July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

How do you stand out from the plethora of messaging apps out there? For Chorus.im, it’s by aiming for something more than just a messaging app.

The company has developed a free HTML5-based messenger that works across every modern mobile device as well as any PC platform. Basically, it enables practically anyone to jump into a text chat — it’s not limited to specific platforms like iMessage and BlackBerry Messenger, and it doesn’t cut out desktop platforms like most other messaging apps.

Chorus.im is clearly laying down its loyalty in the never-ending HTML 5 vs. native app debate. Building a truly cross-platform messaging platform would be much more complicated with native mobile apps, and it would also mean it would have to build an entirely different experience for desktop users.

“We’re big believers in the potential of HTML5 in the long-term. We firmly believe that it will eventually become the primary channel to distribute and consume mobile apps,” said Chorus.im founder and chief executive Steve Tran.

Somewhat ironically, Chorus.im is actually launching mobile apps for iOS and Android today. HTML5 doesn’t yet offer push messaging capabilities, which is critical for a messaging platform. Still, Chorus.im’s core technology is entirely built on HTML5 — I jumped into a live chat with Tran on my desktop without signing into anything. Once HTML5 adds push messaging, it will no longer need to offer standalone mobile apps.

You can start group chats on Chorus.im simply by emailing or texting people on your contact list. The service also stores your offline messages and chat history (not surprising, since it runs entirely in the cloud).

So why another chat service? You can use Chorus.im as a sort of disposable texting service, like if you’re communicating with a Craigslist buyer and trying to keep your personal number private. It’s also a helpful way to start a chat with less tech savvy folks — they simply need to click a link in their e-mail to join in, no log-in required.

The Mountain View, Calif.-based Chorus.im has raised $500,000 in angel funding, and it’s soon going to be in the market for a venture round.

Smartphone user photo via Takayuki/Shutterstock

Here’s one that we should have seen coming.

The Verge is reporting that Microsoft may soon shutter Windows Live Messenger in favor of Skype, which would take over as the company’s primary instant messaging software.

When Microsoft bought Skype for $8.5 billion last year, one of the big questions was how the service would integrate with  existing messaging services like Windows Live Messenger and the enterprise-focused Lync. By shuttering Live Messenger, Microsoft is finally giving us an answer.

While the news may come as a surprise for Live Messenger users, it’s actually been in the cards for a while now, as Microsoft already lets users merge their Skype and Windows Live Messenger accounts.

What’s notable about the news is that while Windows Live Messenger is folding into Skype, it’s the former that has the vastly greater market share among instant messaging clients.

As of this June, Windows Messenger controlled over 60 percent of the market, according to software company OPSWAT. Skype’s market share, meanwhile, hovered around 18 percent.

But while Windows Live Messenger has the market share, Skype some big features: video chat and, more significantly, hugely recognizable branding. Together, the two programs give Microsoft control over nearly 80 percent of the instant messenger market, which is why it’s not surprising the company aims to merge them.

But what does Microsoft have to say about the rumors? Absolutely nothing. “Microsoft makes it a practice to not comment on rumors or speculation,” a company spokesperson said.

Passing notes is passé. Teens supplement books and backpacks with smartphones and social networks. And while we’re sure your kid is the good kid, a reported one in four teens are being bullied online, and 50 percent of teens are using the Internet to cheat.

Bullying exists almost everywhere. When you’re a teen, it’s in a high school’s hallways, gym class, or lunchtime. But today the traditional freshmen swirlie has been replaced by a tagged picture of your daughter as a humpback whale with the caption “Feed me!” at the bottom. McAfee completed its 2012 Teen Internet Behavior Study and found the following had the highest amount of bullying:

• 92 percent of teens are bullied on Facebook.
• 24 percent of teens are bullied on Twitter.
• 18 percent of teens are bullied on Myspace (still?!).
• 15 percent of teens are bullied on instant messaging.

Facebook knows bullying happens on its social network. The company makes a significant effort to combat bullying and has whole teams dedicated to sorting out reported content such as rude comments, photo tags, and posts. It even has a department called Hate and Harassment that deals with reported content that suggests violent or dangerous behavior, such as threats of suicide. In those cases, Facebook ropes in law enforcement; otherwise, it asks the offender to take down the aggressive content and stop bullying via a formal message.

According to McAfee’s study, children often take matters into their own hands, as opposed to using channels like the reporting tools Facebook provides. A huge 65.8 percent of teens say they responded to the bully directly. As we all know, however, online bullying rarely stays online. Of that 65.8 percent, 35 percent responded in person, and 4.5 percent of teens report actually fighting the bully.

And poor online behavior doesn’t stop with bullying. Fifty percent of teens cheat and look up test and homework answers online. Fifteen percent specifically said they cheated on a test using their mobile phone. Only 3 percent of parents believed it. Indeed over 77 percent of parents weren’t worried about online cheating at all.

There’s only a week left until September. It’s time to get your head out of the sand.

Online bullying image via Shutterstock

“Our goal is not to connect you to random people – I don’t think that has worked in the past.” Instead, CEO Ralph Harik said in an interview with VentureBeat that the problem of social discovery is finding relevant people. ”What we really want to do is connect you to people who might have an impact in your life.”

Imo started corporate life in 2008 as the digital one ring of the instant messaging world: a single service that connected many others: AIM, Jabber, MSN, Google Talk and more. From that base the company has iterated and is now releasing features that enable friend discovery as well as friend connection. But not to random people.

Rather, Imo is building a set of algorithms to determine who might be great to connect to. That includes location, interests, friends in common, and previous interactions. In addition, Imo allows you to preview a person that you’re thinking about connecting to, letting you see their interests, employers, contacts, and more. A social service adding human discretion to machine logic seems, well, logical.

One thing I noticed about the interest graph that Imo is using: it’s built within the service itself, rather than taken from a list of Facebook likes.

That’s different than many insta-social services that simply use Facebook as a proxy for profile creation and interest graph generation, and it’s a significant difference. Why? Facebook believes that I’m interested in MendABath BC and Threeboy Design, among other things. In fact, I barely know what they are … I clicked a Like button as a favor to a friend. So the Facebook interest graph is not always the most accurate representation of what we do or don’t like.

Also among the new announcements: Imo is releasing tools that make communication seamless between fixed and mobile devices, including a slick feature that determines if you haven’t seen instant messages sent to your laptop, and then intelligently re-routes them to your phone. And, currently enabled on Android and coming on iPhone, Imo also offers voice calls using data over 3G or Wi-Finetworks.

Imo.im is based in Palo Alto, California, and raised an initial round of capital from Georges Harik, the CEO’s brother and former Google employee. (Full disclosure: Georges Harik was an initial seed investor in VentureBeat.)

Interestingly, Georges Harik was a Distinguished Engineer  at Google, and Director of Googlettes — which is not a lame geek band. They were the team behind Gmail, Google Talk, Picasa, Orkut, and other Google product initiatives.

Photo credit: ShutterStock

Rich with cash from its QQ games and chat, Tencent recently agreed to buy U.S. online game maker Riot Games for $315 million. Observers believe that the company will acquire more firms in a bid to become the world’s largest game company.

Revenues for the year were $2.97 billion, up 57.9 percent compared to a year ago. Earnings were $225.4 million, up 55.4 percent from a year ago. Gross profit margin was 67 percent. Tencent has stakes in and owns a lot of leading Chinese online businesses in fields including instant messaging, games, e-commerce, search and mobile services. Its market capitalization is around $51 billion, which is just about the same as Facebook’s last measured valuation.

User accounts for instant messaging are now at 647.6 million. And the peak number of simultaneous online chat users is 127.5 million. The number of peak simultaneous online QQ game users is 6.8 million. Platforms include QQ, Qzone, microblog and Tenpay. Ma Huateng, chairman and chief executive, said in the earnings statement that “Tencent is entering a new phase of investments for the future.” He said the company will invest in a number of new strategic platforms from microblogging to online security, in addition to existing businesses.

Since those are long-term investments, he said, Tencent isn’t worried about turning a profit on them in the short term. Tencent noted that during the quarter, the company suffered a significant security attack that disrupted its user base and hurt its corporate image. That’s why online security is a priority. Tencent has also been expanding overseas with investments in Russia, India, and Southeast Asia.

Tencent said it had strong online gaming revenue growth (up 9 percent from the previous quarter) thanks to the launch of the web-based massively multiplayer online game Qi Xiong Zheng Ba and better monetization of its Cross Fire, Dungeon and Fighter and QQ Game businesses. Year over year, China’s number of internet users was up 19.1 percent to 457.3 million in 2010, according to the China Internet Network Information Center. That means about 34 percent of the population is online.

Tim Merel, managing director at the boutique investment bank Digi-Capital, said he is not surprised at Tencent’s strong performance, given its strength in users, delivery across platforms, and cutting edge capabilities in cost-efficient game development. He says Tencent’s globalization efforts, as exemplified by its purchase of most of Riot Games, will be interesting to watch. If Tencent can replicate its success elsewhere, then it could become the biggest player in games and other online businesses. Merel wrote an analysis piece for us on Tencent’s strength in games back in September.

The company is being incubated by Y Combinator, and it was co-founded by Leah Culver (formerly a co-founder of simple blogging service Pownce), Eric Florenzano (a developer at games company Mochi Media), and Eric Maguire (also from Mochi Media). Culver said she’d been thinking it was time for a more contemporary, “less nerdy” version of traditional Internet chat room technology when she connected with Florenzano, who had similar thoughts about modernizing Internet forums.

The company’s main emphasis is on real-time, group chatting — to quote today’s blog post announcing the launch, “The best part of Convore is that you can chat with others in real-time. It’s just like instant messaging in your browser.”

When I saw that, I initially thought about Meebo, the company that started out as an instant messaging and chat room service and has since refocused on providing social networking tools to publishers. But I was impressed with the Convore experience, particularly because it’s so easy to find interesting conversations or start new ones.

You can create private groups to talk with your friends, or join public discussion groups. For each group, you can see who’s online. If you keep Convore open as a tab in your Web browser, you’ll hear a cowbell whenever one of your groups is updated. For example, it only took me a few seconds to create a private group that I invited Convore’s co-founders to join, so I could interview them. Then I watched as they joined the room, I posted some questions, and I heard the cowbell when the team posted its answers.

Within a group, conversations are organized into topics. In the public “tech” discussion group, recent topics include Mozilla’s development plans for Firefox, the new collaboration service Asana, and similar conversations. (It’s not all tech-focused.) There are already some long conversations — the Asana topic, for example, has 110 comments. It can be hard to catch up on a conversation of that length if you’re joining mid-way (by the end the Asana topic goes off on a tangent about the perks offered at different companies); Culver said she’s not sure whether most conversations will have a limited shelf-life, or if we’ll see more evergreen topics that just keep going.

The service is free. Culver said the San Francisco-based team has some ideas about a business model but nothing concrete yet. In addition to Y Combinator, Convore is also funded by the Start Fund, created by investors Yuri Milner and Ron Conway specifically for Y Combinator startups.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Kik, the new chat application for smartphones that is faster and more social than standard text messages, continues to report astounding growth in traffic after exclusively revealing the launch of its service to VentureBeat.

The company tells me it registered 250,000 new users in 24 hours yesterday, pushing it over 900,000 total registrations. It’s on track to blow past a million users today, just two weeks after launch. That growth would be unprecedented for any service. [Update: Just an hour after I posted this, the company says it broke 1.1 million users.]

“And it’s still accelerating,” chief executive Ted Livingston tells me. See chart below.

Kik’s charm is its speed. For now it’s also dead simple: It doesn’t let you send attachments, such as photos.

Despite that, Kik has some impressive technology behind the scenes created by Livingston, a former strategist for RIM’s BlackBerry Messenger unit.

And it appears amazingly viral. By targeting smartphone users, it appeals to a subset of all mobile users. But as Livingston explains, those smartphone users are more likely to be connected to each other — and that helps with viral growth. Right now, Kik’s users are clustered in North America.

Once you download Kik (which runs on iPhone, Android or BlackBerry devices), it checks your phone’s address book and recommends contacts you know who have already have downloaded Kik. This part, I’ve since realized, is its secret sauce: For me, it pulled contacts aggressively, including some names I didn’t recognize — but it’s also really effective, because it let me start chatting with my friends immediately.

Kik only takes the final step of adding names to your Kik address book if you message them. You can delete contacts with a finger swipe.

Kik competes with apps like WhatsApp and PingChat. (In a sign of the ecosystem sprouting up around RIM’s headquarters, Kik’s offices sits across the hall from PingChat’s office in the same incubator center in Waterloo, Canada.)

WhatsApp arguably has more features. It lets you send multimedia, such as photos, video and audio files. That may be why WhatsApp gets higher ratings in the app stores.

Like some IM services, Kik lets you see messages instantly. You can even see when the other person is typing. As a result, it feels more immediate than standard text messages and competing chat apps. It labels each message as either “sent,” “delivered” or “read,” letting you know in real time when the user gets and reads it on the other end. The only other service that does this is BlackBerry Messenger. But Livingston says Kik’s service is even faster than BBM. And Kik’s service is free for smartphone users, most of whom are already paying for data plans but may have to pay extra for SMS text messages — which are a notorious ripoff in terms of price per kilobyte of data.

Some commenters on my original Kik post said they don’t think the service’s improvements are good enough to make them switch from SMS. It’s yet another app to download, and why do that when everyone already has SMS? However, others said it worked so smoothly and speedily that they think it has a very good chance to catch on. One user said it it is “perfect” enough that it beats out similar services, just liked Skype beat out other voice-over-Internet services.

Right now, at least, Kik is seeing some crazy growth. The service even hit some traffic limits on RIM yesterday after Kik sent 10 million messages via RIM phones, but Livingston said RIM is increasing the limits.

So what do you think? Is Kik going to kill SMS, or is it just a passing fad?

The chart below shows usage going up significantly from when I last wrote about the service early Wednesday. Kik drew 12,000 users every half-hour at Thursday’s peak, up from 12,000 users every hour on Wednesday.

Earlier this week, VentureBeat reported on New York City’s efforts to modernize its government. The Big Apple is moving ahead quickly, announcing a partnership with Microsoft today that will anchor the city’s technology infrastructure firmly in Microsoft’s cloud.

The five-year deal will move the city’s 30,000 employees to Microsoft’s Internet-based service, including email, instant messaging, and collaboration tools like SharePoint. The deal will also deliver email to an additional 100,000 city employees who currently lack a work account. Microsoft will also aid the city and third-party developers in creating customized apps on the company’s Azure cloud platform.

“We have a network of business partners, 20,000 in the State of New York, who we’re now trying to galvanize,” Microsoft CEO Steve Ballmer said at today’s press conference.

City agencies had previously purchased software individually, but once Mayor Michael Bloomberg made the decision to centralize purchasing decisions and technology strategy, the city went looking for a deal.

“[The deal is] the first of its kind in the nation,” Bloomberg said. “This essentially allows the city to only pay for what it uses.”

The Mayor’s Office claimed the city will save $50 million over the course of the deal. The deal was a renegotiation and consolidation of a number of previous deals between New York City and Microsoft.

In addition to Microsoft’s cloud platform, negotiations are ongoing to bring Windows Phone 7 to New York City employees, according to City Hall sources.

A member of the city’s staff told VentureBeat that Google did not have a chance to bid on the contract, which would appear to be a blow to Google’s enterprise push. Google has already encountered problems while transitioning the City of Los Angeles to Google Apps.

As the largest municipal government in the nation and the only one led by a billionaire tech entrepreneur, New York City provides a major vote of confidence for cloud computing. While proponents have touted the cloud’s ability to lower costs and increase efficiency, skeptics have argued that cloud technology was too insecure for enterprise use.

“We will demand the same security protections when we use cloud computing as when we use our own servers,” Deputy Mayor Stephen Goldsmith said.

The city was primarily interested in the savings and agility provided by cloud computing. While city agencies currently operate 50 data centers, the deal will consolidate these operations into one modern facility. This will allow the city’s tech managers to focus on innovation strategy and implementation rather than maintaining the city’s IT infrastructure.

Goldsmith mentioned after the press conference that the city would focus on assembling data, both from internal sources and social media conversations, in forms that are most useful to the city and third-party developers.

Group video calling is a feature the company slowly ramped up throughout Skype 5′s beta. It first offered the ability for five-person video chats in May. At the time I argued that group video chat would become the next killer webcam feature. In September, the company extended group video chat to support 10-person conversations. Eventually, Skype will charge for group video chats, but for now users can try out the service for free.

We reported at the end of September that Facebook and Skype were partnering up, and the official release of Skype 5 is the first time we get to see Facebook’s integration into the software. You can now log in with Facebook Connect in Skype to instant message, call, and text your Facebook friends. You can also view your Facebook News Feed from within Skype, post status messages, and synchronize your status messages with Skype’s “mood message.”

As I’ve argued previously, the partnership is a win for both companies: Facebook gets access to a robust voice and video calling platform, and Skype will see a massive surge in new users from Facebook’s 500 million users. Skype has 124 million people using its software once a month and 550 million registered users of its own. There will certainly be a great deal of overlap between existing Skype and Facebook users, but the integration will also lead many users to try out Skype who never saw a reason to in the past.

As expected, Skype 5 also introduces a more refined interface and better overall call quality. The new interface should make it more intuitive to use existing Skype features like screen sharing.

Skype plans to update its Mac client by the end of the year with group video calling, and I assume that it would roll out Facebook integration on that platform at the same time.

It’ll be interesting to see where the company goes from here. It is surely working on bringing video chat to its mobile clients eventually, and I wouldn’t be surprised if we heard a Google TV announcement from the company (“Back to the Future”-esque images of 10-person video chats in my living room come to mind). Skype already offers TV-based video calling on Samsung and Panasonic TVs.

Microsoft’s Outlook has dominated the desktop email software market to date, but as the product ages, a few independent contenders are on their way up. One of them is Czech Republic-based eM Client, which is launching a new version of the product today at DEMO.

Like Outlook, eM Client looks to be a Grand Central for communication, letting users manage emails, calendars, contacts, and tasks through a Windows desktop client.

Its 2.7 release features Sync2eM, which allowes users to synchronize contacts and calendars from eM Client to mobile devices like the iPhone, Windows Mobile, and Android, over the air.

Aimed at both regular and business users, the product launched in January 2010 and has gained more than 70,000 installations in six months — an impressive milestone, considering the dominance of Outlook and the trendiness of Web-based email.

Although it seeks mostly to be a worthy Outlook alternative, the product goes beyond Microsoft’s by offering full integration of  instant-messaging clients like Skype, Google Talk, and AIM within its sidebar, and better synchronization with email providers like Yahoo, Gmail, and Hotmail. The 2.7 release adds support for Facebook messaging.

Founded in 2007, eM Client has been under development for three years and left beta testing in January. The 10-employee startup is based in Czech Republic, but recently opened an office in Silicon Valley.

So far, these non-aligned startups have offered an advantage. They’ve let everyone communicate with everyone. They’ve aggregated the various IM clients in a single web site, so that someone with GTalk can IM with someone from Yahoo Messenger.

Some, such as EQO, combine communication services, offering mobile IM together with Skype mobile. Meebo and eBuddy both provide widgets in order to integrate services with these other sites. The result: Friends can chat with each other across platforms from a single location, over increasingly multiple formats — IM, voice, email or text.

However, new competitors are launching every week. Today, we’ve reviewed Orgoo, a new company that will soon be launching and integrating IM, voice, email and text into one Web-based platform from the outset. And giants Google, Yahoo, Microsoft and AOL are beginning to offer competing services. They’re integrating their IM services with other applications, and they are working (to some degree) on making their platforms more interoperable.

Here’s a brief summary on how the field looks:

The big fish

Microsoft
Microsoft’s Chief Software Officer, Ray Ozzie, says that software applications of the future are going to have components that are on the desktop, on the web, and on mobile devices. Windows Live Mail now includes the option to initiate a chat using Windows Live Messenger; the company’s IM platform is already interoperable with Yahoo’s.

Google
Gmail has already successfully integrated the company’s IM platform, GTalk, so that its users can chat while emailing. We’ve also heard rumors that GTalk will be integrated with applications such as Google Docs. AOL and Google also agreed to make their IMs interoperable, albeit in a roundabout way — and it looks like this will happen soon. Like Ozzie, Google CEO Eric Schmidt has been stressing the importance of mobile — like Microsoft, Google is integrating apps across platforms. What’s more, 3rd party sites such as Joost are integrating GTalk into their offerings.

Yahoo
The company’s Web Messenger (beta) launched last week — its own web IM service. It integrates with Windows Live Messenger, although without Yahoo Voice (for now, but this is clearly an early beta release). Looks like more integration with other Yahoo! apps will be here soon, such as with with Yahoo Mail.

AOL
Let’s not forget that the IM granddaddy has web and mobile IM services, too; plus the GTalk interoperability.

With the big fish circling, what are the startup minnows to do?

Answer: differentiate themselves through targeting specific, untapped markets. This means continuing to redefine IM.

We covered one startup, called Livemarkets, that integrates IM with online advertising so that customers can interact quickly and directly with salespeople. The company uses the Jabber open standard, and built its own IM technology on top. But as one of its founders told us, “we’re scared to death of Google and Yahoo.”

Last week, we wrote about Mig33, which is also finding its own way with mobile IM, by integrating with other services, such as voice and text:

“[M]ost of its users are using the company’s own IM service, instead of opting to use more popular IM services, such as Yahoo Messenger, Google Talk, or MSN, which Mig33 does let its users choose. More than 75 percent of subscribers are choosing Mig33’s IM services.”

The company is only 18 months old, but has over four million subscribers, mostly in South East Asia — for many, it is their only form of web access, and compliments existing mobile usage patterns in some countries, like SMS in the Phillipines.

The leading IM startups are busy adding functions, too.

EBuddy has launched a mobile IM service. If Mig33′s success is any indication, eBuddy mobile might also do well abroad. It claims to have momentum: 10.3 million unique web visitors and 1 million unique mobile visitors last month. CEO Jan Joost Rueb says the company gets between 60,000 and 80,000 new users on a “good day.”

Meebo has more than 5.5m people using its web service each month but it isn’t going mobile anytime soon, as this terse response to its users’ requests shows.

Beyond voice and mobile IM integration, eBuddy, Meebo and EQO all offer widgets for integrating into other web services (as do a number of other IM startups). Meebo has also worked out special deals with Netvibes and large partners.

But, really, can the small fry survive?

Web-based IM aggregators such as Meebo have also become popular because their web-based offerings bypass school or corporate firewalls that prevent users from downloading IM platform’s desktop clients. How much will this matter, if Google and others offer similar Web-based products, but with more integration with other apps?

Perhaps a good comparison of the risk is what Google did with Google Maps: A number of startups, such as Platial, created new functionality based on data from Maps, then watched as Google decided to do the same.

But if IM is a commodity, maybe other media and tech conglomerates would find a purchase attractive — a popular and fast-growing IM property could help propel overall growth if integrated well with a conglomerate’s other applications.

We haven’t heard any talk of selling, though. eBuddy’s Rueb, for example, said that the company has “too many plans for 6 months out” and it is considering raising a Series B round even though it is already profitable.

The best news now is that all sizes of fish are getting bigger, and so is the ocean of potential users, especially mobile users. The Economist recently wrote about fishermen in India using mobile devices to learn which local markets would bring them the best prices, thereby reducing transaction costs for all involved. Mig33 is already successful in meeting this type of demand, even though it offers competing IM platforms as part of their services.

And let’s not forget the US. When Forrester Research surveyed students ages of 12 to 21 about their most-wanted mobile phone feature, IM was the top choice, nearly twice as popular as mobile e-mail.

(Disclaimer: We’ve mentioned the IM companies, above, as interesting examples. There is a lot more happening with instant messaging than what we’ve discussed here, such as what the MVNO’s are up to — it’s worth noting that Virgin Mobile is going public — or what’s happening specifically in enterprise IM. And we for sure haven’t mentioned Twitter, which more a new form of blogging rather than a direct competitor to IM.)