Posts from Google

I was at breakfast with a friend yesterday who told me about a project he did with some Twitter data around weather. He said as he was pouring through the data, he saw that there were bursts of tweets at certain times. He dug into the data and saw that it was weather vanes and thermometers that were tweeting out their data.

It got me thinking about things that tweet (like weather vanes, refridgerators, traffic lights, etc) and their role in the land of social media. I believe that devices and sensors that broadcast their data via social media channels are an important source of social data and engagement. And for some reason, they are way more common on Twitter than any other social platform.

Have you ever seen a weather vane on Facebook? I have not. If they exist I'd love to know about them. I want to understand the Internet of Things and its role in social media. I suspect that the symmetric friending model and the use of real names/real people in the Facebook system is a hindrance to devices updating Facebook pages, but I could be wrong.

Services that are too determinent in their use case are ultimately limiting in their extensability to important new uses. Machines are reliable sources of information and the social services that are friendly to them have a number of interesting opportunities in front of them.

The day Google+ launched, I sent a friend at Google who was involved in building the service an email requesting an invite. I got the invite late that day and started playing with the service. Here's my profile. I'm not sure if this page is public or you need a Google+ login to see it. At some point Google will open the service to everyone and I expect this page will be public, but I'm not sure.

In any case, I hope Google+ succeeds. Given the blog posts saying this will kill Tumblr, Twitter, Foursquare, etc, you might wonder why I feel that way. Well first, I don't think competitors kill companies and services. I think the vast majority of "deaths" are self inflicted. Facebook didn't kill MySpace and Friendster, they killed themsleves by failing to address the shortcomings of their services and their inability to respond to changing market dynamics, in some cases brought on by competitors. Of course, that fate could be in store for any company, including our portfolio companies, but it won't be because of Google+.

My vision for social media is:

every single human being posting their thoughts and experiences in any number of ways to the Internet

Not everyone wants a Facebook experience; default private, mutual follow, best for close friends and family. Not everyone wants a Twitter experience; default public, asymmetric follow, best for broadcasting short burts of information to large networks. Not everyone wants a Tumblr experience; totally public, asymmetric follow, best for posting microchunked media.

My dad, for example, doesn't want any of those experiences. He might like Google+. It's a lot like email. He can curate groups of friends; his friends from school, his friends from the army, his friends from the community he lives in, and share information with them quickly and easily. I can see The Gotham Gal's dad loving Google+ too. It's very utilitarian and functional and powerful for certain kinds of users.

I've never thought that there would be one social service to rule them all. I've never thought that there would be one social graph for the web. I believe we'll need a multitude of social services to satsify the needs and desires of all the users of the web. Google+ fills a void between public and private, it serves what is likely to be an older demo less interested in hooking up or hipstering out and more interested in the social utility it provides. That's a good thing. We'll get more people "posting their thoughts and experiences in any number of ways to the Internet."

And there's another reason I hope Google+ succeeds. Developers need more social platforms of scale. A friend on Twitter posted a link yesterday to the post I wrote on the USV blog when we first publicly acknowledged our investment in Zynga. We first invested in Zynga in the fall of 2007 and back then I was eager to see Zynga build a business on multiple social platforms. I wrote:

Currently all of Zynga's games run inside social networks, largely Facebook, but also Bebo and several others. And that list of social nets will grow longer in the next few weeks.

Developers like Zynga benefit from having multiple large social nets to build on top of. Tech blogs have noted that Google+ has hooks for social gaming built in. That is great. My dad would love some of the Zynga games. Maybe he'll join Google+ and play them with his friends (including me) there.

My line about "don't be a xyz bitch" is all about controlling your own destiny. These social platforms are awesome to build and launch on. They give you instant distribution, instant users, instant social identity. But in a perfect world you don't want to be dependent on any single one of them. The more social platforms of scale there are, and we have a bunch now, including Twitter, Tumblr, and Foursquare, the better world it will be for developers. And our business at USV is investing in and helping developers build companies. So I'm rooting for Google+. I think it will serve users who aren't being served well (or at all) on the social web right now. And I think it will be a strong new platform for developers. And both of those are great things for the web, our business, and entrepreneurs.

I've been on a mission to dramatically reduce the legal costs of a venture financing. Our firm is doing our part. On many of our recent transactions, we've gone without counsel and have signed documents without negotiation. That takes out the investor counsel costs. And we've been pushing company counsel to reduce their costs. But we are still seeing company counsel costs of $15k or more on venture financings even with our "no negotiation" approach. I'd like to see venture financing legal fees get to $5k or less. I don't know why raising a venture round can't be like signing a lease on an apartment with standardized docs and a one page rider for any changes.

As we dig into the costs on the company counsel side, there are areas we feel can be improved and areas that cannot. The entrepreneur still needs an experienced counsel to explain the deal to them. That time and money is valuable to everyone involved. I'm hopeful that Brad and Jason's upcoming book will help reduce the time and money spent educating entrpreneurs on venture financings, but realisitcally the company counsel is still going to have to do some hand holding.

But there are many areas where the company counsel is spending time and money doing things that can and should be automated. Tops on that list is document creation, distribution, change management, and ultimately signing.

We've noticed that some of the new online funding platforms, like Profounder, have managed to totally automate this process online. We wonder why the law firms we work with have not. One of the best hacks of the Disrupt Hackathon last weekend was Docracy. I am going to find out if we can use Docracy on our next venture financing to make things more efficient.

And Bijan posted recently that he is using an iPhone app called EasySign to sign legal documents when he is out and about. After going through torture this weekend at our beach house to sign docs that absolutely had to be signed by yesterday, I'm searching for something similar on my Android. Please EasySign team get me an Android version. I promise I will blog about it when you do.

And in the meantime, if anyone knows of any good mobile signing apps on Android, let me know about them in the comments.

This whole area is so ripe for change. We are documenting financings for cutting edge web startups using technology from the middle ages. That must change and it must change now.

Mark Suster wrote a long investment research report on the "The Future of TV and Digital Living Room" opportunity on his blog last night. I don't know how he has time to crank out these amazing blog posts on a regular basis. But he did it and it is very comprehensive. You should read it.

We've got a horse in this race with Boxee. I spend a lot of time thinking about where this sector is going. And I agree with almost all of Mark's analysis and conclusions. This is an investable space with big outcomes. But you have to swim with sharks (content owners) and walk at the feet of elephants (Google, Apple, Microsoft, Sony, Samsung, etc).

The Internet has mostly been a level playing field where the best product wins. That has not been the case in the world of big media and CE. Money talks loudly in that world. So it is still unclear whether Internet economics will work in this sector. But I am hopeful. If it prevails, this will be a very interesting market sector to invest in for the next decade (at least).

Yesterday I was at Sony's offices in NYC and got to play with the new GoogleTV powered big screens. Here's a screen shot of my twitter stream on the Sony GoogleTV (with the tweet I wrote on it on top).

Sony has some cool products coming out that are powered by GoogleTV including big screens like this one and blu-ray players that double as GoogleTV boxes. If you are working in this sector or are interested in seeing where all of this is headed, you should go to a store and play around with them.

I don't think AppleTV, GoogleTV, and Boxee are yet what they can be and will be. There is more high quality streaming content available every day. These software/services for managing, navigating, and discovering it will improve a lot in the coming years.

But I do believe that the old model of TV and Film creation, distribution, and consumption is changing rapidly. Mark's "report" outlines how and why. And with change comes opportunity. In this case big opportunity.

I read Mike Arrington's post on Google's social efforts just now. I have not seen any of Google's work. I have not been briefed. I really have no clue what they are building. But this quote got my attention:

Google Me is not a product, it’s a social layer across all products”. But there’s more – “Google Me will produce an activity stream generated by all Google products.

Q. Why did Twitter succeed and FriendFeed fail?

A. Because FriendFeed was largely a social aggregator whereas Twitter is a service with specific social intent.

I think this is an important distinction. I have not seen any breakout social layers. The social services that have broken out to date have been services where a user has a very specific intent.

Social engagements are weird out of context. Comments to this blog make perfect sense on this blog but less sense when they are tweeted out into a Twitter stream or show up in FriendFeed.

There is value in social aggregation but not huge value. Not "this is how we are going to compete with Facebook value". If you want to compete with Facebook, you have to build a service that offers users a specific social intent and the ability to engage directly around that intent.

Curious if you all agree with me.

Yesterday, Judge Louis Stanton of the Southern District Court here in NYC issued his opinion in the long standing legal battle between YouTube and Viacom. It was the very threat of copyright litigation that forced YouTube to sell to Google, who had the resources to fight this fight.

This decision means that other user generated content services will not have to make the choice that YouTube had to make. Judge Stanton ruled that YouTube was operating within the framework of the Digital Millennium Copyright Act (DMCA) which says that web services that have infringing material in them must respond to take down notices but do not have to proactively weed out their services of all infringing material.

This is a huge victory for entrepreneurs and the web. I am ecstatic.

I spent some time on Comscore this morning looking at US vs Rest Of World traffic for some of the largest web properties. Here are the stats for Feb 2010:

Google: 890mm worldwide visitors, 745mm non US – 84% non US

Facebook: 471mm worldwide visitors, 370mm non US – 78% non US

Twitter: 74mm worldwide users, 53mm non US – 72% non US

I suspect Facebook and Twitter will both end up north of 80% once their internationalization efforts are fully realized. Facebook is a lot farther along that path than Twitter but it seems like Twitter is growing like a weed outside the US right now. This is a Comscore chart of Twitter's non-US traffic through February 2010.

 

The conventional wisdom is that international usage cannot be monetized as well as US traffic and that is certainly true. But with >80% of your potential users outside of the US, I think the web sector needs to start working harder on international monetization.

Even if international traffic could only be monetized 25% as well as US traffic, when your international traffic is 80% of your total traffic, you would make as much money internationally as domestically. So that's a lot of potential out there to be tapped.

And of course, not every international market is equal when it comes to monetization. Markets like western europe and japan monetize very well today. Emerging markets like the BRIC countries (Brazil, Russia, China, and India) should be big opportunities for monetization this decade. Other markets may be tough for years to come.

What this means to me is that web services that are highly international today should invest in fully localizing their user experience and then start thinking about monetizing outside of the US. Start with local partners and then start putting people on the ground in your best international markets.

There's a lot of money "rest of world" and I suspect that will only be more and more true over time. So we should start building web businesses with that in mind.

About a year ago, I wrote a post about Apple's "blind spot" for Flash. I took more heat for that post than anything else I've written here other than political posts. It opened my eyes to the fact that Flash vs HTML5 is one of the most politically heated topics in the tech business. The third rail, as it were.

The choice of what technology web developers use to produce rich browser based applications is a big deal with a lot of important ramifications for companies, investors, and most importantly users. Jeremy Allaire, creator of ColdFusion and Brightcove, addresses this issue today on TechCrunch.

It's an excellent post full of great facts and insights, including this one:

What few people realize is that while H.264 appears to be an open and free standard, in actuality it is not. It is a standard provided by the MPEG-LA consortsia, and is governed by commercial and IP restrictions, which will in 2014 impose a royalty and license requirement on all users of the technology. How can the open Web adopt a format that has such restrictions? It can’t.

Jeremy predicts that "Google will make an end-run on this by launching an open format with an open source license for the technology, which according to industry experts delivers almost all of the same technical benefits as H.264."

If you are a web developer, entrepreneur, or investor, I suggest you go read Jeremy's post in full. It's very good.

If you don't plan to read it, I'll summarize. Jeremy makes two big points. The first is that HTML5 vs Flash is not a winner take all battle (at least for many years). He predicts that for web apps, we'll see more and more developers move to HTLM5. But for video, gaming, and other "immersive" applications, we'll see developers sticking with Flash for a long time.

His second point is that the desktop web and the mobile web are going to play out very differently. He says:

in the context of hand-held computing, where Apple is politically motivated to block the Flash runtime, it is apparent video publishers will be driven to build and operate solutions that leverage HTML5 Video on mobile and iPad browsing environments.

When it comes to HTML5 vs Flash, there are technical arguments, economic arguments, and political arguments. And, unfortunately, the political ones carry a lot of weight.

Jeremy outlines the political agendas of two of the big players in this battle:

a web-centric, HTML5-centric handheld world favors Google because it can leverage it’s existing dominance in search and web advertising. A proprietary App-centric universe favors Apple because it can become the primary gatekeeper to reaching the mobile audience and already has a pole position in integrating payments and advertising into content applications.

I know where I personally come out in this fight. I much prefer a "web-centric handheld world" to a "proprietary app centric universe". And that's why I carry a Google phone instead of an iPhone. For me, it's a political statement as much as anything else.

Someday soon, I'll be reading a blog on my Google phone and I'll come upon a video in a Flash player and I'll be able to hit play and watch it on my phone. That's apparently not going to happen in Apple's "proprietary app centric universe". 

The good news for all of us is that no one company is going to dictate how this plays out. Jeremy says in the wrapup of his post:

it is evident that the competing interests of platform vendors, consumers and app and content publishers will ensure that this remains a fragmented and competitive environment for many years to come

Regardless of whose political camp you are in, we can all agree that a competitive environment is best. Even if it means a more complicated development environment.

I've long noticed that the most innovative, decisive, and risk taking companies are led by founders or at a minimum have their founders actively engaged in all key strategic decisions. There are many examples. One could point to Richard Branson, Steve Jobs, and Rupert Murdoch. It's also noteworthy to look at the difference between Microsoft when Bill Gates was highly engaged and since he's largely moved on.

I was thinking of that today as I was reading Jessica Vascellaro's account of Google's decision making on the China situation. According to Jessica, Eric Schmidt prefers to see Google stay in China. And Sergey Brin prefers to see Google leave.

Google's statement on China is pretty extraordinary. That they are even considering leaving the largest growth market in the world is a stunning revelation. And it is unlikely that hired and professional management would make such a decision. Management's primary job is to build value for shareholders and it would seem that leaving the largest growth market in the world is not in the shareholder's interest.

However, when the largest shareholders happen to be the founders, such decisions take on a different light. And it may well be that leaving China is the best thing for Google, its employees, its customers and users, and its shareholders. Only time will tell what Google will do and what impact it will have on the company.

I am very impressed with Google and have been for a long time. I think that many of the reasons it is such an amazing company result from having its founders engaged and involved in the key strategic decisions the business faces. The founder factor is a huge intangible force in companies and is most often for the best.