Tallhamn said in the blog post that the company failed to draw a lead investor “willing to commit enough capital to fill out the round with follow on investors.” His insights are an indicator of the struggles for the entire energy management sector, including potential competitors that Tallhamn used in a slide from the Cleantech Open including Ecofactor, EnergyHub, AlertMe, and Control4.

The investment community’s perspective on this space had become significantly more critical since we got started, and probably for good reasons. A lot of capital has been destroyed in Series A-Z rounds of funding by our competitors, and most investors made it clear that they’d want to see massive traction before committing capital. They were taking a “wait and see” approach.

The business of helping consumers reduce and manage energy consumption in homes and across appliances and devices is such a small market right now, there can’t be too many players going after basically non-existent revenue. OPower, which provides data analytics and software for utilities for energy bills, is one of the few companies in energy management that I know of that is doing well.

Many of the revenues right now depend on scoring utility deals, which can take months and years to implement. Though, there has also been recent attention from the telcos and consumer electronics companies in the energy management space. But as we’ve mentioned pure play energy management gadgets probably won’t be that interesting to consumers — the gadgets will have to do something else, too, like manage your media or run a home security system. Tallhamn said in his blog post: “On a micro level, the average household’s energy costs are so small ($4k on average across electricity and fuel) that any direct to consumer product aiming to reduce them needs to deliver something beyond just savings.”

Hug was taking a free approach, and looking to mine energy information, with Scoble calling Hug the “Mint of your energy bill.” The company had launched a downloadable energy management application for computers that compiled how many minutes your computer slept and basically called your attention to how much energy you were saving. That app was only a “trojan horse” into a plan to grab a greater piece of the energy management sector, and the company’s idea was to start building a user base before the smart energy devices hit the market, “so that we’d be in a great position for becoming the leading supplier of analytics and control software once they had arrived,” writes Tallhamn.

But alas, you can’t build a product without funding. Tallhamn writes:

Knowing when to push through and when to call it quits is probably one of the hardest things for an entrepreneur, and while I’ll never know for sure, I feel quite confident that this was the right decision for everyone involved.

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CumuLogic was co-founded by Sun Cloud and Startup Essentials vets Rajesh Ramchandani and Laura Ventura, and touts Java creator James Gosling and former Sun CIO Bill Vass as the leaders of its technical advisory board. According to Ramchandani, he and Ventura were inspired to create a Java PaaS after they left Oracle and started thinking about how Sun could might have expanded its cloud computing efforts into the PaaS space had Oracle not killed Sun’s cloud project upon its acquisition of the company. We’ll never know how close CumuLogic is to what Sun might have done, but the company does appear to have embraced Sun’s legacy of giving users plenty of choice and control.

CEO Sandip Gupta told me that CumuLogic is focused on legacy Java applications, of which companies have written countless numbers over the years. Instead of rewriting applications to fit new platforms and, essentially, giving up application components on which companies might have standardized over the years, CumuLogic wants to give them the flexibility to keep using those components, from application platforms to databases. Further, CumuLogic wants to give customers choice of where to host their PaaS environment by providing a software product that can be installed locally or atop an IaaS cloud. Makara, the cloud software recently acquired by Red Hat, offers the same functionality with regard to deployment, but the companies differ in terms of scope.

CumuLogic also is trying to set itself apart by retaining a degree of IT control over the environment. Gupta explained that CumuLogic gives IT administrators the ability to do things like determine application lifecycles, establish permissions and transition environments from dev-test to production — all while giving end users the self-service, automated experience they expect from a PaaS offering.

As anyone following cloud computing over the past several weeks has noticed, however, options for Java PaaS are proliferating fast.  Among the offerings now supporting Java applications are Amazon’s Elastic Beanstalk, Google App Engine, VMforce, CloudBees, Makara and Windows Azure. But each product differs in terms of where they’re hosted, what frameworks and stacks they support, and whether they also support additional programming languages. Gupta thinks CumuLogic can carve out a niche serving the likely sizable population of companies, service providers and ISVs that want to support legacy Java applications in the cloud, which probably is true for the time being until customers start writing new applications in today’s popular web languages such as Ruby and PHP. If that time comes, he added, CumuLogic is willing to look at expanding its scope.

Java image courtesy of Flickr user Dominic’s pics.

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For those keeping track at home, that kind of revenue growth is pretty fantastic, but not terribly surprising. After all, YouTube serves more than 2 billion videos a day, including more than 100 million a day on mobile devices. And the site has very aggressively ramped up advertising over the past year, placing more ads against partner videos and those that run on mobile devices.

Pichette didn’t state revenue numbers, but doubling growth is not totally out of line with previous analyst projections. Barclay’s Capital analyst Doug Anmuth estimated that YouTube pulled in $450 million in revenues during 2009. While Anmuth’s forecast last January called for 55 percent growth, others were less conservative. Last March, Citigroup analyst Mark Mahaney estimated that YouTube would generate nearly $1 billion in sales for the full year.

While doubling revenue is a plus, it’s important to note that Pichette said nothing about YouTube’s profitability. The question of when the online video site would finally turn a profit has been much debated over the past several years. Despite forecasts early last year that YouTube could become profitable in 2010, it seems that the unit — which Google paid $1.65 billion for back in 2006 — still isn’t in the black.

Coincidentally, the Google call was hosted on YouTube and suffered from some pretty dramatic stuttering and lag, which is surprising in part because it was audio-only.

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Liquavista displays reduce power consumption much like the Pixel Qi screens currently found in the Notion Ink Adam tablet and Qualcomm’s promising Mirasol display technology. Instead of the standard option of using a backlight to brighten the display, a Liquavista screen has three options: reflective, transmissive and transflective. Indoors, the screen can act just like a traditional LCD display while outdoors, natural light can be reflected through the pixels for clarity and brightness, without a backlight consuming any power. Transmissive is the typical backlit technology LCDs have used for years, while using natural, passive light for reflective displays is a more recent development. Transflective both reflects and transmits light as needed to save power while still displaying a high-quality image.

So Liquavista has both a power-efficient solution and is outdoor-friendly. But how can an e-Ink type of display be used on mobile devices such as smartphones or tablets? The company says its electrowetting technology can refresh a screen up to 60 times per second, opening the door to the high frame rates needed for gaming, video consumption and other media activities on a handheld device. An early prototype Liquavista display was filmed by the BBC last year, and about halfway through the video, you can see a few examples of full-screen, color video playback.

Such frame-rates open the door for Samsung to incorporate Liquavista’s electrowetting technology into handsets, which could help boost battery life. Samsung currently uses its Super AMOLED technology in its Galaxy S line of smartphones, the Nexus S, and its two Windows Phone 7 devices. Super AMOLED is also a power-efficient technology, but can’t leverage the outdoor properties of Liquavista’s screens, so future Samsung handsets could look just as good outside as they do indoors, if not better.

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Lovefilm operates a business very similar to Netflix in Europe, offering subscriptions to a DVD-by-mail service and a streaming video service for a low monthly fee. The company has about 70,000 DVD and Blu-ray titles available by mail and about 7,500 films for streaming, compared to about 100,000 discs and 20,000 streaming titles available on Netflix. Like Netflix, Lovefilm is also expanding the availability of its streaming offering to be viewable on TVs, Blu-ray players, and other connected devices like the PlayStation 3. And last month, Lovefilm rolled out its streaming service to Germany, a new market for its over-the-top offering.

The acquisition shouldn’t come as a complete surprise; after all, Amazon already had a significant stake in Lovefilm prior to today’s announcement, and had reportedly been interested in buying out the remainder for quite some time. Amazon got that stake after Lovefilm acquired Amazon’s DVD rental business in 2008. Amazon also bought out one of Lovefilm’s venture backers to give it a 42-percent stake in the subscription video firm.

Amazon had long been rumored to have an interest in acquiring Netflix, as a way to supplement its online video-on-demand service with a subscription rental offering. But despite years of rumors, Amazon missed an opportunity to buy Netflix on the cheap, since Netflix stock has shot up over the last year, rising more than 250 percent in that time and giving it a market cap of almost $10 billion.

Speaking of Netflix, Amazon’s acquisition of Lovefilm comes not long after Netflix introduced its streaming service in Canada: its first international market. And after what it sees as a successful rollout there, Netflix has been making noise lately about accelerating its international push and entering new markets this year. That could mean that Netflix might soon launch in the UK, facing off against Lovefilm head-to-head.

At the same time, there’s the possibility that Amazon could bring Lovefilm’s offerings stateside. While the firm’s content seems to focus on the European market, Amazon has been looking to compete with Netflix directly, and reportedly had been pitching studios to operate its own subscription streaming business in the U.S. Using Lovefilm’s existing studio relationships and Amazon’s own cloud-based infrastructure, Amazon could possibly accelerate its subscription video plans and introduce a Netflix-like service here.

All that said, the two also have a somewhat symbiotic relationship, as Netflix is a huge Amazon Web Services (AWS) customer. Since announcing that it was moving to the cloud last year, Netflix has increasingly relied on AWS to power the backend infrastructure behind its streaming business, and may be one reason why Amazon recently increased file object size for its Simple Storage Service.

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“We are working hard with our U.S. carrier partners to bring meaningful smartphone solutions to market that are compelling consumer experiences, have strong operator support and a thriving ecosystem. As in any business, plans can change and deliberate decisions must be made to enable clear focus on bringing the right products to market at the right time.”

From the sounds of the statement, and given that Nokia hasn’t gained traction here in the U.S. with its Symbian devices, it appears to me that Nokia and AT&T couldn’t agree on the financial details of a carrier deal. Conversations may have ended a February launch, but Nokia appears open to revisiting a deal with AT&T — or perhaps the other big GSM operator, T-Mobile — to get its current high-end smartphones in front of consumers at a price competitive to iPhones and Android handsets.

The situation, if true, also tells me that AT&T is confident enough with its current and planned phone portfolio. Yes, the carrier is losing iPhone exclusivity in a few short weeks, but AT&T has solid Android offerings including the new Motorola Atrix 4G, which can fit in a laptop-like dock or pump 1080p video to a high-definition television set.

I actually had high hopes that Nokia would be able to work with AT&T to carry one of the new Symbian devices announced at Nokia World in September. A developer contest held by Nokia tipped off the possibility of a new Nokia device on AT&T, mainly because AT&T was a key sponsor. Now it looks like that plan has either fallen through or been postponed, at best. And that hurts Nokia because its Symbian devices aren’t subsidized, nor do they receive any marketing attention here in the States. This means most consumers don’t know about them, and when they do find out that Nokia has something to offer, they’re put off by prices of $500 or more.

Based on my prior conversations with key Nokia executives, I suspect this is just another set-back, and not a completely closed door. The U.S. market is extremely important to Nokia, I was told back in June by Niklas Savander, EVP and general manager of the markets unit at Nokia. If AT&T won’t play nice with Nokia, then perhaps the largest handset maker in the world in terms of sales can get T-Mobile to offer subsidized Symbian smartphones.

I think the devices have excellent hardware designs, but are lacking in usability. If Nokia can get a carrier to work with them, it will be up to U.S. consumers to pass their own judgment in a world of iPhones and Androids.

Image courtesy of Eldar Murtazin

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Amazon Web Services, which popularized cloud computing with its Elastic Compute Cloud and Simple Storage Service, has moved up the stack from infrastructure to providing Amazon Elastic Beanstalk, its Platform-as-a-Service play. However, Amazon is layering its PaaS offering on top of its other services in a way that’s easily reversed, which means developers can take the easy way out of developing on Beanstalk, or they can peel back the platform to manually provision and tweak their underlying VMs if they want.

Adam Selipsky, VP of Amazon Web Services, says the service was built to address the idea of vendor lock-in and inflexibility that commonly afflicts other platforms for application development. With the first efforts, Amazon is providing a framework for folks to build Java apps on AWS with other programming languages and partnerships to follow. It’s not surprising, given the attention that Platforms-as-a-Service have been getting in the last 12 months or so. At the beginning of last year, Microsoft finally opened up its Azure platform, while a few months later, VMware and Salesforce.com teamed up to offer VMforce, a Java cloud hosted on Salesforce’s infrastructure, and VMware eased into the PaaS market in other ways this year. Google amped up its App Engine offering, tying it to Salesforce and VMware, while smaller providers of Platforms-as-a-Service such as Makara and Heroku were snapped up (by Red Hat and Salesforce respectively).

For Amazon, long the leader in the cloud space, seeing competitors move up the stack and developers taking advantage of those platforms that weren’t necessarily built on AWS infrastructure was a warning. As my colleague Derrick Harris wrote back in May (GigaOM Pro sub req’d):

So, my question is this: If AWS really will be simplifying management within the coming weeks, what are the chances it does so via a PaaS offering of sorts? It would be wise for AWS to leverage its current leads in market and mind share and preempt any serious momentum by PaaS providers. Technically, they’re not competitors yet (to the degree that IaaS and PaaS can vary differently in terms of target audience), but the next generation of PaaS offerings will blur those lines. AWS has the tools to build a holistic PaaS offering, the economies of scale to make it profitable, and the SDKs to cater to specific set of developers. If it does so, the cloud-computing discussion will take on an entirely different tenor as PaaS providers scramble to differentiate themselves from AWS in this area, too.

Amazon’s Beanstalk offering has taken longer to launch than the few weeks Derrick had hoped for, but now it’s here. Amazon’s next move will be expanding beyond Java, something it could do via partnerships with other providers or on its own. Brian White, a developer with AWS, said PHP and Ruby are high on Amazon’s list, but declined to specify how partnerships with other providers might look. When asked about competing with other PaaS providers who host their platforms on AWS infrastructure, Selipsky suggested that perhaps those might become partners for supporting other languages.

Indeed, in its press release on Beanstalk, Amazon included a quote from John Dillon, CEO of Engine Yard, saying the company is working with Amazon to provide a Ruby on Rails offering on Beanstalk. So will Amazon be a giant lumbering down the beanstalk to crush the PaaS competition, and will it lift others up to its height?

Image courtesy of Flickr user Melody.

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We had a phenomenal holiday quarter with record Mac, iPhone and iPad sales. We are firing on all cylinders and we’ve got some exciting things in the pipeline for this year including iPhone 4 on Verizon which customers can’t wait to get their hands on.

The resurgent Mac also set a new sales record: 4.13 million units, breaking last quarter’s record of 3.9 million, and more than 750,000 Macs than the company sold a year ago. To put that number into even greater perspective, Apple sold 4.5 million Macs during all of 2005. Nine months after the launch of the iPad, it appears concerns of Mac cannibalization are groundless, though concern for desktop Macs might be warranted.

In 2010, two out of three Macs sold were laptops. For the first quarter of this fiscal year, Mac laptops represented 70 percent of sales. Mac desktop sales were actually down year-over-year, from 1.23 million to 1.28 million, while laptops surged to 2.9 million during the holiday quarter. While Apple doesn’t break out sales by individual model, the new MacBook Air appears to be having an impact. Apple has indeed become the “mobile devices company” Steve Jobs described last January during the iPad introduction, and the iPod remains the best-selling of Apple’s mobile devices.

Apple sold 19.4 million iPods in the first quarter, compared to nearly 21 million last year, a decrease of 7 percent. For the last four years, Apple has regularly sold between 20 and 25 million iPods during the holidays, indicating the iPod may have reached market saturation. Revenue, which had been increasing despite decreasing sales, is now flat, up just 1 percent. While Apple also doesn’t break out iPods by model, it’s been thought that increasing sales of the higher-priced iPod touch were offsetting an overall iPod sales decline. The change in revenue may indicate that the combination of the iPhone and the iPad are negatively impacting iPod touch sales.

As for the iPhone, after selling 14.1 million units during the first full quarter of iPhone 4 availability (July through September), Apple sold 16.2 million iPhones during the holidays. That’s up an astonishing 86 percent year-over-year, and since 2008, iPhone sales have approximately doubled during each subsequent year’s first quarter. The iPhone earned nearly $10.5 billion for Apple, some 40 percent of all revenue.

Looking forward to next quarter, it’s hard to imagine Apple beating sales for the last two quarters, especially since the next iPhone isn’t expected to arrive until June or July. However, Apple will have the Verizon iPhone, and could finally manage to ship the white iPhone, so another record quarter is possible.

Another sequential record quarter is a little harder to imagine for the iPad. Launched just over nine months ago, the iPad sold 7.33 million units during the holiday quarter, up from 4.19 million the previous quarter. It appears the iPad, like the iPod, has great seasonal cache as a Christmas present. That makes one wonder if the yearly launch may at some point be moved from spring to fall, when new iPods are traditionally unveiled.

That question may come up during Apple’s conference call today, along with the expected queries about Steve Jobs and his medical leave of absence. As always, TheAppleBlog will have highlights and commentary immediately following the call.

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The agreement with Verizon has three implications, with the first being that Bandwidth.com now knows what it will pay to terminate VoIP calls to landlines, which will help it build out a stable cost basis for its business and thus help other VoIP companies it serves do the same. Much like the agreement with the SoundExchange helped Pandora, the online radio station, figure out the costs of providing streaming music to users so it could build out a business model to support itself, this agreement helps Bandwidth.com and other VoIP providers by setting a baseline cost. David Morken, CEO of Bandwidth.com, says he’s in talks with another major wireline provider to sign a similar deal.

The agreement could also help Verizon, which also has a lot of VoIP traffic on its network, pay lower rates to rural telephone companies. Verizon has to pay other telecommunications providers to terminate its VoIP calls, and in some places, it pays almost a half-cent per minute to do so. By publicizing this agreement, Verizon has told the world what it’s charging others, and said what it wants to pay. Expect rural providers to experience pressure from Verizon to bring their VoIP termination fees down to this $0.0007 cent level. From a research note issued today by investment research firm Stifel Nicolaus:

In the absence of reform, we believe Verizon and others are looking to put downward pressure on intercarrier compensation in the marketplace. Verizon is disputing rural carrier collection of access charges for connecting VoIP calls while attempting to negotiate deals, including the one with Bandwidth.com, that move the industry toward lower rates.

The third implication has to do with the somewhat esoteric world of regulation and telecommunications law. The FCC has never ruled on intercarrier compensation rates for VoIP services, because it has never decided if VoIP is a telecommunications service like wireline telephone or an information service like email. Obviously, folks don’t have to pay $0.0007 cents to send an email, although email doesn’t really cross from an IP network to an analog world unless the recipient has dial-up. This private agreement classifies VoIP as an information service and sets a rate — something the FCC hasn’t yet done for VoIP calls. So while the FCC has decades of rate setting and compensation agreements for voice traffic, it has never made the leap to set rates for VoIP. This has left the Verizons and other telcos of the world able to set prices, and the market for VoIP to develop in a way that’s vastly different from the market for email.

So this rather dull-sounding agreement is a big deal for companies like Google, Skype, Twilio and Bandwidth.com, as well as for rural telcos and the FCC. If the FCC decides to make a decision on VoIP interconnection fees rates this year, as some sources have said it will, then Morken says he can let the agreement expire (or not) depending on what the rules say. For Bandwidth.com, which has gone from operating 1 million numbers at the end of 2009 to 17 million numbers today, the agreement is like a hedge against higher prices and regulatory uncertainty that Morken can use to build his business.

With $100 million in annual revenue, up from $85 million the year before, Bandwidth.com is growing well without ever having taken on venture investment. The company, which is profitable, expects to file to go public within the next 18 months, said Morken. We’ve covered the business in December 2009, and I think as an infrastructure provider for VoIP services, Bandwidth.com can sell itself as a credible VoIP platform. Contracts like this only reinforce that legitimacy, although should the FCC declare VoIP an information service, I suppose the contract could become a cost burden other providers wouldn’t have to deal with.

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The OneNote Mobile for iPhone app is just one piece of software that helps users sync their notes to a Windows Live Skydrive account. But it may signal that potentially more Microsoft productivity apps will come to iOS. There are other third-party mobile productivity options available, like Documents To Go, but few are as popular as Word and Excel. If you listen to the words of Takeshi Numoto, corporate VP for Microsoft Office, those apps may not be far off either.

“As new pieces of technology — new browsers, mobile hardware, smart phones and social networks — become bigger parts of (people’s) lives, they expect familiar technology, like Office, to help them access their ideas wherever they are. Today’s release is another step in Office evolving to serve our 750 million customers worldwide. Whether it’s on a PC or Mac, a mobile phone, or online through the Office Web Apps on multiple browsers, we continue to bring Office to the devices, platforms, and operating systems our customers are using. It should be about the ideas and information, not the device, right?,” Numoto wrote on the Microsoft Office blog.

Now, Numoto’s statement doesn’t exactly commit Microsoft to future productivity apps on iOS devices, but it suggests Microsoft is getting used the idea that embracing iOS might be advantageous. If it’s all about the software, then it makes sense not to preclude popular non-Microsoft platforms such as iOS. With Google also pushing hard to make its Docs program more powerful on mobile, with full editing now, it’s logical for Microsoft to look at unleashing more Office mobile apps before iPhone and iPad users get used to working with Google Docs (or iWorks, for that matter) on their devices. It all jibes with an earlier report that Microsoft was looking at bringing Office to Nokia and “other leading smartphone platforms.”

Microsoft will need time to build up Windows Phone 7 as a major mobile competitor, but it has valuable assets in its Office products that can help the company be relevant in mobile if it thinks beyond its own mobile platform. Users would love to be able to have their Word documents available from a desktop, from the cloud and on mobile devices. Now Microsoft just has to get with the program.

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