VentureBeat

I spent four days this week at the Web 2.0 Expo at the Moscone West convention center in San Francisco. Here is a summary of the scene, including photos and my impressions of the show.

I attended the RockYou/Clearspring/Mixercast reception on Tuesday night at Bong Su, a trendy new Vietnamese restaurant. Three companies sponsored the party and so it made the Web 2.0 froth seem a little less excessive, since they can split the bill. There I met RockYou founder Lance Tokuda and enjoyed some fancy fried rice.

On Wednesday, Tim O’Reilly, the head of show organizer O’Reilly, kicked off the conference with a plea for innovation even in the midst of tough economic times.

“If you follow the headlines, you might as well stay home,” O’Reilly (left) said as he opened the speeches on Wednesday. He praised the Internet as the ultimate platform and its ability to create a revolution in human augmentation. That means that, with the web at our fingertips, we won’t have to remember much. He also told the Web 2.0 denizens to harness the collective intelligence of the web. He suggested we rise above the level of the single device and think about making software work across everything.

Go after the hard problems, he implored. “Do you think we’re really done yet?” We’re at the beginning, he said. And he cited a poem by Rainer Maria Rilke, “The Man Watching,” which O’Reilly said he read to his father on his death bed. It’s about how you can grow by being defeated by those who are greater than you are.

That led to the conversation with wunderkind Max Levchin, the CEO of Slide, an event which we used to introduce our live blogging. Eric Eldon caught up with Levchin afterward for a Q&A. The talk inevitably led to “how do you make money?” question that every Web 2.0 company has to grapple with. Levchin made a rare admission for a CEO. He said he was “extremely uncomfortable” being in front of the crowd and was happy that all he could see out there in the audience was a bunch of bright lights. You see, CEOs are just like the rest of us. Except they have a lot more zeroes in their checkbooks.

I was back bright and early the next morning to listen to John Battelle try to get Marc Andreessen to talk trash about Microsoft. But Andreessen (at left in image) was fairly diplomatic, saying only that he was happy there were “counter weights” to Microsoft such as Google. He was happy, he said, that the original ideas of the Netscape Navigator have survived (like the “back” button on browsers) and that something of Netscape lives on in Mozilla’s Firefox browser. He, like Levchin, has a company, the social networking platform Ning, in the $500 million valuation club. If Ning keeps going, it could become Andreessen’s third big start-up home run.

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Yoono is the latest start-up to offer a “web clipping” feature to let you manage your reading and collaborate with others.

For those who’ve never heard of Yoono, it is a French company that offers a social search engine. It gives you downloadable toolbar that, with varying degrees of accuracy, displays websites, blogs, and news articles related to the Web site you’re visiting at the time. When we last wrote about them, in early December, they were claiming 200,000 users, but according to them, the winter months went by and that figure tripled–a somewhat stunning burst, considering Yoono’s low profile.

Yoono “officially” launches and shares its newest feature at the Web 2.0 Expo next week. This new feature is “Buzz It,” a souped-up and smooth-looking mix of Clipmarks and Grouptivity. (See coverage here.) Blending the functionality of its two new rivals, Buzz It allows you to “clip” pieces of content–text, images, videos– from websites and then take what you’ve clipped and save it privately, share it openly, e-mail it to imported contacts or post it to your blog.

In the updated version of Yoono, clicking on a new button in the browser’s toolbar will bring up a “Buzz Note” applet, which is a pop-up screen that becomes your editing dashboard (see screenshot below). This applet deploys Grouptivity’s method and pulls all the videos and images from the site you’re browsing, lining them up as thumbnails. One click on any of the thumbnails adds the content into the Buzz Note, where there is room to jot. Grouptivity, however, limits you to e-mailing your clips. Buzz It does not; as with Clipmarks, exporting your note to your blog or MySpace profile involves a few clicks.

We’ve only seen the demo, but the applet itself is elegant and appears to be intuitive. Compared to Grouptivity’s devilish editing interface, Buzz It’s is an archangel. It offers different editing options from Clipmarks. Clipmarks lets you customize colors, and reduce the size of videos, whereas Buzz lets you do things like reposition text, edit text with formatting like italics and bold, and move photos around.

That being said, for all of Buzz It’s sharp look and feel, Clipmarks offers the most important clipping and posting functionality with a simpler interface: with Clipmarks, you don’t have to open a new window to make clips. It’s difficult to say how popular these sorts of features will become. But for people wanting an easy way to pull content from everywhere and jazz it up with editing tools for their blogs, these are companies to watch.

Note: Grouptivity plans to release a white-label version next week during Web 2.0 Expo.

Wikia, the San Mateo start-up founded by Wikipedia’s Jimmy Wales, is working on a search engine that will use the same strategy as Wikipedia’s user-reliant encyclopedia.

The project is secretive, but has a preliminary launch date of the first quarter of 2007, the Times of London reports.

Wales says Google’s flaws have become more apparent:

Google is very good at many types of search, but in many instances it produces nothing but spam and useless crap. Try searching for the term ‘Tampa hotels’, for example, and you will not get any useful results…

Of course, Wikipedia’s reliance more than a thousand of human administrators has its own problems, such as human bias, so there will be no perfect fix. And there are plenty of other so-called social search engines that have already launched with varying strategies. VentureBeat recently reported on Yoono and Collarity, for example. There are ton of others. Just look at the Firefox recommended add-ons; about half of them have some sort of social search feature. And Yahoo could do a lot more with its social features (Delicious, Flickr and others), as Fred Wilson notes.

The idea is to have humans lend a hand in judging what sites should appear in search results. Google relies on computers, used to count things like the number of links a site has — and spammers are taking advantage of it. Among open-source, user-generated sites, Wikipedia has been among the more successful (it has more than 1.5 million articles, and despite its flaws and plenty of critiques, the site has gained a certain credibility). However, it is unclear how Wales’ other site, Wikia, is performing. Unlike Wikipedia, Wikia is for-profit, and it’s not certain how much user loyalty can be generated for such a site.

Wikia recently received a cash infusion from Amazon to help build out its features, as VentureBeat first reported here.

According to the Times, the search project has been dubbed Wikiasari — a combination of wiki, the Hawaiian word for quick, and asari, which is Japanese for “rummaging search”.

The project will reportedly be built on open source search platforms Nutch and Lucene. Techcrunch has more details here.

Yoono is a tool that finds pages relevant to the one you are surfing on, and locates people who are also interested in that site.

This company is notable because similar players like StumbleUpon have become popular lately.

France-based Yoono relies on the goodwill of other users, however, requiring them 1) to download Yoono’s toolbar (and some users are now overwhelmed by toolbars) and then 2) give Yoono permission to search their bookmarks, which it then stores in its database. Yoono is a long-shot, we believe, because of these hurdles. However, after these two steps, there’s no more work required. In fact, your elderly aunt might figure this out — and she may not want to “tag,” which is the alternative used by other social search engines (StumbleUpon and Delicious).

Let’s take a straightforward example of how Yoono works. If you are surfing VentureBeat, you’ll see (partial screenshot below) that Yoono has searched its database for users who have bookmarked articles where VentureBeat is named. It then lists them in the sidebar at left, by relevance. VentureBeat broke the “Powerset” story, and so it is no surprise this story is high up in the article listings. At the far bottom of the sidebar, you’ll see links that Yoono has found in the bookmarks of people who have also saved VentureBeat as a bookmark (Gigaom and Techmeme are at the top; we’ve cut the screen, but dozens of other links follow).

Right now, there are no “Yoosers,” or people who have tastes that are similar to VentureBeat’s (likely because I haven’t opened up my bookmarks for Yoono to tap).

The company also has a “surprise” button, which is similar to StumbleUpon — it finds a site you might like based on the site you’re surfing.

Its business model is advertising. Ads will put in the sidebar. The company raised $2 million two months ago from AGF Private Equity. It has ten employees.

On Dec. 11, at the Paris Le Web 3 event, Yoono will add a blog search feature (which draws on the RSS feeds from sites contained in the 25 millions bookmarks in its database), and a new way to visualize the Yooser network (a control panel to search Yoosers by topic). The company says it has more than 200,000 users.

Roundup:

Entrepreneurs who have two companies – The Mercury News has a story summarizing the exploits of the guys with two start-ups, Kevin Rose & Jay Adelson (Digg, Revision3), Scott Rafer (MyBlogLog, Mashery) and Evan Williams (Odeo, Twitter). The idea that one is not enough, because you want to hedge your bets.

Venture capitalist George Zachary, who backed Odeo, doesn’t seem impressed: “As an investor, I like to see someone who is 100 percent committed to one company,” he tells the Merc.

YouTube stirs ruckus by giving user data to Paramount lawyers — The popular video-sharing site has been tracking personal data and sharing it, according to MarketWatch. YouTube handed over data to Paramount Pictures on at least one user:

On May 24, lawyers for Viacom Inc.’s Paramount Pictures convinced a federal judge in San Francisco to issue a subpoena requiring YouTube to turn over details about a user who uploaded dialog from the movie studio’s “Twin Towers,” according to a copy of the document.

YouTube promptly handed over the data to Paramount, which on June 16 sued the creator of the 12-minute clip, New York City-based filmmaker Chris Moukarbel, for copyright infringement, in federal court in Washington.

However, Fred Von Lohmann from the EFF, says it is a poor reporting job by MarketWatch, and the problem is with the DMCA, not with YouTube’s privacy practices.

French government now assisting Web 2.0 companies — We recently got an email from Trade Attaché of the French Embassy asking if we’d meet with Yoono during a visit to the Bay Area. We find it notable world powers are helping market their Web 2.0 companies. By the way, the U.S. State Department helps U.S. businesses do this sort of thing abroad, too. Difference is, valley-based start-ups don’t get the state to help out with PR here — so you could say the French have an unfair advantage on U.S. turf ;)

Yoono is a social search engine that makes finding interesting new sites and people related to what you like instantaneous and easy. Yoono integrates with your IE or Firefox browser to instantly suggest similar sites and people sharing the same interests while you surf. Unlike StumbleUpon or Delicious, Yoono’s toolbar requires no effort for users - no tagging, typing keywords or changing interface.

Friendster still chomping on its patents — Friendster President Kent Lindstrom got back to us on our question about how the company plans to use its second patent on social networking. We’d pointed out that we didn’t see any mention of audio or video in the patent language, areas Friendster seemed to be claiming it covered. It covers uploading content and associating it with someone you are connected to on an online social network, and Lindstrom says the patent wording can be extended to cover audio and video. While the company remains unsure of its plans to exploit its patents, the company is engaging Robert Barr, director of the Berkeley Center for Law and Technology, to get advice on whether to start litigating or not, Lindstrom said. Moreover, Lindstrom said the company is “going to build a portfolio of patents.” He said Facebook’s “feed” product, which lets users see updates made to their friends’ profiles may fall under another of Friendster’s patents, which is probably a year away from being granted. “It could fall under the patent,” he said.

Apple is readying a music phone — So says Prudential Equity Group analyst Jesse Tortora, who also said Apple is readying a separate, combination video and music phone. Tortora expects Apple to introduce the devices in January at Macworld, and that one of the phones will offer WiFi connectivity — and will be readily available in the second quarter of next year.

Video conferencing suddenly everywhere — Cisco and Microsoft have just unveiled ambitious video-conference products. But what ever happened to Microsoft’s Placeware product, bought for a considerable amount three years ago, supposedly a competitor to WebEx? One difference is that this new version is a tabletop device, called the RoundTable, and will debut next year. And then there’s Cisco’s new product, called the Telepresence. The HD-based system costs a whopping $79,000.

Box.net raises more funding — The seven month old online storage company is nearing 500,000 registered users and gets funding from DFJ. See our story here.

Turns out, employees are getting the short end of the stick lately at venture-backed companies.

Check out this report from Cooley Godward, a big Silicon Valley law firm, which shows the “rule of three” is being discarded. In former years, venture capitalists got about one-third of the company, the founders held on to a third, and another third was set aside for employee stock options. Today, investors get about 40 percent, founders get about 40 percent, and only 20 percent is set aside for employees. “…The old ‘Rule of Three’ is a thing of the past,” said Jim Fulton, a Cooley partner.

Take the $51 million just raised by wireless email service company, Visto, a story we reported last week. Well, turns out Visto is “washing out” common shareholders. By giving venture backers more ownership of the company, large venture rounds like this usually come at the expense of employees. In the Visto case, we’re hearing many employee shares have become essentially worthless. The company has also started layoffs.

MojoPac flawed?: Last week, we wrote about MojoPac, a notable PC virtualization tool that pushes things forward in letting you carry around all your applications in your pocket. We just saw this report, which suggests there are serious bugs MojoPac will need to fix. We’ll be talking more with the MojoPac folks next week.