The Latest from TechCrunch |  |
- The Great Retweet #TechCrunch50 $100,000 Ticket Giveaway
- Blubet Bets That You Want To Predict Things On Twitter
- The Song of the PowerSquid: The Inside Story of the Life of an Invention Part 6
- Sprint Gobbles Up Virgin Mobile For $483 million
- Blip.tv Lands A Big Distribution Deal With YouTube And Others; Redesigns Dashboard
- Monster Merger: IBM Buys SPSS For Approx. $1.2 Billion In Cash Deal
- Steal! Ben Darnell Leaves Google Reader Team, Joins FriendFeed
- Linux Foundation Launches Branded Credit Card. Yes, It Features Tux.
- MySpace Overtakes Evite On The Event Planning Totem Pole
- Verizon Uses Twitter To Trash Talk AT&T Too
- Apple Is Growing Rotten To The Core: Official Google Voice App Blocked From App Store
- What Everyone Made from the Zappos Sale
- Google Sells Back Its Stake in AOL. There Goes $700 Million.
- Bing Cashback Contest: Correct Answers Not Always Required
- Is Zynga a Target for State Attorneys General?
- Apple Yanks The Cord On GV Mobile. Is It Trying To Kill Google Voice On The iPhone?
- Twitter Adopting The Word ‘Tweet’ On Its Website
- Stealth Search Engine Blekko Raises $11.5 Million
- Apple’s Tablet Is The Kindle In Technicolor (With Laser Beams)
- Twitter Not Outlawed In The White House. And More Tweets Are Coming.
- Rosetta Stone Announces TOTALe, Language Instruction With A Social Bent
- Jeremy Wright Steps Down As CEO of Blog Network b5media
- Defending Its Turf, TweetMeme Is Already Threatening To Sue ReTweet
- Toshiba Is Making a Whole Lot of Flash Memory Chips This Month: New iPods? Tablets? Puppies?
| The Great Retweet #TechCrunch50 $100,000 Ticket Giveaway Posted: 28 Jul 2009 08:22 AM PDT The following message is brought to you by TechCrunch50 co-host Jason Calacanis. In order to build excitement for the TechCrunch50 conference we’ve convinced the bean counters at TechCrunch HQ to let us give away one $2,500 ticket a day for the next 45 days. That’s more than $100,000 worth of TechCrunch50 tickets. So, if you’re broke, laid off or too cheap to buy a ticket, all you have to do is hit your followers with the hashtag #techcrunch50 at the end of each tweet. Every Tweet you send out is another chance to win the ticket being given away that day. Every day we will pick one of the tweets from the previous day with the #techcrunch50 hashtag at random. Some rules:
Good luck and we appreciate your support in this attempt to leverage social media to promote the conference. Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.  
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| Blubet Bets That You Want To Predict Things On Twitter Posted: 28 Jul 2009 08:00 AM PDT
That wasn’t always the case. When the company started on the idea of Blubet a couple years ago, as an offshoot of the community gaming site dotblu, the idea was that it would be more of a traditional site. But then Twitter exploded in popularity, and Blubet knew that it simply couldn’t ignore the expanding social graph and platform that Twitter offers. So now Blubet is entirely built on top of Twitter. It has its own separate site, but for the site to work as it’s intended, you have to tweet out predictions you make on the site, and get others to participate. Of course, you can also do this from Twitter, using hashtags or DMs. But the preferred method is to visit the site and fill out a prediction. From there you can assign a value to the prediction which you will win (or lose) depending on how your bet does. And you can also see friend’s predictions and give them a “yes” or “no” comment based on if you think they will come true or not. The idea here should be fairly obvious: This is all about social gaming. But unlike past social gaming Twitter services like Spymaster, Blubet is being very cautious about what data it sends back to Twitter. For example, it prompts you before you sent a tweet back (which will include a link back to Blubet). If you opt to allow the tweet to go out, that setting will be remembered in the future (but you can always change it). But a key difference with the previous viral games of Twitter is that Blubet does not send DMs to your friends without your knowledge. And it does not currently allow for follow-up comments on prediction posts to get sent back to Twitter (though the site is thinking about that).
And while these points don’t exactly translate into real-world currency (something which is a very gray area), there is a chance to use small transactions to get more points in the game. For example, if you pay $5, you get 1,000 ponits. $5 gets you 5,500 points. And $10 gets you 11,000 points. Obviously, this is step one for how the company plans to make money. But there are other plans too, including sponsor-created bets and intelligent automated bet creations. Blubet founder and CEO Song Kim expects that sports and entertainment will eventually be the two dominant Twitter betting categories. That rings true. Tweeting about a game is one thing, but tweeting about how you think is going to win a game with points on the line, is another game entirely. Blubet has raised $3.6 million in funding to date. The last round (its series A) came a few months ago led by D.E. Shaw. There is also an impressive roster of people who have invested in the past including Bebo founder Michael Birch and VCs Ron Conway and Jeff Clavier. Kim notes that the company has a low burn rate, and this money should last them a while. While there are other startups in the prediction space on the web, notably Hubdub, Blubet believes it’s the first to tackle the issue solely on Twitter. And given the 1.2 million prediction number, it seems like a good place to start. There are also plans to integrate SMS service soon, and plans for both mobile web and apps for platforms likes the iPhone, in the future. Blubet currently consists of 7 employees.
Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.  
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| The Song of the PowerSquid: The Inside Story of the Life of an Invention Part 6 Posted: 28 Jul 2009 07:34 AM PDT  Hello, my name is Christopher Hawker. I am a professional inventor, specializing in innovative consumer products. My company is called Trident Design, LLC. I have developed many products in numerous industries and have over 20 products on the market. My most famous invention is the PowerSquid, a cephalopod-inspired power strip with outlets situated at the end of short cords, thereby eliminating the problem of losing outlets to bulky transformer plugs. John Biggs, editor-in-chief of this blog, has asked me to write the story of the birth of the PowerSquid and its development and journey to market. This is the Song of the PowerSquid. This is part 6 of a 6 part series. Read them all here. Part 6: Philips Enters the Picture In the summer of 2006, I got a call from the president of Power Sentry to tell me that they were being bought by Philips, the Netherlands-based consumer electronics giant. My initial instinct was that this would be a mixed bag. They were just too large. He reassured that it would be great for the PowerSquid, with the awesome brand and marketing power of this giant, worldwide corporation suddenly behind our product. What really ended up happening was that the huge corporation barley noticed that it sold PowerSquid, since it had thousands and thousands of other products. The lack of focus quickly became evident as the relationship began to unfold. Most notably in their responsiveness to our needs as Flexity, which usually amounted to, "bad news delivered late." Nevertheless, we continued to push Flexity. Philips agreed to let us distribute their other power products to our customers, so we became a distributor of the original non-surge PowerSquid, as well as their lower-end (UL Listed) surge protectors. We successfully sold the Calamari into Dell's and Apple's online stores, which were two of our major targets all along. Unfortunately, they both sequestered them to the last page of their surge protector sections. We had no "pay-to-play" money to get higher placement. With no special attention drawn to them and backwoods positioning, neither venue proved as successful as our own site.
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| Sprint Gobbles Up Virgin Mobile For $483 million Posted: 28 Jul 2009 06:50 AM PDT
The acquisition, which was announced earlier this morning, calls for Sprint to pay $5.50 in stock for each Virgin Mobile share, a 31 percent premium to the MVNO’s closing share price Monday of $4.21. The deal is expected to receive approval either in the fall or in early 2010. Sprint Nextel actually already owned 13.1 percent of Virgin Mobile, which uses the carrier’s network to offer service to some 5.2 million subscribers. The deal cancels out Virgin’s $248 million in outstanding debts and will unite Sprint’s Boost service and Virgin Mobile under the same roof. Sprint says it would keep the Virgin Mobile brand and let Virgin Mobile USA’s CEO Dan Schulman, run Sprint’s entire prepaid business if and when the deal closes late this year or early next. In that case, Virgin Mobile shareholders will own about 3 percent of Sprint. Richard Branson’s Virgin Group owns 28.3 percent of Virgin Mobile, while South Korean carrier SK Telecom has a 15.3 percent stake that it got when Virgin Mobile last year bought Helio, another prepaid carrier that uses Sprint’s network. Virgin Mobile shares jumped to $5.20 in premarket trading on Tuesday, while Sprint shares rose to $4.60 from their close at $4.55. Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.  
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| Blip.tv Lands A Big Distribution Deal With YouTube And Others; Redesigns Dashboard Posted: 28 Jul 2009 06:00 AM PDT Mike Hudack, the founder of Blip.tv, just landed a major set of deals to expand the distribution of his Web video network. The biggest deal is with YouTube, which for the first time will allow Blip.tv to place its own ads in the YouTube player on behalf of the Web video creators who use Blip. Hudack is also announcing distribution deals with NBC Local Media for regular TV starting in New York City, Vimeo, and Roku set-top boxes. It is also expanding existing deals to show Blip videos on Verizon FIOS, Tivos, and Sony TVs with Ethernet jacks. About 50,000 different shows have been uploaded to Blip, where video creators can then spread them across the Web, iTunes and set-top boxes. According to the company, Blip is doing 72 million video streams a month to a worldwide audience of 22 million people. Only 4 percent of those views are on Blip.tv itself. “I think we will double our audience with these deals,” says Hudack. He might be able to double his audience with just YouTube, which comScore estimates does 6.6 billion streams a month and reaches about 100 million people in the U.S. alone. It is not so much distributing videos on YouTube that is a big deal. It is being able to share in the advertising revenues and getting tracking data back. YouTube has gradually been making it easier for content partners to sell and place their own ads within YouTube, expanding from a few large media partners at the beginning of the year to about 50 today. Now, YouTube is embracing smaller partners like Blip through a trial with a video ad network founded by ex-Googlers called FreeWheel, which allows Blip and others to serve their own ads inside YouTube. Blip still has to approve individual members before they can tap into those YouTube dollars, but once they pass muster they can use FreeWheel to set up their ads once to play on YouTube, Vimeo, Blip, iTunes, or wherever. FreeWheel takes care of the accounting and rev-shares, which gets complicated when teh money gets split so many ways. Blip deos a 50/50 rev share with video creators after payments to third parties like YouTube and FreeWheel. Along with the new distribution partnerships, Blip has completely redesigned its video management dashboard from the ground up. (See screen shots below). Web video auteurs can now see in one place how many views and dollars each episode of their videos is attracting. (TubeMogul is powering the analytics). The dashboard lets them batch edit and distribute their videos. They can drag and drop teh videos in teh episode list to reorder them, and the new order is automatically propagated to their RSS feed and all point so distribution. The embeddable Blip video player itself is also now much more customizable. . All of these changes should help Hudack get Blip closer to his “stretch” goal of becoming profitable this year. He raised $5.2 million from Bain Capital Ventures last October, which helped it get through the worst of the advertising downturn. “What we found was that the first quarter sucked,” he says, ” but April started leading a resurgence of advertising dollars. Every month is a new record for us.” The average cost advertising rates Blip gets are between $10 and $20 per thousand views. That YouTube deal should have the effect of increasing views while putting downward pressure on CPMs. But if views go up faster than prices go down, Blip will end up better off. Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.  
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| Monster Merger: IBM Buys SPSS For Approx. $1.2 Billion In Cash Deal Posted: 28 Jul 2009 05:18 AM PDT
Big Blue said the acquisition of the publicly-held Chicago company was expected to strengthen its information-agenda initiative, which helps companies take information and turn it into a strategic asset. IBM shares fell 67 cent to $116.96 in pre-market trading, while SPSS shares jumped 41 percent to $49.59. A message from SPSS Chairman, CEO & President Jack Noonan:
Predictive analytics software captures and analyzes data about people's attributes, attitudes and behaviors to gain a full understanding of anticipated future behaviors, so companies can make smarter decisions for improved business outcomes. IBM says it will continue to support and enhance SPSS technologies while allowing customers to take advantage of its own product portfolio. SPSS will become part of the Information Management division within the Software Group business unit, led by Ambuj Goyal, General Manager, IBM Information Management. Update - In other news: IBM also acquired Ounce Labs, a provider of enterprise source code security testing and intends to integrate it into its Rational software business. Financial terms were not disclosed. Crunch Network: CrunchBase the free database of technology companies, people, and investors  
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| Steal! Ben Darnell Leaves Google Reader Team, Joins FriendFeed Posted: 28 Jul 2009 03:43 AM PDT
Darnell is FriendFeed’s first hire in over a year, and will get employee badge number 13. He starts today, and according to the blog post announcing the steal, he’ll be bringing his “ninja-fu data-storage and scalability skills” to the startup. I was reading Darnell’s blog and I noticed something funny: back in May, he blogged about his experiences playing around with Google App Engine and coming up with FriendFork. The latter is a quick product mashed together to make it easier to consume, indeed, FriendFeed in Google Reader. (Hat tip to @OurielOhayon) Crunch Network: CrunchBase the free database of technology companies, people, and investors  
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| Linux Foundation Launches Branded Credit Card. Yes, It Features Tux. Posted: 28 Jul 2009 12:54 AM PDT
Jim Zemlin, executive director of The Linux Foundation in a statement says people can contribute to Linux in a variety of ways (writing code, marketing, etc.) but now have a convenient way of identifying themselves as supporters of the community “by carrying Tux in their pocket”. And then of course there’s the financial incentive. The Linux Foundation is partnering with CardPartner to offer the credit card through UMB Bank. The organization will receive $50 for every activated card as well as a percentage of every purchase made with the credit card. The Linux Foundation also says 100% of the proceeds from the Visa card program will go directly towards providing community technical events and travel grants for open source community members in order to accelerate Linux innovation. Initially, the custom Linux Foundation Visa Platinum card is only available to U.S. residents, but the organization expects to expand in the coming months. You can apply here. Linus must be glowing with pride. Update: there’s also LinuxFund.org, which looks similar and has been around since 1999. Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.  
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| MySpace Overtakes Evite On The Event Planning Totem Pole Posted: 27 Jul 2009 11:02 PM PDT
MySpace has been working to improve its events platform for some time, releasing a new application last March that was built by Slingshot Labs, MySpace’s secretive startup incubator. The new application’s biggest improvement was its integration of MySpace’s social graph — something that the older MySpace events application had largely failed to tap into. Since then the app has seen a number of improvements, including the ability for users to widely distribute (or ‘blast’) invitations to a single event to many of their friends, which has proven useful for the site’s many bands, and likely helped spur growth in the number of invitations sent overall. Of course, the elephant in the room here is Facebook, which has a massively popular Events feature. But the social network doesn’t publish its stats, and when asked for comment it would only respond that the site sees “2.5 million events created each month”. This says nothing about the number of invitations sent, but I wouldn’t be surprised if it has far more than either MySpace or Evite (to give an idea, Evite says that it only gets 570 thousand events created per month — less than a quarter of what Facebook sees). Crunch Network: CrunchBoard because it’s time for you to find a new Job2.0  
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| Verizon Uses Twitter To Trash Talk AT&T Too Posted: 27 Jul 2009 06:47 PM PDT
John Czwartacki, who is the policy blog editor for Verizon, sent the following public message on Twitter, “This what USA’s most reliable wireless network sends BEFORE a conference. #VDC“— complete with a TwitPic (below) of a giant Verizon truck parked outside the conference to bolster signal. He doesn’t mention AT&T specifically, but he doesn’t have to. His next tweet repeats the message, but directed at me. Clearly he’s been reading our rants against AT&T’s poor service, most recently about AT&T having problems during Comic-Con in San Diego. For what it’s worth, AT&T reached out to me the other day saying it felt that it did a good job handling the onslaught of Comic-Con traffic on day 2. Of course, that still doesn’t speak to why it was bad on day one, when the company undoubtedly knew they were going to see a surge of usage. And that’s what Verizon’s tweet speaks to, nipping problems in the butt before they become problems. Judging from SXSW and Comic-Con, apparently that’s too much to ask from AT&T. AT&T has been a trending topic on Twitter multiple times over the past few weeks — and never for a good reason. Verizon is just the latest to jump on the bandwagon of trashing the service on Twitter. Will AT&T respond? Can it? In related news, an AT&T Twitter bot has been responding to negative comments by bloggers with multiple Tweets from fake accounts. Could this be the era of Twitter astroturfing? Crunch Network: CrunchBoard because it’s time for you to find a new Job2.0  
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| Apple Is Growing Rotten To The Core: Official Google Voice App Blocked From App Store Posted: 27 Jul 2009 05:35 PM PDT
A Google Spokesperson has told us the following:
Of course, it’s not hard to guess who’s behind the restriction: our old friend AT&T. Google Voice scares the carriers. It allows users to send free SMS messages and get cheap long-distance over Google Voice’s lines. It also makes it trivial to switch to a new phone service, because everyone calls the Google Voice number anyway. Carriers have known about Google Voice for a long time, but it wasn’t until recently that it began accepting new users, and there has still been some hassle associated with actually using the service. Smartphone apps like GV Mobile remove many of those hassles, which is why AT&T is keen to keep them off the iPhone (Google already has official apps available for BlackBerry and Android). Here’s another testament to just how ridiculous this move is: GV Mobile’s developer Sean Kovacs says that the app was personally approved last April by Phil Schiller, Apple’s senior Vice President of Worldwide Product Marketing — the man who often takes the stage during Apple keynotes when Steve Jobs isn’t around. Kovacs says that Schiller called him to personally apologize for the delay in initially getting the application approved. Now, I’m sure Apple has laid out in its terms of service somewhere that you’re not allowed to mimic the iPhone’s functionality. But when you’ve got a blessing from that high up, that would seem like a pretty good indication that the application belongs in the App Store. The thing that really bothers me about the move is that Apple is now actively stifling innovation. Google Voice is the kind of service that can actually have a positive impact on your life, and not in a frivolous, entertainment-related sense. It makes it easier to connect with people, and to manage those connections. Apple can point to the App Store’s 50,000 applications all it wants, but how many of them could truly be called groundbreaking? Are they really putting a dent in the universe? All the more upsetting is that this comes from the company that Steve Jobs built. The company that once made record labels bow to a flat 0.99 pricing structure for years longer than they would have liked is now screwing customers because AT&T asked them to. They’re trying to limit what I can and can’t run on my mobile phone — a phone whose marketing is largely based on its extensibility. Back when the App Store first launched there were some warnings about its walled garden approach — could developers trust Apple to maintain a fair marketplace? Until recently, Apple has managed the store in a generally benevolent, if not somewhat incompetent manner. But now things are taking a turn for the worse. From a handicapped Sling app to blocked apps from Qik and Google Voice, it’s becoming clear that Apple is doing its best to keep many of the iPhone’s most game-changing apps away from users. Palm, if you’re looking for marketing material — take note. Image by brankomaster. Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.  
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| What Everyone Made from the Zappos Sale Posted: 27 Jul 2009 04:43 PM PDT
Zappos just filed its S4 with the Securities & Exchange Commission, which details the history of the merger talks with Amazon. There’s a lot of boring boilerplate here, but one of the more interesting bits is on page 68, where there’s a confusing breakdown of Zappos’ ownership. The percentages appear to add up to way over 100% because the shares of Venture Frogs are essentially counted three times. Venture Frogs was the firm Zappos CEO and CFO Tony Hsieh and Alfred Lin used to own that first invested in Zappos back in 1999. Because either of them “could” contol the voting shares, the SEC counts each of the shares under their names, as well as under the Venture Frogs name. But once you back that out, one thing is clear: No one could sell the company without the blessing of Hsieh and Lin. CEO Hsieh owns 29.4% of the common shares, CFO Lin owns another 2.7% and Venture Frogs– the firm they started and jointly manage– owns another 39.9% of the shares. Sequoia owned 22% of the company, but made different returns depending on the liquidation preferences in each term sheet. In all, the firm is poised to make a return of roughly $160 million, based on Amazon’s closing price today. Sequoia invested $35 million over the companies E and F rounds. Not bad. It’s much harder to see how much Hsieh and Lin are making, because no one knows how much of the proceeds of the Venture Frogs shares goes to their pockets or to their LPs. But they clearly did well. Hsieh made at least $214 million; Lin made at least $18 million, with the Venture Frogs shares netting an additional $163 million. If that’s a forced sale, the two are crying all the way to the bank. Another shocker from the S4: Zappos’ revenues. We’re so used to that $1 billion-in-gross-merchandise-sales figure being bandied about that people tend to confuse that with Zappos’ actual sales. But that number doesn’t count returns, which can be as high as 40% according to people close to the company. The real sales from 2008 were $635 million, up from $527 million in 2007. In the first quarter of 2009, Zappos grew revenues at a clip of 8%. So while you can argue Amazon still got a great deal; Hsieh and Lin did pretty well too. That makes it all the more impressive that they’re sticking around to keep growing the company rather than heading to a remote beach. Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.  
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| Google Sells Back Its Stake in AOL. There Goes $700 Million. Posted: 27 Jul 2009 03:54 PM PDT Google finally sold back its 5 percent stake in AOL to Time Warner. Originally valued at $1 billion in 2005, Google ended up getting back only $283 million, including some cash distributions. There goes roughly $700 million, but Google already took a writedown on the investment back in the fourth quarter when the whole world was going to pot and nobody really noticed. Time Warner took back the shares in preparation for the eventual public spinoff of AOL. When Google initially bought the shares, it valued AOL at $20 billion. Based on the price Time Warner paid for the repurchase of the shares, AOL is now worth $5.7 billion. I’m sure by the time it actually goes public, new CEO Tim Armstrong and AOL’s bankers are going to be arguing that it is worth a lot more. So did Google get hosed on this investment? Pretty much. But you have to remember that it was part of a larger search outsourcing deal which Google still makes money from today. AOL on its own commands a 3 percent search market share and as such is probably Google’s largest partner site. Even if Google didn’t make back its investment over the past four years, the search volume AOL provides itself is worth paying for. (Search is a volume game, the more search queries you can throw ads against, the better the ROI). So don’t feel too bad for Google. It was buying distribution which helped it maintain its overall market dominance. Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.  
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| Bing Cashback Contest: Correct Answers Not Always Required Posted: 27 Jul 2009 03:06 PM PDT
Today’s question was: “Bing #cashbackpack Trivia: What Bing cashback percentage does drugstore.com offer?” To find the answer, simply search for something like “"drugstore.com bing cash back" on Bing, and you’ll see the sponsored result right at the top. The answer? 20%. The problem? The winner said 10%. That didn’t stop the Bing Cashback account from tweeting out:
Here’s what else is odd. The winner follows one user on Twitter, Bing Cashback. And they have a total of 4 tweets, 3 of which are for the Cashback content (and the other is “studying” — this contest is supposed to be for students). This is leading some to question if the entire thing isn’t rigged, or at the very least being gamed. Regardless, one thing seems very clear: Whoever is running the contest for Microsoft isn’t paying too much attention. The contest is kind of a joke anyway. Once someone goes out and finds the answer, it looks like a bunch of other Twitter users are just repeating it, to try and win. What an awesome contest. I think I’ll play tomorrow. When they ask for the correct cashback percentage for some website, my answer will be “watermelon.” I’m so gonna win that $500. Update: Now Bing is saying that on a sub-site, 10% was listed for whatever reason, so it accepted that answer along with the 20% answer. May want to get those promotions in line Bing. [Thanks Michael] Crunch Network: CrunchBoard because it’s time for you to find a new Job2.0  
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| Is Zynga a Target for State Attorneys General? Posted: 27 Jul 2009 02:09 PM PDT
A few things are striking about this. First off, Zynga is one a handful of companies building Facebook and iPhone apps that has found a way to make money. Lots of money. Close to $200 million dollars in revenues to be precise. The fact that it could be the next target for an overzealous state attorney is a big story in and of itself. Second, the fact that competitors are this threatened by Zynga's cash machine shows an ugly battle royale brewing in the application space. (More on that in a bit.) Online gambling is illegal, according to the U.S. State Department and a handful of states, but there are still some gray areas. In June, the Feds started cracking down on gamblers in an attempt to clear things up. Meanwhile, others like Massachusetts representative Barney Frank are seeking to legalize and tax the $1 billion or more in annual revenues U.S. poker players are mostly sending to sites based overseas. Frank clearly faces a huge uphill battle from religious groups who see poker as a moral issue. But a site like Zynga should be able to side-step all of this, because although you can buy chips for Zynga’s Texas HoldEm game you can’t redeem them for money, right? Maybe not. According to the brief, the issue boils down to three factors: • Is the activity otherwise authorized? • Is poker a game of chance, as opposed to a game of skill? • Does the user bet/win something of value? The answers to the first two are pretty clear—and not contested by Zynga. Poker is clearly considered gambling in the offline world, and poker specifically has been proven in New York State court to be a game of chance not skill in the case of New York v. Turner. That decision read: "Games of chance range from those that require no skill, such as a lottery…to those such as poker, blackjack which require considerable skill in calculating the probability of drawing particular cards. Nonetheless, the latter are as much games of chance as the former, since the outcome depends to a material degree upon the random distribution of cards." The third question is where things get murky. Zynga liberally gives people free chips every time they log in. But you can also buy chips. That constitutes the user betting something of value. So what about the outcome? Do users win something of value? A prosecutor could argue a few angles here: Within the game, there's the case that the chips are of value because they can be used to buy virtual gifts for others or that extended game play and privileges given to players who win more chips constitutes something of value. There's some precedent under New York State law (specifically entailing poker machines in Plato's Cave Corporation v. State Liquor Authority) showing that continued play constitutes something of value. But Zynga could easily argue that there are so many opportunities for continued free play and so many free chips given away at every log in that players clearly aren't motivated to win because of material gains. The one place where Zynga chips do have a clear material value is on illegal secondary markets where chips are regularly bought and sold, and because Zynga allows Facebook friends to send chips to each other transferring chips to a black-market buyer isn’t hard. (Zynga only allows you to gift 100 chips per day, so it is time-consuming.) The brief argues that these illegal markets are readily found with a Google search and that "While Zynga does not support the black market, an argument could be made that they profit from it and do so knowingly." Zynga takes issue with that and argues that it has gone to great lengths to squash the secondary market for chips and enforce its Terms of Service. Zynga has filed numerous cease and desist letters to sites and ISPs, has taken down sites by enforcing legal protections surrounding its own copyrights and trademarks, daily monitors the Web looking for these illegitimate sites, worked with payment processors like PayPal to accelerate the take down of these sites and filed numerous legal actions. There's a demonstrable paper trail showing Zynga's efforts to clamp down on these secondary markets. Cases have included: Zynga Game Network, Inc. v. Phillip Labrasca / Complaint Filed July 1, 2009, Zynga Game Network, Inc. v. Duc Doan / Complaint Filed July 1, 2009, Zynga Game Network, Inc. v. Carmi Solak / Complaint Filed July 14, 2009, Zynga Game Network, Inc. v. Jason McCann / Complaint Filed: July 14, 2009, Zynga Game Network, Inc. v. Chris Sim II / Complaint Filed July 14, 2009 and Zynga Game Network, Inc. v. Moss Brothers / Complaint Filed July 14, 2009. This all raises the question: Why doesn’t Zynga just turn-off the ability to gift friends chips? I expect if prosecutors started to seriously circle, the company would shut it down. It’s hardly a slam dunk that Zynga is breaking the law and a stretch to say going after them is in the public’s interest. The Feds certainly have much more explicit examples of online gambling to focus on first. But could I see an over-zealous legislator or state attorney general bringing a case against them for political reasons? Absolutely. These are people who believe that online dating sites lead to rape, MySpace leads to pedophilia and Twitter leads to terrorism. Crazier claims have certainly been made than saying a game called "poker" could be encouraging online gambling. And while you can argue that World of Warcraft, Second Life or any game operating in the virtual goods economy has the same issues, a game called poker would likely be a clearer target. Now, back to the competitor who leaked us the brief. The person called the meeting under the condition of anonymity, so I can't divulge who it was. But the source argued they commissioned the brief because they too had thought of building poker applications, having watched Zynga's success and wanted to see if there would be legal implications down the line. The findings were enough to scare them away from it. The competitor then decided to leak it because it thought it was unfair that Zynga was using potentially illegal revenues to its own competitive advantage in other applications like Mafia Wars. The competitor alleged that Zynga spends some $500,000 a week on Facebook ads and another $2 million to $3 million per month on MySpace advertising. Whether you find the leak a savvy or slimy business move, it was certainly ballsy: If Zynga is called out it will have a chilling effect on the entire virtual goods space which appears to be one of the most lucrative business models going on the Web. Lastly, I was disappointed that Zynga chief executive Mark Pincus refused to address the claims on the record. I have a huge amount of respect for Pincus and as such gave him every opportunity, including sharing the brief itself nearly a week before publication of this post. The brief raises legitimate questions and if Zynga really believes its operating in the clear, why not just say so on the record? Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.  
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| Apple Yanks The Cord On GV Mobile. Is It Trying To Kill Google Voice On The iPhone? Posted: 27 Jul 2009 02:08 PM PDT
From Kovac’s blog:
Once again, Apple’s App Store policies have crossed the line from irritating to totally ridiculous. GV Mobile taps into a service that is entirely different from the iPhone’s native dialer, making Google Voice far easier to use than it normally is. It’s also laughable that Apple would refuse to specify exactly which features the app was duplicating. Even more worrying are the implications this would have if it becomes Apple’s policy to ban Google Voice apps from the App Store, which would strike a major blow to the service. There is at least one other Google Voice app already available on the App Store, called VoiceCentral, and we’ve previously confirmed that Google has an official app in the works. Update: VoiceCentral has been removed from the App Store as well. This looks like a store-wide policy change. It’s entirely possible that Apple’s decision to ban the app is being driven not by user confusion, but by AT&T’s request. Google Voice is very powerful, and is only becoming increasingly so as it releases new apps and features that make it easier to use. It also hits the carriers where it hurts, making it easy for users to swap numbers on a whim, get cheap calls, save on SMS, and much more. And while it would be surprising if Apple blocked Google’s app from the App Store, it wouldn’t be the first time Google was forced to bow to Apple’s wishes — just last week Google had to scrap a native app built for its Latitude service in favor of a web app at Apple’s request. Yet another possibility is that Google’s official application is imminent, and the GV Mobile app was pulled to reduce confusion once that’s out (though this seems less likely). Update: Apple has removed VoiceCentral from the App Store as well. While both GV Mobile and VoiceCentral still have their profiles available in the store, attempts to buy them results in an error message that they are no longer available. Crunch Network: CrunchBoard because it’s time for you to find a new Job2.0  
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| Twitter Adopting The Word ‘Tweet’ On Its Website Posted: 27 Jul 2009 01:31 PM PDT
Well so far Twitter hasn’t been that terribly prolific in using the words ‘tweet’ or ‘retweet’ apart from some odd blog posts and individual employees’ messages on the micro-sharing service. That has changed today. TechCrunch reader @JoeHagofsky informs us that Twitter has apparently changed the word ‘updates’ on the right sidebar of the page you see when logged onto its website to ‘tweets’ (see screenshots below). It’s also changed on individual profile pages. We see them too and as far as we know this is in fact new. It’s also interesting to note that despite ‘updates’ being changed to ‘tweets’ in a few places, the big, main button used to send a tweet still reads ‘update.’ Of course, this is a minor update, but in light of the posts linked above it’s fairly interesting to see the startup actually adopt the word. It’s been widely reported that Twitter will soon, possibly as early as this week, launch a completely revamped website which could well offer a better experience than the slew of third-party web apps out there. Maybe we’ll see much more use of the word when they do. Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.  
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| Stealth Search Engine Blekko Raises $11.5 Million Posted: 27 Jul 2009 12:34 PM PDT
This is a hard space to find a niche in, but the money at stake if you succeed is staggering. Blekko, the stealth search engine we’ve been covering since early 2008, has raised a third round of financing - $11.5 million from USVP and CMEA. That brings the total amount of capital raised to $17.5 million, including a $1 million credit line. Their last round was in March 2008. We took a look at Blekko in late May. The company wants absolutely no press at all while they continue to bake the product, but we think there is something interesting under the hood. And apparently a few investors agree. Crunch Network: CrunchBoard because it’s time for you to find a new Job2.0  
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| Apple’s Tablet Is The Kindle In Technicolor (With Laser Beams) Posted: 27 Jul 2009 12:01 PM PDT
Here’s the best excerpt:
Uh oh, Amazon. Now, to be fair, the executive completely glosses over any upsides to the current Kindle. Like the fact that its E-ink uses very little power. Or that it can be read in sunlight and is easier on the eyes than a backlit screen, which the Apple device would undoubtedly use. But still, it always seemed inevitable that devices like the Kindle would make the transition from black and white to color, just as televisions and iPods did before it. Now it appears Apple is ready to shove the e-book readers into a world of color before they may be ready. Thought of another way, this new Apple device is kind of like the kids in Pleasantville from the real-world, full-color future who visit the quaint black-and-white fake television town of the 1950s, and turn it on its head. Things could get ugly — but undoubtedly will be more exciting.
Oh yeah, and you can be sure it will not only play music, but movies as well. And I’m sure it will browse the web in a way that makes the Kindle really look antiquated. It’s interesting just how eager the FT report paints book publishers as getting in bed with Apple:
But, as they note, unlike the music industry, which Apple brought to its knees when it got a dominant position, Amazon, not Apple, is the one that threatens to do the same to the book industry right now. In Apple, they likely see a very viable alternative that should ease fears of Amazon doing something like cutting out the middle man (the publishers) and publishing books itself for the Kindle. If Apple really is able to get this device out by September — which again, seems unlikely for a few reasons, another of which is that according to this new FT report, Apple hasn’t even talked to the film studios about it yet — Amazon is going to have to haul ass to get a response out on the market. Could that mean a Kindle 3, in color, by early 2010? [photos and video: New Line Cinemas] Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.  
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| Twitter Not Outlawed In The White House. And More Tweets Are Coming. Posted: 27 Jul 2009 11:07 AM PDT
Here’s where the confusion apparently comes from. Access to Twitter’s website is blocked on most White House computers, but that’s only for security and recordkeeping reasons for the time-being. Apparently, the White House is working with the White House counsel and the Office of Administration CIO “to review and relax these restrictions,” Burton says. And, more importantly, it is apparently not official policy of the White House that staffers are not allowed to tweet, and some do so from their own web-connected devices. And there are computers that can post to Twitter in the White House right now via HootSuite, which you see from time to time as the source of official White House tweets. But most of the official White House account tweets are done by the new media team (consisting of Director of New Media Macon Phillips and Online Programs Director Jesse Lee), from the new media offices are in the Eisenhower Executive Office Building (which is next door to the White House). President Obama’s account is apparently handled by the DNC. So there you go, while it is hard to tweet from inside the White House right now, it’s not impossible, and they’re trying to make it easier. It’s just a matter of recordkeeping and, quite literally, national security right now, which seems understandable. And the White House wants you to know that it likes Twitter. It tweets about it not once, but twice today. First, to clear up the banning issue. And second, like a good Twitter user, to promote itself to try to get a million followers. Lastly, it seems Burton has a good sense of humor about the whole thing. When asked to name some White House staffers that tweet, he replied:
Crunch Network: CrunchBoard because it’s time for you to find a new Job2.0  
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| Rosetta Stone Announces TOTALe, Language Instruction With A Social Bent Posted: 27 Jul 2009 11:00 AM PDT Admit it: you’ve been thinking about learning a foreign language. Maybe you’ve been planning a trip to Mexico or were considering taking over a small, French-speaking colony in the Maldives. Regardless of your interest or your armaments, it’s always nice to know a foreign language. Until now the traditional online teaching methods have involved simple flash-card-like exercises and animations aimed at getting you acquainted with a language or, at the very least, CDs running you through the traditional “I would like to buy some hashish” and “My hovercraft is full of eels” rigmarole we know all too well from learning languages on tape. Rosetta Stone aims to change all that with their new TOTALe live language lessons and activities. Rosetta Stone, a language learning company founded by Allen Stoltzfus in 1992, focused at first on CD-based training and quickly embraced web-based Flash systems for running lessons. The basic kits - about $499 for three lesson levels - include a web-based portion as well as an “audio companion” for training away from the PC. Their new system, called TOTALe, adds two interactive ingredients to the mix. The first is the Rosetta Studio, a live lesson area where you and two other students at your skill level work one-on-one with a live, native speaker. The second ingredient is Rosetta World, a matching service that connects a native speaker of one language with a learner of the other and, in some cases, vice versa. This means an Italian learning English would be connected with an American learning Italian. They then perform activities or play games related to the subject matter and can chat with each other in their native languages. The World portion also takes advantage of Rosetta Stone’s extensive network of students who have used other company products in the past, ensuring everyone can be paired up. The interface is quite simple. After setting up your microphone, the Flash application runs you through standard comprehension lessons and vocabulary. This takes about two hours to complete. Once you’ve completed a full lesson you can go to an online calendar and schedule a Studio session. The sessions last 50 minutes and involve simple discussion and vocabulary drills, all based on photographs illustrating the lesson. The whole system is run inside the browser and works on Safari, Firefox, and Internet Explorer. The screens are large and easy to read and all of the photography is top notch. I ran through some sample lessons in Spanish and found it a great refresher. Considering my High School Spanish has been decimated it was nice to run through the colors and numbers and I got to see my old friends the caballo and the camisa two words I had forgotten entirely. Most of the lessons include a speech portion, allowing you to practice pronunciation as well. I had a bit of trouble with my microphone but it seemed to understand my accented Spanish with ease. The Studio session was fun and educational. A charming young lady led us through a series of exercises, asking us questions based on vocabulary we learned in the lessons and asking us to create sentences out of our limited verbiage. You can mark images with arrows and crosses as well as add your own notes to the images. All of the students can hear each other but the coach - or teacher - is there to prevent you guys from making dates or berating the dumb guy in the room (Thanks, Adriana!) All of this takes time but it seems like time well-spent. I enjoyed the lessons and the Studio session was excellent, giving me an opportunity to speak in Spanish without the pressure of having to perform in real life situations. The company is planning to expand the service to educational institutions, an excellent solution for schools strapped for language educators. By putting a few kids in a room with a live person you create a mini classroom that is, if you think about it, quite amazing. Now for the bad news: TOTALe will be available on Tuesday and will cost $999 for a twelve month subscription. This includes Studio sessions and you can repeat sessions as necessary. After the introductory period it will cost $1,200. Before you go clicking off to buy a used copy of “Farsi for Dummies,” however, remember that Rosetta Stone has been an effective teaching tool for over two decades. The quality of the lessons is extremely high and the chance to work with a native speaker is unrivaled except in face-to-face schools. This social, human aspect really brings the lessons home and adds an amazing amount of value to the program. This idea isn’t new. Sites like LiveMocha, Babalah,Palabea,Busuu, and Learn10 are all trying to create similar solutions. However, Rosetta Stone has a bit more budget and experience behind their TOTALe system. In my own limited experience with the program, it is great for the professional and may be a great way to learn helpful phrases like “Drop your panties Sir William I cannot wait ’til lunch time.” The social aspects alone make the program stand out in a crowded market. Incidentally, if you made it this far into the post you’re eligible to win one of ten year-long subscriptions courtesy of Rosetta Stone. Comment below using your real email address in the correct field and I’ll pick ten comments at random on Wednesday. Crunch Network: CrunchGear drool over the sexiest new gadgets and hardware.  
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| Jeremy Wright Steps Down As CEO of Blog Network b5media Posted: 27 Jul 2009 10:56 AM PDT Jeremy Wright has stepped down as CEO of b5media, the blog network he helped co-found, mostly for unspecified personal reasons. While Wright will remain a board member and shareholder of the venture-backed startup, he already has a replacement: Elaine Kunda will take over the reins as CEO from this point forward. The decision apparently stems from the beginning of this year, when Wright took a short vacation and went offline for about 10 days. He writes:
Wright’s soul-searching follows some shifts at b5media itself, which saw massive pay cuts for bloggers as the economy tumbled last fall. It hasn’t been fun since then. But at least the network as a whole is holding up, with comScore estimating 5.8 million worldwide unique visitors in May, 2009, up from 2.7 million last August. I had a brief chat with Wright, and he assured me revenues and traffic are holding steady, though he refused to detail either one. CrunchBase tells us b5media has raised $2 million in venture funding to date, but since he mentions “millions and millions of dollars” in his blog post I wanted to find out if it was actually more than that. Wright confirmed that the total amount of capital invested in the company is in fact higher than the listed $2 million, but refused to disclose any new investors, let alone any amounts. Wright is moving on to new things, and in the meantime will run a consultancy agency of sorts along with some other people. The name of the short-term venture he will be shifting most of his attention to from now on is netmobs. Crunch Network: CrunchBase the free database of technology companies, people, and investors  
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| Defending Its Turf, TweetMeme Is Already Threatening To Sue ReTweet Posted: 27 Jul 2009 09:51 AM PDT It hasn’t even been 24 hours since we wrote about the impending launch of TweetMeme competitor ReTweet, and already TweetMeme founder Nick Halstead is threatening ReTweet with a lawsuit. He takes being king of retweets very seriously. It is not so much the apparent flat-out copying of TweetMeme’s Website design (ReTweet has not even launched in private beta yet), that bothers him. After all, TweetMeme itself was highly “inspired” by another news aggregator, Techmeme. What bugs him is what he claims to be almost exact copying of code. Halstead writes on the TweetMeme blog:
Update: ReTweet (or at least its holding company Mesiab Labs) responds. He had to look no further than the code for the retweet button itself. The code below is what he found, which he says is “an exact copy of our own retweet button code with the word ‘tweetmeme’ replaced with ‘retweet’".
I just hope all of these startups realize that Twitter could just end up trademarking the term just like they did with Tweet. Crunch Network: MobileCrunch Mobile Gadgets and Applications, Delivered Daily.  
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| Toshiba Is Making a Whole Lot of Flash Memory Chips This Month: New iPods? Tablets? Puppies? Posted: 27 Jul 2009 08:56 AM PDT  New iPods usually come out in September, right? There or thereabouts, at any rate. Well then maybe we should look into this report that says Toshiba will "ramp up" production of flash memory chips during the month of Auguest. Word on the street is that Toshiba is doing so to fulfill a big order from Apple. So, new iPods on the way? Speculate away!
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There are 1.2 million predictions made on Twitter everyday. Those are numbers that the prediction startup 
If you make a prediction on Blubet, and it comes true, you get the number of points you wagered. If you get enough of these points, you level up. And there is a leader board to determine who is doing the best with their predictions. Right now, it’s run on a honor system, with other users charged with reporting a user if they’re lying about a prediction made.
In what looks to be shaping up to be another 
The 
Twitter is great for a lot of things, but I think my favorite use of it is public smack-talking. Just read what Lance Armstrong 
Earlier today we 
If Zappos was a
Last week, we wrote about the 
A few weeks ago a good source gave me a legal document written by a former federal prosecutor and senior Department of Justice official. It was arguing that social gaming company 
Google Voice is a pretty amazing service, but it comes with a number of minor annoyances, including the way in handles outgoing calls and SMS messages. Fortunately, Google has recently 
Remember all the brouhaha about 
One 
While there’s a lot of talk about Apple’s rumored tablet device as it relates to new initiatives from the music industry, the device is undoubtedly a lot larger in scope. The music-angle talk is mostly thanks to the Financial Times 
I have a Kindle (the 2nd generation), and I love it. But even after months of using it, when I switch to it after a day of using my iPhone, my initial reaction is to try and touch the screen. I want to flick my finger from side to side to turn book pages, not use the device’s clunky buttons. I want to be able to turn the device and put it into landscape mode, to pinch to zoom in on picture, and for the love of God, please let me use my finger to click on links rather than the awful joystick thing. Those are things that this Apple device will undoubtedly bring to the table.
The Internet got in a 
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