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June 18, 2008

In This Update:
• LinkedIn Raises $53 Million Round, $1 Billion Valuation
• Microsoft Buys TV Ad Placement Firm Navic Network
• Philadelphia Revives Citywide Wi-Fi Project
• Reddit Social News Site Goes Transparent, Open Source
• Verizon Mulls Alternatives to All-Fiber FiOS
• Amazon Lowers Prices on MP3s, eMusic Raises Them
• Flickr Co-Founders Leave Yahoo
• Skype’s Latest Puts Focus on Watching Who You Call
• New York Times Launches New Social Platform for Times Readers
• Survey: 80% of Youth Using P2P Would Pay for Legal Version
• AOL Inks Deal with Scripps for Video Content
• AT&T and Verizon Say FCC Net Neutrality Principles Work
• Nokia to Launch Advertising ‘Ad Labs’
• U.S. Will Lag in Tech Growth, Study Says
• Cooking.com Raises $13 Million Round
• ImageSpan Raises $11 Million Second Round for Digital Content Licensing
• Social Applications Developer i2we Lands $750,000

LinkedIn Raises $53 Million Round, $1 Billion Valuation
REUTERS
LinkedIn, an online destination for professional networking, raised $53 million from investors in a fourth round of financing, giving the company an estimated valuation of just over $1 billion, LinkedIn Chief Executive Dan Nye said. Private equity firm Bain Capital’s Bain Capital Ventures led the investment round, and LinkedIn’s existing investors, venture capital firms Sequoia Capital, Bessemer Venture Partners and Greylock Partners also put in money, the company said. Jeffrey Glass, Venture Partner at Bain Capital Ventures, said the $1 billion valuation is a “big number if you think about it in absolute terms.” But Bain felt comfortable with its calculation given LinkedIn’s popularity and the growth opportunities that lie ahead, Glass said. “We… feel like we’ll make a nice set of multiples on our money.”
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Microsoft Buys TV Ad Placement Firm Navic Network
PAIDCONTENT
Microsoft continues on its M&A streak, though a much smaller one: it has bought out Waltham, MA-based Navic Systems, an eight-year-old company that helps advertisers place ads on TV programs. Terms were not disclosed. This starts MSFT’s forays into TV ad placement, in which arch rival Google has already made some strides, though in fits and starts. SpotRunner, the LA-based heavily backed firm, is also a rival. Navic’s technologies include campaign management tools to place targeted ads on TV and through Admira provide a unified ad network for targeting audiences across TV ad inventory. Microsoft hopes to build an online service that allows ads to be placed across all platforms, and this acquisition fits into it. Navic has worked with Time Warner Cable, Cox and Charter, among others…it had raised about $43 million in funding from the likes of Pilot House Ventures Group, Pequot Private Equity, Highland Capital Partners and Himalaya Capital.
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Philadelphia Revives Citywide Wi-Fi Project
REUTERS
Philadelphia revived an effort on Tuesday to provide free citywide wireless Internet access in a project to be run by a new group of investors. The city aims to provide free-of-charge outdoor Web access throughout its 135 square miles, which would be the largest area covered by public Wi-fi of any U.S. city. The project, initially launched in 2005, came close to failure when EarthLink, the company that installed wireless transmitters on light poles, abandoned the effort in May amid complaints about signal weakness. In a city of 1.4 million, about 6,000 people signed up for the EarthLink service.
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Reddit Social News Site Goes Transparent, Open Source
ARS TECHNICA
Reddit today announced that it is open-sourcing almost all the code that powers its site and community. As one of the first social news sites to appear in 2005, reddit now sports over 4.5 million monthly unique visitors who generate 120 million pageviews a month. The site experienced its largest growth spurt-a whopping 1,033 percent-in December 2007 with just over 4.1 million unique visitors, and 23 percent of reddit’s users have registered just this year after the company introduced its user-generated category area, called reddits. Reddit is powered by a team of just five members. The decision to open source was also fueled by the potential for building the site based on community ideas and code.
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Verizon Mulls Alternatives to All-Fiber FiOS
REUTERS
Verizon Communications Inc is considering alternatives to employing an all-fiber network for its FiOS high-speed Internet and video service after 2010, its chief technology officer said on Tuesday. One selling point of FiOS has been its use of fiber to the premise (FTTP), which means the fiber optic network is plugged directly into consumers’ homes to enable stable, high-speed Internet and multiple high-definition video channels. But with a cost in excess of $20 billion, FiOS is more costly than rival AT&T Inc’s U-verse service, which makes use of existing copper lines. Verizon has said FTTP is the best way to ensure high speeds. Verizon aims to build out FiOS, which competes with cable providers’ video and Internet services, to over 18 million homes by the end of 2010.
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Amazon Lowers Prices on MP3s, eMusic Raises Them
HYPERBOT
While retaining 89 to 99 cent pricing on most tracks, Amazon is experimenting with lower prices on short term special album downloads. Taking a page from Wal-Mart’s blue light specials which kept shoppers roaming the store to see where the flashing light would land, on Wednesday morning Amazon MP3’s “Daily Deal” offered a download of Coldplay’s X&Y for $1.99 and Stevie Wonder’s #1’s album at $2.99. “Friday’s Five” will offer five albums at $5 each. eMusic, on the other hand, announced a price increase. Effective July 17th, eMusic’s monthly Basic Plan will increase $2 for all subscribers from $9.99 to $11.99. In a move to keep existing subscribers, they will recieve 40 instead of 30 downloads each month and a one time 10 track thank-you bonus.
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Flickr Co-Founders Leave Yahoo
TECHCRUNCH
Photo sharing site Flickr is one of the leading lights of Yahoo – but cofounders (and husband/wife team) Caterina Fake and Stewart Butterfield won’t be around to keep driving the product forward. They are both joining the mass exodus of executives from the company. Fake officially left last Friday. Butterfield (who still officially runs Flickr) will leave on July 12. Kakul Srivastava , the director of product management for Flickr, will take over Stewart’s role as general manager of Flickr. Sara Wood will take over Kakul’s previous position.
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Skype’s Latest Puts Focus on Watching Who You Call
REUTERS
Web communications leader Skype begins public testing on Wednesday of a new version of its software for making free or low-cost phone calls that aims to make casual video chatting more common. The Luxembourg-based unit of online auction leader eBay Inc said that public testing of Skype version 4.0 would begin making video a more integral part of the service. The 4.0 test version invites users to post bigger photos of themselves, instead of just thumbnail images, to encourage callers to see and be seen. It also incorporates features for non-technical users that detect computer settings, available bandwidth and connected audio or video devices to make getting started easier.
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New York Times Launches New Social Platform for Times Readers
BEET.TV
The New York Times has just launched the public beta of TimesPeople, a social networking platform for visitors to the site who want to share and recommend content. In addition to sharing within the Times site, the program allows users to push recommendations to Facebook, the iPhone and other platforms. TimesPeople users can build up friends lists and can see a “news feed” of which stories their friends are recommending, sharing, and commenting on. Times online readers have been able to comment on stories, as well as rate reviewed restaurants and movies, for some time now, but recommending is new.
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Survey: 80% of Youth Using P2P Would Pay for Legal Version
DIGITAL MEDIA WIRE
A new survey of U.K. youth ages 14-24 found that 80% who use peer-to-peer networks to download music would pay for a legal file-sharing service. Conducted by the University of Hertfordshire on behalf of British Music Rights, which represents U.K. songwriters and music publishers, the survey asked 773 young people about their music consumption behavior, and found that 90% own an MP3 player. The average player contains 1,770 tracks — half of which have not been paid for. Sixty-three percent said they used file-sharing networks, while 58% have copied music from a friend’s hard drive to their own, and 95% copy music in some way. Despite the downloading, over 60% said they would continue to buy CDs even if a legal file-sharing service existed — and overall, respondents said the amount of money they spend on live music (60%) exceeds that spent on recorded music (40%).
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AOL Inks Deal with Scripps for Video Content
REUTERS
AOL will distribute video clips from Scripps Networks’ HGTV, Food Network, DIY Network and Fine Living Network, the companies said Wednesday. The videos will be available this summer on AOL Video and the Time Warner-owned portal’s Food, Home and Slashfood sites. Included in the deal are clips from HGTV’s “House Hunters” and Food Network’s “Barefoot Contessa,” “Good Eats With Alton Brown” and “Paula’s Home Cooking.” In May, Scripps, owned by E.W. Scripps, started to place its clips on Google’s YouTube.
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AT&T and Verizon Say FCC Net Neutrality Principles Work
CNET
Executives from AT&T and Verizon Communications said Tuesday that it’s important for the Federal Communications Commission to take action against Comcast for slowing down some peer-to-peer traffic to prove that legislation is not necessary when it comes to Net neutrality. Jim Cicconi, senior executive and vice president for legislative affairs for AT&T, and Tom Tauke, executive vice president of public affairs and policy for Verizon, told an audience at the NxtComm trade show here that it’s important for the FCC to make a decision in the case of Comcast to show that the agency’s Net neutrality principles are enough to keep service providers honest. “It’s in the best interest of the industry for the FCC to make a judgment against Comcast in the BitTorrent case,” Tauke said. ”
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Nokia to Launch Advertising ‘Ad Labs’
GUARDIAN
Nokia is to open a series of “Ad Labs” to train traditional advertising agency staff in the “black art” of mobile advertising in a bid to more rapidly unlock the potential of the nascent £1bn sector. The mobile phone producer’s new Ad Labs, which will open in London and Boston, aim to drive the creative potential of mobile advertising by educating traditional agency staff to embrace the medium in their campaigns for clients. Nokia Ad Lab will aim to train and certify “creative and media personnel at agencies serving global brands”. Speaking ahead of the announcement of the Ad Lab initiative at the Cannes International Advertising Festival today Mike Baker, the Nokia vice-president and head of mobile advertising, said: “We want to be a catalyst in the mobile advertising ecosystem. It is seen as somewhat of a black art practiced in a cottage-industry fashion.”
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U.S. Will Lag in Tech Growth, Study Says
NEW YORK TIMES
Watching television, gaining access to the Internet and listening to music on mobile phones will be a viable business in the next few years, says a study by a consulting arm of PricewaterhouseCoopers. But while marketers and advertisers have much to cheer in the coming digital revolution, the fastest growth will be in emerging markets, with the United States lagging behind. Overall global consumer spending both online and by mobile phones is expected to grow 21.8 percent annually, to $234 billion by 2012, according to the study which Pricewaterhouse expects to release Wednesday. By contrast, spending in the United States will grow at a rate of 16.1 percent, to $75 billion. The firm said there was more opportunity for Internet and mobile entertainment growth in countries like India and China because people there would use phones as a primary source of entertainment.
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Cooking.com Raises $13 Million Round
SOCALTECH
Cooking.com said today that it has raised $13M in a new round of venture capital funding. The firm said that the round was led by Azure Capital Partners, and also included venture debt from ORIX Venture Finance. The new funding will go towards expanding the company’s business operations, including opening a second distribution facility for the firm in Ohio, and enhancing the company’s web site. Azure’s Michael Kwatinetz joins the firm’s board as part of the funding. Cooking.com operates both its own destination site for buying cooking related items; it also runs web sites for Starbucks, Pillsbury, the Food Network, and others.
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ImageSpan Raises $11 Million Second Round for Digital Content Licensing
DIGITAL MEDIA WIRE
ImageSpan, a provider of enabling infrastructure for digital content licensing, announced on Tuesday that it has raised $11 million in its second round of financing, led by Bertelsmann Digital Media Investments. Previous investors Greycroft Partners and Village Ventures, as well as the New York City Investment Fund, City Light Capital and Ackerley Partners also participated. Founded in 2003, Sausalito, Calif.-based ImageSpan says its system was “built for the Web 2.0 world of mashups and projects with multiple copyright holders.” The service covers licensing for digital photos, illustrations and video content.
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Social Applications Developer i2we Lands $750,000
PE HUB
i2we, a social apps maker started by ex-Facebooker Karel Baloun has raised a $750,000 first round led by IDG Ventures. The Berkeley, CA-based company claims 1.52 million Facebook members have installed apps like I am Green and I Am Runner. Karel Baloun was previously the first senior engineer at Facebook.
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