An Update on Microsoft's Razorfish

I had written in November about the layoffs at Razorfish, and early rumors of a sale.

Seems this sale is happening soon. According to the Financial Times, Microsoft has appointed Morgan Stanley to look for a buyer for Razorfish, with French firm Publicis emerging as an early front-runner.

Omnicom and WPP, which are trying to put more focus on digital advertising, are also potential suitors.

Publicis has recently made some financial moves aimed at enabling an acquisition, and have also gotten cozier with Microsoft - on Friday, Publicis announced an agreement with Microsoft Advertising to use Microsoft technology to place Publicis ads on television set-top boxes.

NBC and ABC Suck Lemons

I would like NBC and ABC to lose enough money that they have to shut down. Or at least fire their entire sports-related teams. Let me explain why:

NBC:

NBC has the rights to show the French Open Men's Semifinals this morning. The matches started at 5 am PST today, Friday, June 5th.
You have the opportunity to watch arguably the greatest to ever play the game, Roger Federer. In the other match, you have the cinderalla, who has already dispatched the world's greatest Clay Court player (and a possible arguable greatest ever to play the game, Rafael Nadal).

So when you switch on NBC, what do you see? Why, Dave Matthew's Band, Tom Brokaw, and the rest of the idiots from their morning show. Interspersed with ads from our local carpet dealer. They've decided we can wait until 10 am PST (on a workday!) to watch the matches. That made me develop my first symptoms of high blood pressure.

I am pissed off at NBC. Very pissed off. This is exactly what they did during the Olympics - while also lying about having the broadcasts live.

So what am I going to do about it? I am going to stop watching NBC. Anything on NBC. And I'm going to bad-mouth NBC whenever I can. I like Conan O'Brien. So I'm going to watch him free on YouTube. Hah!

ABC:

ABC won the rights to show the NBA Finals. I know, I know, the NBA season is unreasonably long. But after all that time, we've gotten to the point where we can see Superman and Skip-to-my-Lou go up against the Black Mamba and 9-time winner Phil Jeannie Buss. Kobe, at this point, is in the "best ever" discussions. And had a game to prove it last night. What I would have loved to have seen after the game would be some great analysis, interspersed with humor, etc. etc.... ok, I would have loved to have the TNT Inside The NBA crew (EJ, Barkley, Kenny) take us through the game.

Do you know what I saw instead? A local Oakland crew. Three guys - at least I know/ like Nate Thurmond. The other expert they brought in was the Warriors assistant coach for shooting for big men, or something. No disrespect, but.... And they kept trying to work the Warriors into everything. Kept talking about Michael Pietrus, and showing clips of him as a Warrior. WTF!?!?!?

Ok, so ABC wasn't as bad as NBC. I'm not going to bad-mouth them as much as I will NBC. But I'm quite unhappy.

NBC and ABC suck lemons. I want NBC to fail.

The Layoff Spectrum - No One Spared

Layoffs are here, and they're here to stay. The surprising thing is how many supposedly (at least to me) well-performing companies are also having to lay off staff.



Nike - Nike is doing very well, thank you, with their stable of highly paid stars selling the socks off the competition. Really, how many other shoe ads do you see nowadays? And Nike is better positioned than most, since it is highly diversified throughout the sports arena - shoes, clothes, sports equipment (rackets, balls, bats), related gear.
It doesn't matter. Nike is laying off 5% of their global staff. And surprisingly, the jobs are not just mostly in the higher-wage countries - China is coming in for a high proportion of manufacturing job losses.



Miami Heat - The Heat were not expected to compete this year... or get any audience worth mentioning. But an MVP-caliber year by the NBA's scoring leader (Dwayne Wade), two highly touted rookies, and a surprise 5th seed in the playoffs capped by a 7-game first round series boosted the Heat's revenues well beyond any reasonable projections.
No matter - the Heat are also going through a round of layoffs.

The End Of Valleywag

Valleywag, Silicon Valley's gossip site (and sort of pretend tech and startups related site) was always a fun read.  After the staff was trimmed, it became a little less so.  Ok, maybe a lot less so.

But today sounds the death bell.  Owen Thomas is leaving Gawker Media (Valleywag's parent), and moving to NBC.   There's no one left.

Rest in peace, Valleywag.

Crossing 95K Visits

I just crossed the 95K visits mark on my blogs:

• The serious blog - all about Tech, Startups, Revenue
• The all-purpose, main blog
• Blog on cars - one of my passions
• Blog about Travel topics, including not just destinations, but also food, wine, etc.
• The older, retired Autos blog

Looking forward to 100K.

And on a smaller scale, my profile on blogger has now been viewed over 1,400 times.

New York Times Article On Kosmix

Our little startup, Kosmix, was just covered in the New York times 

The article was titled Just Don’t Compare Kosmix to Google

Published: March 14, 2009

KOSMIX, a well-financed Silicon Valley start-up, is often described on blogs and news sites as a search engine that may someday rival Google.

As flattering as that notion may sound, it rankles Venky Harinarayan and Anand Rajaraman, the co-founders of Kosmix. And that’s not because other start-ups making similar assertions have fallen laughably short of the mark. It’s because Kosmix is trying to do something that is quite different from traditional Web search.

“Search does what it does well, very well,” Mr. Harinarayan said. “I don’t think we can ever compete with that.” Kosmix, he said, is not about finding the best set of documents for a specific keyword or phrase. Instead, its goal is to “tell me more about something,” he said.

For a key word or topic that a user enters, Kosmix gathers content from across the Web to build a sort of multimedia encyclopedia entry on the fly. For many queries, the results are pretty satisfying and look as if they have been compiled by a human editor, not a computer.

If Kosmix succeeds in attracting a large following, it may well be the latest challenge, not to Google, but to a long string of old and new media companies struggling to hold on to their audiences and make a living on the Web.

Kosmix’s home page offers a mix of news, entertainment and other content from around the Web. But it is on searches that Kosmix becomes really interesting.

Type in “Kauai,” for example, and Kosmix will return a fairly rich page that includes an entry from WikiTravel, a user-created travel site; restaurant recommendations from The New York Times; photographs and videos from services like Flickr and YouTube; audio clips of local music; reviews of guidebooks, bed-and-breakfasts and other services; blog posts and more. It also has top results from Google, and suggests a list of related topics.

(Read the rest of the article on the New York Times website)

Meehive Launched, Nice Press Coverage

Kosmix' personalized newspaper, Meehive, launched today.  We've had some good coverage, including:

• Techcrunch
• Venture Beat
• Louis Gray

Kosmix Introduces Meehive to Deliver Personalized News Pages

“As much as you might think I'm overloaded with information from the Web, I'm not, honestly. I find that often my first tendency after reading through my Google Reader items is to want to go back to the site and start again, only to find them empty. It's possible, with MeeHive up and running, that when I've hit zero on Google Reader, and tapped out my FriendFeed and Twitter, I can have a destination to find out what the rest of the world is doing outside my little bubble.”

• Portfolio, Tech Observer

“Now there's a company that will make you your very own personalized newspaper made up of traditional media posts and blogs, kind of like a cyber-news Frankenstein delivered right to your inbox.”

• Killer Startups

MeeHive.com Your Personalized Newspaper

“When all is said and done, this is yet another legitimate way to keep abreast of any development that could appertain to you, and access that information as part of a personalized website. An account can be created in no time at all, so that if you want to see if this solution is right for you or not just wend your way to www.meehive.com.”

• Fone Arena

MeeHive Personalized News on iPhone/iPod Touch App Review

“I have been playing with the MeeHive iPhone App for over a week now and…it’s a simple app which makes news consumption on your iphone very easy.”

• Resource Shelf

Kosmix Launches MeeHive Personalized News

Facebook With (More) Egg On Its Face

Facebook recently updated its Terms Of Service to effectively say - "we own your data in perpetuity, even if you go ahead and leave Facebook.  Complain all you like."  

(Ok, I took some liberties with my summary).  Anyway, Shades of Beacon!, they got slammed in the blogosphere, and had to bow down to the public's wishes.  Here's what I saw on my Facebook home page yesterday:

"Over the past few days, we have received a lot of feedback about the new terms we posted two weeks ago. Because of this response, we have decided to return to our previous Terms of Use while we resolve the issues that people have raised. "

What does this mean for Facebook?  Without oversimplifying, they do need some of the updates in their Terms of Service, to better manage their network.  And they would like to add some of the other updates, to be able to use data on their network better - specially for monitoring and monetizing. 

My guess is that they'll slowly start adding a tweak here, a sentence there, and gradually update their Terms of Service to include most of the  changes they wanted.  It will just take them some time now.

Passing 80,000 Visits On Blogs

Earlier this month (February, 2009), I crossed the 80K visits mark on my blogs.  Nice. 

My blogs are:

• The serious blog - all about Tech, Startups, Revenue
• The all-purpose, main blog
• Blog on cars - one of my passions
• Blog about Travel topics, including not just destinations, but also food, wine, etc.
• The older, retired Autos blog

And on a smaller scale, my profile on blogger has now been viewed over 1,000 times. 

Nissan In Pain

The current economic meltdown is taking down another Japanese Automaker.  Nissan fell to a full-year loss, its first in almost 10 years.  In this, it followed in Toyota's footsteps

About 20,000 employees (9% of its workforce) are being let go. 

Directors will have salaries reduced by 10%, and will not get bonuses, while Managers will have their salaries reduced by 5%.

Nissan, more than the other big Japanese auto makers, is rushing towards the future, as evidenced by the awe-inspiring GTR (I just saw it on the street - nice).  Lets hope they can get back to their profitable ways soon.  Their new lineup is quite exciting, with a number of speedy looking cars, including the 370Z and the Altima coupe.

iPhone App Review - Perfect Girl

The Perfect Girl app on the iPhone ($0.99) is hilarious.  Its one of those perfect simple ideas - and is copied (natch) by that beer ad all the guys love.

The interface is simple - one "Speak" button.  By either pressing it, or shaking your iPhone, you get the Perfect Girl to give you a perfect line.  Some examples include:

"I love ninjas"

"Wear what you want"

"I'll try anything once"

"I hooked up the surround sound",  etc.

(My favorites so far are the first and last ones).

Layoffs At Wal-Mart, Too

Recession-proof no more?  Wal-Mart is cutting 800 jobs at its Arkansas (Bill Clinton!) headquarters.  Mainly, the cuts are in the departments responsible for building new stores - as only 125 - 135 are planned for 2009,  a 20% - 25% drop from 2008. 

At the same time, I guess they'll add a lot more folks when these new stores do get built.  So at worst, this is a bit of a re-alignment.

Toyota Sees Net Loss For 2008 Fiscal Year

Even the mighty are falling (and I'm not talking about the oblivious mighty, like Detroit's Big 3).   Toyota, which has been profitable each year since 1950, is turning in its first annual net loss ($3.85 Billion,  or 350 Billion Yen) for fiscal 2008, ending in March.

At a broad level, there are two strategies Toyota can adopt to fix 2009-

a) Increase revenues.  Very tough, but Toyota is well situated, with its leadership in hybrid/ economical cars, as well as TCO (Total Cost of Ownership) cars.    As long as it can hold off challenges from Honda and Ford's eco-friendly cars...

One thing that is obvious is that Toyota's marketing efforts need to take a big leap here.  The Scion was a very smartly played game - they need to extend that to their breadwinners.

b) Reduce costs.  Yes, Toyota is the guru of Lean, Six Sigma, TWM, and any other buzz-words you know, plus a host of others you don't know.  They will probably figure out a way here, again, and hopefully without affecting their full-time employees (sorry contractors)

Google Blog Post On Eye-Tracking

This is a great post, specially for the real-time video showing how users' eyes move on a search page.

I'm not putting up any summary/ synopsis - most people in the business will know the basics of this post.  You'll still learn a little somethin' somethin'.

http://googleblog.blogspot.com/2009/02/eye-tracking-studies-more-than-meets.html

Changes At Webaroo - Now SMS GupShup

Webaroo, which over the years morphed into SMS GupShup, has long been a company I've liked.  (Anand, one of the Kosmix co-founders, and one of the investors in Webaroo, likes them too - check out his blog post on them). 

Webaroo, though, is finally moving their entire team to India.  That means those on the US team who aren't moving over, are moving on.  I believe Rakesh Mathur, their CEO, might also be taking some time off from Webaroo.

This comes after some good traction news from Webaroo -

• SMS Gupshup has a user base of 12 Million people (I believe this is all in India.  I have the Webaroo tool installed on Firefox, but they don't seem to be working on that any more)
• Helion Ventures and Charles River Ventures just put another $11 Million into the company, in October 2008.  Very good!

What Else Do Kosmix And Google Have In Common

Kosmix is similar to Google in a few ways - we're both in the search space, our founders are from the same Stanford research group.... and now this. 

I was at a dinner with a few friends, including one from Google, at Palo Alto's Counter Burger (amazing burgers, I kid you not!), when the folks around us noticed what you see below.

I'm taking this as a great sign for Kosmix following in Google's growth curve!  Woohoo!

Sir, May I have Another... Layoffs

(previous layoff news)

Corning has had a few lives since its inception.  Its latest includes the glass used in flat screens, both computers and televisions. 

Given that demand for both those consumables has softened a bit, Corning is laying off 13% of its workforce - about 3,500 people

Chemical company Ashland is freezing wages (big surprise), adopting a 2-week furlough program, and, of course, cutting 1,300 jobs

Boeing is dive-bombing about 10,000 jobs.  Thanks to its union workers striking, and slowing down their revenue stream even further - very smart, guys

(Sigh)... More Layoffs

(Previous announcements)

A quick name check to:

Brooks Automation - which is cutting 20% of its workforce (350 people), in its second round of layoffs

Halliburton (yes, even Cheney's old company is going to lay off people, known as they are towards their people-friendly policies... NOT)

Schlumberger, not to be outdone by Halliburton, has announced it will lay off 5,000 people... and might have another headcount reduction in 6 months

Intel, after initially affirming it wasn't going to lay off employees, is cutting 6,000 manufacturing jobs.

Layoffs, Layoffs And More Layoffs

(Following my previous post on companies announcing layoffs)

The layoff announcements keep coming, and will probably keep coming over the next 6 months.  Some notable ones:

I had already chronicled how Caterpillar was cutting pay to manage costs.  Well, turns out they should have waited a bit... the cost cutting continues, with another 5,000 layoffs announced (in addition to 2,500 full-time and 8,000 contract employees having already been asked to leave).

UAL, United Airlines' parent, is laying off 1,000 people - it had recently (Q4 of 2008) laid off 1,500. 

Sprint Nextel is cutting 8,000 jobs.  Ouch!  I blame their tv ads (I hate the Sprint, and the Verizon ads).

Black Monday - 70,000 Laid Off

Yesterday, Monday, was a pretty sad day - layoffs to the tune of 70,000 employees were announced.  Among those who are letting people go:

Texas Instruments (TI) is laying off 12% of its employees - 3,400 people.  Demand for their chips has softened, given that virtually every downstream sector that is a customer (including cell phones) is experiencing soft demand, and high inventory.

Home Depot is closing its Expo chain, and some other smaller locations, leading to a loss of 7,000 jobs.  I don't fully understand how the housing and repair markets are affecting them - one the one hand, the overall housing market, specially new house building, has been hit hard, and this probably impacts Home Depot.  On the other hand, I would expect home-owners to have started doing a lot more of their own home repairs, which should benefit the Home Depot.

General Motors hasn't stopped hemorrhaging, and is cutting another 2,000 jobs in Michigan and Ohio plants

Staving Layoffs - Controlling Pay

Companies are, perhaps predictably, managing personnel costs now by controlling pay.  In most cases, salaries have been frozen, bonuses are being cut or eliminated.  In some extreme cases,  salaries are actually being reduced. 

And given the job climate, the employees can only say, "Thank you, may I have another?"

Yahoo has, starting this week, frozen pay raises.  Bonuses have also been cut (but per my sources, hopefully not completely eliminated in all cases).

  AMD has had layoffs (1,100 people), and the remaining employees are enduring pay cuts ranging from 5% - 20%

And Circuit City's 30K+ employees are all going to lose their jobs, as the chain shuts down.  (Note - I went to one of their stores, and didn't really find things selling for a huge discount.  This isn't like Sharper Image's going-out-of-business sale)

Having fired over a thousand people, Saks is also freezing wages, and removing 401K contributions for the year

Caterpillar, which I would say is the most successful autos-related company in today's climate, is cutting pay - up to 15% for regular employees, and up to 50% for executives

YRC has cut pay by 15% for employees that are non-union, and by 10% for its drivers

Hutchinson is reducing pay by 5% for its remaining employees

Robert Scoble At Kosmix

Robert Scoble, of Scobleizer fame (along with quite a few others, of course), is at the Kosmix offices today.  Cool.

Blue Screen Of Death - Microsoft Layoffs

Microsoft profit dropped 11% - thats quite huge.  And finally, the long-rumored layoffs are coming.  5,000 people in the next few months. 

It isn't a huge number for a company of Microsoft's size (about 5%), but it is a little unprecedented.  This is the software behemoth's first-ever layoff (at least as far as I know.  I'm not counting layoffs from acquired companies, of course.

Microsoft has a process where under-performers are constantly weeded out, a la Intel.  This will probably continue, and might even get increased - so who knows the true employee turnover to come?

Sony - Layoffs For The Official Number One

Sony is shutting down one of its two Japanese TV factories, and laying off 2,000 people (about 3%) of its workforce this year.  That's quite painful, but not unexpected in today's climate.

The funny comment though comes from Kaz Hirai, Sony's head of Computer Entertainment.  His contention is that Sony's PS3 is the "official leader.." in the gaming industry. 

Let's see.  There are three main players in the gaming industry - PS3, Microsoft's XBOX 360, and Nintendo's Wii. 

Good ol' Kaz says the Wii is operating in a different world, and hence doesn't count.  I'm a serious gamer, and I don't look at the Wii as a machine I would buy (although it has a few games, like Super Mario Galaxy, that are very good).  But this is a bit silly. 

Even if we gave Kaz a bit of a point here, the Xbox 360 is still outselling the PS3 2:1.  That's not small change.  His argument here?  That Microsoft still hasn't shown it can stay around for 5 years.

Of course, Microsoft recently announced the 360 is not going to be replaced any time soon - that it's life-cycle is going to be well above 5 years.  And having owned both the Xbox, as well as the Xbox 360, I can say that their customer service is quite good.  I've had both my Xbox, as well as my 360 replaced free of charge for different reasons.  The service was quick and efficient. 

So, my dear Hirai-san, please check your facts.  You aren't the official leader if you're lagging behind your only two competitors in sales as well as installed base.

The World Hasn't Ended... Yet

Yes, the world hasn't ended.  The economy is still not completely in the toilet.   But some early signs are coming...

- Google had a layoff - the big G has laid off 100 HR folks.  Makes sense, since they aren't hiring.  they've also shut down their recently opened Austin office.

- Steve Jobs is sick, and has taken 6 months off.  Apple stock got clobbered as a result.  And suddenly the prospect of a religion without its chief prophet has become all too real

Ouch.

Breaking News - Carol Bartz New Yahoo CEO!

Interesting stuff - Carol Bartz, Autodesk's  limo-riding,  performance-enhancing former CEO is going to be Jerry Yang's replacement.

Good to finally have a decision.  More on this later

Not Even One Laptop Per Child

OLPC, or One Laptop Per Child, has laid off half its workforce (~32 people).  The remaining employees will also probably get pay cuts.

Ouch

LiveJournal Dying

LiveJournal today announced a "restructuring" in their US (San Francisco) office.  All product and engineering team members are gone, top to bottom.  Only technical operations (keep those servers humming, boys!), legal, admin and customer service teams are staying... as of now. 

SUP, the Russian internet startup that bought LiveJournal in 2007 for $30 Million, will probably start consolidating all tasks in Russia.  LiveJournal is quite popular, but just like all other social networks (except MySpace), has failed to figure out how to make money.

LiveJournal is just the latest social network to start going under.  Some others I've covered (a sample of the pain in social networks) are:

• Hi5,  which represents the second tier of social networks after Facebook and Myspace
• LinkedIn, representing the business social networks
• Sneakerplay, representing the ultra-niche networks
• Ning, representing the overly funded network enablers
• Zivity, representing the adult social networks  (yep, it really is a downturn)
• And, of course, Facebook's theoretical value falling (theoretically) from $15 Billion to $1.5 Billion. 

Quite painful, unfortunately. 

Alcoa Cutting Jobs, Production Output, Facilities

The economic downturn means that basic commodities manufacturing and production is getting seriously affected.  Alcoa, which produces Aluminum, is making drastic changes.  Among all the reasons - Automotive production is falling drastically, and there is a surfeit of inventory throughout the Automotive supply chains.

• Cutting output by 18% - 750K tonnes/year
• Reducing 2009 capital expenditures by 50%
• Cutting 13 - 15% of workforce (13,500 - 15,000 jobs)
• Salary and hiring freezes.  Contract positions being eliminated
• Selling four business units that don't deal with core products, and that should bring in about $100MM   (about the amount these four lost in 2008 - a net loss of ~6%):
• automotive wheels
• electric systems
• global foil
• transportation products

Alcoa had gone through a round of layoffs around June - August, which were a little prior to a full realization of the economic conditions hitting the world. 

Page Rank Increase For My Blog

A Page Rank increase of +1, bringing it to 2, for  Capoeirista,  my cover-all blog.  Ho-hum.

Whats New At Cuil?

Last time we checked,  Cuil had lost their VP of Product, Louis Monier.  How are they doing now?

Unfortunately, their traffic doesn't seem to be doing too well.  They botched their launch slightly;  they had great PR, got a lot of traffic, couldn't handle it, and didn't have the best results for searches. 

Cuil does still have a following.  But as the two charts from Quantcast and Compete show, below, their current strategy of incremental improvements has not won back their launch audience yet.

Quantcast

Compete