If Skype co-founder Niklas Zennstrom is looking for guidance on how to spend his eBay windfall, he might want to have lunch with eBay founder and chairman Pierre Omidyar, who has a growing investment portfolio being done through Omidyar Network. His latest investment is Digg.com, which recently raised $2.8 million, according to Silicon Beat. Omidyar's other investments include Feedster,
Socialtext, Dan Gilmour's Grassroots Media and John Battelle's FM
Publishing. Zennstrom may want to follow the path taken by eBay's first employee,
Jeff Skoll, who has become very involved with philanthropic work. Skoll, a Montreal-native
and a University of Toronto grad ( have to wave the Maple Leaf!) has also invested in a film production company. With eBay CFO Rajiv Dutta
poised to become Skype's new president after his successor is found,
perhaps Zennstrom better start looking for his next gig. The big
question is what Zennstrom does next? After Kazaa and Skype, he'll have
no problem raising venture capital – if he really needs any financial
help at all – but the expectations will be sky high. There is no doubt
Zennstrom will stay in the Internet space but his next move will be
very intriguing and exciting. If I was a betting man, I'd say it
would be something related to streaming video. Why video?
it's a hot market, Zennstrom has already done music and voice
(which leaves video as the last the big three markets to be tackled),
he knows how to build a global brand, and his track record will allow
him to bring in strategic investors such as television networks and
movie studios. Anyone else prepared to make a bold prediction
on what the future holds for Mr. Z. (Nortel CEO Mike
Zafirovski being the other one.)
Canadian Blog Awards
Well what do you know, I got nominated for a Canadian Blog Award in the media category (although my blog is more technology/business). I'll have to start practicing my Sally Field acceptance speech (…..you like me. Right now, you like me”) just in case.
Google's RSS/Portal Plans
I've received several e-mails from Google with the following message:
“Google would like to include your RSS feed(s) in our personalized homepage. This developing product allows users to add useful and interesting RSS feeds like yours to customized versions of the Google homepage. We wanted to let you know that we expect to add your RSS/XML feed content (title and item links) to current/future versions of this product. As a result, users will be able to view links to your content on Google personalized homepage — driving increased traffic to your site with no extra work on your part.”
Anyone else getting this message and, more important, what does it suggest about Google's RSS and portal strategies given the focus on a “personalized homepage”? So far, Google's homepage has been pretty low-profile. I haven't visited the home page much but it now lets you add all kinds of content. This includes an “Add Content” feature in which you can “Create a Section” by punching in keywords or RSS feeds. It produces several choices that you can easily add to the homepage. Google is no Yahoo or MSN yet but there are signs of progress.
Comcast Invests in Wi-Fi Equipment Maker
Ottawa-based BelAir Networks has attracted US$20-million
in private equity, including a strategic investment from the venture capital arm of Comcast Corp.,
the largest cableco in the U.S. This is Comcast Interactive's first
Canadian investment. BelAir, which makes wireless gear used to build
hotspots, is no stranger to U.S. telcos being part of
AT&T's bid for the city of Philadelphia's municipal Wi-Fi system.
Earthlink, however, won the contract. Comcast offered little insight
into its Wi-Fi plans other than telling the Ottawa Citizen
that BelAir
is “well positioned to address the needs of multiple
customer segments, including those of the cable market.” Comcast has
made other investments, however, in Wi-Fi security and management
software. You have to think Comcast is looking to BelAir's technology
to protect its
high-speed Internet business. Comcast and Verizon were less than pleased
with Philadelphia's Wi-Fi plans, and lobbied the state legislature to
block the city's plan. If free or cheap municipal Wi-Fi service
is going to become a competitive reality, maybe Comcast and other
cablecos and telcos need to get into the game by offering a service
offering better QoS. Cablecos and telcos could sell Wi-Fi as an add-on
to existing high-speed customers or as a standalone service. As for the
the growth of the Wi-Fi market, In-Stat estimates
that from 2004 through 2009, the market for wireless mesh network
access
points will grow from $33.5 million to $974.3 million.
Aside from Comcast, other investors in BelAir's financing were McLean Watson, T-Mobile Venture Fund, JPMorgan Partners, VenGrowth
Capital Partners Inc. and BDC Venture Capital also participated in
this round.
Shaw's Telephony Progress
Shaw Communications added 34K cable
telephony subscribers in its fiscal fourth-quarter – numbers that
impressed analysts even though it doesn't seem like a big number in the
scheme of things. The 34K new customers came despite difficulty in
porting lines from Telus, which was going through a strike. As well,
Shaw only moved into Winnipeg in July. Analysts described the
performance “strong” and a sign that price ($55 a month) will not be a
growth hindrance. From a financially-disciplined perspective, Shaw may
doing well but it only has attracted 54K customers in eight months,
barely a dent in Telus' residential market share. If Shaw's prices
aren't high, they're high enough that most local phone customers have
not rushed to switch. The bigger question is how many customers can
Shaw be reasonably expected to get. Perhaps 250,000 (at current prices)
is a reasonable cap. If that's the case, should Telus really be
worried? If Telus rolls out IP-TV and attracts 250K customers, is the
battle betwen Telus and Shaw a wash?
8×8's Q2 results: Growth at Both Ends
Time for one of my favorite VoIP actives: deciphering 8×8 Inc.'s quarterly results.
Let's start with the second quarter's top line: $7.1-million vs.
$2.5-million a year earlier. Sounds good but the bottom line also
expanded: a loss of $5.6-million vs. a loss of $5.1-million. The
company said the red ink is due to growth into new markets such as the
U.K. The question is whether adding 20K subscribers in the quarter (93K
vs. 73K as of the end of Q1) is a good return on investment. Another
burning question is how much gas 8×8 has left in the tank given it now
has $19.7-million of cash compared with $24.9-million at the end of the
first quarter. For 8×8, the pot of gold at the end of the rainbow is Infonetics Research's forecast that
there will be 24 million subscribers and $8.4-billion in VoIP revenue
by 2008, compared with 1.1 million and $255-million respectively in
2004. The problem, however, is the cablecos (Time-Warner, Cablevision)
are coming on strong while Vonage's market share has fallen to its
lowest level in nine months, which is not the best thing for a company
trying to a $600-million IPO. Click here
to check out some the ominous things Infonetics analyst Kevin Mitchell
told Om Malik recently about VoIP start-ups. By the way, investors seem
underwhelmed by 8×8's results as the shares climbed one cent to $1.70.
Let's start with the second quarter's top line: $7.1-million vs.
$2.5-million a year earlier. Sounds good but the bottom line also
expanded: a loss of $5.6-million vs. a loss of $5.1-million. The
company said the red ink is due to growth into new markets such as the
U.K. The question is whether adding 20K subscribers in the quarter (93K
vs. 73K as of the end of Q1) is a good return on investment. Another
burning question is how much gas 8×8 has left in the tank given it now
has $19.7-million of cash compared with $24.9-million at the end of the
first quarter. For 8×8, the pot of gold at the end of the rainbow is Infonetics Research's forecast that
there will be 24 million subscribers and $8.4-billion in VoIP revenue
by 2008, compared with 1.1 million and $255-million respectively in
2004. The problem, however, is the cablecos (Time-Warner, Cablevision)
are coming on strong while Vonage's market share has fallen to its
lowest level in nine months, which is not the best thing for a company
trying to a $600-million IPO. Click here
to check out some the ominous things Infonetics analyst Kevin Mitchell
told Om Malik recently about VoIP start-ups. By the way, investors seem
underwhelmed by 8×8's results as the shares climbed one cent to $1.70.
