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Strong Q2 results for Amazon

posted on July 26, 2007

Second quarter results are coming out for big internet retailers, and the industry seems to be in great shape. Amazon reported $78 million in profit on $2.89 billion sales. A year ago, they reported $22 million in profit on $2.14 billion in sales.

Amazon CEO Jeff Bezos attributes this 255% increase in net income largely to Amazon Prime. Amazon Prime is a membership program that costs $79/year. Members get free second day shipping and overnight shipping for only $3.99.

Being one of those people who always order at least $25 from Amazon in order to get the free shipping, I can’t really fathom why many people would spend $80/year to get their books a day or two sooner. But, I am obviously wrong, and Amazon has again demonstrated why they are the top e-tailer on the web. I can only imagine how much the lifetime value of customers participating in that program has jumped.

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Microsoft Takes Aim at Web Video with Silverlight

posted on July 26, 2007

According to a blog post at CNET, Microsoft’s “cross-browser, cross-platform plug-in for delivering the next generation of .NET based media experiences” also known as Silverlight is set to be released this week.

Silverlight is designed to be a competitive offering to multi-media development tools and plug-ins like Flash. Flash has been the development tool of choice for web based video publishers, and Microsoft would like to usurp Adobe’s dominance in this space.

Martin LaMonica with CNET states “Silverlight videos embedded within a Web page can be resized and have higher fidelity than Flash videos, according to Microsoft.”

Building a better mouse trap may be a good strategy for Microsoft; however, replacing a long time standard like Flash may prove difficult in the long run.

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Judges Reminds ConnectU they Need Actual Evidence to Sue Facebook

posted on July 26, 2007

There’s at least one sensible judge in Boston and he’s presiding over ConnectU’s claim that Facebook’s Mark Zuckerberg built the popular social network on stolen intellectual property.

Massachusetts Federal Judge Douglas P. Woodlock repeatedly suggested that ConnectU hadn’t provided enough evidence to support their claim that Zuckerberg had built Facebook on code used by ConnectU.

“Claims must have a factual basis,” the judge said. The allegations, which ranged from breach of confidence to fraud to misappropriation of trade secrets, comprised a “most evanescent of explanations,” Woodlock said. He gave ConnectU’s founders–Divya Narendra and twin brothers Cameron and Tyler Winklevoss–until August 8 to provide a revised complaint. He also gave Facebook two weeks after that date to respond.

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Online Videos Go Viral as Study Shows 57% Share their Favorites

posted on July 26, 2007

If you have plans for any kind of viral marketing campaign in 2007, you may wish to take a look at the numbers revealed by a new Pew study.

57% of internet users watch video online and of that number 57% send their favorite videos on to their friends. They must be sending them to more than one person, judging by the 75% that said they receive videos from others. If your video appeals to the 18-29 age group, you can expect that video sharing rate to jump to 67%.

But before you grab your video camera and round up the staff, you may want to consider some investment into video production. 62% of online video watchers prefer content that is “professionally produced” and only 19% prefer videos “produced by amateurs.” Can’t be bothered to hire a production crew? Target the male 18-29 demo – only 43% of them prefer professional video.

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Business.com Reportedly Sold for $350 Million

posted on July 26, 2007

Business.com moves on to the next chapter of its overpriced life, with R.H. Donnelley acquiring the company for a reported $350 million – in line with what we reported in June.

paidContent reports…

The auction was heated, and initially included IAC, New York Times, DJ and News Corp. IAC didn?t end up bidding, News Corp dropped out as the price went above $300 million, Dow Jones couldn?t pull it together in the wake of all the turmoil with News Corp bid, and New York Times was in there until late in the game.

RHD already published a good number of the yellow pages that land on your doorstep and maintains many online versions too. Out of those that bid, RHD appears to have the most in common with Business.com, so it’s not surprising they stayed in the bidding until the end.

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Business Doesn’t Need SEO

posted on July 25, 2007

That’s because real businesses have real business models. So much of the web has been created by throwing stuff against the wall and seeing what sticks. Only then do many entrepreneurs mold a business model around a website and most of the time unsuccessfully.

As the Internet grows into it’s teenage years, much as with real children, we see it starting to comprehend economic logic. Making money costs money. The majority of successful businesses around the world are built on the foundation of ROI (return on investment) not ROTSBFC (return on time spent building free customers).

Don’t get me wrong, the days of home based pocket change startups aren’t going anywhere anytime soon. But unfortunately the percentage of those ventures that succeed is rapidly shrinking due to business people with investment capital entering the market online.

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Facebook: High and Mighty

posted on July 25, 2007

As instigator of the unofficial Facebook rumor blog, I figured I should cover this story (better late than never)! According to TheDeal.com’s David Shabelman, there’s a good reason Facebook isn’t being acquired: they want way more than they’re really worth.

Yes, we knew that. But it’s not just Zuckerberg that’s pushing for the big bucks: the VCs who funded Facebook are holding out for a better offer as well:

‘We’re so far apart with what we think it’s worth and what other people do it doesn’t make sense for us to have conversations,’ [Facebook director and investor Peter] Thiel said. ‘Either they’re underestimating it or we’re overestimating it, but given that disconnect, it would be a complete waste of time for the company to be talking with people.’