Author: Carlo Longino

Online dating site Match.com sent a letter from its lawyer to rival Plentyoffish.com last week, accusing it of citing statistics about itself and its members (like the fact that they’ll go on 18 million dates this year) that Match says can’t be supported. It then went on to “demand that [Plentyoffish] immediately cease and desist”… or provide Match with user data to back them up. Ever the friendly rival, Match’s lawyer said the company would be glad to sign a confidentiality agreement before taking a gander and Plentyoffish’s proprietary data. POF’s founder basically told Match to get lost, highlighting several figures that Match touts about its service, including one saying that an average of nearly 1000 people per day get married after first meeting on Match. To be honest, a lot of the figures cited by both parties are a little hard to believe, and sound like little more than attempts by the sites to sell hope to prospective users. But starting a fight over a rival’s claims — when all that’s likely to do is call attention to your own — may not be the wisest move for anybody in the online dating business.

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Steve Jobs fired the latest salvo in the ongoing Apple-Adobe spat today, with his “Thoughts on Flash” posted on the Apple site. In short, he says that Adobe looking out just for its own interests in drawing developers to its “100% proprietary” Flash ecosystem while Apple supports a great, open standards-based world. But just as we pointed out a couple of weeks ago when Apple moved to block cross-platform development tools, regardless of what Apple says, its interest is locking developers into its Apple-controlled and dominated ecosystem. Nearly every accusation Jobs levels at Adobe and its products can be made about Apple and the way it seeks to control iPhone app development. Jobs brings up Apple’s support for open Web standards, but that’s really little more than a red herring to distract attention from how Apple wants to lock down developers into its own ecosystem. Jobs makes it clear that he has no interest in developers using any platform apart from the iPhone, and any tool that helps them do so is worthy of his scorn. So for him to talk about supporting Web standards — with the point being that they’re standards, available across platforms — is disingenuous when Apple’s strategy for apps is guilty of pretty much everything he accuses Adobe of. None of this, on a strategic level, is particularly reprehensible, they’re just business decisions (even if we don’t agree with the approach). But Apple’s apparent insistence on playing by a different set of rules to everyone else, and the hot air that accompanies it, grates just a little bit.

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It’s been rumored for several weeks now that Palm was up for sale, with a number of different companies supposedly taking a look at it, but news has come through now that HP has picked it up for $1.2 billion. Palm’s business has been running downhill for a few years now; its worldwide market share has fallen from 3.5 percent in 2005 to 1.5 percent in 2009 — despite the relatively warm welcome its Pre device received. The Pre was the first Palm phone to run its latest operating system, WebOS, which was supposed to help the company compete in a revitalized and highly competitive marketplace against the likes of Android devices and the iPhone. But that hasn’t yet happened. The Pre (and the following device, the Pixi) hasn’t grabbed significant market share, which compounds Palm’s other problem: lack of a strong developer community for WebOS. That is actually sort of ironic, given that an older incarnation of Palm was probably better than anybody in the mobile space at cultivating a huge and loyal developer community, back in the days of Palm OS. So if scale and a lack of developers are the two biggest problems holding Palm back, does the HP deal actually do anything to help solve them? Maybe that’s looking at the situation the wrong way: perhaps the point of this isn’t for HP to fix Palm, but for Palm to bring something more to the table for HP. Like 1,500 patents.

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The RIAA’s blog is an endless source of fun, and its latest post is touting some figures showing the success of the recent “Record Store Day”. Record Store Day is a yearly event started by a group of indie record stores that’s grown over the last couple of years, and is marked with some festivities as well as the release of a lot of limited-edition records, CDs and other products available only in hard copy in certain participating shops. This year, there were 175 such products, and they helped boost the sales of indie shops. In particular, sales of vinyl albums were up 119 percent over the previous week, and vinyl single sales grew by 529 percent. But this isn’t proof that the “we must sell music” mantra is correct; the sales increased not because people were buying music, they increased because they were buying an attractive, scarce physical product, like special vinyl picture discs or limited-edition prints. Record Store Day is a great example of how the packaging of a product that happens to contain music can drive people to buy it. The value consumers were paying for was in that packaging, not necessarily the content within it. Whether they know it or not, the stores and bands have given customers a reason to buy.

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Small patent holding firm Klausner Technologies has sued HTC for infringing the patents on visual voicemail it says it holds, adding the phone maker to a long list of companies that have been attacked with the overly broad patent. Just as in the previous cases, it’s not clear how this system actually helps anybody that’s doing any actual innovation; the company with the patent, but which has never apparently done anything to actually bring it to market, gets to assess an innovation tax on companies doing the actual legwork. Meanwhile, the idea underlying the patent — displaying voicemail info on a screen — really isn’t much more than a foreseeable progression of technology. So carry on, patent system, holding back innovation and misaligning incentives.

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The Privacy Rights Clearinghouse has put up a pretty interesting chronology of data breaches (via Guardianista) detailing leaks in the US since 2005 that resulted in the loss of people’s personal info. They’ve totaled up the figure over the past five and a bit years, and it’s a staggering 358.4 million records lost. Keep in mind that 358.4 million is just a minimum, since there are plenty of leaks that have lost an unknown number of records (like the one from a closed-down Hollywood Video store in Nevada, where customer records were thrown in a dumpster then scattered by the wind). Still, you may be thinking that you don’t hear about record-breaking data breaches much these days, but that’s not because they’ve stopped — it’s just that they happen so often, they’re really not all that newsworthy any more. A lot of lip service gets paid to clamping down on fraud, but it really doesn’t seem like much goes on to stop data leaks, since the penalties for the leaks are toothless and are cheaper than any real prevention.

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If you were anywhere near a techy site on the internet last week, you probably noticed the sensational story of how a prototype of a forthcoming iPhone got left behind in a Silicon Valley bar, and eventually ended up in the hands (and on the pages) of gadget site Gizmodo. Given Apple’s history of cracking down on new product leaks, it wasn’t too surprising to see the company ask for the phone back, nor to hear rumors that police were looking into the matter. However, it was a little surprising to read today that California police have seized computers and other gear from one of Gizmodo’s editors, breaking down his door in the process. The COO of Gizmodo parent Gawker Media alleges that the search was illegal, as the editor is protected under California’s shield law, which protects journalists from revealing their sources. Gawker founder Nick Denton says the case should let us find out if “bloggers count as journalists”, but that’s not completely clear. The shield law exists to protect unnamed sources, not to let journalists commit crimes (such as receiving stolen property) and then cover them up under the guise of their work. So while the case may not settle if bloggers are seen as journalists in the eyes of the law, it should settle once and for all that age-old question of whether or not an iPhone prototype left in a bar by an Apple employee constitutes stolen property.

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A couple of weeks ago, Netflix announced that it had reached a “deal” with Fox and Universal movies studios, in which it agreed to delay the release of their DVDs to its subscribers by 28 days. Netflix did the deal in order to maintain its access to movies for its streaming service, and the studios think it will help them sell more DVDs. The studios tried to get DVD rental service Redbox over a similar barrel by threatening its access to their DVDs. Redbox had already caved to Warner Bros., and has now done a similar deal to Netflix’s, with Fox and Universal. And, just like all the earlier deals, this one’s pretty stupid on the part of the movie studios. Let’s go over why.

Redbox offers two main benefits to its customers: convenience and price. Its machines are everywhere these days, and its $1 per night price capitalized on the widespread consumer displeasure with Blockbuster and other rental chains’ high prices and late fees. The Redbox customer is price sensitive; so is it really very likely that delaying the release of a movie by a month is going to get them to decide to shell out $15-$25 per movie to see it immediately after it’s released? The same goes for Netflix subscribers. If they’re already paying for their subscription service, why would they run out to buy a new release — particularly when they already have to wait to get some new releases anyway. The studios think they can force customers to change their behavior by controlling access to new movies. All this plan is going to do is to illustrate to them that the part of the market they’re aiming for with these delays really doesn’t care enough — or cares about other factors more — to behave any differently.

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There’s been an almighty kerfuffle in British historian circles the last couple of weeks, after some people noticed a couple of reviewers on Amazon were talking up one historian’s work while trashing books written by others in the same field. The author in question was named Orlando Figes, a professor at London’s Birkbeck College. One of the pseudonyms used on Amazon was “orlando-birkbeck”, so it wasn’t too difficult to assume who was posting the reviews. Word started getting around and was picked up by some newspapers, leading Figes’ lawyer to deny his involvement and demand corrections be run, suggesting Figes could be entitled to damages. Then, the lawyer issued a statement blaming Figes’ wife (herself a lawyer) for the reviews. Not surprisingly, Figes has now admitted he wrote the reviews, and he’s very sorry. This isn’t the first time authors have been caught giving themselves good reviews, and generally, most attempts to do this sort of thing end badly. You’d expect by now that most reasonably intelligent people would understand that, and figure out that the potential downside of getting caught far outweighs any positive benefit the fake reviews could deliver. Then again, you’d also expect that most reasonably intelligent people wouldn’t fall for 419 scams, either.

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For years, there’s been conflicting research on the health risks posed by mobile phones. For every study that found a link between the radiation from phones and cancer, there was another that didn’t. Part of the problem is that the health issues that could be caused by phones can take years to emerge, and since mobile phones are relatively new — and have changed significantly over the past 10 or 15 years — so definitive research is a long and difficult task. But now, some researchers in Europe are embarking on a large-scale, 20- to 30-year study to examine just how phones affect people’s health. They’re looking at cancer, but also other issues commonly tied to phones, such as brain diseases, headaches, tinnitus, depression and sleep disorders, and will also be examining radiation emitted by other devices, like baby monitors and cordless phones. It will be great to have some more definitive answers as to exactly what risks we’re subjecting ourselves to by putting mobile phones up against our heads, so be sure to check back in a few decades.

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Skype has been one of the louder voices in pushing for broadband providers to be forced to keep their networks open. One of the company’s execs has taken to its blog supporting net neutrality regulations in the EU, making some useful points about how it’s services like Skype that sell broadband subscriptions and, specifically, mobile data plans. But how does that reconcile with Skype’s mobile moves in the US, where it appears to be pushing exclusive deals with operators over “open” access? So, on the one hand, Skype doesn’t want to have to pay telcos for access to its customers. But then on the other, it looks like Skype wants to charge telcos to be able to offer its service to their customers. This makes it look like Skype is okay with pay-to-play systems, but only when it’s on the receiving end. Certainly Skype is free to use whatever business model it likes, but it certainly appears it’s trying to have the best of both worlds here.

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Wanderlust wrote in to point out the rumors doing the rounds today that Hulu is getting ready to launch a paid subscription service, something that’s popped up before. Apparently Hulu is looking to offer the five most recent episodes of a show for free, then will charge $10 a month for access to older episodes. There aren’t a ton of details, so it’s not clear exactly how the plan will play out. But we can say this: unless Hulu is adding some real value for users, and not just putting currently free content behind a paywall, it’s doomed to failure. It’s pretty clear that some of Hulu’s corporate overlords think all of its content should be behind a paywall. But erecting a paywall will simply drive Hulu users to unauthorized downloads and streams, delivering those content providers absolutely nothing. All too often these paywalls are based on the idea that once users have nowhere else to go, they’ll start paying; the reality is, though, there’s always somewhere else to go.

Hulu’s success thus far has been by attracting users with a good choice of content presented in a good interface, reflecting something of an understanding that the way to compete with free, unauthorized content is to offer users something better. It’s already started to undermine some of its success by blocking certain browsers in an attempt to force users to only access its content (and its advertising) through means of which it approves, and the paywall represents yet another step towards replacing a product that’s better than unauthorized content with one that’s worse. In any case, when online streaming TV shows are already pulling in some high ad rates, does it make any sense at all for Hulu to start throwing up paywalls?

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One of US telcos’ favorite talking points is the “free ride” that Google and other content providers get on their networks. It’s fundamentally wrong, since Google and others obviously pay their bandwidth bills, but it’s also conceptually flawed, as telco execs seem to think it’s their networks, rather than the content which travels over it, that consumers value. The stupidity isn’t bounded by this country’s borders, though, with the head of a UK broadband-via-satellite provider saying that “Neither consumers or providers are bearing the cost” of data traffic over broadband networks. With that, we’d like to extend our usual challenge to the exec: if neither consumers or content providers are paying, how about paying their bandwidth bills for a month?

The exec contends that broadband providers will all eventually move to usage-based pricing, and in a letter to the Financial Times, says that when they do, “content free loaders will suddenly find that demand falls dramatically”. Perhaps it’s just a typo, and he meant to say “broadband providers will suddenly find that demand falls dramatically”? Once again, the exec fails to understand that people don’t buy network access from his company just for the sake of it, they buy it for access to content. If he, or any other provider, starts putting walls up between consumers and the content they want to access, whether through walled gardens or usage-based pricing (really just a code word for “much higher fees”), they will reduce the value of their customers’ connections, and subsequently what they’ll pay for it. So if the end result of a shift to usage-based pricing is decreased usage — and subsequently no real change in providers’ revenues — what good is the shift?

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On its quarterly conference call, AT&T’s CFO once again talked up how the company needed to
move away from flat-rate mobile data plans because its networks are being overwhelmed by traffic from a small percentage of its users. This rhetoric — which is really just trying to warm up the market for future price increases — comes despite figures showing that AT&T’s data revenues are increasing, while its network investment is decreasing. On some level, if an operator like AT&T wants to try to force through higher prices by increased flat rates or usage-based pricing, go right ahead; we’ll see just how the market reacts. But all of their talk about their poor overwhelmed networks would go down a little bit better if they wouldn’t decry flat-rate plans in situations like this, while they launch cheap flat-rate unlimited plans at the same time, as AT&T has done for the iPad 3G. If AT&T’s network is already taxed and cheap data plans are to blame, why launch another one on a device that’s built to consume data?

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TV broadcasters have long struggled with how to deal with DVRs and how they allow users to skip over commercials. Perhaps the favored approach has been to come up with technological responses to try and prevent people from fast-forwarding; fewer companies have figured out that advertising is content, and needs to be treated as such. Viewers need to be given a reason to watch ads, whether it’s simply entertainment or because the content offers some other value. Another idea that’s being tested:
not stopping the show during ad breaks. On one show on CNN, when the ads start, the studio cameras keep rolling, showing “behind-the-scenes” footage in a small box in the corner. The belief is that if there’s still some bit of “program content” going, it will be enough to keep people from flipping channels or skipping ahead, even if it is just paper shuffling and makeup being touched up. It’s an interesting proposition, but once viewers realize they’re not missing anything of value, won’t they switch away or fast-forward? And if the program content actually is valuable, won’t people just not pay attention to the ads? The problem here seems to be that this is just an effort to recreate a captive audience. But without offering anything of value to the viewer — whether it’s the ads themselves or this “program content” — they’re not going to stick around and suck up the ads.

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A consistent source of angst from mobile phone users are the costs they often must incur to replace devices that get broken or damaged. Thanks to the subsidies mobile operators pay on handsets, they typically don’t like to replace phones for free, asking users to pay up or renew their contracts. One key part of operators’ arsenal in determining if damage has been caused by the user are liquid sensors. These little round stickers often reside under a phone’s battery, and typically turn from white to some shade of red when they’ve been exposed to liquid. So if you’ve dropped your phone in a puddle and it stops working, the liquid sensor probably won’t back up your story that your phone just all of a sudden stopped working. The iPhone is no different in this regard, but a San Francisco woman has sued Apple, alleging that the iPhone’s sensors generate false positives, letting Apple skip out on warranty obligations. The woman alleges she’s had to replace her iPhone at her own expense twice, after the sensors showed her device had been exposed to water, even though it had not. For what it’s worth, Apple says the sensors work just fine. This case may seem pretty pointless, but should the woman prevail, it could set a powerful precedent for all types of phones sold by carriers here in the US, and impact how they carry out their warranty replacement and service plans.

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Mark writes in with a story about how some newspapers are apparently jacking up the prices they charge for death notices (via The Consumerist). The original author balked at paying the SF Chronicle $450 for a 182-word death notice, calling it an exploitation of people who, when dealing with a death, will simply swallow it and pay up. That might be a little extreme, but clearly death notices are an area where papers can try to make up revenues they’ve lost in their classifieds and other areas. The key word here is “try” — by jacking up the cost of death notices, the plan seems to be to replace lots of people paying newspapers a little bit of money with a few people paying them a lot. Which makes perfect sense, right? The problem is that papers are assuming that death notices are something people will keep paying for blindly, when, like so many other parts of their business, they appear to be living on borrowed time. Just like classifieds shifted to the internet, so too are things like death notices, with social networks like Facebook becoming a more popular way for members of younger generations to learn about deaths in their social circles. Charging high fees for death notices seems like an easy way for newspapers to hasten their irrelevance and demise, not a way to grow their revenues.

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Online gaming is massively popular in South Korea, so much so that its popularity among teens — and their propensity to stay up all night playing them — is seen as serious social problem. But the country’s professional gaming leagues have been hit by a match-fixing scandal in which players and officials have allegedly taken bribes (via the BBC) from gamblers to throw games of StarCraft. The incredible popularity of StarCraft, and other online games, in Korea has created enough interest to fuel illegal gambling sites that bet on the outcome of matches between the country’s 12 pro teams. The maker of StarCraft, Blizzard, has been trying to take a cut of the TV revenues generated from the matches, a move that wasn’t well received in Korea. It looks like that spat might get precluded by the crumbling of the pro league.

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A startup called Groupon recently brought back some memories of the dot-com bubble when it announced that it had raised a $135 million round of financing, reportedly at a valuation of $1.35 billion. The company offers users in different cities the ability to join a group to buy coupons or discounts from a local business. If enough people join in, everybody gets the deal; if the magic number isn’t reached, nobody gets it. In addition to the VC round, the business model is straight out of the bubble, and is pretty close to one used by Mercata, a Paul Allen-backed company that failed back in 2001. Apparently, Mercata garnered a dozen patents based around group buying, and they’ve now been sold to a Groupon rival called Tippr. That company’s CEO told GigaOM that he plans to enforce the patents, but he believes “that patents are primarily a defensive weapon, not offensive.” It’s not entirely clear how those two statements can be reconciled, but he assures us that he’s not a patent troll. In any case, it’s hard to see how this situation really benefits anybody (apart from the lawyers), as it foreshadows a lot of money and other resources being devoted to a patent fight — resources that would be better spent elsewhere.

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The next World Cup (wait, can we say that?) soccer tournament begins in less than two months, and it looks like some folks are already lining up the excuses for when their team underperforms on the pitch. The latest one: blaming the use of iPods and video games for preventing teams from building a “collective spirit.” An English coach started the riff by saying, “I’m not a big fan of these big earphones on the way to games,” and that “my thing with the iPod generation is that when they leave the ground and go away to their closeted little lives they shouldn’t forget what’s got them where they are and what impact they can have.” It should be added that his team currently lies near the bottom of the top English league, and their problems likely run much, much deeper than their players’ headphones. But hey, just like when your nation fails at the World Cup, it’s a lot easier to blame technology than anything legitimate, like at the last tournament, when Brazil’s poor performance was blamed on Ronaldinho’s interest in scoring on his PS2 (and his girlfriend) rather than for his team. This pining for the good ol’ days also ignores the idea that technology can deliver some benefits to players and their teams as well, and that the current generation of players might be more effective at bonding over some video games than beers, cards or whatever else their forerunners got up to.

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