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Yahoo swears it isn’t going to screw up Tumblr — but how realistic is that promise?

Mathew Ingram — Tue, 21 May 2013 18:47:18 +0000

As the dust begins to settle from one of the most significant acquisitions in web-land since the Facebook/Instagram deal, the warm glow of euphoria created by Yahoo’s $1.1-billion takeover of Tumblr has given way to the harsh reality of blending — or, more importantly, not blending — two vastly different companies and cultures. In a statement about the deal, Yahoo CEO Marissa Mayer promised not to “screw it up,” a comment undoubtedly aimed at the sensitive community of Tumblr fanatics. But is it even possible for Yahoo to keep this promise?

Even before the news was confirmed on Monday, critics with long memories were reminding anyone who would listen about Yahoo’s track record with acquisitions, which has some rather notorious bumps in it, including two major ones known as GeoCities and Flickr. Those two deals alone have made many question whether Yahoo will be able to do the right thing with Tumblr — and while it may be unfair to lay the blame for these at Marissa Mayer’s feet, there are plenty of reasons to be skeptical about the future of this latest acquisition.

How long will it take yahoo to ruin tumblr?—
Blake Hounshell (@blakehounshell) May 19, 2013

GeoCities + Flickr: billions in missed opportunities

In 1999, Yahoo bought GeoCities for about $3.5 billion, which even at the time was an eye-popping amount. Although it was over a decade ago, which is eons in internet time, there are some broad similarities between what GeoCities was then and what Tumblr is now: both were distinctive and somewhat chaotic communities, focused on allowing individuals to create their own space. Yahoo did a number of things that arguably accelerated the demise of its high-priced acquisition, including trying to monetize it through hosting fees and cheesy banner ads.

The other stick that many anti-Yahoo types use when they want to beat the company up about its acquisition strategy is Flickr, the pioneering photo community that languished under Yahoo’s ownership until relatively recently. As many of its hard-core fans (including me) have argued in the past, Flickr was — or at least could have been — Instagram before Instagram.

There have been a number of post-mortems on what happened with Flickr, but in a nutshell Yahoo did almost everything wrong: the larger company took away or smothered much of the photo-sharing community’s most important features, prevented its employees from innovating or growing, and forced all kinds of integration between the two platforms that did nothing to benefit users — in fact, precisely the opposite. It was like the trifecta of failure, and a perfect example of why most large-scale acquisitions don’t work.

“All Yahoo cared about was the database its users had built and tagged. It didn’t care about the community that had created it or (more importantly) continuing to grow that community by introducing new features.”

Successful mergers are exceedingly rare

It’s certainly reasonable to argue — as many of her fans in Silicon Valley have since the Tumblr deal was announced — that Marissa Mayer shouldn’t be held to account for these lapses, since she had nothing to do with them and the internet has changed a lot since then. Yahoo is also substantially more desperate than it used to be (if that’s possible), and that has arguably made Mayer more cautious about potential screw-ups.

But the bottom line is that just because Mayer is a new CEO doesn’t mean she or the company won’t screw Tumblr up somehow anyway — either deliberately or by accident. That’s because large companies like Yahoo have a way of destroying the value of the things they acquire even if they don’t mean to do so, especially when the thing they have acquired is a somewhat unique community with special characteristics, which Tumblr arguably is.

This is why successful large acquisitions of web communities or services are so rare — rare enough that almost everyone can only point to a single example: namely, Google buying YouTube (although Facebook’s acquisition of Instagram is looking like it may be another one). The question for Yahoo and Mayer is whether Tumblr can be kept as a distinct entity and yet still monetized, as YouTube has been, or whether the process of monetization will inevitably turn Tumblr into the latest example of a MySpace-style failure.

Can Yahoo do what Google did with YouTube?

Former YouTube exec Hunter Walk took a look at what Google did right in the case of YouTube, and boiled it down to five factors, including keeping the product from getting too intertwined with the parent company and maintaining a separate physical identity. But to me the most important ones were:

Protect Tumblr from “helpful” Yahoos: This is where the accidental destruction of acquisitions often comes from — people who just want to help, but whose requests for features and other attempts at integration wound up almost “hugging us to death,” as Walk puts it. There is a powerful desire to get efficiencies out of acquisitions, but many of those attempts fail badly and ruin the thing they were trying to monetize or grow in the first place.

Stop short-term monetization that won’t scale: Walk talks about how YouTube managed to avoid the natural desire to build all sorts of easy-win monetization methods into the platform, and focused instead on longer-term approaches that were harder to sell in the early going but built more value. If Yahoo sees Tumblr as a way to bulk up its banner ad or other programs, it could wind up making the exact same mistake that YouTube was able to avoid.

In the end, much of the answer to the question about Yahoo screwing up Tumblr rests on Marissa Mayer, and her ability to stave off the desires of both the board of directors and the other senior managers who see Tumblr as either a distraction or a digital cow to be milked and then sent to the abbatoir.

Post and thumbnail photos courtesy of Flickr / Stephen Brace and Getty Images / Chris Jackson and Pamuk Sekerli Tardis

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Hold the phone: Google isn’t hanging up on Voice in Hangouts after all

Kevin C. Tofel — Mon, 20 May 2013 18:47:03 +0000

Although last week’s Google I/O event overflowed with new feature debuts, I noted on Thursday that one key Google service was absent: Google Voice. Instead we heard about Google’s new Hangouts app, a unified messaging service for the web, Android and iOS devices.

Hangouts has taken the place of Google Talk, which is what I use daily to make phone calls via Google Voice. Or at least I used to.

At the moment, users who upgrade to Hangouts on the web lose the ability to make voice calls through the old Google Talk. Incoming Google Voice calls can still be accepted through the new Hangouts, however. It turns out that Google Voice actually is a big part of Hangouts, it’s just not ready yet. Nikhyl Singhal, a product manager for all of Google’s real-time communications services said this on his Google+ page on Monday:

“Hangouts is designed to be the future of Google Voice, and making/receiving phone calls is just the beginning. Future versions of Hangouts will integrate Google Voice more seamlessly.”

Singhal notes that from within Gmail, users can still place outbound Google Voice phone calls, so the functionality is still available; just not yet in the new Hangouts app or the Chrome extension for Hangouts.

On a related note, Hangouts still doesn’t use the open source WebRTC, or Web real-time communications, API that will allow for video, voice and file sharing without the need for plug-ins. Instead, the service is still built upon technology from Vidyo, which clarified the WebRTC situation in a blog post today. Google has confirmed the same to my colleague, Janko Roettgers.

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The week in cloud: Google and Microsoft spar while IBM and SAP play hot hands

Barb Darrow — Sun, 19 May 2013 16:00:49 +0000

Google I/O, which saw the public launch of Google Compute Engine, also spawned a “I know you are, what am I,” slapfest between two companies that would like to unseat Amazon Web Services as the king of public cloud. Apparently Google CEO Larry Page doesn’t think the company’s “Don’t be Evil” mantra applies to trash talking rivals. And someone should clue in him in that a billionaire whining about how other billionaires have done his company wrong is a tad unseemly. Especially coming as it did after Page bemoaned the “negativity” in press reports about Google technology.

“Every story I read about Google is us versus some other company or some stupid thing. Being negative is not how we make progress. The most important things are not zero sum.” Page said Google struggles “with people like Microsoft,” he said. As for Oracle, which is suing Google over Android’s use of Java, Google has “a difficult relationship with Oracle, including having to appear in court … Money is obviously more important to them than any collaboration.”

In comments emailed to CIO.com, Microsoft responded:

“It’s ironic that Larry is lending his voice to the discussion of interoperability considering his company’s decision — today — to file a cease and desist order to remove the YouTube app from Windows Phone, let alone the recent decision to make it more difficult for our customers to connect their Gmail accounts to their Windows experience.”

Page’s words came a few days after Microsoft announced interoperability between its Outlook.com email service and Gmail and just after word came out that Google demanded that Microsoft rip its home-built YouTube app from the Windows store (and remove the app off the Windows Phones that were already running it.) So, who’s the winner in this melee? Neither vendor comes out looking good. For Microsoft to complain about Google’s business practices is laughable given its own track record. But for Google to claim it’s not evil while restricting consumer choice is also awful. Consumers might just say a pox on both their houses.

IBM spreads Watson around …

Watson, the natural-language-understanding software that played (and won) at Jeopardy, will be made more broadly available to third-party software makers, IBM CEO Ginny Rometty said last week. Thus Watson technology could be used perhaps even by IBM competitors, to build self-teaching computer systems, according to Bloomberg News. IBM has made the most possible PR use of Watson capabilities, working to embed that intelligence in medical and other applications. Last week, IBM took its show on the road to Washington D.C. last week to show Congress the progress Watson has made in healthcare applications.

… as SAP doubles down on HANA

German enterprise software giant SAP, in a move you could see coming miles away, said this week that HANA, it’s in-memory analytical database, will be the brains of its ERP software going forward, according to InformationWeek and other outlets. Running do-or-die ERP and CRM applications on HANA is a big step up from data warehouses because ERP and CRM cannot go down for hours or a day without severe blowback. And yet at the annual SAPPHIRE conference last week SAP announced general availability of its core Business Suite applications on HANA. Or, as CRN put it, it “bet the farm” on HANA.

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ICYMI Podcasts: Real Chrome apps, a history of IoT and Google I/O 2013

Kevin C. Tofel — Sun, 19 May 2013 14:15:04 +0000

Another week full of tech news means another week of GigaOM podcasts filled with analysis and commentary. Here’s a summary of what you might have missed, along with links to our audio episodes.

On the GigaOM Chrome Show, Chris Albrecht and I chatted with special guest, Joe Marini. As a Google Developer Advocate, Joe is an expert on the Chrome app experience along with the technology behind it such as Packaged Apps and Native Client apps.

Stacey Higginbotham also had a special guest interview this week on the Internet of Things podcast. Adam Dunkels explains how his early IoT coding efforts helped form the basis for LEGO Mindstorms robots and gave him the knowledge to start his latest company, Thingsquare.

Lastly, on the GigaOM Weekly Wrapup show, Tom Krazit, Eliza Kern, Janko Roettgers and I team up to dissect all of the developments at this year’s Google I/O event, ranging from new APIs for Chrome and Android to the new Google Play Music All Access subscription service.

(Download the GigaOM Chrome Show)

(Download the GigaOM Internet of Things podcast)

(Download the GigaOM Weekly Wrapup podcast)

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Why Yahoo acquiring Tumblr for $1 billion makes a certain horrible kind of sense

Mathew Ingram — Sat, 18 May 2013 15:41:27 +0000

According to a blizzard of anonymous news reports, Marissa Mayer is working feverishly to land the biggest fish of her career as CEO of Yahoo: namely, the $1-billion-plus acquisition of New York-based Tumblr, the ultra-hip blog network — the two are reportedly involved in discussions that could come to fruition as early as Sunday. Although Tumblr fans seem horrified by the idea, this one makes a substantial amount of sense for both sides.

Of course, as Om and others have already mentioned, there’s no guarantee this deal will actually be consummated: it could fall apart on valuation, as so many deals do — or Facebook could swoop in with a much higher offer and snatch Tumblr out of Yahoo’s clutches, the same way it did when it stole Instagram away from Twitter last year for close to $1 billion.

Update: According to the Wall Street Journal, the Yahoo board of directors has approved a $1.1-billion all-cash bid to acquire Tumblr.

It makes Yahoo look desperate — because it is

Even if the deal does get done, one of the risks for Mayer and Yahoo is that the company could look desperate by paying more than $1 billion for a site that had revenues of less than $15 million last year (although CEO David Karp has said that figure should hit $100 million this year). That’s an almost bubble-like multiple for a company, and there will likely be plenty of criticism from investors who believe that $1 billion could be better spent elsewhere — in other words, on businesses that would make Yahoo a better return.

But the painful fact is that Yahoo doesn’t just look desperate — in many ways it is desperate. Mayer has made some changes since she took over the ailing former web portal, including the acquisition of Summly and a number of other mobile-focused startups and services, but the company still needs to make some aggressive moves if it is going to jump-start any growth at all. And since Yahoo has about $4 billion in cash on hand, it can arguably afford to make a big bet.

Yahoo buying Tumblr makes sense. Tumblr is only big, cool, newish social platform that Yahoo can afford.—
Henry Blodget (@hblodget) May 17, 2013

For Yahoo, the addition of Tumblr would do a number of things: because of the size and profile of the deal, it would make a major statement about Mayer’s intention to do whatever it takes to revitalize the company, and it would also send a signal to Facebook and Google — and even Apple — that Yahoo is a potential force to be reckoned with when it comes to potential acquisitions. Is doing that worth $1 billion? That’s for Yahoo’s investors and board of directors to decide.

Just as important, it would inject some much-needed life and energy into the somewhat stale lineup of content that the company currently relies on, which caters more to the over-50 set than it does to anyone in the much-desired 18 to 25 demographic. More than any other network, Tumblr is the platform of choice for media-obsessed teens and 20-somethings, who spend massive amounts of time sharing photos and videos and animated GIFs on the site — an engine of potential value that Yahoo desperately needs.

Tumblr gets a massive exit

This doesn’t come without its own risks, of course: As a number of observers have noted, Tumblr’s content contains a large quantity of not only mature or arguably offensive content but outright pornography, which many argue is the source of its massive traffic numbers. How Yahoo (or Facebook for that matter) would deal with this kind of content remains to be seen.

3 q's for Yahoo: 1) Can you convert Tumblr users to Yahoo products? 2) Can you monetize Tumblr PVs? 3) What to do w/ all that Tumblr porn?—
Mark Zohar (@markzohar) May 18, 2013

For Tumblr, meanwhile, being acquired would solve a number of problems — the main one being that the company has gone well beyond the “we’re a startup so we don’t really have to make money” stage, and is facing increasing pressure from the investors who have given CEO David Karp more than $125 million in venture financing, an investment that values the company at about $800 million. Accepting a giant check from Yahoo would take care of that problem in one fell swoop, especially if it was all in cash.

With a major company like Yahoo as a partner, Tumblr could connect its massive audience of users to the firehose of ads and other monetization methods the giant web portal has, and potentially generate much more revenue than it could have by itself. The only lingering question at that point is whether Tumblr fans decide that Yahoo is poisoning the well of social content and community on the site, and decide to flee for greener pastures. In other words, does Yahoo make Tumblr into YouTube — a successful standalone network that can grow and prosper on its own — or does it become MySpace?

The only scenario where a Yahoo-Tumblr combo works is if Yahoo keeps Tumblr separate in the same way Google managed YouTube.—
Mark Birch (@marksbirch) May 18, 2013

Post and thumbnail photos courtesy of Shutterstock / ollyy and Albert Chau

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Android this week: Google I/O recapped; Better Bluetooth; Galaxy S 4 Google Edition

Kevin C. Tofel — Sat, 18 May 2013 12:49:21 +0000

The annual Google I/O event has come and gone, with plenty of news specific to Android. While the event focuses on developers, consumers will see benefits in Android thanks to improvements in Google’s core services and many new APIs for developers to use in Android apps. There was no new Nexus phone, no update to the Nexus 7 tablet, nor a new Nexus 11 tablet. But for those willing to shell out $649, there is a modified Galaxy S 4 coming soon.

Google announced that in June, customers can order the handset through the Google Play store. Instead of the phone running Samsung’s customized TouchWiz software, it will instead run on pure Android, just like the Nexus 4. That means it will get future software updates directly through Google and not Samsung or a network provider.

Of course, some of the newest Samsung features won’t be present on the phone: I wouldn’t expect Samsung’s new camera modes to be there, nor would I expect gestures to work for hands-free scrolling or swiping. Still, in light of no new Nexus hardware, the unlocked handset could appeal to hardcore Android enthusiasts.

So without the release of Android 4.3 at Google I/O, does that mean Android hasn’t improved? Not at all; in fact, Google essentially boosted Android’s software without needing to wait for carriers and handset makers to upgrade the software. How did this happen? A large part of the 3.5 hour Google I/O keynote was dedicated to new Android services and APIs, plus a new application called Hangouts.

The new Hangouts app replaces Google Talk and is Google’s effort to unify its messaging platform. The app supports video calls with up to 10 participants, SMS notifications of incoming chat requests when offline, text chat and works across platforms: You can communication with other users on the web or on iOS devices. Hangouts also highlights a great new feature in Android: Support for synchronized notifications. If you get a notification on one device and take action, the notification won’t appear on other devices or in the Chrome browser.

Google also introduced its music subscription and discovery service called Google Play Music All Access. For a $9.99 monthly fee — $7.99 if you start a 30-day trial by June 30 — you get unlimited access to stream tracks thought the Play Music app and on the web. Human curators surface top songs and albums while music recommendations come from Google’s Knowledge Graph and your Google+ circles.

Gaming got a supercharge in Android as well. Developers can use the new Google Play Games services that allow cross-platform gaming complete with achievements and leaderboards. Game progress can also be saved to the cloud, allowing gamers to pick up where the left off, even from another device.

Android also saw one other big announcement this week, but it didn’t happen at Google I/O. The Bluetooth SIG announced that Android will gain support for Bluetooth Smart and Smart Ready devices in the coming months. That’s likely to be included in an actual Android release as some developers told me that Google will be completely changing the Bluetooth software stack in Android. Regardless, this means widespread support for Bluetooth 4.0 Smart and Smart Ready accessories such as watches, heart rate monitors and other low-powered companion devices.

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WebRTC is growing fast: soon to surpass one billion devices

Janko Roettgers — Fri, 17 May 2013 19:46:12 +0000

WebRTC, the new technology that enables plugin-free voice and video chat within the browser, should be available on more than one billion unique endpoints (think: desktop browsers and mobile devices) “within a week,” according to Google’s WebRTC engineering lead Justin Uberti, who gave an update on WebRTC’s progress at Google I/O Friday.

WebRTC is going to reach that milestone thanks in part to Firefox 22, which was just released this week. The new version of Firefox comes with WebRTC enabled in its beta version, which should add a large number of users to the addressable market for WebRTC developers.

Uberti also said that WebRTC is going to come to iOS devices soon: Apple hasn’t joined the efforts to implement and standardize WebRTC yet, but Google wants to nonetheless give developers a way to address users on iPads and iPhones through the release of a native toolkit.

Of course, there is another holdout: Microsoft has been pushing forward with its own version of WebRTC, which some have seen as an effort to torpedo the standard. Uberti had a much more optimistic take on the differences Friday, saying that Microsoft has been “a great participant in the standards.” He added: “I’m very optimistic that we are going to see a version of (Internet Explorer) that supports this technology in the not-too distant future.”

Image courtesy of Flickr user Tsahi Levent-Levi.

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The future, according to Google

Jordan Novet — Fri, 17 May 2013 14:47:53 +0000

During a fireside chat with four Google Research heavyweights — artificial-intelligence guru Peter Norvig, Google Glass guy Thad Starner, MapReduce paper co-author Jeff Dean and distributed computing wizard Alfred Spector — on Thursday, an audience member sucked up the air in the overcrowded room when he asked “where we’ll be 10 years from now.”

Without a doubt, the panel, at Google I/O, was an apt forum for that question. If any company is innovating in a big way, it’s Google, with recent advancements in voice recognition, wearable technology, quantum computing and other realms. So it wouldn’t be surprising to see some of the Google luminaries’ ideas actually come into being. Here’s what they had to say:

“Speech recognition and vision are showing dramatic improvements over the last few years. We just need to scale them up and make them work better. … They’re (mobile devices) going to vanish into much smaller devices that you carry around and aren’t full-size laptops.” — Jeff Dean

“We’re getting more contextualized. The computer is not what you go to to use. It’s something that’s around you all the time and sort of more integrated into your life, rather than a separate thing.” — Peter Norvig

“I would argue that we’re currently living the singularity, where the tool stops and the mind begins will start becoming blurry.” — Thad Starner

So there you have it, folks — the computer as a smaller and more natural extension of the human brain. Now, let’s set the kitchen timer for 10 years and see what actually happens.

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Why Google thinks the GPU is the engine for the web of the future

Jordan Novet — Fri, 17 May 2013 00:57:10 +0000

For years, the internet provided users with static clumps of information stored and refreshed in databases on the back end. But as interactive games, animations and fancy scrolling have become popular, graphics have become fancier and screens richer. Throughout this evolution, hardware components on users’ devices have gotten more capable, but now Google seems to think the GPU is the best tool for the internet of tomorrow.

At a talk at the Google I/O conference on Thursday, Googlers Colt McAnlis (pictured), a developer advocate working on Chrome games and performance, and Grace Kloba, the technical lead on Chrome for Android, gave developers some tips for making better use of the GPU. Doing some of these things can help websites display their graphics as soon as possible and become optimized for “touch events” such as scrolling without sacrificing performance.

Chrome developers can split up many website components into GPU layers, each of which can be subdivided into a bunch of tiles for an entire page — think of a grid overlaid on top of the page. Instead of asking the CPU to upload the pixels to the whole screen area, the GPU caches those tiles inside its memory when a page is accessed and then serves up select tiles in response to user behavior, such as scrolling. This approach “allows the CPU to drink margaritas and essentially chill out while the GPU does all the heavy lifting,” McAnlis said.

But there’s a tradeoff to this layering approach. Making many layers can result in entirely too many tiles, and the GPU “has a static, non-growable memory resource in its texture cache,” McAnlis said. “If the cache is full, you have to push old tiles out of the cache before you put new tiles in.” And that can result in a decrease in performance.

In short, developers have to figure out the right number of layers for each page. For example, if a user ends up not using a tile that is loaded and cached on the GPU, it’s a waste of a GPU compute cycle. Developers can learn more about the use of GPU inside Chrome in the Chromium Project’s design documents and get insight into GPU use with the Trace Event Profiling Tool. Developers can also run experiments through Chrome, McAnlis said.

To demonstrate good use of layers, McAnlis pointed, perhaps unsurprisingly, to a Google site, the mobile version of the Google I/O conference site. “Look at the source code,” he said. “It’s a great example.” The header is its own layer, he said, and it expands and contracts and adjusts the times of conference sessions as the user scrolls up and down the page.

The winners on the web over the next few years will be the sites that can serve rich, compelling content as fast as possible. It looks like Google believes taking full advantage of the GPU might be the best way to accomplish that goal.

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What do good shoes, Google+ and Facebook have in common?

Om Malik — Thu, 16 May 2013 20:52:16 +0000

James Russell, a London based designer, took issue with my post Wednesday about the new Google+ design and how its aesthetic is different from Facebook. He argued that, well, the new Google+ still looks like Facebook and went on to make his case using visuals from both services. Basically, he thinks it is business as usual. I accept his criticism for his reasoning makes sense, but I just don’t agree.

Photo courtesy: Leffot

I don’t know James, but my sense from reading his post is that he approaches design through a visual lens. Unlike him, I am not a designer and so my way of thinking about design is influenced by not mere visual aspects, but also how things are constructed. I don’t just love the shoes because of how they look — though that matters — but I also look at where the leather comes from, how it is stitched together and what kind of craftsmanship has gone into it. From shoe trees to little patterns on the toe to the packaging to the font on the label, all of those little things add up to the design aesthetic.

And that way of thinking about the design aesthetic extends to other things, including website design. Yes, fonts matter, and the layouts matter, but so does the relative relationship to the kind of content, the speed of the web service and even the screen size and how it all correlates to me.

So, using that lens, when I looked at Google+ and its new design, what I saw was that it was less social in the “Facebook sort of a way.” And by that I mean: it’s less about people, likes and shares being the primary action drivers on the page. Instead, I saw a design aesthetic defined by data and machines inferring relationships, the importance of content and the relative weight of all the elements on the page. The new super hashtag is a good example of what I am talking about — it surfaces a lot more information on those specific topics — with very little to do with social relationships.

As I pointed out in my post (and also on my post about Google Maps’ redesign,) we have moved into the world of data-informed applications and design too has to adapt to this reality. So, while there might be elements on the page might overlap on few occasions, the departure in the core philosophies that is reflected in the overall aesthetic is pretty clear to my eye. And as far as I can tell, that aesthetic is all about a philosophy and how it relates to senses.

Google has always been about inferring and serving up information. Facebook is about implicit actions. The new Google+ design is an extension of that thinking. And as Vic Gundotra, Google’s Senior Vice President of Google+ said: “We have put Google in Google+.”

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