VentureBeat

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Investors have poured $30 million more into video site Metacafe, the popular online video site.

This is a significant amount of money for a company that already raised $15 million. But the support may be necessary if Metacafe is to stay among the front-runners. It is the seventh most popular video site, according to Nielsen/NetRatings, behind companies with many more resources, such as Google’s YouTube and the video sites of other giants such as Yahoo, MSN and MySpace. (Update: Hitwise, meanwhile puts Metacafe in eighth place. See below)

YouTube used only $11.5 million in venture backing, before it was bought by Google for $1.6 billion.

The round was led by new investors Highland Capital Partners and DAG Ventures. Existing backers Accel Partners and Benchmark Capital also contributed to the round, first by VentureWire today (subscription only).

[Update: We just talked with chief exec Erick Hachenburg. He says Metacafe is arguably the largest independent video site. While Veoh rivals Metacafe on some metrics, Veoh doesn't focus as much on short-form video. Metacafe's traffic has doubled in the U.S. so far this year, to more than 6 million uniques a month, from 3 million, Hachenburg notes. Globally, uniques climbed to 26 million from 17 million.]

[Update II: The company wouldn't comment on valuation, but says it is higher than when the company raised its previous round.]

The Tel Aviv, Israeli company moved its headquarters to Palo Alto, Calif. last year to partake of Silicon Valley’s technology savvy.

We wrote about Metacafe here, explaining how it filters videos before they hit the front page. It relies on a technology called “video rank,” which watches how users interact with a video for signs suggesting popularity (for example, if they watch it several times). It also relies on a community of a 100,000 review panelists to provide a thumbs-up on a popular video.

Several months ago, there were rumors that the company was selling itself. The company’s founder Arik Czerniak stepped aside earlier this year.

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Updated

Google said today it will offer a range of new features in its search results, including things like a new navigation bar at the top left side of the home page to things like Google’s Calendar, Docs & Spreadsheets and Picasa Web Albums.

The effort is part of what it calls a move to “universal search,” much of which will be subtle at first, but will change over time.

Many of the changes will begin today (Wednesday). Many of the features, including the navigation bar, still weren’t live as of this writing. We checked with Google, and a spokesman said the changes are still rolling out, and that everyone will see the changes by Thursday morning. The changes were announced during Google’s Searchology event today, which VentureBeat attended.

More significantly, the move is also an answer to a threat posed by a string of other search engine companies, including Ask and Hakia, which are starting to give users clusters of information about a search term neatly on the first page of results — rather than spitting out the pages and pages of results like Google.

Google said that search results will include links to more sources, such as videos, books and blogs and maps. Take the example of a search for Star Wars character Darth Vader. Google said users want info about the character and the actor – not just web pages that mention the movie. Google will deliver search results that include different elements — such as a humorous parody of the movie, images of the Darth Vader character, news reports on the latest Lucas film, as well as websites focused on the actor James Earl Jones – ranked according to how relevant Google thinks they are to the query.

See image below for what we are seeing as of 1pm on Wednesday:

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Google said it is introducing a new “technical infrastructure” to enable the intensive computations to produce universal search results — and that it’s upgrading its ranking algorithm to compare the different clusters of information.

Here are the other parts of Google’s announcements today:

New links have been added above the search results — For example, a search for “python” will now generate links to Google’s Blogs, Books, Groups, and Code pages. See below.

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Google Experimental — Available on Google Labs, you can use this to search results on a map or timeline. For instance, when you search for “Albert Einstein” you can choose to see search results on a map that shows locations mentioned within web pages about Einstein or on a timeline illustrating the history of Einstein’s life. We don’t see this feature yet, either.

Updated

Cross-language search engine — This is coming. Until now, you’ve been able to download Google’s toolbar and you can get translations of words and phrases by scrolling over text. However, this new cross-language feature will be different: Queries will be translated into other languages, and results from other languages will be translated on the fly back into your language of choice.

More videos in Video search — Videos will be pulled from video sites beyond Google Video and YouTube, including for example MetaCafe.

(Updated) roundup of latest tech stuff:

Amazon.com answers Wal-Mart on video downloads — There are so many video download services, it’s easy to get jaded. Wal-Mart just announced its own download service, but the test site looks awful (it still badly garbled as of this writing). A more promising video service is the offering by Amazon Unbox to download movies directly to your TiVo. This is significant: It’s the first service letting people watch regular TV programming and Internet video from the same box. This will be rolled out beginning in a few weeks. Other services, such as CinemaNow, Akimbo and others require buying a new box, setting up a network or other steps that confuse or turn off most people. [Update: Just noticed that Amazon-TiVo consumers will have to order their videos from their PCs, instead of from their TiVO, so this is not as simple as we originally thought.]

News Corp. rethinking ad deal with Google — Google is dragging its feet on filtering copyrighted videos on its new property YouTube, so you’d expect the music and video companies owning the copyrights would play hard ball. No surprise, then, that MySpace parent News Corp. is apparently rethinking the advertising deal it signed with Google last year (see WSJ story). News Corp. is already upset with Google over the copyright issue.

Another RFID company trying to go public — RFID stands for Radio Frequency ID, and refers to the little radio tags retailers and others are placing on goods to track them better. It was supposed to be all the rage two years ago, but the early-bird companies wanting to go public look risky. First there was Alien Technology, which was rejected by the public markets. Now Applied Digital, which a Florida company that owns an implantable RFID unit, is trying for the second time, and still looks risky.

Talking of risky IPOs, Globalstar was always one — We always thought satellite communications company Globalstar rushed its IPO a bit, going public as soon as it got some decent revenues. But it did so after raising a bunch of cash, and not long out of bankruptcy. Were there unknown problems lurking at this company? We couldn’t tell. Now, it turns out all their satellites might just stop working because of technology problems, it discloses. Needless to say, the stock has plunged.

AT&T shuts down the famous Iowa phone-loophole scam — Or at least, it appears to be making progress in one case, FuturePhone.

Once high-flying video site Metacafe, imploding? — Traffic is apparently falling for the company, which recently located to Palo Alto from Israel. Company gets a new CEO.

MFG.com, online marketplace for custom manufacturers, raises $4M — The Atlanta company, seeded earlier by Amazon.com’s chief exec, Jeff Bezos, has raised its first round of venture capital, led by the European Founders Fund. Designers with sketchings and other designs to implement can get hooked up with specialty suppliers.

Google tracks not only your search history, but apparently your spam history too — In other words, if you tried to spam its search engine in the past, you may be permanently blacklisted.

Teliris raises $40 million for telepresence offering - It’s to difficult to understand why companies like Teliris, which is already established, is raising $40 million from Fidelity Ventures and Columbia Capital to build out its “telepresence” offering, when such large competitors Hewlett Packard, Cisco Systems and others have entered the market with similar high-end offerings. With communications costs going down, and more video-conferencing offerings launching for free (albeit perhaps with not such high quality yet), its difficult to know how companies, even large ones, can continue to justify spending several hundred thousand dollars on each room installation. But Fidelity has been a smart investor in the past, so maybe it knows something about the budgets of Fortune 500 companies that we don’t.

Lots of other financings — See VentureBeat’s Newswire for latest deals, including Beceem’s latest funding, to help build out mobile WiMax, Fonality’s funding for VoIP services, Bright Source’s funding for solar power plants, and Baynote’s funding to stave off upstarts like online behavior companies, Aggregate Knowledge.

(Update: Apologies, we’d meant to put a questionmark in the headline, so we’ve fixed. We’re checking on this rumor, but now we’re getting more doubts about this supposed sale)

Here’s the latest in Silicon Valley tech world:

Video site MetaCafe to be sold for $200 million? — That’s what this site says. We reviewed Metacafe, which recently moved to Palo Alto, here.

Common Sense Media, a site where families can review movies, films, TV shows, games, raises $4.25 million — The cash for the San Francisco company comes from the Omidyar Network. Christine Herron, an investor at Omidyar, has spoken highly about this company; the investment comes as little surprise.

Lots of VC deals — If you haven’t kept up with our left column lately, here are links to the venture fundings of PayByTouch, MontaVista (from a couple of days ago), and Pinger (we’ve since confirmed details of this one), respectively. Also Zipcar, largest car-sharing service, raises $25 million. This is the second round of venture backing for the company, and it comes from Greylock Partners, Benchmark Capital and Boston Community Ventures.

Has Google invested in Chinese peer-to-peer company Xunlei? — That’s what the rumor is. Xunlei is reported to have seen between 75 million to 100 million downloads of its software, and has raised previous funding from Morningside and IDG Ventures.

Google’s vanishing click-fraud case — Bizarre story about how Google has apparently dropped a click-fraud case. Michael Bradley, 32, reportedly was caught red-handed while trying to extort money from Google — investigators allegedly taped him across from an office at Google where he’d visited and threatened distribute a click-fraud technology he’d developed, unless Google paid up. The article makes your think Google found the technology so scary that it cut some sort of deal with Bradley, to avoid legal proceedings that would have brought the technology to light.

Yahoo’s woes in china continue — Yahoo China President Xie Wen has left “for personal reasons,” only 42 days after he had joined the company.

Jason Calacanis joins Sequoia Capital as entrepreneur in residence — Calacanis recently resigned from leading AOL’s Netscape property, and said Tuesday he’ll be joining Sequoia Capital, the big-name Silicon Valley venture capital firm. Previously, he founded Silicon Alley Reporter magazine and was a co-founder of Weblogs, a network blogs sold to AOL last year.

AskCity looking pretty good — Last week, we reported IAC and its search property, Ask, were launching a local portal site. It has launched, and it looks very useful. As mentioned, it makes sense for IAC to merge its various properties: Now you can select a restaurant, book a reservation through OpenTable, do a search for nearby events, such as a concert, book a ticket through Ticketmaster, find a map to chart your nights traveling, and do all this during one search session — and all at IAC’s properties.

We’ve put green arrows on the screenshot below to highlight the notable parts. At right is a place you can easily annotate it all for friends (place markers, or draw boxes on a map, and so on). On the left, you’ll see the four categories of search: businesses and services, events, movies, and maps & directions.

Have you visited video site Metacafe yet?

If you haven’t, get ready for shocking videos. Almost every one we viewed today had our heart racing or mesmerized us in some way. Tomorrow (Monday), Metacafe introduces a “producer awards” feature, which pays video makers $5 per 1,000 views their videos get — providing the video gets a minimum of 20,000 total views.

This is what makes Metacafe different. It keeps out the junk videos you often find at the top of the YouTube and other video sites — because it lets human filters decide which videos are best. It doesn’t rely on a video’s view count alone, which makes YouTube susceptible to gaming. This, Metacafe says, gives the user a higher probability of finding a video engaging — and we have to agree (we didn’t necessarily like the videos we see there, but there’s no denying we found them engaging).

YouTube is a great place to post short, homemade videos, because YouTube has no filters to block them. MetaCafe, however, raises the standards: Of videos on YouTube, 90 percent are watched less than 1,000 times. Of the top 200 vidoes on each site, MetaCafe’s get many more viewers, chief executive Arik Czerniak tell us.

It does this by injecting a step between when you upload a video and when the video hits the site. Unlike at YouTube, where a video goes directly to a site, a video at Metacafe first gets distributed to a random group of reviewers among some 100,000 who have agreed to participate in the review process. This group gives their initial thumbs up or down on a video’s potential appeal to a mass audience.

If a video gets the thumbs up, Metacafe posts it to the site, and then tracks the interactions users have with the video, such as whether they watch it multiple times, or send to friends. If the video looks popular, Metacafe keeps pushing it up the ranks. YouTube, Czerniak says, is more easily gamed: Users send links to a thousand friends, and their friends’ views count toward pushing up a video’s popularity regardless of its quality.

Metacafe’s detection system blocks the submission of duplicate videos or of shorter versions of videos already posted. This helps avoid spamming and copyright infringement problems. Metacafe can license the video its users submit and then distribute it to other sites. It thus helps producers avoid having to worry about ruthlessly marketing their videos, as they have to do on other sites.

The graphic below shows how Metacafe ignores the length of the blue “long tail,” or the mediocre videos submitted by individuals getting hardly any views. (Click on the image, and you’ll see a powerpoint with more of MetaCafe’s strategy and details).

Metacafe says it is the largest “independent” video site, as in not owned by a large company (thus excluding YouTube-Google). Below is data citing ComScore Media Metrix. Metacafe has 17M unique visitors a month globally, and that number has been growing steadily, from three million in January.

CEO Czerniak recently moved the company’s headquarters to Palo Alto. Why not LA — after all, Metacafe is focused on top-notch video producing? He said the world’s center for internet talent is still Silicon Valley. As the company develops relationships with producers, it may consider opening an office in LA, he said.

YouTube will contribute to valley’s allure — Two years ago, Google’s buzz, even before its IPO, gave entrepreneurs like Tribe’s founder Mark Pincus inspiration to dream up the social networking revolution. YouTube’s grand sale will also inspire a new wave of entrepreneurs, no doubt. The WSJ has a timely piece — written before YouTube’s sale was announced — about the entrepreneurs still coming to Silicon Valley.

There’s Matt Sanchez, co-founder of video company VideoEgg, who found he was spending more time in Silicon Valley than his home in New Haven, so packed a 12-foot U-Haul van with his servers and other junk, and moved out here. It has paid off. His team of four have since landed venture money, hired 22 more people, and signed lots of deals with Web sites, most of them within an hour’s drive. “There’s a unique set of resources in Silicon Valley that don’t exist in other places,” Sanchez, 25, told the Journal. And then there’s Metacafe, the Israeli video site, which just opened a Palo Alto office, and plans to hire 12 people by the end of the year.

How things change. We still remember the NYT trying to compare Silicon Valley with Detroit, back when it was fashionable to bash this place — and th was as recent as early 2005!

MySpace cleared — The suit filed by Brad Greenspan, the former chief executive of MySpace, against the popular social networking site, has been dismissed.

MeeVee’s logo sign — Meevee, the personal TV and entertainment guide company, is going to some lengths to build branding, putting up a large logo on its building and filming it, reminding some of the bubble era. It has raised $20 million in venture capital.

Microsoft offers mobile ads too –Google and Yahoo offer sponsored ads besides search results on your mobile phone. Now Microsoft has joined them, but offering click-to-call technology too — which is where you see an ad, click on it, and your phone dials the advertiser.

Google and Zoho gunning for online office software leadership — We’ll be moderating a panel tomorrow at the Office 2.0 Conference in San Francisco. We recently wrote about Zoho’s impressive product release schedule, apparently an effort to steal the thunder from Google. Zoho has now incorporated its array of software, including a new calendar and a new email feature, under one roof called Zoho Virtual Office. Meanwhile, Google does its own integration, linking up Writely and Spreadsheets with Docs & Spreadsheets.

Tellme Networks making headway in voice recognition — Speaking of the competition in mobile search, Tellme has been around a long time as a private company, based in Mountain View, and is getting a second wind. Back during the Internet bubble days, it was laying off workers. Now that voice recognition has become hot, it has just signed a deal with Cingular Wireless to offer a 411 information service that will allow Internet searches too. It is now handling more than two billion directory calls a year, 74 percent of which are done without human intervention, according to the NYT.

Netflix’s recommendation technology beat within a week — Netflix, the popular DVD site, offered a prize to anyone who beat its recommendation algorithm. Within a week, a team from WXYZConsulting.com in Los Gatos beat Netflix. The team is led by data mining engineering professor named Yi Zhang, of UC Santa Cruz (pictured here).

Sequoia Capital is almost out of Google — We’ve mentioned venture firm Sequoia’s various conflicts and interests related to its backing of Google. But lately, the venture capital firm’s holdings in Google have dwindled to about 0.1%, according to a filing in April by the SEC. That leaves it with 412,823 shares, worth less than $200 million.