Epic 2014, Google, Amazon, Googlezon…

Google employee reveals it all to Microsoft

A former Googler who returned to Microsoft after a start-up he left the software giant to launch was acquired by Google, has some not so positive insights to share about what it’s really like to work at the Googleplex. Behind the lava lamps, organic dinners and free shuttle buses lurks a company where employees end up working long hours, don’t enjoy private offices and get paid less than Microsofties.

That’s according to an internal Microsoft e-mail that has made its way to the Web. The blog posting is believed to have been written by a Microsoft recruiter who interviewed the ex-Googler.

Some highlights:

– “People are generally in the building between 10 a.m. and about 6 p.m. every day, but nearly everyone is on e-mail 24/7 and most people spend most of their evenings working from home.”

– “Most people don’t actually have a 20 percent project. Most managers won’t remind you to start one.”

– “There are glass-walled offices, there are open-space areas, there are cubicles, there are people who’s (sic) desks are literally in hallways because there’s no room anywhere else.”

– “A college kid can literally join Google and, like they did as freshman at university, let Google take care of everything. Of course, if Google handles everything for you, it’s hard to think about leaving because of all the ’stuff’ you’ll need to transition and then manage for yourself.”

– “Google doesn’t place any value on previous industry experience. (It puts tremendous value on degrees, especially Stanford ones.)”

– “Google actually pays less salary than Microsoft.”

– “Google’s health insurance is actually not nearly as good as Microsoft’s.”

Among the insider’s suggestions for Microsoft to compete more effectively with Google in recruiting and retention is offering employees free food. Serving breakfast by 8:30 a.m. will ensure that many workers are at the office early, the ex-Googler said.

Who is this mystery person who dares to reveal the untold secrets about the company ranked best place to work by Fortune?

In her ZDNet blog, Microsoft watcher Mary Jo Foley says she knows who it is and that she contacted him and his opinions reflect those in the e-mail. He is one of the founders of Phatbits, a company acquired by Google, she says. He left Microsoft before starting Phatbits and then returned after leaving Google. Foley does not identify him but writes that he said he did not create the blog or post the e-mail to it.

UPDATE 9:00 AM PT June 28: A new “Phatbits.com” blog has one entry, entitled “My Words,” in which someone claims credit for the opinions expressed about Google but not for the creation of the posting or the blog, and expresses dismay that Foley revealed enough information for his identity to be discovered. “Today my words got splashed all around the Internet. It’s interesting to see them living a life of their own outside the context they were created in,” the posting says. It includes a letter to Foley that says, in part, “The questions did come from my recruiter and what is published is, as far as I know, my exact response. I haven’t compared the online text with the original response so it’s possible some details have been changed but, as far as I know, those are my words. I answered the questions in the context of a business communication so my response might include things Microsoft considers confidential. I made a big effort to make sure it didn’t contain any facts that Google considers confidential per my agreements with them.” It is signed “Warm Regards, Geoffrey.”

Search for Tomorrow – The Google Killers

An army of fledgling companies is lining up to take on Google. Could the world’s biggest search engine possibly be vulnerable?

Inc. Slideshow: The Google Killers

In April 2002, The New York Times anointed Google “the king of search.” It’s impossible to argue with that today. Google, which is headquartered in Mountain View, California, conducts 48 percent of all online searches in the United States, compared with Yahoo’s 28 percent. And although Google’s sales growth has slowed ever so slightly, it is beyond impressive for a company that is already huge. In the most recent quarter, Google reported revenue of $3.2 billion, a 67 percent increase over the same period in the prior year.

Yet despite Google’s dominance, there are dozens of companies working to bring new search tools to market. Last year alone, 68 search-oriented firms raised venture capital, according to VentureOne, and countless others have been self-funded or backed by angel investors. Yahoo and other members of the old guard are also showing signs of life.

What’s behind the renewed competition? The upstarts believe there is more than enough opportunity to go around. The market for search advertising is expected to hit $11.1 billion by 2011. And Google’s reputation has taken a pounding. Keyword prices for valuable terms (example: “medical malpractice”) are skyrocketing, crowding out smaller advertisers. Those who can afford keywords can be the victims of click fraud, by which they are charged for meaningless traffic. They must also compete for traffic with sham websites called sportals, splogs, and flogs, which divert users to irrelevant sites. To fight these scam artists, Google constantly tinkers with its algorithms, but that can sometimes frustrate the legitimate efforts of advertisers to optimize their rankings.

Besides these shortcomings, some competitors sense that Google is increasingly distracted by its ballooning portfolio of products. There’s the plan to scan the world’s books, the digital medical records, the no-frills office software, and even a map of the moon. Viacom’s $1 billion YouTube lawsuit, filed in March, is seen by some rivals as a portent of headaches to come.

In public, Google is sanguine about the rise in competition. “We’ve always said that small companies should be buying ads on Google and other search engines,” says Sheryl Sandberg, who oversees the company’s online advertising sales. “But we think we offer the highest quality of information to our users.”

Few would argue that Google is set for a fall anytime soon. Still, the bets being placed against it offer a fascinating menu of options for business owners in any industry who want to upset the status quo. Here’s a look at five ways of taking on Google.

The Technologists

Try out: hakia.com and powerset.com

Google became Google in part because its technology was better than everyone else’s, but it’s been more than a decade since Sergey Brin and Larry Page began developing it. Many software developers believe the world is ready for something new.

To that end, Powerset and Hakia, start-ups based in San Francisco and New York City, respectively, are developing “natural language” technologies that aim to absorb the human nuances of a user’s query. Both companies are well financed: Hakia has raised $16 million, Powerset $13 million. Using artificial intelligence technology from Xerox’s famed Palo Alto Research Center, Powerset will debut later this year. The beta version of Hakia is already online, and it seems to work as promised. Type in “Which club does Tiger Woods use?” and Hakia provides equipment-related results and serves you an ad for Callaway. Google responds to the same search terms by offering you information on Tiger Woods video games.

Natural language technology raises some questions. A site that handles searches better than Google could end up processing fewer of them. Would fewer searches yield less ad revenue? Plus, both Hakia and Powerset acknowledge that natural language sites are expensive to build and chug processing power. Are they doomed to lower profit margins? “The short answer is we’ll take them,” says Powerset founder and CEO Barney Pell. Last year, Google’s net profit margin as a company was 29 percent. If Powerset or Hakia make less on their searches, Pell says, they will still have viable businesses.

The People Powered

Try out: chacha.com and search.wikia.com

Scott Jones is relying on a business-world version of the time-honored “ask your teenager” approach. His site ChaCha employs more than 31,000 workers, half of them college kids, to serve as guides for stumped online searchers. The guides chat online with users for three minutes on average, and then provide them with a list of results. They work part time from home and earn between $5 and $10 an hour.

The approach is expensive, but Jones hopes to bring in revenue by running video ads for users while they wait. Then there’s the bigger prize. Data collected from ChaCha’s conversations will serve as the backbone for an automated search engine that will one day compete directly with Google. At least one Web pioneer thinks Jones is on to something: Amazon’s Jeff Bezos is one of Jones’s lead investors.

The people-not-machines approach also underlies Wikia, a company started by Wikipedia founder Jimmy Wales. Plans remain under wraps, but the gist is that users will edit automated search results for relevance. Like Wikipedia, Wikia will allow users to track changes and identify who is making them, undercutting efforts to manipulate search results. “Someone can do something bad,” says Wikia CEO Gil Penchina, “but at least it will be transparent.”

The Specializers

Try out: The likes of toptenwholesale.com, zillow.com, and kayak.com

Unlike Google, “vertical search” companies don’t rely on fancy algorithms or indexing technology. Instead, they specialize in a topic or industry and use rudimentary search means, such as collecting links to relevant sites or charging companies a per-click fee for a listing.

A handful of consumer-oriented vertical search engines–Zillow.com in real estate and Kayak.com in travel–have already garnered significant attention and Web traffic. The category also contains many business-to-business sites. For example, TopTenWholesale.com helps distributors source industrial-sized merchandise. (One recent posting offered a case pack of 200 laser pointers.) “Vertical search engines know their industries in a way that Google or Yahoo never can,” says founder Jason Prescott, who reports sales of $1.5 million last year. That may sound small, but the market will top $1 billion in ad spending by 2009, according to Outsell, a Burlingame, California, research firm.

The Comeback Kids

Try out: yahoo.com, ask.com, and live.com

In a bid to grab market share, Google’s major rivals–Yahoo, Ask.com, and Microsoft –have been on a rebranding binge. Microsoft and Ask.com have introduced spare homepages that resemble you-know-who’s. (Ask also retired its Jeeves butler mascot.) Not to be outdone, Yahoo recently unveiled Panama, which is intended to bring its system for placing ads alongside search results into parity with Google’s system. None of these changes is revolutionary, but they could make these also-rans more attractive to companies that advertise online if Google’s keyword prices continue to rise.

The Adsense Assailants

Try out: contextweb.com and quigo.com

Most people associate Google with search, and yet 39 percent of its revenue (or $4.2 billion) comes from the AdSense network, a service that allows website owners to display Google ads in return for a share of revenue. Some of Google’s new rivals are bypassing search and instead going after this business. The problem with AdSense, they say, is that Google refuses to reveal the actual revenue split to its partner sites. A firm called ContextWeb is now offering sites more control over how much they are paid. Another upstart, Quigo, is letting advertisers be more choosey about where their ads are displayed; Google has promised to follow suit.

Whether or not the challengers gain a foothold in the market, their efforts are good news for all companies that rely on search-engine optimization and online advertising to boost sales. By challenging Google, they help to ensure that it doesn’t become complacent. “Everyone thinks Google is great, but we don’t have any reference point for what search can be,” says Riza Berkan, founder and CEO of Hakia. “Search is not yet a solved problem.”

Inc.

Microsoft Pays $6 billion for aQuantive: Massive Ad Network Consolidation Is Occuring

Breaking: Microsoft is acquiring advertising network aQuantive the parent company to Avenue A | Razorfish, Atlas and DRIVEpm, for roughly $6 billion in an all-cash transaction, the company said this morning.

aQuantive is a public company (AQNT) and had a market cap of just $2.8 billion as of yesterday. The acquisition price of $6 billion is a roughly 2x premium on yesterday’s closing price, which is a reflection of the fact that this were competing bidders (see notes below). The acquisition comes after recent big acquisitions by Google and Yahoo in this space. Google bought Doubleclick for $3.1 billion in April. Later that same month, Yahoo acquired competitor RightMedia for $680 million. Just yesterday, WPP Group acquired yet another company in this space, 24/7 Real Media, for $649 million.

2006 revenues for aQuantive were $442 million. Net income as about $54 million.

aQuantive’s operating companies include both tools and ad agencies. The company is located in Seattle.

Microsoft is held a media call this morning to discuss the transaction. My notes are below. At about 7 am PST a recording of the call will be available at 1-800-774-9248.

Notes From Media Call:

(see CenterNetworks as well, Allen Stern has taken very complete notes)

Deal brings lots of new relationships with publishers and advertisers

Microsoft is now able to sell display ads on any website

Good tools for rich media ads, including IPTV

aQuantive was founded in 1997.

Microsoft says they are showing they are willing to aggressively grow strategically. Ad market is predicted to grow dramatically over the next few years. Lots of synergies between companies. Will be able to better monetize microsoft inventory, and will now be able to sell display ads on third party sites. Financial implications to MS: deal will close in FY 2008. They do not think it will have a significant impact on MS operating income.

MS expects an antitrust review in the U.S. and maybe in other countries. Probably not EU, but perhaps in Germany.

MS talking about privacy: says aQuantive has high degree of respect for privacy and fits well with Microsoft’s privacy policies.

Bear Stearns question: does this affect MS’s opinion on Google/doubleclick transaction. MS: no, not at all. Says this will promote competition and Google/doubleclick will hurt competition. Microsoft is in none of the businesses that aQuantive is in, whereas Google was already in direct competition with doubleclick and will give Google 80% market share in those markets.

question on how difficult integration will be with MS’s Adcenter platform? MS says online ad market is $40 billion annually and growing 20% per year. Says MS is committed to getting their share of the market, and this deal gives them a more complete end to end solution (paid search, display ads, CPA). MS says the deal will make their time to market much quicker. They are looking to consolidate their inventory from MS sites to create more scale for ad network. Talking about MS’s new software + services model, phones, games, IPTV, etc. and that advertising will drive these businesses.

MS has a long relationship with aQuantive, has been a customer for many years.

question on the size of the premium v. yesterdays closing price for aQuantive. MS says if they can drive growth through acquisition better than through internal growth they will do it. “we have the economic fire power to do more if we wish to”. MS says this was a competitive bidding situation, and “we are delighted to have won”

MS is saying that there is very little overlap between the two companies, the products are highly complementary.

this is largest MS acquisition to date, but this is only 2% of MS market cap, and they have $35 b in cash on had.

TechCrunch

Windows Mobile 6 unveiled: Mini-Vista

New Windows Mobile 6 to Be Presented at 3GSM in Barcelona.

First details about Microsoft’s new operating system for mobile phones have emerged on the Web, with analysts saying it is a Vista in miniature.

Windows Mobile 6, code-named Crossbow, brings a new Vista-like interface and a lot of improvements concerning interoperability with other services crafted at Redmond. The new mobile OS will be available in the second half of 2007, and its newest features will be presented next week at the 3GSM conference that takes place in Barcelona, Spain.

Suzan DelBene, vice president for the company’s mobile-device marketing, said that she expects the OS to be installed on smartphones all over the world in the next few months.

Among the new features included in Windows Mobile are:

• Email in Rich HTML Format.
• Live links to SharePoint sites.
• Windows Live for Mobile included in Windows Mobile 6.
• New Security features such as remote wiping capabilities if your device is lost or stolen.
• Enhanced Windows Vista Synchronization through Windows Mobile Device Center.
• Calendar ribbon gives you your important appoints quickly.
• Contacts with context – call records now attached to individual contact cards in Windows Mobile 6.
• .NET Compact Framework and SQL Server built in to Windows Mobile 6.

According to estimates, Microsoft sold 3 million licenses of Windows Mobile last quarter, up 90 percent from a year earlier, and is now boasting with fruitful partnerships signed with Samsung (for the BlackJack model), T-Mobile (Dash) or Palm’s Treo.

Windows Mobile 6 is built using the same core as the WM5-the Window CE 5- so all applications which run on WM5 should work fine with the new edition. “We hope to be 100 percent compatible,” said John O’Rourke, a general manager in Microsoft’s Mobile and Embedded devices unit. “If an application works in Windows Mobile 5, it should work on Windows Mobile 6.”

Windows CE (sometimes abbreviated WinCE) is a variation of Microsoft’s Windows operating system for minimalist computers and embedded systems. Windows CE is a distinctly different kernel, rather than a “trimmed down” version of desktop Windows. Windows CE kernel is built to run even with less than a megabyte of memory. Windows CE 5.0 is the most open Microsoft Operating System to date, though not all of the system is available under shared source agreements.

Since the kernels are similar, users of WM5 will be able to upgrade their OS just like an XP user upgrades for Windows Vista.

All Windows Mobile 6-powered phones will include the previously introduced Direct Push Technology for always up-to-date E-Mail delivery and automatic synchronization of Outlook calendars and contacts through Microsoft Exchange Server.

Windows Mobile 6 will also offer a set of important device security and management features including the ability to remotely wipe all data from a device should it be lost or stolen, ensuring that confidential information remains that way.

Users of Microsoft Office on the PC – of which there are nearly 400 million worldwide – will feel right at home with the new mobile versions of Outlook, Word, Excel and PowerPoint built for all Windows Mobile 6 smartphones. Windows Mobile 6 addresses extensive user feedback and incorporates enhancements from the new Microsoft Office Mobile, making information management easier and more convenient.

The software also offers a new Windows Live search engine that combines Internet search with the ability to find and map nearby locations, DelBene said.

Thus, the Redmond behemoth is trying to surge into Google’s market share, which is about 5 times bigger than Microsoft’s in search engines domain.

The Windows Mobile 6 platform will offer a variety of other security options, giving IT departments the choice of how best to secure a device, from new Exchange Server policies and certificate options, storage card encryption, and continued support for remote and local device wipe.

Organizations using Information Rights Management (IRM) technology to control the viewing, storing and printing of confidential information on PCs will be able to extend those same rights to Windows Mobile 6 devices, a feature not available on any other mobile phone platform.

Powerful, new mobile versions of the .NET Compact Framework and SQL Server are built into Windows Mobile 6 make it even easier to create and access sales tools, inventory tracking, and many other applications from a smartphone.

With another WM6 built-in application users will be able to easily transform their smartphone into a high-speed modem for their laptop (“one-click easy”) with either a Bluetooth wireless or cable connection.

Windows Mobile 6 also makes it easier for operators and device makers to integrate a VoIP solution into a device they’re building.

playfuls.com

Bill Gates Introducing Windows Vista

From Times Square in New York City, Microsoft Chairman Bill Gates hosted the worldwide launch of Windows Vista and the 2007 Microsoft Office System. The celebration paid tribute to the millions of Microsoft customers, partners and product testers around the world who provided input and feedback on these products — helping Microsoft transform the way people communicate, create and share content, and access information and entertainment in the new digital age.

On-Demand Webcast

Microsto

The Real Value Of Vista

Microsoft’s new Windows will allow you to make the most of your digital media.

When Vista finally hits the shelves on Jan. 29, most consumers won’t have a clue why they should buy it. Never mind the fanfare it will receive as Microsoft Chairman William H. Gates III formally launches the new Windows from the stage of the Nokia Theater in New York. Or the hundreds of millions of dollars the software giant plans to spend through June to market it. With all of Vista’s many new features, Microsoft seems incapable of really zeroing in on the handful that will truly change the way consumers use their PCs.

Not that Vista won’t be a step forward. Just think back to what your PC was like five years ago when Windows xp launched. It was still the era of the Blue Screen of Death, that infamous window that popped up to say your PC had just crashed. Windows XP improved PC reliability. But in retrospect, the real breakthrough for consumers (those who didn’t already have a Mac, that is) was XP’s ability to help digitize their entertainment. Windows XP made it a snap to stash music, photos, and video online.

Windows XP pretty much stopped right there, though. Microsoft Corp. made it easy to rip a CD to your PC’s hard drive. But it took Apple Inc., with its iPod, to figure out how to actually take advantage of that digitization and make it easy for consumers to listen to their digital tunes. And forget about photos. Consumers have snapped scads of photos—2 billion in 2006 alone. But they remain trapped on hard drives of PCs running Windows XP. It’s not all that different than storing snapshots in shoeboxes under the bed.

Enter Vista. Let’s go out on a limb and suggest that for all the knocks against Microsoft and the jokes about how long it took to crank this thing out, Vista will in time be recognized as a leap past XP. And not just because it is far more secure and boots up more quickly. When consumers look back a few years from now, the Vista improvement they may be most likely to cite is the ability to actually use all that digital content they’ve been accumulating over the years.

The result of Microsoft’s efforts is a collection of devices and services that takes Windows a step closer to truly being a digital hub. Think once again about those photos. Microsoft has worked with a handful of partners that have developed digital picture frames that connect to PCs over a wireless network.

Sounds geeky. But Microsoft has made it easy for PCs to recognize the frames on a home network, so all users need to do is turn on the frame to connect with it. Then, from their PC, they can select which pictures to display on the frames scattered around the house. “A lot of the success of Vista will be up to the partners like us to make it dead simple,” says Jesse Grindeland, director of sales for i-mate plc, a Dubai company whose $299 Momento 10-inch frame goes on sale when Vista launches.

FREEING THE MUSIC
Another gadget, the Sonos Digital Music System, was wowing gearheads long before Vista came along. The Sonos system lets customers shoot music wirelessly from PCs to speakers throughout the house. And it worked well, except for music purchased online that contains copy protection preventing it from playing on multiple devices. Windows Media 11, the music technology inside Vista, fixes that, letting you stream copy-protected content throughout the house.

None of this was easy for Microsoft, which has always done better with business than consumers. “We’re really focused on creating a consumer brand for Microsoft,” says Brad Brooks, general manager in the Windows Client group. Microsoft’s critics will point out that many Vista features are already in Apple’s Mac OS X. Even Vista’s new method of recovering old versions of files, with the drab moniker Volume Shadow Copy, trails Apple’s much flashier Time Machine technology.

But for most PC users, these improvements will matter regardless of who had them first, says Michael Gartenberg, research director at JupiterKagan Inc. After all, Vista, like its predecessor, will continue to outsell the Mac by 20 to 1.

Businessweek

Yahoo + AOL + Microsoft = Google Killer?

How do you get three giants out of quicksand? The biggest giant eats the other two and makes a boat from their bones.

That seems to be Wall Street’s approach to building an apt competitor to Google. Shortly after analysts dreamed of a Microsoft-owned Yahoo, they’ve amended their solution to include AOL.

Last week, Merrill Lynch analyst Jessica Reif Cohen told reporters that an AOL Yahoo merger was possible in 2007. Cohen said an AOL Yahoo merger was “one of the more logical combinations” to take on Google, cut costs, and combine audiences, and that Time Warner was open to it.

This caused quite the buzz, spawning charts with potential combinations of companies that could merge with or be acquired by another company for strategic reasons.

A Yahoo AOL combination is considered among the most likely, as is a Microsoft buy out of AOL and/or Yahoo.

Or, if we get out our pie-in-the-sky caps, the ideal scenario is Yahoo merges with AOL and Microsoft buys them both. MSN is sinking in the search market. Yahoo is stagnant. And AOL is ready to be sold for parts. But, theoretically, the high profile threesome could make one hell of a Mighty Morphin’ Power Ranger.

This is GEMAYA revisited, that too big of a darn acronym symbolic of too big of a darn theoretical super conglomerate consisting of Google, eBay, Microsoft, Amazon, Yahoo, AOL. And Wall Street gets so hot when people get all cyber-orgiastic.

On paper, it is potentially the only way Microsoft and Yahoo will catch Google. But since competition is key, making GEMAYA a ready target for trustbusters, maybe we should restructure that super conglomerate, add some, and divide it all into two mega-super-conglomerates.

It’s worked for the telcos, right?

How about DAMMIT (Disney, Amazon, Microsoft, Motorola, Interactive, Time Warner) vs. E-GANGS (eBay, Google, Apple, News Corp., General Electric, Sun Microsystems)?

Now we’re just being silly, aren’t we?

Something tells me we haven’t even seen silly yet. We just don’t know, at this point, what level or direction of silly it will be. It would seem silly for there not to be major collaborations to maximize the online market. The size of these potential super-companies isn’t just silly, it’s down right ridiculous. But it also seems silly to drive from the end-user seat, without any concrete confirmation from the players involved.

But it is fun to do, especially at the end of year when there’s little going on and you can’t think of anything to say.

http://www.webproworld.com/viewtopic.php?t=70805

S&P still likes eBay

On Monday I spoke with Scott Kessler, S&P’s Senior Director of Information Technology Research. He has a strong buy recommendation on eBay, Inc. (NASDAQ:EBAY) but is less excited about Microsoft Corporation (NASDAQ:MSFT), Google Inc. (NASDAQ:GOOG), and Yahoo Inc. (NASDAQ:YHOO).

Since I spoke with him in late July, he has had some good calls. He became bullish on Google in early August after which the stock rose from $380 to $480. As Google approached his $500 target, Kessler changed his call to a hold. He also was bullish on Microsoft which rose from $22 to $28 before changing to a hold rating as he felt that with a target price of $31 the potential upside in the stock was limited. And he remains skeptical of Yahoo, due to his concern about its management and business strategy.

S&P expects the S&P 500 to reach $1,510 by the end of 2007, a 7% increase over its current level. Kessler feels that while economic growth will slow in 2007, the decline will not be significant. However, he expects faster growth in Europe and Asia than in the U.S.

The slowing growth could harm eBay but Kessler feels that PayPal — which represents 20% to 25% of eBay’s revenues — represents an under appreciated growth opportunity. In Kessler’s view, PayPal could grow to be a third of eBay’s revenue and it will encourage more people around the world to do more business with eBay. He believes that eBay will have a tough time competing in the important China market — where the leading competitor Taobao is giving away the service. However, he expects eBay to earn $1 a share in 2007 and he views the stock as inexpensive at its current $32.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, and a Professor of Management at Babson College. He has no financial interest in eBay, Google, Microsoft, or Yahoo.

Source: http://msft.bloggingstocks.com/2006/12/13/sandp-still-likes-ebay/