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SAP, which battles with Oracle as the rival titans in enterprise software, will be expanding its cloud-based services with the acquisition.

Salesforce users are starting to understand that Chatter, the messaging and transactions system for the entire Force.com platform, is not a chat tool. Rather, it's a communications stream that substitutes for most internal email. Why isn't it a chat tool, you ask?  The only plausible answer - that Salesforce simply hasn't plugged in the chat capability yet - becomes moot next month.

Piece-by-piece, but by no means slowly, Salesforce has been assembling an integrated arsenal of cloud-based weapons aimed squarely at Microsoft's stronghold on enterprise applications, particularly with respect to communication. We've talked about its move to reduce workers' reliance on Outlook, and email in general, as their main mode of indirect contact. Outlook's trump card has been its tie-ins to Windows Live Messenger, which are certain to be augmented by tie-ins to Skype (hopefully within our lifetimes).

But Microsoft shedding light on its Skype integration plans would be like Fischer telling Spassky his queen is vulnerable. While Redmond scrambles to coordinate Skype with Office 14 and Windows 8, Salesforce is integrating its own direct IM system into Chatter. Beginning next month, users of Salesforce or apps built on its platform will be able to launch ad hoc chats in the context of their activity streams. 

Screen Sharing

And by fall 2012, the company will add screen sharing.

"For a lot of the ad hoc collaboration - when somebody needs help on a deal or they're trying to solve a case or write an answer quickly -  are they going to set up a meeting and structure that?  Usually not," says Kendall Collins, Salesforce's senior vice president and general manager for Chatter. Here, Collins is talking about Salesforce's existing tie-ins to Citrix GoToMeeting, its preferred tool for videoconferencing.

ReadWriteWeb asked Collins whether this new one-two punch of IM with videoconferencing endangers that partnership. His response was clever: Users are likely to kick in screen sharing on the fly or in the context of a support call. They'll continue to use GoToMeeting, he said, to set up scheduled conferences between multiple parties. 

"GoToMeeting is an incredible tool for structured meetings, webinars and large, external audiences," he said. "But we've seen as a gap in the market the ability to collaborate in context around a business process." In fact, Collins' meeting with us took place over GoToMeeting - it was scheduled in advance, it utilized single-source screen sharing, and it was moderated. It also involved someone outside the team members' network (myself). "I think that people will have the need for very structured meetings and content delivery," he added.

But this new screen-sharing feature will be localized to team members, and will pop up in the context of a chat initiated through the activity stream in the Chatter tab.

The chat process itself is less than revolutionary, though it fills the most prominent void in Salesforce's cloud arsenal. With the system engaged, users will see point-of-presence indicators beside each team member, indicating their current state of availability. Outlook users have had this ability with Office Communicator for several years now, and it's part of Microsoft's tie-in to its Lync server (formerly Unified Communications).

Mobile First? Not This Time

This is where Salesforce's strategy gets interesting, and maybe a little dicey: The company will roll out its inline chat feature to desktop users first, Collins told us. It's still testing mobile capabilities. Mobile is important because it impacts the very meaning of "available" in the context of Chatter's inline chat. Not long ago, "available" and "accessible" were different properties. You may be out of the office and thus unavailable, for example. If (and probably when) mobile accessibility goes live for inline chat, if you're accessible in any way (that is, if you're close to your smartphone), then you're probably available. Unless, of course, you shut your blinds and make yourself unavailable.

And that, strangely enough, plays into Salesforce's own emerging "karma" metric, which appears below each user's portrait on her profile page. The metric measures relative influence on other members of the team. It's an analytic measurement and a complicated one at that, explains Collins: "Customers have never had an ability to understand the influence and impact of any individual in the graph. So you're starting to see some interesting gamification." He tells a story of a fellow Salesforce employee who discovered to his own shock that, despite making the most comments to the team, he failed to score high on the influence bar. "That pushed him to contribute more," he adds, "and I think the value of any network is based on your contributions."

As Salesforce develops mobile chat, relative accessibility is likely to be a factor in the influence score.

Auditability

One of the barriers preventing big business from moving to a Salesforce-driven system right away has been the need to comply with federal mandates to retain emails and internal communications. If your business uses less email this year than it did last year, that might look suspicious to a judge.

Collins assures us that Salesforce is keeping this fact in mind, especially as it continues to roll out a separate, governments-only service.  "Trust has been a hallmark of Salesforce.com," he says. "Having auditable processes and audible ways to track data is part of who we are, and that's no different with Chatter. In fact, one of the reasons IT customers choose Chatter over competitors is that they trust us for compliance, scale, performance, disaster recovery and all the things they need in an enterprise-grade system. We spent a lot of time building out all the key compliance tables for Chatter... We have gone through audits with various financial institutions, many of whom use Chatter as their employee social network. And we know some customers have explicit requirements around e-discovery. We've had partners build various tools on top of those compliance tables. So, if you have a very stringent industry requirement or specific company requirement that is not something that Chatter does out of the box, we've got a host of partners."

Patent troll Lodsys became infamous after it extracted a license from Apple only to turn around and sue small iOS app developers for including features like in-app purchasing in their products. But one startup is now taking a stand and has asked a federal court to examine the case.

Lodsys, a shell company that doesn’t do anything but file lawsuits, appears undeterred by the pressure from Apple or by popular contempt. This month alone, it used the same patents to sue dozens more companies, including names like Dell, Rosetta Stone and Overstock.com. Last month, a federal court finally gave Apple permission to intervene in one of the lawsuits and argue that its own license should protect the app developers.

But it appears that Lodsys is continuing its shakedown of small app makers by offering them a “licensing solution” they can’t refuse in return for a share of their royalties. The troll’s latest antics came to light this week after a brave Seattle app maker, A Thinking Ape, refused the shakedown and instead asked a federal court to declare that apps like “In Your Dorm” don’t infringe the patents.

The complaint by A Thinking Ape lists Lodsys’ campaign of lawsuits against everyone from the New York Times to Wolfram Alpha and sums up the nature of the racket:

Defendant does not create products; it solely engages in aggressive litigation tactics to compel licenses of their AssertedPatents from companies that do produce products.

A handful of other developers have tried to stand up to Lodsys in the past but most capitulated soon after and agreed to pay the troll a tax (rumored to be 2.5 percent of revenues).

The Soul of a Patent Troll

Patent trolling took off after the U.S. Patent and Trademark Office began issuing a flood of questionable “business method” patents related to things like software and, believe it or not, a crustless peanut butter and jelly sandwich. In 2006, lawyers used such a patent to threaten Research in Motion with an injunction against the BlackBerry and extract a $612 million payout.

Lodsys appears to have perfected the art. The troll has been sending identical threat letters (you can see one below) that extol the virtues of patent developer Daniel Abelow. The letter explains that “Dan” has been to several Ivy League schools and “an independent consultant on presenting information via the internet.”

So who is this latter-day Ben Franklin? Here’s a shot from his homepage:

Dan repeatedly describes himself as an “inventor” but it doesn’t appear he has any training in science or engineering. An average person would be as likely to call Dan an inventor as they would call former Yahoo CEO Scott Thompson a computer scientist.

But given the state of the patent system, it appears we’re stuck with the likes of Dan for a while. Or at least until courageous app developers or Apple can flush Lodsys and its shadowy backers from the patent system once and for all.

Here’s a typical Lodsys letter. Scroll down to see Dan’s marvelous inventions in action:

Lodsys Letter Copy

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While a number of mobile payment startups are trying to retire the credit card, the old plastic continues to be a vital tool for a lot of new businesses. We’ve talked about other services like CardSpring that allows developers to build loyalty and offer programs that link to exiting credit cards. Some of the latest companies to try their hand at card-based programs are Mirth and Cardify, two start-ups that presented at TechCrunch Disrupt Tuesday. Both companies tap into CardSpring to sync card data.

Mirth allows a regular of a business to get a set discount when they use their synced credit card. As long as they visit twice in a month, they are considered a Mirth regular, which gives them a discount at any Mirth merchant. Merchants can get analytics about their customers and message their regular customers to remind them about seasonal specials. The service is just getting underway in a few stores in New York and no mobile app at this point.

Cardify enables consumers to unlock rewards and perks at the places they frequent the most. For users who link their credit and debit cards to their Cardify account, they will get points for every dollar they spend at a Cardify merchant. This can be used for simple discounts or special perks, like the ability to get a premium table. The app provides real-time analytics on how much users are spending and can also display for merchants the profile of customers inside their stores, if they opt in to geo-fencing.

Cardify has got a slick mobile app that lets people track their reward points and see what perks they can earn. It’s also got a deal with CityGrid Media and UrbanSpoon, which will help the service get distribution at half a million locations nationwide. That’s a testament to Cardify’s roots as project out of Hatch Labs, the mobile incubator of IAC, owner of CityGrid and UrbanSpoon.

When CardSpring debuted in February, I imagined a number of businesses would launch using the technology. LocalBonus, another loyalty start-up in New York, also got underway recently using CardSpring’s technology. Now that there are more card-linked loyalty programs, it’s going to be harder to stand out if a company is merely tying loyalty to credit card purchases. The winner will be the service that can provide more data and tools to merchants that helps them identify and reach out to their best customers. And it has to have a great user experience for consumers, so the process of earning points, checking on their progress and redeeming rewards is effortless.

Between Mirth and Cardify, I’m more impressed by Cardify, which has a better interface through its mobile app, more tools for merchants and a way to craft rewards that are unique to each location. I’m not sure people will go to the lengths of opting in for a geofencing, which can be a drag, but that’s also a nice touch, allowing a merchant to recognize a customer when they walk in the door. Ultimately, there’s going to be even more loyalty programs that tie into card data. They will all have to get consumers over any concerns about turning over their credit card numbers. But more and more, people are willing to share their payment data if they can get some real rewards or perks for their trouble.

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Google’s $12+ billion Motorola deal is closed, and Google veteran Dennis Woodside is taking over as Motorola CEO. Now the fun begins. For a variety of reasons, this has the potential to be Google’s most interesting project yet.

• This is Google’s first and biggest opportunity to make cool, real, physical things that could change the way people live. That sounds annoyingly optimistic, but it’s true. It is fun to laugh a little at Google’s glasses project, self-driving cars or whatever.  But try telling me with a straight face that your iPhone hasn’t changed your life. Many very smart, creative people work at Google, and I’d love to see them try some interesting things and really go for it in a way that Motorola would never have done before.
• This sort of stuff is not in Google’s comfort zone. Google has been excellent at building and acquiring web-based software, running it at scale and brokering the sale of keyword-based advertising. Google has done some hardware stuff for a long time, such as its homegrown servers and its Google Search Appliance. But Google has no background in creating, marketing or supporting consumer hardware for millions of people at a time. This means Google could either be really bad at it, or it could become really good at it. It helps that Motorola is a sort-of-functioning company today, but not successful enough that anything is sacred.
• Google has long maintained that Motorola will be kept at arm’s length, that it won’t be favored over other Android partners, that it will be separate from Google, etc. Some of that may be true, but my hunch is that a lot of that was just posturing to get the deal approved. Google has a huge opportunity to do fascinating, important work with Motorola, and even create a real business around Android-powered mobile devices. I expect Google and Motorola will eventually become a lot closer.
• This could present some soul-searching opportunities for Google, during which it will have to decide whether to do things that are better for its Android partners or better for Google. In some cases, what’s better for Google - and worse for the Android partners - may also be better for society. In some cases, the opposite may be true. This highlights the weird position that Google is in with Android. On one hand, it has built something huge that it doesn’t really control. If anything, its lack of control is what allowed it to become so huge, so fast, in the first place. On the other hand, Android-the-product probably needs more of Google’s control to improve. And Android-the-business definitely does.
• One opportunity would be to formally split Android devices into three tracks: plain-old-Android, do what you want with it; the Nexus program (significant Google control, available to select partners); and a third line (complete Google control, exclusive to Motorola, ideally the highest-quality line). We’ll see if that happens - and if it does, whether it works. Everyone has different motivations for Android: Google, phone manufacturers, carriers and consumers. They might never harmonize.
• Motorola Mobility isn’t just a cell phone company. It also owns a TV set-top box and infrastructure division. This could be helpful in getting Google deeper into the television industry, where the largest chunk of big-brand ad dollars are still spent. But Motorola’s set-top box customers - the world’s cable and telco giants - are probably some of the most Google-phobic companies around. Watching Google’s courtship here - or perhaps its decision to flip this business altogether - will be especially interesting.
• Lastly, Motorola is huge, which makes this interesting for totally different reasons. Google has had a lot of experience - and success - taking small and mid-sized companies and making them part of the Google story. In some cases, like YouTube, they’re sort-of left alone. In other cases, like AdMob, they’re built into Google and then Google is built around it. But this is a totally new experiment that incorporates moving large, unfamiliar objects at scale like nothing Google has done before. It could be a dramatic failure or a huge success. (Or Google could just decide to piece things apart and sell them!) And that’s unlike almost everything else Google does, which either starts out small and fizzles, or gradually grows bigger - Gmail, Chrome, etc. The fact that it’s already so big makes it special. And one of the first moves to watch will be to see how big Google keeps it.

 

This post originally appeared on SplatF. Logos by grostoryeu.

One thing that's always amazed me is how the record labels ever got away with making it a standard thing that musicians hand over their copyrights to the label entirely. Sure, the labels put up some risk capital and handle part of the business side of things, but to totally give up all of your copyrights? In the tech industry, we've got lots of experience with risk capital, but venture capital deals (even as many entrepreneurs bemoan the deal terms) never go as far as record label deals in basically claiming 100% equity ownership in exchange for a piddly royalty (and only after you pay back the initial loan). But, of course, thanks to a broken system, musicians basically had little choice in the past but to sign a record label deal -- and with just a few large players in the space, giving away you're entire output was considered "standard." But, that leads to some troubling results. We've already seen how artists have complained about their own works being used in suing fans. These artists feel helpless about this legal campaign that attacks their fans, potentially creating significant problems for any attempt by those musicians to connect with fans and earn a living going forward. Take, for example, the tragic story of the band All Shall Perish, as chronicled on TorrentFreak. Apparently, the band's German label handed over the rights to sue to a Panama-based copyright troll who is now suing people in the US, contrary to the band's own wishes. The band, of course, recognizes that suing dozens of its biggest fans is not a good idea, but seems powerless to stop things.

“The band’s attorney made it clear to the licensing people [at Nuclear Blast Records] that the band wanted no part in lawsuits against fans. The industry is changing, illegal downloading is troublesome for bands and of course, for record labels, but whatever the solution will be – streaming, subscription, Kickstarter, new ways of looking at it entirely, whatever comes about – the band and I are in agreement (as is their lawyer) that SUING MUSIC FANS SURE ISN’T IT,” Downey told TorrentFreak.

Apparently, after a lot of pressure from the band, the label claims it will tell the trolling operation, World Digital Rights, to dismiss the lawsuits. The band is now trying to regain control of its copyrights, and is saying that it would much prefer to protect its fans rather than sue them:

“The band, their attorney and myself have and will continue to take any steps to protect their fans, yes, even those who file trade,” Downey told us. “The band would prefer that their fans legally purchase, stream or otherwise enjoy their music. But they definitely have not, will not and do not wish to sue their fans.”

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El 25 de octubre de 2005 se celebró por primera vez el Día de Internet, promovido por la Asociación de Usuarios de Internet y por la Internet Society. Ese mismo año, la Cumbre de la Sociedad de la Información celebrada en Túnez decidió proponer a la ONU la designación del 17 de mayo como el Día Mundial de la Sociedad de la Información, lo cual hizo que el Día de Internet se trasladara a esa fecha.

El objetivo de esta jornada es dar a conocer las posibilidades que ofrecen las nuevas tecnologías para mejorar el nivel de vida de las personas y, en general, de la sociedad. La web www.diadeinternet.org se ha convertido en el epicentro informativo de todas las actividades que se desarrollan durante esa jornada, actividades de promoción de Internet y de las Nuevas Tecnologías, de acercamiento de la Sociedad de la Información a colectivos en riesgo de exclusión y, en general, de divulgación de Internet y de las oportunidades que ofrece para la ciudadanía y los pueblos.

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Kleiner Perkins Caufield & Byers, the blue-chip Silicon Valley venture capital firm known for its early investments in Google, is being sued by an investment partner.

Verizon Wireless revealed a new incarnation of its old V Cast streaming mobile video service on Tuesday; this one built on the back of its new LTE network. Called Viewdini, the Android app aggregates content from premium video services such as Hulu, mSpot — now a Samsung-owned property — and Netflix as well as Comcast’s Xfinity and Verizon’s own FiOS programming.

Verizon didn’t reveal any details about how this high-quality, long-form content would gel with its restricted data plans when the app launches later this month, but I suspect Viewdini may be Verizon’s first venture into the ‘toll-free’ mobile broadband: Rather than charge the customer for the gigabytes of video consumed, it charges the content provider.

Lately Verizon has been talking up the idea of reversing the mobile data business model (as has AT&T), giving its customers unlimited access to any video or over-the-top content service so long as the owner of the service pays the carriage charges. So far Verizon hasn’t implemented any specific policies – that we know of – but if it can secure the cooperation of content providers, it’s only a matter of time.

Viewdini would fit perfectly with that model because video consumes enormous bandwidth relative to other services. If Verizon customers were to make regular use of TV show and movie streaming they would quickly max out their data plans (or enter into throttling territory in the case of its grandfathered unlimited customers). Without any kind of tweak to Verizon’s capping policies, Viewdini practically invites customers to run up huge overage charges, which would hardly be a customer relations coup.

But the apps-charging structure provides a clue as to how Verizon might offer that pipe for free. “By simply searching for a title, topic, or star’s name, viewdini will let customers know which services have mobile video for streaming, and whether it is available  at no additional charge, by subscription, to rent or for purchase,” Verizon stated in its press release.

In each case, Verizon could skim a little from the top of each purchase, for instance collecting a portion of a movie rental or purchase fee. In the case of subscription video services like Hulu Plus or Netflix, Verizon could take a share of monthly revenue from every subscriber that used Viewdini or just charge the video providers flat per-gigabyte or per-stream fees.

Verizon plans to expand its initial line-up to movie studios and other TV sites. If it is able negotiate revenue sharing deals with every service it aggregates, Verizon could easily offer Viewdini as completely toll-free app.

That would make a lot of consumers happy, as they’d be free to stream away without worrying about their data caps, but it could have a chilling effect on the application developers. Netflix and Comcast may be able to afford bandwidth fees, but smaller companies may not be able to – especially if they’re offering up their content for free.

Comcast is already facing criticism that it’s running afoul of net neutrality rules for capping residential broadband data while giving a free ride to its own Xfinity traffic. But the net neutrality rules don’t apply wireless, so if Verizon wants to go the toll-free route, there’s nothing to stop it.

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Google now owns Motorola. Chinese regulators followed the U.S. and Europe in clearing the deal earlier this week, removing the last barrier. Although the acquisition opens new territory for the search giant, its most immediate effect could be remaking the existing Android landscape. Will Google use its new arm to pound all competitors, or just Apple?

Google, a Hardware Company?

The first big change will be to replace Motorola's chief. CEO Sanjay Jha is out, replaced by longtime Google employee Dennis Woodside, a man instrumental in the revenue growth of Google as a business over the last several years. Now his job will be to streamline Motorola’s smartphone product line, cut out the dead weight of Motorola Mobility and deliver on the Android geek’s wet dream.

Many pundits and analysts thought that when Google acquired Motorola, it was purely a patent deal. Google had just lost out on a boatload of critical mobile patents in the Nortel patent auction and Android looked more vulnerable to being taken down in the patent wars than ever. With Motorola in its war chest, Google all of a sudden had 17,000 patents from the company that basically invented the cell phone. With patents in hand, would Google spin off Motorola Mobility or sell it piece by piece?

Selling off Motorola's hardware division doesn't appear to be in the plan. If the search company were going to do that, Google CEO Larry Page likely would not have enticed one of his most effective lieutenants, Woodside, to take over. Yet, while the smartphone division will likely remain under Google's control, other hardware aspects of Motorola Mobility, such as its set-top cable box segment, may go on the block.

“Many users coming online today may never use a desktop machine, and the impact of that transition will be profound - as will the ability to just tap and pay with your phone. That’s why it’s a great time to be in the mobile business, and why I’m confident Dennis and the team at Motorola will be creating the next generation of mobile devices that will improve lives for years to come,” Page wrote. 

Balancing the Ecosystem

To prognosticate the future of Motorola and Google, it is pertinent to look at the guidelines various government bodies put in place when approving the merger. For instance, both the European Commission (the European Union version of the Federal Trade Commission) and the U.S. Department of Justice concentrated mostly on the patents aspect of the merger. The U.S. DOJ was obviously thinking that Motorola/Google was a pure patent play when it approved Google’s acquisition, the sale of Nortel’s patents to “RockStar Bidco” (a consortium of Apple, Research In Motion and Microsoft) and Apple’s acquisition of Novell’s patents in the same ruling. 

“The division's investigations focused on whether the acquiring firms could use these patents to raise rivals' costs or foreclose competition,” the DOJ stated in its release. “The division concluded that the specific transactions at issue are not likely to significantly change existing market dynamics.”

While the E.U. and the U.S. focused on the patents aspect of the deals, China had different motivations when it approved the deal earlier this week. China stipulated that Google had to keep Android free and open source for at least the next five years. China is clearly looking out for its smartphone manufacturers in this deal, with Huawei, Meizu, Lenovo and ZTE pumping out versions of Android smartphones on a regular basis. 

An acquisition of this size, with so many global entities sticking their fingers in the pie, is a fascinating study on the global impact of Android. While Google does not directly profit from Android hardware (for now), there are billions of dollars wrapped up in the Android ecosystem. And this is where Google needs to tread carefully. It needs to balance its desire to streamline the Android process while also not alienating its OEM and carrier partners in the process.

One way to appease the Android ecosystem would be to spread the love when it comes to flagship Android Nexus devices. According to reports, Google will be giving early access of its next Android operating system, likely called Jelly Bean, to five different manufacturing partners that could then sell the device directly to consumers. One motivation for this would be to wrest control of Android from mobile carriers, such as Verizon and AT&T (in the same way that Google originally had planned when it unveiled the first Nexus device and tried to sell it without the carriers). Another reason, and probably more important from Google’s perspective, would be that it could let Motorola create a quintessential Android Nexus device and avoid claims of favoritism.

Benefits of Motorola/Google Android Devices

The potential benefits of Google taking top-level control of the Android ecosystem are intriguing. Google benefits, consumers benefit, developers benefit. It remains to be seen if the carriers and other manufacturers will benefit, especially if Motorola and Google create an Android device that becomes a true “iPhone killer” and starts cannibalizing sales from other Android handsets. 

For consumers, the benefits are obvious: an extremely high-end smartphone and likely an equally impressive tablet that are streamlined to Android software and hardware specifications. The device would receive timely Android firmware upgrades and customer support from Google and Motorola. The very best of Android delivered at palatable price points.

Google benefits from these devices as well. It is hard to say that Page and the rest of the Google executives see the revenue that Apple is making from its iOS line of devices and don't want a bigger slice of that pie. For instance, Apple made more in profit from its hardware last quarter than Google made in total revenue. 

This is not going to be easy for Google and Motorola. Google is moving into an entirely new product category and that comes with its own problems outside of the balancing act that has to be performed with the rest of the Android ecosystem. There are a lot of balls to juggle, not only in incorporating Motorola into Google, but creating a vibrant division that operates and iterates with a high degree of quality. 

What can be said is this: In many, many ways, the best thing to ever happen to Android will be Google’s acquisition of Motorola. Google can now defend its mobile operating system with Motorola’s patents and create dynamic devices with Motorola’s hardware. At the same time, the E.U. and U.S. have put in measures concerning litigation around essential patents and China has ensured that Android will remain open and free. There will be losers in the Android ecosystem, among them several mobile manufacturers and maybe mobile carriers, depending on how much control Google can exercise over the sale of the devices. 

When the Motorola deal was announced last August and Page said that Google wanted to “supercharge” Android, he was not being facetious. Google has a tremendous opportunity in front of it. The path is paved with daggers but the benefit to the entire ecosystem at this point outweighs the risks. 

Dell Inc's quarterly revenue fell more than Wall Street's expectations, hurt by weak sales to consumers, large enterprises and government units.

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Good, but not great, growth has Wall Street punishing car sharing market leader Zipcar, which IPO’ed at $18 last year, zoomed to $28 and now sits at around ten bucks. But the question on many people’s minds is: What is Hertz doing?

The argument for Hertz successfully competing with Zipcar goes like this: Hertz doesn’t require an annual membership fee (Zipcar charges $60), has no late fees (Zipcar charges $50 per hour), it allows one way rentals in some locations, and yeah, it already has a massive fleet of diverse cars.

On paper, Hertz getting into the car sharing game doesn’t sound good for Zipcar, even if you believe there is room for multiple players and that this is a market with considerable future growth. There aren’t good market projections for this nascent industry, though a recent analysis from RAND Corporation took a stab at it, suggesting that with improving tech to locate and rent vehicles combined with favorable government policy, the industry could include 7.5 million users, more than ten times where it currently sits.

Hertz’s CEO Mark Frissora made news in March when Bloomberg reported that he had considered buying Zipcar. But confident that he could leverage Hertz’s existing fleet of 375,000 cars and its customer relationships, he ultimately decided to launch Hertz’s own service. Referring to the New York market, Frissora has said Hertz has 35,000 cars there and once they’re all enabled for hourly rental, Zipcar will “have a real problem.”

In 2009, Hertz acquired Paris based car sharing technology developer Eileo, which makes the Zibox that Hertz is relying on to convert its fleet. The Zibox immobilizes the engine and interfaces with the reservation system to allow drivers to enter and start the car. Hertz offers drivers a key fob that acts like an RFID card. In testing it found drivers wanted a key that they could take with them on their key chain that controls entry to the car. Drivers wanted to feel like they were carrying a car key. The actual car key that starts the car is tethered to the car so that customers don’t take it with them when dropping off the car.

How Hertz will do it

I caught up with Jordan Reber, the VP of Hertz On Demand, who is overseeing the global ramp up of Hertz’s hourly rental service. In our discussion about Hertz’s entry into the car sharing market, Reber noted, “It’s what people tend to ignore when they compare us to competitors, it’s the size of our logistics and parent infrastructure. The issue of car sharing is scale. When those cars are tech enabled, we’re able to put them where our customers want them, be it Omaha or New York City.”

And it’s this scaling up that will ultimately prove whether Hertz can be a market leader in car sharing. Zipcar currently has 709,000 members and 9,300 vehicles in the U.S. and Europe. Hertz has been fairly measured in its ramp up so far with 160,000 worldwide members and about 1,100 cars available. On the question of how much of the Hertz fleet would convert to hourly rentals, Hertz’s Public Affairs Manager Paula Rivera would only say that it would occur over the next 12-18 months and that Hertz is “aiming to get a significant amount of the fleet installed with the [Eileo] technology.”

If the ramp up feels slow, it’s partially because Hertz is being very careful not to cannibalize its core car rental business and Reber made a point of saying that internal data shows that 70 percent of Hertz On Demand users use the service for hourly rental or after hours use.

Moreover, if most in the car sharing market view car sharing as a discrete business, Hertz is far more inclined to view it as a potential source of incremental revenue where it can gradually pick off markets like New York where it’s well positioned with a high volume of locations and available cars. There are likely to be regional advantages that flow toward any player with good logistics in a given city.

You also don’t get the sense that Hertz wants to launch whole hog with national campaigns and run into the car sharing space (it has minimal presence in other markets like San Francisco). It’s not as if Zipcar is making money hand over fist right now as it hopes 2012 will be its first year of very modest profitability.

What’s interesting about the figures is that Hertz has racked up 160,000 members worldwide (90,000 in the U.S.) with a fraction of the number of hourly vehicles in circulation as Zipcar. Sure a big reason for this is that joining Hertz On Demand is free, but that doesn’t make it any less real that the company has millions of existing customers to market to, so that it can get RFID enabled key fobs into those hands so they can easily rent a car. Reber added that Hertz is open to enabling cars to be opened with smartphones when he believes near field communication technology and mobile payment systems are more mature.

Whatever the rate of Hertz’s ramp into car sharing, it’s not likely going away as a priority for the company. Reber was frank in saying, “Car sharing is closely controlled and watched by our CEO [Frissora]. It’s a big focus for us here, not because of me but because of our CEO.” At this point it’s just a question for Hertz of incrementally executing in key markets, which should be enough to give Zipcar a minor headache.

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Despite the growth of mobile coupons, the vast majority of them are still printed. And that’s where the biggest offers are. So instead of trying to displace coupons completely, SnipSnap a new Philadephia start-up is giving people a way to take a picture of a printed coupon with an iPhone app and display it a check-out.

The app, which launched last month, allows people to scan coupons they find in a mailer or newspaper. It reformats the information in the app and makes it easy for people to present the barcode at the point of sale for redemption. Users can get set alerts to warn them before a coupon is about to expire or remind them when they enter a store where they’ve saved a coupon. The app also offers the ability to share coupons online through Facebook, Twitter and email.

For users who don’t have coupons to scan, they can also discover other coupons snipped by  fellow users. And retailers, including SnipSnaps’s first partner, Aeropostale, can also serve up coupons inside the app’s discover tab.

Not every coupon can be redeemed successfully, either because the point of sale hardware can’t scan the barcode or because the store may not choose to accept it in this form. SnipSnap doesn’t work with manufacturer coupons right now, but the company is working to accept those offer coupons inside the app.  SnipSnap lets users report if a coupon was accepted or not, which goes into a success score rating.

Ted Mann, the founder and CEO, came up with the idea after leaving newspaper giant Gannett, where he served as digital development director. He said he was motivated by what he called his “bowl of shame” of clipped coupons that eventually expired. Eventually, the app will become a way to distribute mobile coupons, but for the present it lets people make use of the 93 percent of coupons that are printed today.

Mann’s app, which won a couple of start-up contests in Philadelphia, has seen more than 123,000 downloads and has been featured in the Apple App Store. The former DreamIt’s company announced Tuesday it has raised a $555,000 seed round.

There are still questions about how well the service can work. Retailers may rethink how generous they are with coupons if they know that can be so easily shared. And the fact that a merchant can still reject a coupon means a consumer doesn’t have that certainty that a print coupon user has. That can be a problem if retailers start pushing back on the use of the app. But if SnipSnap can work with more retailers and eventually manufacturers, it can become a viable competitor to Coupons.com and Cellfire.

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The improved results in emerging markets, as well as in Germany and Britain, helped offset declines in Italy and Spain.

Facebook’s initial public offering is believed to have created as many as 1,000 new millionaires Friday, many of them employees who helped build the world’s largest social network. Now that the company is public, Facebook’s biggest challenge may be making sure it doesn’t have an exodus of talent.

The history of the dot-com bubble is littered with stories about startup founders who became multi-millionaires on paper, only to watch their fortunes and companies disappear. There is also a persistent fear of changing the company's culture in a way that differs from the fundamentals that built the success story in the first place. A common analogy is parking lots that used to fill up at 7 a.m. and be full until well after sunset now don’t see cars until 9 a.m. and empty out at 5 p.m.

And the cars filling those lots are usually expensive sports cars.

"Buy one thing you've always wanted," Karl Jacobs, a serial entrepreneur and early Facebook advisor, said when asked by CNN what advice he would give to the new millionaires. "A lot of people don't celebrate the fact that they've worked really hard."

Another fear is that companies will see an exodus of talent: Facebook COO Sheryl Sandberg, who became a billionaire on Friday, famously left Google after helping orchestrate that company’s IPO.

Facebook Could Be Different

By allowing employees to trade shares on private exchanges before Friday’s IPO, Facebook may have inadvertently protected itself from the brain drain that hits a lot of tech companies as soon as they go public. Any employee who wanted to cash out and start over somewhere else has had months to do just that (as an aside, those private exchange trades may also be why Facebook’s shares didn’t take a big first-day jump like other IPOs, which rise an average of 22% on their first day of trading).

“If employees wanted to cash out, they could have sold their shares on the secondary market,” said Jonathan Rick of Levick Strategic Communications LLC in Washington, D.C. “To the contrary, Facebookers love working at Facebook; they enjoy coming in the office of a company that maintains its startup culture while making history,” 

And even as Facebook shares continue to slump further and further below the IPO price in the company’s first week of trading, there is still a buzz of excitement around the company. Rick drew comparisons to Google, which opened at $100 in 2004 and now trades at more than $600 per share.

“Facebookers are true believers: They know that the best is yet to come, that cashing out now would be like selling Google when it opened at $100,” Rick said.

Imitation as the Highest Form of Flattery

Charley Polachi, a recruitment expert, said he expects Facebook’s IPO to have a ripple effect in that it will inspire other people to start their own firms in hopes of becoming the next $100 billion IPO. The IPO also has a more direct impact: It may help companies find seed money from newly minted Facebook millionaires who either want to invest in startups or try their own hand at starting a company.

“I think one of the great things about the Facebook IPO is it inspires more people to get involved with the information economy,” Andrew Rachleff, CEO of the venture capital firm Wealthfront, told CNBC on Friday.

Enterprise software giant SAP is buying Ariba in a $4.3 billion move that will give it control of what is probably the world’s largest online-marketplace for goods and services.

Ariba’s online marketplace is used by business buyers and sellers of all sorts of products and services. The Sunnyvale, Calif. company has partnered with all the big enterprise software companies including SAP and its arch-rival Oracle so that businesses using Oracle or SAP supply chain or ERP software for their own production also used Ariba to connect with prospective buyers.

“It’s a good fit for SAP which is all about what happens to the end of the enterprise and Ariba which is between enterprises, said Dana Gardner, analyst with Interarbor Solutions

The strength of Ariba, said Gartner, is that it fields an “ecumenical” cloud that works with all the big ERP players except for Workday. The thing to watch is whether SAP will align Ariba more tightly to its own ERP customers and products as opposed to those running competitive products.

This is an interesting buy for SAP, which has a huge global customer base for its traditional on-premises ERP products and is building out more cloud-based services with its acquisition last year of SuccessFactors. Ariba itself is global presence, especially after its acquisition early this year of Quadrem, a Dutch supply chain company with strong presence in Asia and South America. Having said that, there is some overlap between Ariba and SAP which has some of its own procurement and ecommerce software.

According to the SAP statement announcing the move:

The Ariba network is the largest and most global trading network, connecting and automating more than $319 billion in commerce transactions, collaborations, and intelligence among more than 730,000 companies. SAP’s global customer base of more than 190,000 companies includes the largest buyers and sellers in the world, offering great potential to increase the number of participants, as well as the volume and types of transactions conducted through this network.

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We've been following the "Ultramercial" case for a while. This was about a company that got a patent (7,346,545 that is basically about requiring you to watch an ad before you can watch some content). Ultramercial sued Hulu, YouTube and WildTangent. The case bounced around the court system for a while, with some using the Bilski ruling to reject the patent as an "abstract idea." However, CAFC (the appeals court that handles patent appeals and always seems to have a soft spot for patents) said the concept was perfectly fine. In reading through the details, CAFC's explanation was basically that since the patent described doing this abstract idea "on the internet," suddenly it became patentable. Back in March, we wrote about WildTangent's appeal to the Supreme Court, which pointed out the ridiculousness of saying that as long as you add "on the internet" to an abstract idea that it suddenly becomes patentable. While it felt like there was a good chance that the Supreme Court would hear the case, there was one other interesting development that happened a week later: the Supreme Court smartly rejected broad patents on medical diagnostics in the Prometheus Laboratories v. Mayo Labs case, noting that such patents are on unpatentable subject matter. Specifically, the ruling held that "A patent, for example, could not simply recite a law of nature and then add the instruction 'apply the law.'" Many people expected the Supreme Court to use this ruling to get CAFC to reconsider its Myriad ruling that allowed gene patents -- which it did. But the big news coming out this week was that the Supreme Court has accepted the appeal of the Ultramercial case by vacating CAFC's ruling and asking it to reconsider the Ultramercial case in light of the Prometheus ruling:

The petition for a writ of certiorari is granted [G]. The judgment is vacated [V], and the case is remanded [R] to the United States Court of Appeals for the Federal Circuit for further consideration in light of Mayo Collaborative Services v. Prometheus Laboratories, Inc., 566 U.S. ___ (2012).

This actually makes a lot of sense. The Prometheus ruling makes clear that saying "general idea + apply this idea" is not patentable subject matter. And yet, CAFC's ruling in the Ultramercial case basically said the opposite, noting that "general idea + apply this idea on the internet" is patentable subject matter. So, once again, it appears that CAFC's completely out of touch view of the patent system is getting smacked down by the Supreme Court. CAFC now has these two more chances to get it right and to stop slobbering all over ridiculous expansions of the patent system. Hopefully CAFC gets it right the second time around, and the ruling in Ultramercial is useful in limiting ridiculously overbroad software patents. Permalink | Comments | Email This Story

My do-it-yourself smarthome system may be getting an upgrade with an Internet connected front door lock. Lockitron just caught my eye for a few reasons, but the main one is support for near-field communications or NFC. I already use the NFC chip in my Galaxy Nexus for wireless mobile payments and with the $295 Lockitron deadbolt system, I could wave my smartphone near the front door to unlock it. Here’s a look at how the system works:

While the NFC support is appealing to me, I also like that you can remotely unlock the door with a mobile app or by text message. That’s handy for when you need to let someone in the house or have a package dropped off inside. Of course, I wouldn’t open the door for just anyone; that’s why I have a web-connected camera too.

Installation of the Lockitron appears to be a snap as well because the lock doesn’t require any wiring for power or connectivity. Instead, 4 easy to replace AA batteries are used in the lock and it receives wireless commands over a home Wi-Fi network. Most other wireless locks I’ve investigated require some electricity rewiring, which I’m not looking to do. After installing the Lockitron, you simply connect a small server unit to the wireless router in your home.

Obviously if the lock’s batteries run out or your home loses electricity — and therefore, the wireless network — you can’t open the door with an app or text. In that case, you’ll still need a key, but I don’t mind carrying one around in my wallet. And for all of the services to work — key issuing, revoking, access from any internet connection — the lock must be in communication with Lockitron. However, the company is working on a software option that allows homeowners total management of the lock on their home network.

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If you can’t beat ‘em, join ‘em. Or better yet, acquire ‘em. As competition heats up in the educational technology space, that seems to be the thinking at publishing giant McGraw-Hill’s higher education division.

During a presentation for reporters Tuesday about adaptive learning and e-books, Brian Kibby, president of McGraw-Hill Higher Education, frequently referenced the startups angling to bring technology into college classrooms across the country. But instead of taking a territorial position, the longtime leader in educational content took an open-arms approach.

“I encourage startups in this space because I’d like to acquire you and partner with you,” he said. “So please join this space.”

When asked about how the company will compete with startups offering free or more affordable content, (such as Coursera, Boundless, Akemos, and others), he said “the more ideas that come into this space, the better off the student is going to be.”  Ultimately, the companies that succeed are the ones that can prove their value by improving student performance, he added.

As for players that are resistant to new and different models? “I think they’re a little foolish,” he said. “I think they need to try anything and be a little bold.”

As higher education costs continue to climb, and new technologies open up access and more affordable options, incumbent companies like McGraw-Hill are under pressure to maintain their leadership and relevance. The company’s adaptive learning platform LearnSmart, which it launched in 2008, is one of its leading-edge tools. It also provides digital lecture and homework tools for students and professors, and backed e-book startup Inkling.

Following general technology trends regarding mobile and broadband adoption, Kibby estimated that the use of adaptive-learning technology will accelerate in the next 15 months and be ubiquitous on college campuses in the next 36 months.

Noting the rise of “big data,” Jay Chakrapani, vice president and general manager of digital at McGraw-Hill Higher Education, said during the presentation that the company wants to be the “Netflix of education.”

Just like Netflix gets better at personalizing suggestions for consumers as it gathers more data, LearnSmart also improves its personalization capabilities for students. As of April 2012, the company said, more than 800,000 students have answered almost 750 million questions. Every second, students answer about 17 LearnSmart questions, or about 1.5 million every day.

For now, Kibby said, the company offers LearnSmart programs for every major course category at the university (which is about 40, according to its website). But, eventually, he said they want to expand globally and to K-12 schools. As it scales, it will likely face mounting competition from other learning startups like NY-based Knewton and others.

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Last night, the SpaceX Falcon 9 rocket blasted off from Cape Canaveral, Fla. It's carrying a reusable spacecraft called Dragon, which can dock with the International Space Station. It's unmanned this time, but it's capable of carrying cargo or crew. This will be the first time a spacecraft built and launched by a private company docks with the station. It's a new era.

The move toward private spaceflight has forged ahead with NASA's blessing. After retiring the space shuttle fleet this year, NASA wants to outsource these regular missions to private companies. SpaceX has stepped up. Founded by South African superhero Elon Musk (who also brought us the Tesla Roadster electric car), SpaceX has now proven that its Falcon rockets can succeed the space shuttle.

The launch was initially planned for Saturday, May 19, but it was aborted with less than a second left on the clock. A flight computer detected an unusual reading in one of the Falcon's nine engines and shut down the launch automatically, just as the rocket flared to life. Engineers repaired a faulty check valve in a matter of hours, and the launch was rescheduled for Monday. It went off without a hitch.

This was the third successful launch of the Falcon 9, and its second stage delivered the Dragon capsule into orbit. It will now rendezvous with the International Space Station and perform a series of docking tests. If successful, the space station crew will grab the Dragon with a robotic arm and guide it in to dock.

"We obviously have to go through a number of steps to berth with the Space Station," Musk said at the post-launch press conference, "but everything is looking really good, and I think I would count today as a success no matter what happens with the rest of the mission."

The Dragon is designed to carry cargo or astronauts. It has room for up to seven people on board. NASA has given SpaceX almost $400 million in funding to ensure the success of this program, hoping that these private missions to the space station can become routine.

SpaceX employs around 1,800 people, and it has a $1.6 billion contract with NASA for 12 cargo flights. If this current mission succeeds, SpaceX will begin fulfilling that contract this year.

Images via Space Fellowship and SpaceX