samar is also looking for angel investors to help support Elementeo’s development.

VentureBeat: A year ago, you were still working on the game. What has happened since then?

Samar: We hired artists from all around the world to work on the game and design it in such a way as to show chemistry as a side-affect of fantasy. The idea was to give every element a personality.

We also went to a lot of different places. We went to Washington, D.C. And we went to the American Chemical Society conference in New Orleans. I showed my chemistry game there, and it was a hit. They pre-ordered 50 games.

But for the last two months, we’ve just been working on finishing up the game. And now it’s out.

VB: What’s the experience like, of working on the company and also going to school?

AS: Most of the work gets done on weekends. During development it took many, many hours. But it wasn’t your standard startup, not 60 hours a week. After homework, it’s maybe an hour, and on weekends 5-6 hours a day.

My whole family is involved as well. My sister is developing another version, my mom is working on sales and fulfillment.

VB: Why didn’t you take venture capital?

AS: VCs did contact us, and we must have had a half-dozen meetings. But we wanted to go at our own pace. We knew, if you take VC, you’re working 60 hours a week and going at a very fast pace. At that time, with school, we wanted to go slow.

Later we contacted the VCs and said we were ready to talk again. But at that time, they said their goals didn’t match with me. I’m going to highschool, and they want someone who’s working a lot.

So far, the money has come from my father.

VB: Didn’t you consider dropping out of school?

AS: I would never imagine dropping out of school, at all. It’s one of those things — I really like school. I didn’t really spend time thinking about it.

VB: So how did enough work get done to complete the game and start shipping it?

Read the rest of this entry »

A new service launching today promises to put book publishers in touch with a group of online companies including Amazon, Google and Sony, in order to boost both digital and print sales.

Constellation, the name of the service being unveiled by Perseus Books Group, is not aimed at giant publishing groups like Hachette and Random House. Instead, it’s a bid to put smaller companies in touch with technology that they don’t have the budget or expertise to tackle themselves.

That technology includes online and e-book versions of books, on-demand printing of books and distribution services for online, electronic and print versions — really, everything that comes after the writing and editing of the book. The New York Times first reported the news.

The venture could prove to be important because there are thousands of small publishing houses in the United States alone, just as there are many underground and indie music labels. But where indie music found it relatively easy to outstrip their larger rivals online, their peers in book publishing have had a tougher time.

Some independent authors have already set a precedent, and met with some success, by releasing free versions of their books online or marketing their writing in social media. That suggests there is room for tech startups like BookSurge, Ebrary and Lightning Source (three more of the companies in the Constellation deal) to grow, if any coherent market can develop among the publishers. There are also movements to create entirely new products, like open source textbooks.

On the other hand, attempts to move online by traditional publishers are often doomed by the timidity of their participants. That trend is best seen in the newspaper industry, but plenty of online book ventures have also failed, like Bookface, a year 2000 venture between four big publishers that attempted to support reading material with advertising, but later silently fizzled out.

There’s also the possibility that the problem hampering book publishing is not a lack of effort, but a lack of potential. Many might argue that books will never enjoy another heyday, instead only offering a small audience and marginal profits to all but a few best-selling authors. Unless devices like the Kindle can provide the spark for a new community of readers, they may be right.

Apple’s App Store is filled (some would say littered) with applications that are basically useless. Multiple cow bell applications, multiple fake lighter applications, multiple coin flip applications, etc. The thing is, who’s to say what is useful and what isn’t? Some even tried to argue that about the $1,000 I Am Rich “piece of art” application.

Apparently, Apple has a say in what is useful.

A rejection letter from Apple obtained by MacRumors details why an application called Pull My Finger was not accepted into the App Store. While you might think it had to do with it being mildly inappropriate, the letter actually states that it was “of limited utility.”

But how is Pull My Finger any less useful than the current number one paid application, Koi Pond, MacRumors rightly asks? Pull My Finger is an application that allows you to do just what it says, pull a finger. (Naturally, you get the sound you’d expect to follow.) Koi Pond presents a virtual pond with virtual koi that you can move around. Neither seem to do anything of “utility.”

If Koi Pond could be considered a work of art (or a very boring game), couldn’t Pull My Finger be considered a humorous app? Should either of those genres have more value than the other?

It would seem one of two things is happening within the App Store: Either Apple thinks the application is inappropriate and just doesn’t want to say that. Or, it is realizing that the store is quickly filling up with a lot of useless applications and wants to stymie that growth.

It’s also interesting that Apple suggests the developer spread his app through the Ad Hoc method, which involves someone giving you access to your iPhone’s identification number so an application can be manually transfered. Will we soon see someone set up a listing of applications that can be installed Ad Hoc but that Apple will not allow in the App Store?

Find the video of Pull My Finger below.

[photo: flickr/elisfanclub]

As more location-based services come out, one definite problem I’ve been experiencing is a lack of membership. That is to say, most of them work great, but no one I know really uses them, making them fairly useless. Whrrl, the location-based social network has a new feature today that may up its adoption.

The service had teamed up with Deep Focus which handles the marketing for the cable television channel HBO to promote the hit show Entourage. Entourage follows the exploits of an up and coming actor in Hollywood who has brought his friends along for the ride (his “entourage”).

This promotion isn’t a straightforward advertising campaign however. Instead, all of Entourage’s primary characters now have Whrrl accounts. This means that you can follow what bar Turtle, Drama, E and Vinny Chase (characters from the show) are in. Or find out where super agent Ari Gold is screaming at his assistant Lloyd.

Of course all of this information is fake — as these characters are fake, but it’s still kind of fun. It adds a fictional element to the service and allows for deeper interaction with Entourage if you love that show. This reminds me of how another hit show, AMC’s Mad Men, has its characters on Twitter (though they weren’t actually created by AMC, and the channel tried to remove them before realizing that was stupid). Many users of the micro-messaging service are following the tweets of characters like Don Draper and Roger Sterling while they talk, in character, to other Twitter users.

Whrrl will allow users to add individual Entourage characters as friends, or follow the group as a whole. In addition to location updates, there will be character commentary much like I described above for the Mad Men characters on Twitter.

It will be interesting to see if certain locations in the series (with is primarily based in Los Angeles) become more popular when users start getting updates from the Entourage guys. That could add a whole other marketing layer to this.

Whrrl’s parent company Pelago raised a $15 million second round back in May. Pelago was also the first company in venture capital firm Kleiner, Perkins, Caufield & Byers‘ portfolio to join Kleiner Perkins’ iFund, the $100 million fund which the firm set up to spur iPhone application development. Its iPhone app launched in July with Apple’s App Store. The service is also available on a wide variety of other mobile devices.

Entourage’s new season starts on Sunday. Find out more about the promotion here.

[photos: HBO]

When I got a chance to meet with events web site Eventful back in July to look at their iPhone application, the company informed me it was working on some interesting ways to incorporate advertisements. Today, it revealed those plans: It’s the first cross-platform partner of location-based ad-targeting service 1020 Placecast.

What this means is that Placecast will be in charge of serving up advertisements on Eventful’s webpages and on its mobile site — including the application built for the iPhone. The mobile element is important because Placecast will have access to the device’s GPS chips to serve up ads based on where a user is. Because of this, these ads will demand higher CPMs (cost per mille, or the cost per a thousand impressions) and should be more relevant to the user, the company says.

Since Eventful is all about local events, it makes sense that it would team up with an advertising partner that targeted local areas. This will work on the service’s website as well by utilizing elements such as zip codes and other page content.

The San Francisco, Calif.-based Placecast was founded in 2005. It received funding from Voyager Capital and Onset Ventures.

Amazon’s new online streaming video service, Video on Demand, isn’t going to win any awards for creative branding. Then again, to have a service with such a straightforward name replace one that had anything but, Unbox, may be a good thing. Most importantly, Video on Demand is a compelling alternative to the iTunes video store.

While Amazon Unbox offered movie purchases and rentals, it was PC-only initially before eventually moving on to TiVo personal video recording boxes as well. It had a limited market. Video on Demand now works with both PC and Macs and reaches into your living room by way of TiVo or a number of Microsoft Windows Media Center extender boxes — including the Xbox 360 gaming console.

Those two bridges to the living room give Video on Demand access to potentially millions of television sets — more than enough to compete with the Apple TV, Apple’s digital video box that connects to televisions. Video on Demand also has an important trump card over Apple: NBC content.

NBC pulled its content off of iTunes in late 2007, and despite some rumors of reconciliation, it has not come back yet. Part of the reason is that NBC’s own online video venture with Fox, Hulu, has become a big success. While Video on Demand and Hulu will have much of the same television content, each takes different approaches to the presentation. Video on Demand offers commercial-free television episodes for purchase at $1.99 an episode (or less if you buy a season pass), while Hulu offers commercial-backed episodes for free.

I haven’t found Hulu’s ads to be too annoying — certainly not enough to outweigh the benefit of free. But with Hulu there’s no way to get the content on a television set unless you hook your computer directly into it. That gives users a clear incentive to use Amazon’s service.

Apple could be ready to respond as soon as Tuesday on the television front, when it’s rumored Apple will start offering television shows in high definition (HD). That’s a very nice feature, but if Apple has persuaded NBC to come back in the fold, that would set up a real rivalry between itself and this new Video on Demand service.

Prices are largely the same on both, not only for television content, but for movies as well. Movie purchases on Video on Demand range from $7.99 to $14.99, while movie rentals range from $2.99 to $3.99. The libraries for rentals look to be about the same. Certain rentals are available the day they launch on DVD depending on if the studio behind them has allowed for it, while others are only available for purchase at first.

Amazon also has a back catalog of some 40,000 films for purchase and/or rent, as NewTeeVee points out.

The online player itself (above) is pretty nice — at least in full screen mode. In windowed mode there is entirely too much else going on Amazon’s site to distract your eye. Video quality seems good, roughly what you get with Hulu.

Just as AmazonMP3 is now a compelling (if not superior in some regards) rival to Apple’s iTunes music store, Video on Demand is a legitimate rival to the iTunes movie store. Amazon is nowhere near Apple in terms of usability of its store, but at the end of the day selection will be the key factor, and with NBC content and tens of thousands of new and catalogue movies, Video on Demand cannot be overlooked.

The digital living room box Roku, which currently streams Netflix movies, is thought to be seeking other content partnerships. Certainly, Video on Demand would be a good fit to offer the new movies that Netflix doesn’t allow users to stream.

Microsoft cut Xbox 360 prices on all three of its console versions today. The $50 to $79 price cuts mean that Microsoft will have the cheapest new console on the market in the form of the Xbox 360 Arcade, which will now cost $199 compared to the $249 Nintendo Wii.

The Arcade version, however, has no hard disk and isn’t the best-selling version. The Xbox 360 with a 60 gigabyte hard disk with sell for $299, down from $349. And the Xbox 360 Elite with a 120-gigabyte hard disk will sell for $399, down from $449.

Microsoft made the move to hang on to its No. 2 position in the console war. Sony’s PlayStation 3 has been marginally outselling the Xbox 360 for the last three months. These kinds of price moves will put pressure on the rivals, but it isn’t clear exactly what the effect will be.

The move was anticipated, though some expected the price cuts to happen at the E3 trade show in July. At that time, Microsoft swapped out the 20-gigabyte hard drive for a 60 gigabyte drive and kept the price of the console the same $349. It discounted the 20-gigabyte versions to $299 to clear inventory. The Microsoft price cut comes a few days after it announced it would cut its price 30 percent in Japan.

Nintendo hasn’t changed the price of the Wii since it debuted in the fall of 2006. That’s because the console continues to sell out in many locations. Sony, meanwhile, has kept its prices stable by adding bigger hard drives. It now has a $499 model with a 160-gigabyte drive and a $399 model with a 80-gigabyte drive. Earlier this summer, those models had 80 gigabyte and 40 gigabyte drives, respectively. Sony also eliminated a high-cost version of the console that was backward compatible with PlayStation 2 games.

As we reported earlier, Microsoft is able to cut prices because it has a new lower-cost version of the electronics inside the machine. Now it is using a board code-named Jasper, which has a 65-nanometer version of the IBM processor and a 65-nm version of the ATI (AMD) graphics chip in the machine. These components cost less to make and so it’s easier for Microsoft to cut prices without losing money on its machines.

As Microsoft pointed out, history shows that more than 75 percent of all console sales happen after the price falls below $200. But Nintendo might impolitely note that, sans hard drive, the Xbox 360 Arcade isn’t such a great bargain for consumers. Sony, on the other hand, may have a harder time staying ahead of Microsoft in the coming months unless it cuts prices on its own. So far, indications are that Sony won’t cut prices. You can bet, however, that if PS3 sales start to sag, they will change their mind.

Stylesight, a company that helps merchandisers and designers track fashion trends, has raised $16 million in a first round of financing.

We’ve written about a bunch of fashion sites, particularly those targeting women, but Stylesight is aiming for businesses and professionals, not shoppers. The New York-based company’s services include trend forecasting and market reporting, which can be used to create new products and plan marketing campaigns. It also offers an image search tool that replaces the traditional portfolio of hot new fashion with an online database of 3 million images. You can see a screenshot of one of Stylesight’s “Fashion Office” trend reports below. (No, I’m not sure why scrap metal is trendy, but I guess that’s why we need the professionals.)

Stylesight provides its services via online subscription, also known as software-as-a-service. It was founded in 2003 by Frank Bober, who previously worked in the manufacturing industry. The round comes from Fidelity Ventures.

Google’s new browser Chrome is amazing. How amazing? So much so that I’ve booted Microsoft Windows on my iMac two days in a row now after not using it for months. (Chrome isn’t yet available for Mac OS X, more on that below.) Does Chrome have some bugs and issues? Sure, but in terms of everyday experience I feel like I can safely say it’s the best browsing experience I’ve had on Windows since the day I switched from Internet Explorer to Firefox several years ago.

But that’s the big problem, Chrome currently only works on Windows. Google promises that both a Mac and Linux version are coming but refuses to give any indication of when that will be. That’s disheartening for us Mac users, but I have good news today.

Mike Pinkerton, the project lead for Mozilla’s Camino Project is working on bringing Chrome to the Mac for Google, he confirmed on his blog. (Pinkerton is a Google employee who does Camino on the side.) Camino is the open source web browser that was built by Mozilla team members specifically for the Mac.

Mozilla, of course, also makes the Firefox web browser, which also runs on Macs. But up until the recent version 3 release, Firefox had become increasingly bloated and cumbersome running in Apple’s OS X environment. Camino was the opposite. It’s very light weight and very quick. It doesn’t offer any of the extensions that Firefox has, but it renders pages extremely well using the Gecko rendering engine.

With Chrome, Pinkerton is switching gears and developing a browser using the WebKit engine. While at first Pinkerton admitted apprehension to switching sides as it were, he lays his thoughts out well in his post:

“I was worried for so long about what I’d say about all this and how it would be perceived and how I’d have to spin it and yadda yadda yadda, but I realized today that it’s really just about building great software and being a part of a group of people who want to make the web better, faster, safer, and easier. To move the web forward. It doesn’t matter if you’re at Google, Apple, Mozilla, or even Microsoft.”

Pinkerton has a long history in developing web browsers. He worked at Netscape in the 1990s and then teamed up with developer Dave Hyatt to make Camino. Hyatt, who Pinkerton refers to as “jinglepants” and mentions in his post, went on to work for Apple and helped develop the Safari browser — which also runs on WebKit. It seems the two will now be reunited under the WebKit roof.

Pinkerton also notes that The Camino Project will move forward. And he’ll still be at the helm. He promises that Camino version 2.0 based on Gecko 1.9 is very much underway and that alpha build status is drawing near.

This will however, likely raise more questions about Mozilla’s and Google’s relationship. Google supports Mozilla financially in exchange for benefits like Google search residing on Firefox’s default homepage. The release of Chrome raised questions about just how much Google would continue to support Mozilla, though the two sides did just recently renew their pact for 3 years.

Pinkerton’s involvement in Chrome is great news for Mac users. If you’ve never tried out Camino, give it a spin here. This team did web browsing right and now that looks as if it’ll be translated into Chrome when it launches for the Mac.

[Hat tip to Twitter user Jimmy Gleason for pointing this out.]