Looks like good sense has prevailed. Media giant News Corp, despite persistent rumors to the contrary, is not planning to unleash a competitor to Amazon’s Kindle, CEO Rupert Murdoch said in an interview with the company’s Fox Business. He is leaving the device business to those who know it best — device makers. When asked by Stuart Varney, a Fox anchor, if the company was going to get into the hardware business with an electronic reader, Murdoch said:

I don’t think that’s likely. We’re looking and talking to a lot of laboratories and big companies around the world like Sony, Fujitsu, Samsung. We’re all working on wireless readers for books or for newspapers or for magazines.

I think they’re a year or two away, being marketed in a mass way, high-quality ones. And we will be absolutely neutral. We’re very happy to have our products distributed over any device provided it’s only going to subscribers who are paying for it.

In May, The Daily Beast reported that News Corp had put together a team that was looking to come up with a way to charge for online content, including building hardware to consume it.

The source tells me that this team is “personally run and overseen” by Murdoch, 78. Murdoch has enlisted the aid of a longtime trusted lieutenant, Les Hinton, now CEO of Dow Jones, which News Corp. took over in 2007, and Murdoch’s youngest son and heir-apparent, James, 36, the London-based CEO of News Corp.’s Asian and European operations since late 2007.

Good luck with that, Mr. Murdoch. The decision to not build a device is a smart one; the company can benefit from working with as many partners as it wants to encourage the use of its content. Now what are the odds that other newspaper companies will suddenly rethink their plans for Kindle competitors?

Photo of Rupert Murdoch courtesy of World Economic Forum via Flickr.

I just saw that Amazon has launched a new, special store — dubbed Amazon Wireless — that sells wireless service plans and devices from U.S. carriers AT&T and Verizon Wireless. Sprint and T-Mobile USA are coming to the store soon. To be fair, Amazon is playing catch-up with San Francisco-based specialty e-tailer, LetsTalk, which offers more options when it comes to plans, carriers and devices. It also has a 10-year head start.

Nevertheless, it is safe to predict that thanks to its dominating presence on the Internet, Amazon will be a formidable competitor to LetsTalk. The clean and easy-to-use design, description of devices and quality of reviews alone ensures the future of this offering. I wouldn’t be surprised if a few years from now it becomes a king-maker in this high-volume business. I am frankly surprised that it took Amazon until now to do this, considering that it’s been offering mobile plans and special deals for so long. Wireless retailers get a nice chunk of change from the carriers for the deals they bring to the party.

The big question is if this is a new strategy, that of micro-stores focused on specialist markets. It had launched Endless, a specialty shoe store back in 2007. And Amazon bought Dpreview.com, a digital camera review site, in May 2007. How about a digital photography-focused store, or a cooking-related store. What do you guys think?

Updated with new maps from Akamai: Akamai, a Cambridge, Mass.-based company that has built a content delivery network that spans the globe, will soon be releasing the latest edition of its “State of The Internet” report, which looks at some of the key Internet developments, including growth in network speeds, actual connections and the number of web sites. I got an early look at the first-quarter 2009 report, from which I have cobbled together some interesting stats.

• Akamai observed a nearly 5 percent increase (from the fourth quarter of 2008) globally in the number of unique IP addresses connecting to its network. The year-over-year change was 27.51 percent, while the U.S. saw a 20 percent jump in unique IPs. China saw a 37 percent year-over-year annual gain in unique IP addresses.
• In the first quarter of 2009, one-fifth of the Internet connections around the world were at speeds greater than 5 Mbps, up 5 percent from the prior quarter and nearly 30 percent higher than the first quarter of 2008.
• WiMAX is gaining traction around the planet. Many of us focus on Clearwire in the U.S. and often overlook the growth of WiMAX in emerging economies such as Eastern Europe, the Baltics and Africa.
• Plans for four new submarine cables were announced that would bring more bandwidth to the African continent, which is also seeing a massive mobile phone boom, thus driving the need for more bandwidth. These cables include Glo-1 launched by Nigerian operators Globalcom.

Related: State of the Internet reports, Q1 2008 and Q4 2008 Report

I woke up this morning to see the whole world talking about Google’s new operating system, Chrome OS, that is targeting  netbooks and desktops. I spent a big part of the morning reading many different stories and posts — and they say absolutely nothing, apart from chunks of information from the original blog post, which is, well, a lot of words that say nothing much. Meanwhile, The New York Times has the best overview of the Chrome OS announcement, so don’t bother reading anything else for now. The guys at jkOnTheRun sum up the release of the OS succinctly when they write:

A web, or cloud, OS that puts the bulk of all user activity firmly up in the web. No heavy lifting on the user’s netbook; that will all take place up in the cloud with the Chrome OS handling it all. This is so clever on Google’s part, and could very well turn the next page on cloud computing.

Stacey is currently working on our analysis, but I was hoping to get a conversation started with our community — what do you make of this new development? Do you think Google has what it takes to beat Microsoft, or will this prove to the the equivalent of a Hollywood starlet, hot today, not tomorrow?

The consumer electronics industry, like its mobile phone counterpart, is going into a phase of flux, where Moore’s law and smart software and services would dictate how tomorrow’s consumer devices are built. Everyone — from start-ups such as Sonos to Microsoft and Sony  — is trying to figure out their next move.

Apple, which has been great so far at building clever products that leverage software, services and commodity hardware, has so far lagged in its efforts. Apple TV, its Internet set-top box, has been a disappointment. Michael Wolf, who spearheads GigaOM Pro, thinks it is time for Apple to refocus its attention on this device.

“Since the launch of Apple TV, the company has launched its app store, pushed into gaming, and started offering HD video content on iTunes,” he writes (subscription required). “Add it all together on a refreshed box, and it could be a potent combination.” Higher video quality and adding gaming capabilities are two of his picks. I was wondering if you would like to share your perspective in the comments section.

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Michael Jackson’s memorial held today at the Staples Center in Los Angeles turned out to be one of the biggest online events ever, according to various reports. Akamai says that it was the second-largest day in terms of total traffic on its network. Akamai delivered more than 2,185,000 live and on-demand streams in both the Flash and Windows Media formats. Total traffic on the Akamai network surpassed a rate of more than 2 terabits per second during the memorial service. Akamai says that it delivered 548 Gbps of live and on-demand Flash streams utilizing Adobe Flash technology.

There were 3,924,370 visitors per minute as of 1 pm EST and an average of more than 3.3 million visitors per minute overall. That is second only to the 4,247,971 global visitors per minute who visited news sites on June 25th when the news of Michael Jackson first hit the web. Unlike June 25th, there weren’t many outages reported, but there were widespread slowdowns. According to Gomez, a company that monitors the web, the availability of the home pages of seven of the mainstream news media sites from 12:45 pm-3 pm EST only dipped as low as 98.2 percent even though the response time was slower than usual. Response time (page load times) ranged from 6.5 seconds to 18.5 seconds (usually spans 3.5-7.3 seconds), according to Gomez. However, when it comes to live streaming, Gomez saw lots of rebuffering (i.e.. video ‘stalling issues’) at these news sites — time spent waiting rather than watching was under 5 percent in the U.S. but as high as 40 percent in Asia.

According to AlertSite, which also monitors web performance, E!Online and TMZ reported a few errors during the 12 pm-2 pm EST period. The response time for E!Online’s home page reached as high as 20.75 seconds at 2 pm EST. TMZ’s home page response time reached 10.41 seconds at 1 pm EST. “Overall we saw about a 10 percent uptick in response times on average for the sites we were monitoring,” said AlertSite Chief Strategy Officer Ken Godskind, who pointed out that, “Even Twitter was affected, with login success in the 50 percent range during the 1 pm, 2 pm and 3 pm hours (EST).”

Here are some other random stats associated with this event.

• Verizon Wireless network says that from 1 pm-3 pm EST today, voice attempts on Verizon network around the Staples Center went up 10 percent from same time Monday, while data attempts for texting and mobile web were up 86 percent around the Staples Center from same time Monday.
• Michael Jackson tributes accounted for nearly 5 percent of the total tweets on Twitter, according to Twist (via Pete Cashmore.)

• According to Facebook, a million users posted about 800,000 status updates. That compares to the 1.8 million Facebook status updates with the word “Obama” on Inauguration Day. The Michael Jackson page, however, has grown to have nearly 7 million fans, a million more than President Obama’s page. And Facebook says some 800,000 virtual MJ gloves have been given away as gifts.

Related post: Live streaming grief: Saying goodbye to Michael Jackson.

Twitter traffic visualization, courtesy of Twist via Mashable

Max Levchin’s Slide, a San Francisco-based startup that caught the Facebook application wave early, is making a strategic shift, refocusing its revenue efforts on higher-margin premium advertising that include brand sponsorships for many of its well-known applications such as Super Poke. As part of this realignment, the company’s advertising sales force will be slashed, though some members are being reassigned to new roles, we have learned.

The news of these pending changes was shared with the company in a brief email sent out earlier today. Slide has raised over $58 million in funding from Blue Run Ventures, Founders Fund, Mayfield, Khosla Ventures, T-Rowe Price and Fidelity Investments. The company is valued at half a billion dollars. Slide is focusing its attention on building a team that will focus on higher-end campaigns, ones in the $500,000 category range.  When we contacted Levchin, he said that the company has had a good track record of building relationships with big brands. While these deals take longer to close, they are more lucrative for the company.

Smaller advertising deals that range between $30,000 and $50,000 have lower margins. Slide is going to add more people focused on “business development.” “Sure this is going to drive up our cost of sales, but so are the RFPs,” said Levchin, who co-founded PayPal. He described it as a “purely analytical decision.”

I can’t blame Levchin for making this decision.  As we wrote earlier:

Advertisers are pushing more ad dollars online, but the number of sites to house them are growing even faster. And so there is more and more discussion this month that CPM rates are falling. (There remain optimistic exceptions, however.) The relatively balmy climate of Web 2.0 means more sites are looking for ad revenue just as mainstream advertisers are contemplating cuts in their ad budgets.

Of the folks I have talked to, most agree that there is a major advertising glut in the market. The increased usage of Facebook and Facebook applications is only helping to create advertising inventory out of thin air. This is putting downward pressure on the amount of money publishers can charge for their inventory. This problem is especially rampant in social networks, which are growing at a relentless pace. In this highly commoditized market, publishers including app developers such as Slide have to stand out and deliver larger brand experiences.  It wouldn’t surprise me if more follow suit.

Related Post:

1. Max Levchin on The GigaOM Show

Photo of Max Levchin courtesy of flawed artist via Flickr

If you’re a startup that’s building its business using Google’s services, be warned, because the Mountain View, Calif.-based search giant is a fair-weather friend. Take real estate listings companies like Trulia and RedFin, which both use Google Maps as part of their offerings. They got a rude awakening today, thanks to moves being made by Google’s Sydney office. Google’s Australian arm is looking to get into the classified real estate business via a new tool that uses Google Maps and connects buyers and renters to available properties.

The service is launching with listings provided by the Real Estate Institute of Western Australia and homehound.com.au, the free property listing service owned by Michael Hannan’s Independent Print Media Group.

Google is planning to roll out has had a similar service in the U.S. as well. And when that happens, the company will be competing with Craigslist, RedFin and countless other real estate listings providers, including those provided by newspapers for over a year, the UI of which is being updated today. Search Engine Land’s Matt McGee correctly points out that Google’s service is pretty rudimentary compared to the in-depth information provided by pure-play real estate services.

What remains to be seen is how the real estate industry will react. One of Australia’s leading real estate advertising publishers has decided against giving its listings to Google. Closer to home, the National Association of Realtors recently made its feelings clear when it called Google a “scraper” site and supported a local board’s decision to stop allowing some MLS listings to be crawled by search engines.

Whatever the outcome, it makes perfect sense that Google is taking this route; numerous real estate listings services already use Google’s mapping service and the company needs to find new ways to make money in order to keep its revenue stream growing. If it doesn’t, the company faces the prospect of its stock going south. And Google can’t afford to have its stock sink because it needs that currency to keep its offices stocked with smart engineers.

And if that means competing with its friends, its attitude is — just ask Mozilla — so be it. Big companies often encroach on the territory of their partners and today’s news shows Google is no different.

Updated: The Guardian reports that Nokia is planning a touchscreen mobile phone that runs Google’s Android operating system and the handset maker will likely show off the device at the Nokia World conference in September 2009. When I read the story based on information from “industry insiders,” I was incredulous.

Analysts at HSBC reckon Nokia had 47 percent of the global smartphone market in 2007; that was down to 35 percent last summer and 31 percent at the end of the year…But the response to the opening of Symbian has been relatively muted. By contrast, users of the iPhone have already downloaded over a billion applications in just nine months and Android has attracted a host of developers offering their “widgets,” or applications, to consumers through the Android Marketplace.

Will Nokia jettison hundreds of millions of dollars it has invested in Symbian, the operating system that powers its Nokia N- and E-Series phones, among others? If it does, it would be a major shift for the company and a tactical admission that its own efforts in developing software and services for a new era of the mobile web was a bust. It also would be a continuation of a muddled and convoluted response to the smartphone assault by the likes of Apple and BlackBerry. Smartphones are one of the fastest-growing and most lucrative portions of the handset business, as illustrated by the profits being raked in by Apple and Research In Motion.

I am still having a tough time believing that Nokia will switch horses. It is quite possible that the company is using Android as a basis for a 3G- or 4G-enabled netbook-type device that’s powered by Intel’s chips.

The two companies recently announced in a press release “a long-term relationship to develop a new class of Intel Architecture-based mobile computing device and chipset architectures which will combine the performance of powerful computers with high-bandwidth mobile broadband communications and ubiquitous Internet connectivity.”

Update: Nokia has denied any such plans and dismissed the Guardian story. “Absolutely no truth to this whatsoever,” a Nokia spokesman was quoted by Reuters as saying. “Everyone knows that Symbian is our preferred platform for advanced mobile devices.”

Marc Andreessen, the prominent founder of Netscape Communications, and his longtime business partner, Ben Horowitz, are teaming up again — this time to spearhead a new $300 million venture fund, called Andreessen-Horowitz, that will invest in companies of all shapes and sizes — from very early stage businesses that require a few hundred thousand dollars to late-stage companies that might require tens of millions. Marc had announced his intent to start the fund on “The Charlie Rose” show. (Watch the video.)

Marc and Ben have a simple objective for their new fund: use their nimbleness — the fund will have just two general partners — to invest in companies that meet their view of the world. “We are going to focus on products that we understand, which is essentially classic computer technologies,” Andreessen said. We met last week to discuss his new fund; I decided to focus our conversation about the web infrastructure. “There are a lot of changes in the (web and IT) ecosystem,” he said. “lots of interesting opportunities in the (web’s) backend.”

I agree — as I have often talked about in the past, as we hurl towards what is essentially an ultraband, always-connected and networked planet, there are enormous opportunities. Today’s technologies are woefully falling short of the needs of this new web. When I interviewed Facebook’s VP of Engineering, Jonathan Heiliger, who spoke at our Structure 09 conference, he bemoaned the lack of hardware to meet the needs of his fast-growing company.

It is hardly a surprise that Andreessen and Horowitz are taking a top-down and bottom-up approach to investing. Marc’s history of working with the web’s front end (Netscape and Ning) gives him the ability to understand the web layer. He also sits on the board of Facebook, a company that is helping redefine the future of the Internet.

Marc and Ben previously teamed up to form Opsware, an IT infrastructure management company that after a few setbacks evolved into a thriving venture that was eventually acquired by Hewlett-Packard for $1.6 billion. That gives the duo an opportunity to understand the changing innards of the Internet.

WebappVM, Apptio, ExtraHop and Good Data are some of their current investments in the infrastructure of the web. Marc said they would be looking at more investments in cloud computing startups. “We think that networking is going to follow the same curve as the workstation,” Andreessen said. Moore’s law is going to allow companies to build smart, next-generation devices that are based on a commodity infrastructure platform.

In the past, we have written about companies such as Vyatta, which are taking on Cisco by building an open-source router. This trend is only going to gather momentum, Andreessen argues. The edge networking devices will get a lot smarter, and that is going to open up opportunities. Andreessen and Horowitz believe that things will follow the same curve as Linux and Solaris. It took a long time for Linux to gain traction, but when it did, it eventually started to corrode Solaris. “Hardware will get a lot dumber and a lot cheaper, and software will become the key focus,” Andreessen said. His optimism stems from the fact that the networking stack is still built on 20-year-old ideas of the network and the infrastructure. Storage is one likely candidate for massive disruption. For instance, the emergence of solid-state storage offers immense opportunities both in terms of innovation and investment. (Related GigaOM Pro Report: Bringing Moore’s Law to the Data Storage Market. Content available only to subscribers. Subscribe to GigaOM Pro for $79 a year.)

Disclosures:

1. I am a venture partner at True Ventures, an early-stage venture investment firm. True is also an investor in the parent company of this blog, Giga Omni Media.
2. Allan Leinwand, founder of Vyatta, is an occasional guest columnist for GigaOM.

Like a wrinkle in a crisp cotton sheet, sometimes our past and present come together all too abruptly, leading us down memory lane, a trip that often brings a wistful smile. I had that same feeling when I read the news that CompuServe, the ground-breaking online service that presaged the commercial Internet, was shutting down after 30 years. I am not sure how many people remember CompuServe, but it was a major influence in my life and helped define my future as a technology writer.

I first encountered CompuServe in 1992 — before that I was too poor to own a computer and a dedicated phone line. At the time, I was fairly young and struggling to find direction in my writing career. I also had started reading about the information superhighway and the Arpanet.

I bought a very expensive AST PC. It came with a 3.5-inch CompuServe disk and a speedy 9600-baud external dial-up modem. Within a matter of minutes, I was signed up. I got an awkward numerical email address and a welcome email. A few hours later, I was checking out online bulletin boards and reading magazine content online.

But my eureka moment came with the arrival of the initial welcome email from CompuServe. Like a photographer who sees the image slowly take shape on paper submerged in his development tray, my future became clear to me. Suddenly, the information superhighway, connectivity, and what would eventually be known as the commercial Internet were what I was going to write about. Thanks to CompuServe, I had stumbled onto the biggest story still being told.

CompuServe was a great tool for a novice like me to become wise in the ways of the Internet — from FTP to bulletin boards to Internet email and eventually web browsing. Sure, it cost a lot of money — something that was scarce in my early days as an immigrant. Eventually, I graduated to Pipeline and enjoyed the raw Internet. My work life allowed me to write about the early days of Netscape and many such companies, but it was CompuServe that remained a constant.

It was a great tool that I used to research stories and to communicate with many like-minded people. It allowed me to tap into a lot of databases including Forbes magazine’s archive. I used that archive to learn about David Churbuck, my eventual boss at Forbes.com, whom I stalked and talked into hiring me. As a reporter, I wrote about the online wars of the mid-1990s as Prodigy, CompuServe and AOL competed with each other and emerging Internet service providers.

These were the glory days for the ISPs and online services. I remember visiting Columbus, Ohio, just to get a glimpse of CompuServe’s campus, gawking at the enormous building with awe. Weeks later, I would visit Prodigy’s offices in downtown New York and meet with AOL executives at some Silicon Alley breakfast. It was a thrilling time, and these companies were the stars, no different than today’s Facebook and Twitter.

I also wrote about America Online buying CompuServe. That consolidation only presaged my own evolution as a writer. Eventually, both those companies became less relevant to my job and me, as I started writing about optical networks, broadband and the future of the web.

At the turn of the century, CompuServe fell out my immediate memory. But it always remained in the back of my mind, a mile-marker of sorts, defining my journey not only as an immigrant to this great country but also as a technology reporter.

So with a sense of sadness, but mostly with gratitude and fond memories, I bid adieu to a service that has played such a pivotal role in our online lives.

Photo of CompuServe magazine courtesy of The Metropolitican Blog.

For much of this decade, Mozilla and its Firefox browser were the upstarts, out to beat the big, bad Microsoft and its Internet Explorer browser. Firefox, the descendant of Netscape, the browser that helped jump-start the web revolution, was nimble and it was secure — something Microsoft’s IE wasn’t. And it triggered a movement. According to Net Applications, which tracks browser market share, as of the end of May, Mozilla accounted for some 22 percent of the browser market. Microsoft’s IE, by comparison, still holds a roughly 66 percent share.

Despite it success, the open-source browser maker finds itself in an all familiar situation: fighting the odds on multiple fronts. Unlike the past when it had to contend just with Microsoft, Mozilla’s competition has grown many fold. Furthermore, the browser battleground has grown much bigger and now also includes mobile devices. Microsoft’s Internet Explorer 8, Apple’s Safari 4.0, Google’s Chrome, Opera and Firefox are the five major competitors on the desktop, while WebKit-based browsers are the champions of the mobile world. Last week, when Mozilla announced its new Firefox 3.5 browser software, I decided to reach out to CEO John Lilly for a quick conversation about the state of the browser market. After all, Firefox’s latest browser comes at a time when Google, Apple and Microsoft have all upped the ante in the browser marketplace.

“The world is a lot different from a year ago, and we have three brand new browsers and there is a lot more competition and as a result the users are getting a lot more technology,” said Lilly. But he was not coy about the fact that Firefox has taken over a substantial share of the market, snatching it away from Microsoft’s Internet Explorer. “Having said that, I think it is uncomfortable, because our rivals have 2-3 times the magnitude of people and resources, and they are relentless.” (Techcrunch has a post about recent market share changes, based on statistics from Statscounter.)

It’s quite understandable why everyone is so obsessed with the browser. As guest columnist Rohit Sharma had previously noted, “Today, browsers have lent their structure, chassis and struts to network-connected applications that devour user time and attention away from the browser itself.” But going forward, things are going to be vastly different. To understand the potential, look no further than the iPhone and its many applications. “Many iPhone users may have already forgotten that the rendering engine used underneath them all is a Webkit,” wrote Sharma, “the same underlying layout/display engine used in Safari and Google Chrome as well as Android and Palm Pre webOS.” What that means is that now browser-based network-aware applications can exist on any platform — be it the desktop or the mobile. This makes controlling a browser wildly important for companies such as Google, Microsoft and Apple.

“Super-interactive browser that sits atop a super-fast connection…now interesting things will happen over the next 5-10 years,” remarked Marc Andressen, whose first startup, Netscape Communications, introduced the consumer web to millions by way of its Netscape browser, at a gathering last year.

Lilly is betting on a few things that will keep Firefox ahead of its rivals. First of all, it’s built by a vibrant community of Firefox developers. Secondly, it has garnered the support of folks who develop browser add-ons such as extensions and themes, which allows the browser to adapt to the needs of a diverse user base. Most importantly, Lilly said that Firefox supports the open web, whereas his competitors have their own agendas. “It is premature to put the ‘Mission Accomplished’ banner on the open web,” he said. “Microsoft is still a big player.” Apple, meanwhile, won’t be supporting open video codecs such as Ogg Theora, according to Lilly. Even Google is ambivalent about certain things, though the search giant is “better than” the others, he added.

When I asked Lilly if the emergence of Google Chrome had shifted the focus toward a browser’s speed and performance, he acknowledged that there is competitive pressure and said that as a result, the Mozilla team is looking to “keep the browser fast and slim and still be highly customizable.” So while the version 3.5 of Firefox might be out, Mozilla is working hard on the release of the next version of the browser (3.6), due out either late this year or in 2010. “You should look at what is in Mozilla Labs and see those features making it to the browser,” Lilly said.

Mozilla Weave (which blends web services with the desktop) and Personas, a lightweight theming system are two recent efforts that will likely end up in the next generation of Firefox browsers. Mozilla is excited about Ubiquity, an in-browser command line utility and another new recent effort. JetPack is an API that allows developers to write extensions for Firefox using standard technologies such as HTML, CSS and JavaScript. A common theme that unites these four major areas of push: they allow Mozilla to keep the browser slim and fast, but at the same time make it super customizable. “It is about making the browser faster and increasing its performance,” Lilly said.

When I asked Lilly about Mozilla’s mobile efforts, he said that they were working hard to extend Firefox to the mobile. “It is something the whole company is paying attention to,” he said. He pointed out that a beta version of Firefox for Mobiles (code named Fennec) is available for Nokia-backed mobile-focused Linux distribution, Mameo, and that another version is available as second alpha for Windows Mobile.

I don’t think that’s going to be enough, however. Mobile is Mozilla’s Achilles heel — it’s losing mobile platforms to WebKit. As we pointed out earlier, “Today’s browser competition is less about who renders HTML properly, and more about what the incumbent browser is and how well it accommodates whatever new applications the Internet throws its way.” These days, many of these applications are popping up on mobile phones, thanks to the emergence of platforms such as Google’s Android, Palm’s Pre and Apple’s iPhone. These platforms are attracting developers, who will work with WebKit and not Firefox. In other words, Mozilla runs the risk of losing developer interest.

But Mozilla has been here before, with its back to the wall. The good news is that Lilly and his crew realize that and are working on it. Well let’s hope they succeed — for if they do, it will mean consumers get better technology.

Related Posts:

• Mozilla not worried about Google browser
• GigaOM Interview: John Lilly, CEO of Mozilla Corp.
• The GigaOM Show: A Conversation with John Lilly
• Browser wars again.

Photo of John Lilly by Joi via Flickr.

The launch of Apple’s new iPhone 3GS was the best sales day ever for AT&T’s retail stores, while the number of orders taken at its online store also hit an all-time high, according to an internal memo obtained by MacDailyNews, a blog devoted to all things Apple. While the memo doesn’t outline the precise number of devices sold, it does reveal other details.

On this year’s launch day, iPhone sales exceeded sales recorded on 2008’s iPhone launch day, Black Friday 2008 and Dec. 26, 2008 — all heavy-volume sales days. In fact, this year we surpassed 2008’s launch day sales at about noon Central time, and sustained our previous peak hour record, also set in 2008, for 11 straight hours.

Apple sold a million iPhones the weekend of the 3GS launch. A survey by Piper Jaffrey shows that nearly 56 percent of iPhone 3GS buyers were upgrading from the old device and only 28 percent were switching to AT&T — but that’s still about 280,000 new subscribers that will be handing over a lot of money to the carrier. As I pointed out in a previous post, “[T]he average iPhone user gave AT&T about $94.74 a month vs. an average postpaid AT&T customer, who spends about $59.21 a month.”

In the market for a new TV? These days, there are bargains galore, especially when it comes to those with plasma screens. The Wall Street Journal reports that the growing popularity of their LCD cousins has TV makers such as Pioneer and Vizio phasing out their entire plasma TV line-ups. Others may soon follow suit. (Read an alternative take on the future of Plasma TVs.)

One can hardly blame them — there were 30 million LCD TVs sold in the U.S. in 2008 vs. 4 million plasma TVs, according to Display Search, a market research company. That’s quite a comedown for a technology that once represented the cutting edge of the display market.

Plasma is made of cells. Each cell is essentially two plates of glass filled with neon-xenon gas that is electrically charged, which then strikes phosphors on the screen and that in turns displays the image. LCD panels in comparison are made of two layers of transparent material where one of the layers is coated with a special polymer that holds liquid crystals. Electric current is passed through these crystals which either pass the light or stop it, there by creating an image. (From About.com)

I remember when plasmas trumped LCDs by a mile, both in terms of picture quality and viewing angle. There were some problems with them, of course — they generated too much heat and static images burned into the screen, limiting their lifespan. They’ve since improved a lot, but so have LCDs, which by comparison have better contrast, sharper images and higher refresh rates. NewTeeVee back in February saw the demise of Pioneer’s Kuro TV line-up as a sign that plasma TVs would go the way of the buggy whip.

I paid an ungodly amount of money for a 42-inch plasma screen TV in 2002, only to sell it on Craigslist for a third of that price when I moved to San Francisco in March 2003. It taught me a valuable lesson: Televisions (and most consumer electronics) lose value really quickly, so there’s no point in overpaying by buying the latest and greatest. (I leave that for cell phones, computers and headphones.) Today, I have a 50-inch Panasonic LCD TV — not exactly the best on the market, but it does a fine job as a display for my DVD player and my Apple TV.

Now I’m getting ready to move to a bigger apartment. This would give me a chance to buy another television, this time for the bedroom. I’m thinking about buying a cheap plasma TV — just for old times sake. After all, it will be obsolete by the time I’m ready to move again so I won’t feel that bad about losing my investment.

P.S.: In case you’re still wrestling with which TV — LCD or plasma — to buy, CNet has a handy comparison guide.

Mobile phone sales are going to decline sharply over the next five years, to the tune of 1.04 billion devices, according to Informa Telecoms & Media. In its new report, “The Financial Crisis: Analyzing the impact on global mobile markets,” the research firm has revised its forecast for device sales over the next five years down by 14 percent.

Some 6.39 billion devices are forecast to purchased between now and 2013, Informa said, vs. its previous expectation that 7.43 billion devices would be bought. For 2009, Informa revised its forecast for the number of mobiles phones that will be purchased down to 1.12 billion devices from 1.32 billion. This is a brutal revision for a business that has always been about furious growth and razor-thin margins.

The downshift in overall device sales is one of the reasons why companies are shifting their attention away from low-cost devices to smartphones and an emerging category of devices I like to call superphones. Devices such as Apple’s iPhone sell fewer units but have higher profit margins. A recent surge in demand for RIM’s BlackBerry devices and more recently, HTC’s Android-based smartphones show that the incumbents such as Samsung, Nokia and LG are lagging in this higher end of the market. No wonder they’re redoubling their energies to focus on it, as evidenced by Nokia introducing a brand new line-up of its higher-end (and higher margin) N and E-Series of devices.

Joost, a much-vaunted online video startup, today announced that it will offer a white-label video hosting platform, thus entering a crowded market littered with the carcasses of other failed video hosts. The company is also losing its famous chief executive, Mike Volpi, whom it’s replacing with Matt Zelesko, the current vice president of engineering. And it plans to cut a portion of its workforce — between about 70 of its remaining 90 employees, according to Advertising Age. It also shut down its office in the Netherlands.

When I read about all the planned changes at the company earlier today, the first thought that crossed my mind was: Stick a fork in it; Joost is done. After all, this whole white-label video strategy is like a leaky lifeboat in the middle of the Pacific Ocean. The NewTeeVee crew sums up the situation very succinctly: “Becoming a white-label video provider was what a business did when all other strategies failed.”

As someone who has followed Joost from its very inception, when it was known as The Venice Project, I’m amazed at how badly it’s stumbled. It shouldn’t have.

It had everything going for it, including:

• Successful, Celebrity Founders: Niklas Zennstrom and Janus Friis started the company in 2006 after palming off Skype to eBay for billions of dollars.
• Proven Technology: Joltid formed the basis for music- and file-sharing service Kazaa and later Skype.
• Substantial Funding: It raised $45 million in funding from the who’s who of the tech world: Sequoia Capital, Index Ventures, Viacom, CBS and Chinese tycoon Li Ka-shing.
• Incredible Buzz: The company had incredible pre-launch buzz that helped it to convince thousands of users to download its P2P video client — something that doesn’t happen all that often on today’s web.
• Big, Famous Partners: It managed to gain early traction with content providers such as Viacom and CBS, which were also investors in the company.

So what went wrong? Quite a few things, actually. Other startups should learn from the mistakes of Joost and avoid repeating them, such as:

• Too Big, Too Fast: Joost hired too many people, too quickly. It never behaved like a startup but instead always felt like a grown-up company with too many bureaucratic layers.
• Too Geographically Spread Out: The company was based in multiple geographic locations — New York, London and The Netherlands — and as a result, each location became somewhat of a silo.
• Not Enough Focus: Remember what your mom used to say when you took too big of a bite? If you’re not careful, you’re going to choke. Startups are just like that. Unless you focus, you’re going to choke. Joost couldn’t focus on one single market — and startups need to focus on one market at a time in order to win.
• Too Much Hype Too Soon: Like many, we were one of the early fans of this startup. Its founder pedigree generated a lot of pre-release interest. Nearly 250,000 folks signed up for the beta version of the software. But when technology problems hit, the pre-release buzz turned into buzzkill.
• Slow to Fix Its Technology Problems : Joost’s P2P network had technical problems early on that resulted in user defection. The company didn’t move to address those concerns fast enough. These technology problems have continued to nag the company throughout its life, even when it switched to a browser-based focus.
• Client vs. Browser: The company took too long to realize that the client-based strategy was going to lose out to browser-based video services. Its legacy of building clients became its Achilles’ heel.
• Didn’t Press Its Early-Mover Advantage: Joost had correctly identified that it needed the blessing of the content owners, but it failed to move aggressively enough to convince them to work with its platform. The client and technology problems didn’t help matters, either.
• Big Media Dis-Connect: Its big media investors were never willing to give Joost a content edge over the competition, prompting users to tune it out in favor of other services.
• Too Many Internal Problems: The company had some serious management problems, some of which led to the firing of its CTO in January 2008.
• Hulu: It started with a simple, easy-to-use interface for its browser-based video service, offered higher-quality video and used content from its backers, NBC and Fox, to become a household name, which in turn allowed Hulu to convince other content owners to sign up for its platform. Now it owns 10 percent of online video traffic.
• Chasing Its Own Tail: Joost also made some basic mistakes, such as not having a good SEO strategy. It never quite figured out a social media strategy in order to garner viral growth, either. It was like a tech company from the 1990s — out of sync with today’s web environment.

The dark cloud of doom started to settle over the company last year, as the team at NewTeeVee noticed time and again. NewTeeVee writer Janko Roettgers offered a recipe to fix Joost last fall, but apparently it was too little, too late, even then. The company consistently failed to gain any traction, even after unveiling new APIs and a browser-based offering. In the end, however, it all boiled down to a lack of content.

Photo credit of Mike Volpi pic: Eirikso via Flickr.