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Here’s the latest action:

Six Apart evolves into an ad network — The blogging company behind MovableType, TypePad and Vox is offering a new advertising program which will give publishers more control over ads and revenue from their sites. The company claims its ad network will be better than the many others out there (with more popping up everyday) because it has the best experience with advertisements specific to blogs. The company also launched Six Apart Services after acquiring Apperceptive, a New York-based company that has helped build communities for large sites such as The Washington Post, The Huffington Post and Boing Boing. Six Apart vice president, Anil Dash has more.

Microsoft acquires Xobni, maybe — The email startup, which Bill Gates has called “the next generation of social networking,” has supposedly signed a letter of intent to be purchased by the software giant, sources tell TechCrunch, apparently for $20 million. But not so fast,  we reached co-founder Matt Brezina on his cell, who said it was too early to comment. He said the company remains focused on rolling out product for general release. He did seem remarkably relaxed, suggesting the deal may not yet be in final stages, but it was hard to tell. He was sauntering on the Penn State campus, about to start a lecture to students, providing tips about entrepreneurship. Now we’re seeing other sources say no letter has been signed and that the company plans to remain independent until it gets its product out. Our guess is that Microsoft has offered, but that no deal has been signed yet. Xobni works as a plug-in for Microsoft Outlook and allows users to easily view past related conversations and search quickly through mail — which sounds a lot like Google’s Gmail.

Sequoia adds another partner to start broader investment initiatve — The WSJ’s Rebecca Buckman follows up on rumors that Sequoia is seeking to broaden its activities, confirming the hiring of Eric Upin and Keith Johnson, both of the Stanford Management Company. They’re creating an investment fund that would “invest in multiple asset classes, instead of just venture capital… The new vehicle — if it gets off the ground — likely would mimic the investment style of university endowments and other private funds that put money into stocks and bonds but also ‘alternative investments,’ such as buyout funds, venture capital and natural-resources investments.”

23andMe admits personal genetics have no medical purpose — Google raised eyebrows when it made investments in both genetic screening company, 23andMe (started by Google co-founder Sergey Brin’s wife) and Navigenics, another company that allows you to see your genome. Now under scrutiny in states like New York, services like these are being forced to admit they are little more than a vanity. “23andMe’s services are not medical … they are educational,” 23andMe spokesman Paul Kranhold told Forbes.

Attack of the Mac clones — Computer maker Psystar continues to grab headlines with its OS X-enabled (Apple’s operating system) computer. Apple does not allow 3rd parties to create Mac computers, whereas dozens of manufacters make Windows-based PCs. But with Apple’s market-share and demand on the rise, there certainly seems to be a market out there for a very low-cost Mac. Apple’s Mac Mini is currently the cheapest they offer at $599, but this Psystar system would be $399 with no software installed. Naturally, the legality of making these systems without Apple’s blessing is an issue.

John Battelle is first “John” in Google, shows Google is broken — Look, we all like John Battelle, the founder and chairman of Federated Media (which runs some of the ads on VentureBeat), but come on, he’s the number one result when you type “John” into Google’s search box? “I mean, I am ahead of Lennon. The Gospel. Er…McCain,” Battelle himself notes. I could go on: John Adams, John Hancock, John F. Kennedy, etc. With all due respect, I think it’s fair to say that most of the world has no idea who John Battelle is, yet that’s who they’ll find when they search for one of the most common names in the English language.

Here’s the latest action:

Advanced Micro Devices is in a world of hurt — The Sunnyvale, Calif. chip company lost $358 million on revenues of $1.5 billion in the quarter. It cited a tough outlook for the computer market, but it is clearly hurting from Intel’s newfound competitiveness. AMD’s core business is microprocessors and graphics chips for personal computers. It has other businesses related to getting those chips into other devices, from consumer electronics to mobile phones. CEO Hector Ruiz said the company is looking at its “non-core businesses” to evaluate them as part of a new cost-cutting program. That’s in addition to its previously announced restructuring in which it will cut 10 percent of its staff. Hence, it may sell off some of its non-core businesses.

Sequoia wants to be Blackstone, Carlyle going through shift — Sequoia Capital, Silicon Valley’s top dog venture capital firm, is trying to broaden its franchise, looking to do asset management and advisory work, according to Dan Primack, who says it is looking to become the venture community’s Blackstone Group. Among other things, PE Wire says Sequoia is raising a $750M hedge fund and has hired Eric Upin, former chief investment officer for the Stanford University endowment, and Michael Beckwith, former principal with Maverick Capital. We’ll look into this (let us know if you know more). Meanwhile, Primack also mentions that Bob Grady, who has led venture capital activities for The Carlyle Group, an investment firm with close ties to the Bush Administration, is moving into a lesser role. It’s part of a larger transition happening at the firm. The firm has lost two partners, and it replaced them with Nick Sturiale (formerly of Sevin Rosen Funds) and Greg Rossman (formerly of Pequot Capital). According to Primack, it also has hired Jeb Miller as a principal. Miller was previously ousted from ComVentures when that firm merged with Velocity Interactive Group.

Technorati and b5media to merge? — Seems like an odd idea to merge a company like Technorati, which searches and ranks blogs all across the web, with b5media’s network of 340 topic-oriented blogs. Wouldn’t the result be b5-biased Technorati rankings? Anyway, the merger is off because of personality differences and accounting issues, apparently.

The future of social networking: Watch this space — Social networking executives, investors and pundits sounded optimistic at a panel held on Microsoft’s Silicon Valley campus yesterday afternoon. There are still issues with making networks profitable, but that will come with time, panelists said. The discussion was part of ReMix, a follow-up to Microsoft’s big Mix conference earlier this year. The award for best quote goes to Dalton Caldwell of imeem (pictured), who said about Facebook founder Mark Zuckerberg, “I think Zuckerberg is calling the shots for our industry, and when they launched a platform, our heads exploded.”

Electronic Arts and Take-Two Interactive continue to trade barbs as EA extends takeover offer — More here. Our previous coverage here.

Quality-video site Hulu coming to mobile? — It’s been talked about before, and chief executive Jason Kilar implied as much again during a recent talk. Of course, there are already mobile competitors. YouTube has its own mobile site, while startup MyWaves has a deal with media conglomerate Viacom to be the sole provider of mobile Viacom videos.

“‘Crazy guy’” thinks CNN’s web site is about to be attacked by Chinese computers — more here.

The real estate market is in serious turmoil and has likely thrown the entire economy into a recession, so you’d think a real estate search startup might not be a hot item. But you’d be wrong.

One such real estate search startup, Trulia, is not only doing fine, but usage of the site is accelerating as a result of the housing downturn, co-founder and chief executive Pete Flint tells us. Users are flocking to sites such as Trulia, because they are independent and give people more control to find exactly what they are looking for, at the right price, in troubled times.

Today, Trulia is launching a new feature to to make the service even more useful: Integration with Google Street View. The service, which you might have heard of because of the controversy that surrounds it amid privacy concerns, shows panoramic pictures of places on Google Maps that can be rotated 360 degrees. You can traverse within this view to give you the feeling as if you on the city’s street itself.

This is useful for Trulia. Imagine you are looking for a new home. Sure, you read all of the descriptions and see a few static photos, but actually looking around the entire neighborhood as it looks on any given day — from your computer — is invaluable. “[It's] literally the next best thing to walking down the street yourself,” Flint says.

Trulia worked closely with Google to implement the functionality, and both sides are pleased with the results. While there have been the aforementioned security concerns about Google Street View, this is a perfect example of why how such a feature can be practical.

Assume you are looking for a home in one of the 40 cities Google Street View currently covers. When you do a search through Trulia and find a result you like, you are taken to a page with all the detailed information you would expect to find, but also with the street view of the property embedded right in the page. It’s not simply porting in the entire Google Map and having the big bubble pop up that you might be used to seeing if you’ve used Street View before, instead a street view picture focusing on the property is placed right in front of you in its own area on the page (see above picture).

Even though chief competitor Zillow has raised a lot more money (somewhere around $87 million), Trulia has been more than holding its own, growing its audience three fold in the last twelve months and seeing revenue almost double in the last quarter. Trulia raised $18 million in funding from investors including Sequoia and Accel.

A massive shift in advertising from periodical classifieds to sites such as Trulia has also helped the site, the company wrote about in a blog post recently.

Trulia currently has over 60 million real estate properties. The company plans to add this new street view feature to all of them as Google rolls it out to more cities.

We previously covered Trulia here, and have also covered another of its competitors, Roost, here.

Kenshoo helps advertisers with search engine marketing campaigns more efficiently reach search users.

The Israeli company has raised several million from Sequoia.

Search engine marketing is an umbrella term for a variety of techniques designed to increase the visibility of your web site on search engine result pages. The best-known examples are Google Adwords, Microsoft Adcenter and Yahoo Panama.

Kenshoo automates the traditionally manual process of building search campaigns across these services and figuring out which keywords are most effective.

Many large advertising companies, including DoubleClick and aQuantive, provide SEM analytics services.

Kenshoo recognizes keywords that don’t perform and substitutes them with more relevant keywords for an advertiser’s campaign. It lets you locate competitor ads and see what keywords are working for them, then combine those keywords into your own ad. It detects click-fraud. It manages your bids on Adwords, Panama and other systems automatically according to rules concern price and length of ad run that you set beforehand. More here.

The Israeli company works with large advertising agencies and clients like instant message service ICQ.

This is Kenshoo’s first round of venture funding.

Sequoia Capital, arguably Silicon Valley’s most successful venture capital firm, is big-footing one of its most respected investors.

It brazenly demanded that Yale University invest in Sequoia’s risky adventures abroad in places like China, India and in later-stage investing. And when Yale refused, Sequoia ejected the university from access to its well-performing early stage funds — the ones that in the past have invested in companies like Google and Yahoo.

Sequoia’s aggressive handling of Yale came to light in a memo issued by the university, a highly respected investor because it commits money long term and has long embraced venture capital (see the New York Times story about well-regarded Yale chief investment officer David Swensen, left). The memo was cited today by the Wall Street Journal’s Rebecca Buckman.

This is the first public sign of a rift that until now had been simmering in the background. Sequoia and many other respected venture firms are trying to adapt to a global economy, moving abroad to create separate funds in India and China. However, these moves are risky because the firms made their names here in Silicon Valley at a time when there was little competition among venture capital firms. By contrast, there’s plenty of competition in foreign markets. Moreover, Sequoia has raised “late-stage” funds to invest in more mature companies, but it hasn’t done too well with the approach in the past. During the last boom, for example, it invested in later-stage companies at the top of the market — including WebVan, Scient, eToys, some right before they went public — only to see them flameout spectacularly after the bubble burst. Sequoia last year raised $861 million to again try its hand in late-stage companies.

Yale declined to invest in this and Sequoia’s China and Israel funds, the WSJ reports. Sequoia later decided to “oust Yale from its partner group” in retaliation. Sequoia told Yale it preferred investors that would give the firm a “blank check” to invest as it saw fit, according to the 39-page Yale memo written last year. Yale declined to comment for the WSJ piece. Sequoia argued that other firms hadn’t been penalized for not investing in the oversees funds, but notably, it didn’t comment on the later-stage funds. Also, Yale is significant because of its stature and respect. By pulling out of other funds, it set a precedent for other investors to do the same. It’s likely that Sequoia saw this as a precedent possibility and wanted to send a message to other investors that it wouldn’t be tolerated — although this is just speculation on our part.

[Update: We're hearing this rift has to do with some personalities involved at the two institutions. We'd like to know more. Moreover, it is extraordinary that Sequoia went to the extent to get another investor, MIT, to issue a statement on its behalf. The firm is famously aloof when it comes to responding to inquiries about its activities, even requests coming from publications like the WSJ.]

Here’s the latest round-up of Silicon Valley tech news:

Video launch of the day: Stumble Video — StumbleUpon, the site that lets you “stumble upon” other sites by offering up recommendations based on your perceived interests, has reportedly seen a spike in popularity. So it has launched a video version, Stumble Video. You stay on its home page, and it plays videos for you. You give thumbs up and thumbs down, letting it figure out your tastes. In doing so, you create your own video channel. It lets you click on a button to find people with similar tastes, and see their channels. Right now, it serves videos from YouTube, Google Video, and Myspace, but will expand.

Seven raises $42 million for wireless email product — The wireless email industry is very crowded, and we’re not sure how Seven, a private Redwood City company is doing. Seven says it is the second largest in the sector, behind RIM’s Blackberry, and serves 108 mobile operators. Meanwhile, competitor Motorola has acquired Good, and Visto is losing money but still raising bucketloads ($51M recently). Here is Seven’s statement, which also discloses a CEO chnage.

Yahoo finally opens up Panama to US businesses — It revamps Yahoo’s ad program to be more like Google’s. The platform lets businesses manage their campaigns, test their ads’ potential performance, estimated return on investment and more.

Skype 3.0 has two new features — Trying to keep up with the times, Internet phone company Skype has released the following: 1) Extras, which allows you to play games with your global contacts, share your musical tastes by showing what you’re listening to on LastFM via your “mood message,” and 2) Public Chats, which connects you to others on Skype with perceived similar interests.

MySpace may not have overtaken Yahoo — Lots of media reports about MySpace overtaking Yahoo in overall page views to become biggest on the Web. Comscore figures are cited. However, as we’ve stated, the devil is in the stat details. Sure, Yahoo showed a 9 percent dip in traffic, but that’s partly because Yahoo became more efficient, using AJAX more and so people don’t have to click (VentureBeat has something similar on left side of our homepage), and that deflates page views. By contrast, MySpace’s awful design requires extra page impressions to actually get anything done. Great story on this sort of thing in the NYT, about the tricks played by sites like Concierge.com, ForbesAuto, and Heavy.com (Harvard’s Ben Edelman, pictured here, continues to be a great watchdog).

The Venice Project opens for testing • This is the new Internet TV start-up run by Skype co-founders Niklas Zennstrom and Janus Friis, which seeks to replicate the phone peer-to-peer technology of Skype and apply it to Internet TV. They’re being mean, and forcing you to get an invite. GigaOm has more. An early critique, but this is still early testing, folks.

Bloggers may have to disclose if they are compensated to promote products — The Federal Trade Commission said companies engaging in word-of-mouth marketing, in which bloggers are compensated to promote products, must disclose those relationships.

The poor man’s Silicon Valley holiday party — Venture capital firm Gabriel Ventures is sponsoring a holiday event with Stirr in SF this evening, for 150 start-ups that can’t afford their own bash. Gabriel has rented out the Exploratorium, and is throwing in $22,000 in shwag, including iPods, and their footing the wine bill. We’re told it is sold out. We all love to snark on VCs, but what would life be like in the valley without these sugar daddies?

Sequoia invests $48M into India’s fifth largest carrier — IDEA Cellular plans to raise $560 million in an IPO next year, and Sequoia Capital has scored a 1.5 percent stake.

New alloy may boost memory chips 500-fold, compared to flash chip — That’s the early word from IBM scientists. Details here.

Qihoo, a fast-growing but controversial Chinese search engine for Web 2.0 content, has raised $25 million more in a second round of venture capital from credible U.S investors.

This is significant because Qihoo has launched a new kind of search engine, dedicated to Web 2.0 content — focused on blogs and forums, for example — that has seen its traffic spike in China. Page views have grown from tens of millions of page views a day, to a hundred million page views by the end of this year, the company says. If true, after a mere year’s operation, Qihoo is about a third the size of Chinese industry leader Baidu. The funding brings Qihoo’s total to a whopping $45 million, a significant amount of capital for a Chinese company.

This is a victory for Qihoo’s chief executive and founder, Hongyi Zhou (pictured left), who has come under fierce personal attack from Jack Ma (pictured below), chief executive of rival, Alibaba. We reported on the controversy here, and many people told us Zhou’s fight with the Ma would tarnish his reputation — because of Ma’s clout. Alibaba operates its own search property, Yahoo China, which has sued Qihoo, and has been readying a suit against Zhou directly.

However, U.S. venture capital firm Highland Capital Partners has braced itself and taken the lead to invest in the company. Also investing are Redpoint Ventures and existing investors Sequoia Capital China, CDH, Matrix Partners and IDG Ventures. Sequoia and Matrix have historically been among the best performing venture capital firms. As reported, Alibaba and Yahoo exerted pressure on investors, including Sequoia, to avoid backing Qihoo. VentureBeat reported that Yahoo’s co-founder Jerry Yang and Sequoia’s Michael Moritz were even forced to a meeting over the dispute.

VentureBeat just spoke with Dan Nova (below) of Highland, who will be joining Qihoo’s board. Nova is experienced in search, having co-founded Lycos and invested in Ask Jeeves. His firm has traveled frequently to China and met with more than a hundred companies there, Nova said.

He said ironically, the media attention generated by the Ma-Zhou fight has not hurt Qihoo, rather helped it.

“This is a classic David versus Goliath story,” he said. “The more press we continue to get, the more traffic we get — the traffic is through the roof.”

He hopes the legal disputes can be resolved, he said. “They didn’t serve the purpose they’d intended, which was to make investors nervous about investing in Qihoo,” he said of Alibaba’s legal moves and other threats.

Nova said he is not concerned about potential lawsuits. Zhou is not a liability, he said, noting that Zhou has demonstrated his prowess and integrity by founding search company 3721 (later bought by Yahoo), and by the fact that his backers at 3721 (IDG, for example) are backing him again at Qihoo. “He’s a rock-star among Chinese entrepreneurs,” Nova said.

He said Qihoo is pioneering a new kind of search, focused on unstructured, user-generated content of the type found on blogs and Chinese online bulletin boards, which is more dynamic, and something Google’s Blog Search has been patchy at, he said. He said Qihoo’s architecture is its secret sauce, but that it takes the best of Digg, Google and Technorati and rolls them up into one. He said Qihoo is not trying to duplicate Google’s main engine search, but that the Chinese users are interested in lighter subjects, such as lifestyle and entertainment — a strength of Qihoo, he said. (Politics is avoided for obvious reasons).

Updated

Jajah, a Mountain View VoIP start-up that began offering free phone calls in June, has gone one better. It is now allows free calls from your mobile phone.

It just launched the service at DEMO.

Jajah is a scrappy, quirky company. It can, without warning, cut off calls if you talk too long. But Jajah may be one to watch nonetheless — because it works so simply and for free. And it is raking in the dough, and looks to be profitable. It may even be looking at IPO prospects soon, if you believe their numbers.

We wrote about Jajah here. Until now, Jajah has let you dial your call from a PC. It puts through the call by doing the following: Jajah calls you back on your land-line, you pick your phone up, and voila, you find it connecting you to your friend across the country, or wherever you called.

Now, you can make free calls from your mobile phone, regardless of whether it has a browser or you have to rely on its SMS or some other interface. It lets you talk for free as long as the person on the other end is registered. If not, you pay low rates.

The bugs we experienced with the service a couple of months ago appear to be fixed. But the company is still cutting people off if they talk for free too long, he conceded. He said Jajah is looking for the best way to warn customers that their call is nearing an end. They still don’t have a clear policy for when that cut-off point is — an example of how the company seems to get away with things by offering an otherwise useful service.

It makes money by allowing you to make scheduled calls at specific dates and times. It also allows you to text message your contacts for five cents. The conference calling is simpler and more compelling than most other services we’re aware of. You simply enter the numbers of the people you are calling (up to ten people), click a single button, and presto, it is calling. Moreover, you don’t have to be on your computer, because, as described, it connects you with your phone. It costs 2.5 cents a minute for each connection. So if you have four people on the line, that’s 10 cents a minute — or $6 an hour. That’s far cheaper than most other services we know.

Jajah’s Scharf says Jajah’s network architecture is more distributed than Skype’s, having servers in multiple areas of the globe, allowing it to pay only for local voice calls (via the “last mile”) after routing the rest of the call through the Internet. The company’s technology transfers voice to Internet Protocol and back to voice again.

He says the company’s goal is to become everyone’s “second” phone service. It can only work if people have a primary phone account. He says Jajah is about to hit one million paying users any day now — which is impressive when you consider the more mature leader Skype has only 1.7 million total paying users.

With $10 per month in revenue on the average user, and assuming it can get to a steady one million paying users a month, that means the company could soon be raking in more than $100 million a year — which is IPO territory. It has margins of $3 per month per user, so it may soon be profitable too (though we don’t know what its up-front fixed costs are). The company has 50 employees.

Scharf has a good story about how he got the venture backing from Sequoia Capital. Heavy-hitting Sequoia venture capitalist Michael Moritz (who backed Google and Yahoo) was sitting in an airport next to someone who was using Jajah’s prototype VoIP service. Impressed, Moritz put out a search to find the company. Somehow, Moritz’s team got mixed up and thought the company was based in Australia, and looked for the company down under, before realizing that Jajah was really based in Austria, Scharf said. Moritz’s team liked the company so much, they decided to fund it even though at the time Sequoia’s bylaws didn’t allow for a European investment. Sequoia was motivated to alter its statutes to be able to make the investment.

However, European firm 3i almost stole the deal. They were talking with Jajah first, and had made an offer. Sequoia had come along and shown its initial interest, but the firm unexpectedly hesitated for several days, forcing Jajah to accepted the 3i offer, Scharf explained. Scharf later heard that Moritz had assumed Jajah was bluffing about having an offer from 3i in order to force Sequoia’s hand. When Sequoia found out the deal had actually been signed, its partners were stunned, Scharf said. “There was silence on the phone,” he said. However, Scharf was later able to cite a 60-day right-to-rescind clause in the 3i deal, and accepted the offer from Sequoia instead.

Update: We’ve corrected our original reference to the number of paying users Skype and Jajah have. We originally listed the numbers as “monthly” paying users, when the numbers actually refer to “total” paying users.