VentureBeat

Here’s the latest action:

Facebook growing quickly all around the world — The social networking site is seeing rapid growth in Latin America (it’s growing fastest in Chile, with 2,197 percent growth in 2008) as well as continued expansion in Europe. Inside Facebook has more numbers.

New Zealand inventor tests “world’s first practical jetpack” — Glenn Martin has spent 27 years developing the device, and hopes to starting selling it next year for $100,000 per jetpack. Apparently, he has venture backing, too.

Electronic Arts posts $95 million loss — The loss is wider than expected, but not as bad as $132 million a year ago. The big video game maker says that it is investing heavily in R&D in hopes of scoring bigger hits in the future.

Sony has sold 14.4 million PlayStation 3s to date — Sales of the PS3 and the PlayStation Portable are driving growth for Sony Computer Entertainment, which struggled to reach profitability in the year after the PS3 launched in 2006.

Google’s Sergey Brin says iPhone is pushing trend toward mobile search – During Google’s recent Q2 earnings conference call, Brin estimated that “on a rough order of magnitude” iPhone users do 30 times as many mobile web searches as users of other devices.

MySpace layoffs coming, but less than rumored — The layoffs are part of the company’s annual performance reviews, MySpace Chief Operating Officer Amit Kapur told TechCrunch. All laid off workers will be replaced, and they’ll add up to less than the 5 percent that TechCrunch previously said was rumored.

Amazon launches new payment services — The online retailer has released two new e-commerce payment services that online merchants can use on their sites, Checkout by Amazon and Amazon Simple Pay.

Google Maps gets a new look — The layout is now more blue and less cluttered.

Palm hits 2 million in Centro sales — The news comes four months after the company announced that it sold the first 1 million of its Centro smartphones. That’s not bad, but it casts Apple’s extraordinary iPhone 3G sales — 1 million phones in three days — into even greater relief.

Here’s the latest action:

Dow Jones has its worst June since Depression: U.S. stocks tumbled on Friday and sent the Dow Jones Industrial Average to its worst June performance since the Great Depression. Record oil prices, credit-market write downs and the the economic slump spooked everybody. Goldman Sachs told investors to sell GM stock, sparking a sell-off as crude prices rose again. The broader S&P 500 index fell 2.9 percent on Friday. The Dow is at its lowest since September 2006. It has fallen 9.4 percent so far this month, its worst June since an 18 percent drop in 1930.

Rupert ready for another bite: Rupert Murdoch’s News Corp. and Permira Advisors made a $970 million bid to buy NDS Group, a provider of digital technology for pay-TV services. NDS Group said it would evaluate the $60 a share offer, which is 21 percent above Friday’s closing price of $49.70.

Take that, VMware: Microsoft unveiled its long-awaited virtualization technology to compete against VMware. Its Windows Server 2008 Hyper-V product has been in the works since 2003, when Microsoft acquired Connectix, which made software to run both Windows and the Mac OS on the same computer.

Palm stock heads to bottom: Palm’s stock fell eight percent Friday a day after the company reported a worse-than-expected loss for its fourth fiscal quarter. The company dropped $43.4 million, compared with a profit a year earlier. Revenue was down 26 percent to $296.2 million. It also expects to lose money in the current quarter. Plam’s Treo continues to lose ground to Research In Motion’s Blackberry and Apple’s iPhone.

Attention, K-Mart shoppers: Microsoft may have something up its sleeve for the E3 trade show starting July 14. The company is rumored to be cutting the price of its Xbox 360 Premium unit from $349 to $299. The latest rumor comes from a purported K-Mart ad. It’s been a long time since Microsoft last cut its game console prices by $50 in August, 2007. The price cuts say a lot. It shows Microsoft is the aggressor in driving down prices, putting pressure on both Sony and Nintendo to do the same. It also says that Microsoft sees a need to cut prices, perhaps because of slowing sales of its consoles. And the fact that it isn’t cutting $100 shows that the company isn’t crazy and doesn’t want to lose lots of money on each console sold.

Sony promises a big overhaul, new PlayStation 3 video downloading: Sony has been restructuring for three years but now CEO Howard Stringer is proposing an aggressive strategy built around video downloading and products that can talk to each other across the Internet. Video downloading will be part of products ranging from TVs to the PlayStation 3.

iPhone will debut in Canada with underwhelming prices: Rogers unveiled some not-so-popular prices for Apple’s Jesus phone for its scheduled debut in a couple of weeks.

Google speeds Blackberry search results: Google said that it has improved the speed of its mobile search results pages for Blackberry web browsers.

Here’s the latest action:

 Facebook to launch people search in one month — Facebook will let search engines find and display very basic information from your Facebook profile, including only your name and the option to message you or friend you, it announced early this morning.

This way, if somebody searches for you on Google, this “public” page will show up — making it even easier for prospective employers to know where to find you on Facebook, and delve into your personal life. Of course, anyone else trying to find out abut you through Google now will know how to become your friend, which may help drive Facebook adoption even more.

The company says it will wait a month before letting this information loose for the search engines to find, so people have time to change their settings and keep their profiles hidden.

Business 2.0 to be officially shut down — As it proceeded to lop off the tech-business arm of its media empire, Time Inc., owner of Business 2.0, decided not to sell the magazine to Mansueto Ventures, owner of rival magazine Fast Company, reports The New York Times. The reason: it did not want to arm another competitor: The Business 2.0 brand and its 600,000 subscribers, in someone else’s hands could undermine its other business property, Fortune. Some Business 2.0 staff members will join Fortune, while most others reportedly will join other tech publications.

Microsoft releases Silverlight — After months of hype, version 1.0 of Silverlight, Microsoft’s multimedia plugin for developers has been released. It’s the company’s challenge to Adobe’s Flash online multimedia player. While Silverlight has gotten positive reviews from tech circles, it is trying to challenge Flash’s 90 percent-and-growing market share for multimedia players. Microsoft has made a number of major deals to promote Silverlight, including a video deal with Major League Baseball (screenshot left, with the sample here).

Rockyou’s integration of Like.com search results, needs work — Like.com, a visual search engine company that has changed directions since its founding, has integrated its search results into the slide shows featured on the popular photo site RockYou. See example at left. If you’re looking at a picture of a woman in a shirt, for example, Like.com will show you similar shirts and let you buy them. Or at least that’s the idea. It could use improvement, because the example given shows shoes and other items that have little resemblance to the shirt in the picture, and so Like is more likely to become annoying than useful. People don’t want to be distracted by advertising that isn’t relevant to them. In a Techcrunch piece, Like says its ads are getting $0.80 CPM, and that its sharing the revenue wtih RockYou. However, no word yet on the number of ad pages being served. (Via Techcrunch)

Palm scraps the Foleo its laptop-like companion to the Treo — The Foleo, from the beginning, had looked like a questionable project, and we were surprised it got as much publicity as it did. Who needs another device, when you’ve got a Treo and a high-powered laptop already? So Palm yesterday said it has canceled the project, and is taking a charge of “less than $10 million” for the work put into it.

NBC embraces Amazon after ditching Apple’s iTunes — NBC Universal canceled its contract with Apple’s iTunes, and instead announced its shows will appear on Amazon Unbox as soon as next week.

Synthasite, the Web site creator, gives out shares — The company is giving out 1,000 shares in its company to designers who create templates it can offer to users. It says its stock is worth $250,000, but its all very questionable, so participants beware.

MetaCard offers credit card for SecondLife — Details here.

VentureBeat talked last night with Roger McNamee (pictured left), asking him why his firm, Elevation Partners, would want to buy into Palm, a company that many people see having a tough time ahead, given intense competition.

Some doubt its chances of survival as a standalone company.

[See our initial coverage of Elevation's $325 million in investment into Palm. Also see the Mercury News coverage. The Elevation-Palm deal comes amid a wave of M&A activity -- see coverage here of Flextronics' acquisition of Solectron yesterday. Finally, the acquisition of Avaya, a computer networking company, for $8 billion by Silver Lake Partners and TPG, announced yesterday, is the latest in a trend of massive private equity buyouts.]

Here’s how McNamee explains the Palm deal. His starting thesis is that mobile is big and getting bigger — that technology is increasingly allowing people to take and get content wherever they want. Only about seven percent of cellphones are smart-phones today. Within some time frame, say ten years, all devices will be smart-phones, he said. And with only a few players with the know-how to offer a full platform — he counts three, Apple, RIM and Palm — this bet makes a lot of sense, he said.

Here’s more on why: A significant cycle of hardware innovation over the past year has made mobile devices smaller, but those devices are imperfect, he said. Each of them — the Q, the BlackJack, the Pearl and the Palm Treo — have had their own limitations. “It’s really hard to do more than one thing really well,” McNamee notes.

Because hardware has made so many advances, the accompanying software makes a significant difference. Apple succeeded with the iPod not merely because it gives you a hard drive to carry tunes around with you, but also because of its surrounding architecture, including The iTunes store and supporting software. People won’t buy music from a platform that doesn’t have all these parts, he said. The same success has been seen by the video-console players, where McNamee has looked closely: One vendor takes charge of the key components and makes them all work together.

So what are the characteristics of the players most likely to succeed in the smart-phone industry? McNamee lists them: They’ve got to be innovative, have software, have good systems engineers and be ready to take risks.

Who fits the bill? “At a minimum, RIM, Palm, and in three weeks, Apple,” says McNamee, “But not everyone.” Many software makers failed at making the transition to graphical mode interfaces on the PC; similarly, many phone companies won’t transition either, he said.

Because all phone will one day be smart-phones, “this is not a winner-takes-all situation,” he said. He believes Apple’s iPhone will be successful. Its base of some 100 million iPod users, mostly satisfied customers, gives Apple a huge start. RIM also continues to do well. And Palm, too, has got what it takes. Having recruited Jon Rubinstein, and benefiting from idea guy Jeff Hawkins, the company has a team of innovators that is difficult to replicate.

And thus begins the slow, steady grind by Palm to reassert itself.

Palm Inc., the smart-phone maker, will reportedly sell a 25 percent stake to a private equity firm Elevation Partners, of Silicon Valley, for $325 million.

The move, reported by the WSJ, comes after two years of a sideways trading stock (see chart below), a recognition that Palm faces ever increasing competition, and indecision about what strategy it should pursue.

It also comes after a former employee of Palm, Gibu Thomas, argued in a column at VentureBeat recently that Palm should not sell to a private equity firm. There, he argued that Palm should get over aspirations to be the “next Apple,” and sell to a corporate strategic investor — because the forces of competition are too great.

Selling a stake to a private equity buyer keeps Palm’s independent aspirations alive — because a private equity buyer is more likely to try to want to restructure Palm and sell off its stake again down the road.

Notably, Elevation Partners has ties with Apple, and it plans to introduce some former Apple talent to the Sunnyvale, Calif.-based Palm. Jon Rubinstein (pictured above left), Apple’s former head of hardware who helped oversee the creation of the iPod music player, will join Palm as executive chairman and head up product development, according to the WSJ. Fred Anderson, a partner at Elevation, was a former Apple chief financial officer, will join Palm’s board (recently his relationship has soured with Apple’s Steve Jobs). Another Elevation partner, U2’s Bono, helped introduce the U2 iPod. And of course, Roger McNamee, another partner at Elevation, known for the prolific devices that adorn his belt — now likely to carry both a Palm Treo and an iPod — will also reportedly join the board.

This all comes, of course, just as Apple is to unleash its highly anticipated iPhone. And Palm recently unveiled the rather perplexing Foleo — designed to be a companion to Palm’s smartphones, but never quite making the case as to why it is any better than a laptop (at least in our view).

According to the WSJ, Palm will “pay $940 million in cash, or about $9 a share, to existing shareholders whose ownership of the company will drop to 75 percent under the deal’s terms. The company will fund the restructuring with the $325 million from Elevation, $400 million in new debt and more than $200 million of cash on its balance sheet to complete the transaction.

According to the terms, Elevation is paying a 16 percent premium on Palm’s price, the WSJ said.

The latest action:

Cognition launches new search engine company — Cognition, of Santa Monica, Calif., is yet another company trying to understanding the meaning of words, to offer a better a search engine. But it looks somewhat quirky. It offers a search portal in the areas of health, politics and legal support. We tested it, using the words “knee pain,” but found the results less useful than those provided by Kosmix, Healthline and Medstory.

Its engine has been taught the meaning of 375,000 English words, so that if you use two or more words together, it hopes to make a better stab at what you mean than Google does. Previous efforts have been elusive until now, but new companies, Hakia (already launched) and Powerset (to launch later this year) are also trying. Cognition was founded by computational linguistics PhD, Kathleen Dahlgren. Its separate site, Coghog, was supposed to launch last year, but hasn’t. (More details here.) For now, it appears to want to serve corporate clients, in the area of legal support and healthcare.

Jaxtr announces other investors — The start-up, which offers you a unique URL, which people can click and have a call go through to you without even having your phone number, said it has raised $1.5 million. We reported on the company earlier, but new investors disclose Warren Packard, managing director at Draper Fisher Jurvetson; Ken Howery, managing partner at The Founders Fund; investor Ron Conway. Jaxtr wants to raise $10M more. It is offering more features, such as voice and text messages. The albatross around this company’s neck, however, is its limit of free incoming calls to 100 free minutes. Its target group of young women may balk at that. Note that DFJ’s Packard is also a backer of Snapvine, a voice player that has some overlap with Jaxtr.

TrustedID’s co-founder steps down — Speaking of DFJ, another of the venture capital firm’s companies, TrustedID is seeing some changes as it prepares to raise more money. The Redwood City, Calif. start-up offers a service that freezes your credit reports, so that fraudsters can’t open financial accounts under your name, but you have to pay $8 a month. Co-founder Omar Ahmad, former CIO for Napster, has stepped down as president, but retains a board seat. Chief executive Scott Mitic today tell us Ahmad stepped down because “he’s an idea guy,” preferring to work with start-ups in their earliest days. Mitic says the company is growing, but declined to say how many subscribers the company has. Ahmad launched the company, he told us at the time, because his brother-in-law was a victim of ID theft. As reported here (scroll down), the company received $5 million in funding from DFJ a year ago.

Get ready for Apple TV — Some are calling it “the network in disguise,” and it is apparently expected to begin shipping to stores this week

Google introduces Pay-Per-Action — In other words, advertisers can decide to pay a publisher only if a reader of the site does something like fill out a questionnaire. (Details here.)

Palm about to be sold, by this week? — Word of talks continue to leak, suggesting bankers trying to sell the company are trying their best to drum up offers. The maker of the Treo and other devices is likely to be acquired by Nokia, a private equity firm (or firms) or even Motorola, reports Unstrung. Rumored deal deadline: Thursday.

Here’s the latest action:

March Madness alerts — Palo Alto mobile search company 4INFO will send you an alert in the final minutes of any of NCAA March Madness game that looks like it could be an upset. It sends final scores too. To sign up, text TOURNEY ALERTS to 44636, or signup at the company’s site.

Coffee-house entrepreneurs — The SF Chronicle has a piece about the SF entrepreneurs who launch companies at coffee houses, exploiting the WiFi connections at places like Starbucks. Problem is when the competition finds out. We remember once meeting wiki company Jot’s founder Joe Kraus at Coupa Cafe, a place where Ross Mayfield, of competitor Socialtext, often had his alter-office.

Dick Costello, chief exec of Feedburner, starts blog — He focuses on entrepreneurship, and has some good tips about how to raise cash, and how to manage hiring, among other things.

AskCity’s map tools are nifty — We’ve already mentioned the useful local map, direction, movie, restaurant and other features offered by AskCity. Here’s the latest: You can now circle places on a map, such as an intersection, and then search for say, that coffee shop that your friend told you about, but which you forgot the name of — because it lets returns in its results all of the coffee shops within the circle you drew.

Google’s bus system — Every Google employee gets a ride to work, with a WiFi-equipped bus so they can work while commuting. (See NYT story).

Paul Mercer, interface guru, hired by Palm — Mercer, a former Apple employee, who designed the interface of the nano-sized Samsung YP-Z5, has been hired by Palm, to help it regain momentum in the face of Apple’s iPhone launch.

Forbes’ list of the world’s billionaires — The latest list is out, and Google’s showing is impressive. Co-founders Larry and Sergey are the two youngest on the long list of Californians.

Freebase reality check — Lot of excitement Friday about the launch of Freebase by Metaweb Technologies, billed by some to be the “synapses for the global brain,” but some people are yawning at the idea.

Even as global warming concerns grow, oil companies are getting more efficient at producing more oil — Which means more global warming. (See NYT story.)

Clearwire’s woes — Clearwire, the company that went public last week to raise more cash to build out its costly WiMax network, sees continued downward pressure. It went public at $25 last week. See graph at left, from this morning, where it dipped below $20 briefly. However, it rose at the end of the day.

FraudWall raises $1.01 million — We reported on the click-fraud company, Fraudwall, launched by Ron Conway and Jim Pitkow, in January. It has now raised $1.01 million of a $1.5 million planned first round, from Sherpalo Ventures and Baseline Ventures, according to PE Week. Sherpalo’s Ram Shriram is a new investor. Shriram, still on the Google board, is especially likely to have good insight into how important the click-fraud problem is for Google to solve.

Yet another photo/video site, Zannel, launches — Zannel is designed for mobile users. You can upload your camera-phone’s photos or video to Zannel’s web site, and you can send them to friends, through Zannel’s peer-to-peer network. The recipient gets an SMS (text message), opens it up and a link takes them to their WAP browser. We reported on its $6 million in funding here.