VentureBeat

Here’s the latest (updated) action:
1) Kyte.tv raises $15 million
2) Electric Sheep Company lays off 22
3) FCC receives 700MHz auction applications
4) Microsoft signs $500M ad deal
5) GPS devices fly off the shelves
6) Netsuite sets high price for planned IPO
7) Eric Eldon, celebrity at large?

Kyte.tv raises $15M second round — An online startup that offers a video player allowing near-live communications by video, photo and chat, Kyte has picked up some steam online, attracting a decent-sized audience and celebrities like 50 Cent to its service. The $15 million second round was provided by Telefonica, Nokia, DoCoMo, Swisscom, Holtzbrinck and Draper Fisher Jurvetson, according to Robert Scoble. Quite a hefty amount, in comparison to the $2 million investment into live streaming video company, Ustream that we reported in yesterday’s roundup. However, Kyte still has some work to do in competing against newer, sharper-looking rivals like Qik, which says it can stream live video straight from your phone, something Kyte doesn’t quite do (though is working on).

Electric Sheep Company lays off 22 employees — It’s time to cull some lambs from the fold for the Electric Sheep Company, which builds software that third-party companies can add to virtual worlds Second Life. It had planned to build an ad network within these worlds. Instead, it has cut almost a third of its workforce, and is giving up on the ad plans for now. It plans to branch out beyond Second Life to worlds like Metaplace (our coverage). More details are at ClickZ News.

FCC receives applications for 700MHz auctions — More than two hundred applications were filed to bid on the upcoming Federal Communications Commission auction for the 700 Megahertz wireless spectrum, planned to begin January 24th. Although some applicants must correct and finalize their applications, the list contains some notable names — Google, of course, but also Microsoft co-founder Paul Allen’s venture firm Vulcan Capital, and startups like Frontline Wireless (expected). Check out the lists of finished and unfinished applicants yourself for more.

Microsoft signs $500M ad deal with Viacom – Taking a first step toward becoming a viable competitor to Google in the online ad market, Microsoft signed a deal with Viacom that it says is worth about $500 million, over a contract period of five years. Google, in turn, immediately claimed that the deal is proof that Federal anti-trust watchdogs should allow its merger with DoubleClick to go through. Microsoft may well be kicking itself, because as Bloomberg reports, the Federal Trade Commission will likely approve the Google-DoubleClick merger this month (although it must also find approval with European regulators).

NetSuite sets high price for planned IPO — First the expected range for NetSuite’s initial public offering was $13 to $16, then underwriters boosted it to $19 to $22. Now the final price has been set at $26, almost double the original range. That means that Larry Ellison, the billionaire CEO of Oracle whose family owns over 70 percent of the company, will make out like a bandit. NetSuite, of course, is a competitor to Salesforce, whose own stellar performance on the markets likely helped improve NetSuite’s outlook. Ellison was also at one time an early investor in Salesforce, which is now run by a former employee of his, Marc Benioff.

GPS devices becoming cheaper, more ubiquitous — Many GPS devices have dropped below $100, and even the better units often retail for little more than $200. Sales of the devices at local malls are through the roof, according to Dean Takahashi. Cell phones, likewise, are providing an ever-cheaper way to find your way around. Excellent news for the dozens of startups that have sprung up offering to show you the way to the nearest store, friend or event — now the question is, which will come out on top?

VentureBeat’s own Eric Eldon becomes a celebrity — Admittedly, those are the words of Speedddate.com, a dating startup that ran a session with eight “celebrity bloggers.” We (or he) will take the compliment. Way to end those lonely nights of blogging, Eric.

Kyte.tv, the San Francisco company that lets users manage their own TV channels online or on a cell-phone, has raised a second round of financing in the “single-digit” millions of dollars.

Swiss carrier Swisscom and German media group Holtzbrinck Ventures has invested in the round, Chief executive Daniel Graf told VentureBeat. He would not disclose the exact amount. The investment follows the launch of Kyte last month. Some 3,000 users have since downloaded the player, Graf said. The funding comes after a $2.25 million investment last year from Draper Fisher Jurvetson, Draper Richards and Skype co-founder Niklas Zennstrom. (Here’s our most recent coverage, and link to the VentureBeat Kyte channel we showed off at the time).

Other investors in the latest round include “angel” investors Klaus Hommels, Oliver Jung, and Peter Schüpbach.

It’s just the latest new media investment for Holtzbrinck, which has become the German equivalent of News Corp. in terms of making Web 2.0 investments and acquisitions. Its portfolio includes studiVZ, Germany’s Facebook.

Kyte.tv, the service that wants to be your own interactive TV channel, has finally launched.

We wrote wrote about the company two months ago, after first getting a demo.

You can host your photos, slide-shows, videos all in one place — the Kyte channel — and lets you post the channel player anywhere you want. It also lets you do mashups with things like surveys and music, and is integrated with live chat –distinguishing it from Slide and Rockyou, its closest competitors.

There’s even more to this player, as you’ll see from the example below. We’ve embedded our “VentureBeat channel,” and you’ll see several clips that demonstrate different parts of Kyte. (Click where it says “VentureBeat” underneath the player to see all of the clips). There’s also a brief interview I had Thursday with Draper Richards’ Howard Hartenbaum, the earliest investor in Skype, and also a backer of Kyte. His challenge was to force founder Daniel Graf to release the player — Graf kept holding on to it, to stuff in more features. Once Graf finally agreed to April 23 as launch date, Hartenbaum ordered a stone and had April 23rd etched into it (the stone sits in Daniel’s office).

The challenge for Kyte is whether it can rise above the noise of other players out there. Its multiple features may appeal more to the video/photo aficionado than to the average user.

There are more compelling Kyte channel examples at Kyte.TV itself. See the one at Mashuptown.com, the author of which says he prefers Kyte to YouTube for posting his videos because he can keep them all in one place. Each video within the player has its own URL.

Kyte has made a few changes since we last saw it: While your most recent content shows in the player, there’s a dashboard below giving visitors a glimpse of your earlier content (by clicking on “VentureBeat” in the example above, or easier seen here). If a friend posts to your channel live with a photo from their mobile phone, there’s a red blinking button in the player to show it is real time. Also new: Kyte shows who else is posting your channel on their site, and also trackbacks to show who is viewing your channel (so you can see who on MySpace or Facebook is watching it). The editing tools also let you drag songs over your photos or videos — something that competitors Slide and Rockyou don’t let you do. For now, it doesn’t let you upload music, for legal reasons, but gives you a choice of ten songs it has licensed (more coming) and the option to buy music from from iTunes.

Graf says he’s focused first on growing distribution, but is thinking of ways to make money. One is to take a cut when people purchase music.

At the least, Kyte should be commended for testing the limits of all that we have today — mobile, the Web, music, video and photos and real-time communications — all in one place.

This year has become the “show-me” year. Internet start-ups showing no traction are getting shut down, or trimmed — abandoned by once wide-eyed investors.

The Web 2.0 bubble is bursting, but VentureBeat agrees with others that this is more like an “oozing.” New, innovative companies will continue to get funding from VCs, but with more caution. Investments amounts in Web 2.0, while booming, are so far nowhere near the absurd levels seen during the 1999-2000 period (see the Hornik-Dagres debate about this here), so the wreckage won’t cause as much pain. Back in 2000, trillions of dollars of market value were lost, because the entire U.S. economy had gotten sucked up into it. This time, not so.

Still, some pain there is.

Peerflix, the DVD-swapping company, is the latest company to lay off employees, VentureBeat has learned. The Menlo Park, Calif. company has shut its Canadian office, cutting an undisclosed number of workers, founder Billy McNair confirmed. We heard the company may have cut a quarter of its workfroce, but McNair wouldn’t provide any details. These appear to be the first layoffs hitting the “swapping platform” sector. See our piece last year about Peerflix, where McNair’s optimism stands in stark contrast to today. This company’s business model has been controversial from the start, as you’ll see from the comments.

In other developments:

FilmLoop close to death — FilmLoop, of Palo Alto, Calif., has reportedly laid off most of its staff of 30 employees after failing to find a buyer. The company raised $7 million in venture capital just eight months ago, from ComVentures. Co-founder Prescott Lee and a few others remain. FilmLoop let users create photo slide shows on websites, something that several other players let you do — from Slide, to Rockyou and Photobucket. Note our skepticism back when it raised its cash. It was very late to the game.

Jobster confirms layoffs — Rumors began last year. Jobster confirms 60 people, or 41 percent of its worforce, have been cut (its entire sales and support staff).

…meanwhile, consolidation in social networking continues — The German Facebook clone, StudiVZ has been sold for a reported 85 million Euros (less than the earlier reports suggested), to Holtzbrick Verlag, a German publishing giant that had invested earlier in StudiVZ.

…and the new ideas don’t seem that compelling — Decentral.tv, the San Rafael, Calif. start-up raised $2.3 million several months ago to launch “interactive broadcast broadband communities,” which we called vague at the time, but said we’d wait to see. Now it is apparently launching Kyte.tv, which offers video channels you can watch online or on mobile phones. We could be wrong (we’re relying on other accounts), but it doesn’t seem to push things forward. This follows plans by Old Media folks to launch Next New Networks, the latest niche video company — having raised $8 million — with nothing yet to show. Are they getting religion too late, or can they leverage their network to launch something compelling anyway? Time will tell. But companies that raise cash first, before launching and getting users, are rarely successes — though there are exceptions.

Similar thoughts, too for Twistage, based in San Francisco and New York, yet another start-up offering companies a way to use video on their own sites. It has raised under $1 million in angel funding, and moved into the Looksmart building in SF, reports Liz Gannes. Backers are Computer Associates chairman Lewis Ranieri and Jerry Colonna, formerly of Flatiron Partners. Several other companies are doing this, including Brightcove, Reality Digital (see our post here), vSocial and GridNetworks. On the hopeful side, thousands of companies will want to incorporate video into their sites in sophisticated ways, but on the downside, the technology is quickly becoming a commodity.

Othes putting off VC plans — Some companies are giving up looking for cash, in part because many VCs are getting skeptical. One very well known Web 2.0 investor tells VentureBeat he’s made his last Web 2.0 investment, though he didn’t want his name disclosed. One valley-based company Mojeo, originally told VentureBeat it would look to raise VC money to bolster its service to let people find out more local information on their mobile phones — by sharing their location with companies Yahoo, Google and Upcoming. Co-founder Mike Prince told VentureBeat that he and co-founder Dave Sutter have instead returned their focus to their day jobs, and passing on getting cash for now — though will continue to push Mojeo forward.