Microsoft-Yahoo deal: links for Feb 13, 2008

February 13, 2008

Updated links relating to Microsoft’s bid for Yahoo! from eweek, zdnet, forbes and fortune.
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Is the Web 2.0 Bubble Set to Burst?

November 20, 2007

By Jim Rapoza

In recent months, an increasing number of technology analysts and pundits have started to sound the alarm that we are on the cusp of another technology bubble burst—in this case, the Web 2.0 bubble. If you expect me to disagree with these pundits, guess again. Of course another bubble burst is coming.

All of this talk about bubbles got me thinking about the classic cycles of busts. Because when you analyze past technology bubbles, you’ll always see the same progression from pure technology to pure marketing. By paying attention to this progression, you might even be able to tell when a bubble is getting too big for its own good and is likely to burst.

So how does one begin to build a technology bubble? At the beginning of a bubble, it’s all technology. This is the point of entry of the inventers. These are the people who have the idea of a new groundbreaking technology, such as e-commerce, social networking, PC software, whatever. At this end of the spectrum, the participants are brilliant technologically but have no marketing skills whatsoever. The only people who are paying attention to their breakthroughs are those with similar technological inclinations.

The next phase is where the innovative entrepreneurs come in. These players understand the technology but also have enough marketing skills and salesmanship to build products that people actually want, and they are able to start real buzz around a new technology.

This leads to the equilibrium point for technology and marketing. This is also the stage in a technology bubble where the biggest, best and most enduring solutions are created—whether it’s Microsoft, Amazon, Google or eBay.

Unfortunately, this is also the stage in which the people who are all marketing and no technology decide that it’s time to get in on the action. You know who these “entrepreneurs” are. These are the snake oil salesmen. The people who talk a good game and can convince anyone from venture capitalists to the press to the general public that they have the biggest, coolest, most important new thing out there.

So what if their product doesn’t do anything, or has no way to actually make money, or is a bad version of another product that’s already out there? These players are so good at marketing themselves and their products that they are able to generate irrational exuberance.

But all these people are really supplying is a bunch of hot air. And you know what happens to bubbles when they get too full of hot air.


And so the bubble bursts, taking down the shameful hucksters who caused the burst (though also typically taking down a few legitimate companies that deserved better).

But the bubble burst isn’t always a bad thing. For the technologies involved, it can be a cleansing experience. With all the hype and hot air removed, the technology can settle down to doing its intended job. After all, despite the damage of the .com bust, e-commerce is doing just fine.

So keep an eye on your bubble cycles and know when to avoid the hot air. And, remember: Somewhere out there right now is a technology-savvy and marketing-weak inventor who is starting the first puffs for a whole new technology bubble.


Software Industry M&A: What’s Next?

November 19, 2007

By Rob Preston

The software industry is fast consolidating around only a handful of dominant players: IBM, Oracle, Microsoft, and SAP in the first tier, and Hewlett-Packard, EMC, CA, and Symantec in a second, more narrowly focused one. Quibble if you want about which companies belong where, but it’s clear that software is going the way of the PC, auto, lighting fixture, consumer goods, and other mature manufacturing industries: ruled by the giants.

Are we done yet? Hardly. Expect much more consolidation in the months and years ahead. What follows is a purely speculative though objective analysis on what could follow, company by massive software company.

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Symantec’s Top 10 Internet Security Trends

November 19, 2007

Topping Symantec’s list of 2007 security trends is data breaches. It’s not hard to understand why: According to a 2006 study by the Ponemon Institute, data breaches cost an average of $4.7 million per incident and are predicted to cost even more in the future. That’s not the sort of outlay any IT pro wants to own. “Data breaches are indicative of an underlying trend: a movement away from hobbyist attacks… to targeted financially motivated attacks,” said Amrit Williams, CTO of enterprise security company BigFix and a former IT security analyst for Gartner. “When you have a motivation that’s driven by financial gain, the goal is to be quiet. You don’t want to be seen. What the attackers are after is not to bring systems down. They’re after the information itself.”

Symantec’s number two security trend for 2007 is Windows Vista, which has seen 16 security patches since its introduction. Both Symantec and McAfee foresee more attention being paid to Vista by malware writers as Vista adoption continues.

Third on Symantec’s list is spam, which reached record levels in 2007, according to the company. That may seem improbable given the vast sea of spam in which we’ve been swimming for the past few years, but spammers’ fortunes are buoyed by their ever-rising tide of unwanted messages. Thus, we now have to contend with spam in new bulky flavors — image spam, PDF spam, MP3 spam, and greeting card spam — that strains server resources even further.

A tasty irony: Offline, the mafia has long been involved with garbage collection; online, the cyber mafia is in the business of garbage generation and it’s the security industry that makes a killing cleaning up.

And, as Williams and others have said, it is a business. Symantec claims that a member of the Fujacks cybercrime gang once boasted, “This is a better money-making industry than real estate.”

To sustain that business and improve margins, cybercriminals are creating professional attack kits. That’s the fourth-ranked trend on Symantec’s list. “Forty-two percent of phishing Web sites observed in the first half of the year were associated with three phishing toolkits,” according to Symantec. Kits like WebAttacker and MPack make malicious expertise available globally in an instant, with the only requirements being a download, some IT savvy, and contempt for the law. Keeping with the professionalization of cybercrime are the fifth-, sixth-, and seventh-ranked security trends of 2007: phishing, exploitation of trusted brands, and bots, respectively. Phishing sites rose 18% in the first half of the year, according to Symantec, and the bots conquered Estonia in May, albeit briefly.

The eighth-ranked trend of 2007, as Symantec sees it, is Web plug-in vulnerabilities.

Number nine gets back to the professionalization of cybercrime: The creation of a market for security vulnerabilities. WabiSabiLabi aspires to be an informational eBay for legitimate buyers to obtain information about security flaws that isn’t yet public knowledge. If the market works, and it appears to be doing so, companies may discover that the cost of security is more than they expected.

Finally, the last item on Symantec’s list is virtual machine security. Virtualization is all the rage, because of perceived benefits in terms of cost and flexibility of management. Security is in there too, but there’s some debate about whether virtualization creates security problems, too. Symantec expects malware writers will give the skeptics some ammunition as they find ways into virtualized systems.

Looking ahead, Symantec sees storm clouds, which proves convenient for a company that sells umbrellas, so to speak. It expects election season social engineering to victimize computer users in 2008. It foresees increasingly sophisticated bots that can host phishing sites on the compromised computers of unwitting consumers — have fun explaining that to the FBI when they seize your PC.

Web-based threats will continue, Symantec expects, particularly as browsers become more uniform in the way they respond to scripting languages like JavaScript. And cross-site scripting exploits work, so malware writers can be counted on to continue making use of them.

As mobile phones, particularly smartphones with complex operating systems, continue to become more popular, Symantec sees hacker interest following. What luck that security companies are already offering mobile security software.

And like McAfee, Symantec expects attacks on virtual worlds to rise. There’s already a thriving market for virtual goods and it’s probably a safe bet that the FBI won’t send agents to recover your stolen gold or Axe of the Gronn Lords.

Such threats won’t be fixed by products, Williams insisted. He expects that the IT security story of 2008 will be the convergence of security and systems management. “It’s too costly, difficult, and challenging to maintain separate infrastructures,” he said.


Startups Use DEMO Show as Launching Pad

November 19, 2007

By Clint Boulton

DEMOfall 07 in San Diego on Sept. 24 marked the formal launch of LongJump and Yuuguu, two vendors trying to make their products stick in a cluttered Web 2.0 market.

LongJump, of Sunnyvale, Calif., is a challenger, CEO and Founder Pankaj Malviya told eWEEK in a recent interview.

A service of Relationals, a privately held maker of on-demand CRM (customer relationship management) and SFA (sales force automation) business applications, LongJump’s initial offering includes 12 SAAS (software as a service) applications in customer service, sales, marketing, finance and human resources.

Relationals’ platform forms the foundation for the LongJump service. But while the Relationals platform caters to enterprises, LongJump aims to sell its wares to small and midsize businesses at a more attractive price point than offerings, Malviya said.

After all, he said, SMBs can’t afford expensive enterprise software that is taxing to maintain, cannot be easily customized and does not integrate with other business applications.

“Business environments have become dynamic,” Malviya said. “Users do not want to settle down with that big monolithic application, whether it’s or SAP. They want to be able to dynamically change the application configuration and mash up the data to meet their requirements. We believe our platform has the capability to provide that.”

Malviya said that LongJump applications work well together and are simple to customize to allow SMBs to Web-enable their business processes so they can manage information and collaborate more efficiently.

Features of the software include: customizable homepages with configurable dashboard widgets; reporting with configurable charts and graphs; the ability to search and see data in calendar views and list views; embeddable business processes such as Web forms; management capabilities to assign access rights by team, role and user.

LongJump is also promising SAS 90 Type II compliance for user data protection and security and five-nines (99.999 percent) infrastructure and application availability.

One application, OfficeSpace, lets knowledge workers share calendars, tasks, status reports, documents and other information, replacing e-mail as a means of internal information exchange.

Another app, 360˚ Customer Manager, allows users to store customer account information, share contacts related to customers and keep track of appointments, documents and e-mails.

LongJump hasn’t hashed out pricing yet, but as a gesture of good faith to prove it’s more affordable than options, the company is offering all of its applications for free for a 90-day trial period through Dec. 31, 2007, after which pricing will be announced.

Yuuguu Web Collaboration

Yuuguu, of Manchester, UK, which means “fusion” in Japanese, introduced its Web collaboration tools at DEMOfall 07.

Yuuguu CEO Anish Kapoor said Yuuguu helps people work together remotely, across different platforms, as if “they were sitting in the same room.”

Positioned as an alternative to Web conferencing tools from WebEx, Microsoft and Citrix, Yuuguu’s software enables users to see, share and take control of each other’s computer screens and applications.

Colleagues can message and chat while they share screens. The platform includes voice conferencing services for one-to-one and one-to-many voice calls. Yuuguu also boasts presence, letting users see when friends or co-workers are online, and click to invite them.

Prospective users can download the software, save it to their computer, and invite people by sending them a link.

Kapoor emphasized that Yuuguu’s software is free and said that Web collaboration offerings from WebEx, Citrix and Microsoft “horrifically expensive and geared toward large enterprises.”

Kapoor said the company plans to make money with add-on services, including the ability to recall logged historical conversations and collaboration sessions, as well as customization features such as a company logo or brand.

But prospective online collaboration players seem to make up the bulk of the newcomers, which is no surprise considering the multi-billion-dollar market potential of the space.

For example, MyQuire, based in Mountain View, Calif., will debut a tool to let members work with tools such as Word, Excel and PowerPoint and keep projects on track with task lists, calendars and e-mail notifications.

Users can also “meet” with other project members in real time wherever they are and connect their projects with their personal and professional networks.

Also, Diigo, of Reno, Nev., which stands for “Digest of Internet Information, Groups and Other stuff,” introduced an information network that creates communities around information, topics and knowledge.

A collaborative social networking site, Diigo connects members through the content they collect, while also allowing people to discover and share information that matters to them with others in the network.


Gartner: SAAS to Make Big Jump in Business Software by 2011

November 14, 2007

By John Hazard

More than a quarter of business applications bought and sold in 2011 will be delivered as software as a service, according to Gartner projections.

A report released Sept. 26 by the research firm said that adoption is well on its way, with SAAS accounting for roughly 5 percent of business software revenue in 2005, and more in some markets such as CRM—8 percent in 2005 and an expected 12 percent this year.


Does a Microsoft-Facebook Tie Portend the Next Net Bubble?

November 1, 2007

By Clint Boulton

Though just a rumor at this point, the idea that Microsoft took a 1.6-percent stake in popular social networking site Facebook has some industry experts anticipating the next Internet bubble.

Ovum Research analyst David Bradshaw said the stake could open the floodgates for social-networking vendors going public with high valuations.

“Indeed, it is such a large amount that it makes me suspect that we’re in the run-up to another bubble in Internet company values,” Bradshaw told eWEEK. “A lot of other people will seek to go public,” he said, noting that the public is ripe for a new Internet bubble.

That’s right. Another Internet bubble. Another half-decade of sky-high valuations, lavish spending and high-tech incubators.

Fueling the high-cost frenzy for such properties as LinkedIn, Twitter, Bebo, Friendster and Digg, will be the desire to implement technologies from these companies into products for the enterprise, Bradshaw said.

Should some sort of Microsoft-Facebook union come to fruition, expect some of Facebook’s social-computing tools to be incorporated in Microsoft’s SharePoint collaboration software, said IDC analyst Mark Levitt.

“My take is that Microsoft is active enough in the consumer Web space that an investment in Facebook may not result in any crossing over into the enterprise for the foreseeable future,” Levitt told eWEEK. “But down the road, you are right that the Facebook’s experience and technology could find its way into Microsoft’s SharePoint solutions for enabling business social networking.”

However, Bradshaw said the stovepiped architecture of enterprise applications present some significant obstacles for vendors to address.

He said while social networks such as Facebook, of Palo Alto, Calif., and LinkedIn have made some strides on the recruitment ground, no one has cracked the selling of tools that enterprises themselves could adopt.

Aside from the challenges of negotiating social networking into enterprise systems, Bradshaw said that some problems with Facebook could preclude the company from rising as fast as some think and thwart his theory.

Those issues include privacy concerns associated with protecting minors from sexual predators and the ongoing legal action between Facebook CEO Mark Zuckerberg and his former roommates over the alleged theft of intellectual property.

Gilbane Group analyst Geoff Bock agreed that Facebook’s privacy issues could scare off prospective companies. On Sept. 24, the New York State Attorney General’s office subpoenaed Facebook for documents that demonstrate the company is not protecting underage users from potential predators.

Moreover, Bock downplayed the Internet bubble theory and has his own theory on the interest in Facebook.

“The reason for the valuation is that it is a platform, and it appears to be a platform for the Net natives, people who group up and live on the Internet all of their lives,” Bock told eWEEK. “What we’ve seen time and again on the Internet is that places, locations, platforms and environments that get a lot of eyeballs and start doing useful things can get pretty decent valuations in the public marketplace.”

Bock also took a dimmer view of social computing in the enterprise, at least in the near term. The analyst said that while Facebook and Google allowing mashups make them enormously popular, that doesn’t mean these companies will help social-networking tools transition into the enterprise.

Bock said that enterprise content-management platforms from IBM, EMC and Microsoft SharePoint don’t support social networking, noting that it’s not clear how social computing works inside the enterprise.

He said businesses would have to build relationships with customers to link the information, supply chain and value chain flows together.

“We don’t have good software yet that manages those links,” Bock said. “Every major company is working on defining and managing the links and I don’t think the Googles, Facebooks and Amazons understand the enterprise enough to do that.”

If any company comes close to socializing the enterprise platform, Bock said, it’s IBM with its Lotus Connections software.

Differences of opinion on the evolution of social-networking tools in the enterprise abound. IDC analyst Rachel Happe said she is moderately bullish on the notion of social networking moving into the enterprise, noting that “social networking provides a filter to information, and information is exploding online.”

In fact, Happe called eWEEK Sept. 26 from the Emerging Technologies Conference at MIT, in Cambridge, Mass., where she said research engineers from Cisco Systems and Intel talked about how they are looking to use social networking to “evolve search to information discovery and filtering.

“They see social networking as an underlying platform for a lot of applications,” Happe said, noting that her research showed that device companies are looking at social-networking applications and P2P (peer-to-peer) media distribution as something to bundle with their devices to better control information flow.

Meanwhile, Bradshaw concluded that with the evolution of this Web 2.0 world of social networking and collaboration, “Facebook is no more than a step along the way and that there’s something further to come.”

“Longer term, we believe that social networking sites have to evolve further,” he said. “Maybe we need bubble 2.0 to burst before we can get to that, but let’s hope not.”

Burton Group analyst Mike Gotta said while the industry is still trying to understand what people want from a social-networking platform, the opportunity is compelling in terms of how social networking can alter product- and service-delivery models and also influence customer and community relationships.

But is there a bubble coming?

“We are so early in this phase that it’s difficult to position this as a bubble per se,” Gotta said. “Instead, I view it as one aspect of broader societal, market and economic trends that are transforming business and organizational models.”


Google/OpenSocial vs. Microsoft/Facebook

November 1, 2007

By Steven J. Vaughan-Nichols

So there they were, Google vs. Microsoft, slugging it out again. This time, to the winner, would go a small percentage of the ownership of the popular social networking site, Facebook. The real prize though was that the winner would get to decide if Facebook would continue to accept advertising only from advertisers working with Microsoft.

And, the winner was… Microsoft!

Now, Google doesn’t lose to Microsoft, or anyone else for that matter, very often. So maybe, just maybe, when Google announced today—Halloween—that it was going to offer Internet developers an open system, OpenSocial, to create applications across Web sites—read social networking sites—it was a pure coincidence. Just like, say, it was pure coincidence that soap somehow ends up on your windows tonight.

Seriously, I’m sure Google has been working on cross-site applications that will let social sites syndicate content from one site to another for a while now. Even Google can’t get a dozen partners, including the social network LinkedIn for business professionals, its own Orkut network and Friendster to all sign up in a few days… Or could they?

No, no, I’m sure they’ve been working on this for a while. After all, if you look at what Google is trying to do from both a technical and a business viewpoint, OpenSocial fits in perfectly.

Google wants and needs open systems, and, to a lesser extent, open source. Google makes its moola from selling advertising on everything and anything you can place on the Web. If the systems are open, Google engineers are fast enough and bright enough to find a way to hook an ad to almost anything on the Web. Or, if they can’t hook an ad to it, they know how to PageRank it, so that your best chance of finding a site, an application, a friend, what-have-you is via the Google search engine.

If Google can build the open system itself, which is exactly what they’re doing, it’s even easier for them. By opening it up, they insure that the open-source development process will get the new system up and running as quickly as possible, while at the same time debugging at a rapid rate.

Indeed, if you think about it, this face-off over Facebook, says a lot about both companies. Google wants to open up its advertising. Microsoft—and this is so Microsoft of them—wants to keep the advertising all to themselves.

Take this step further. Right now Microsoft really, really wants you, as a business customer, to buy into SharePoint. And, why shouldn’t they? If you really want to get the most from SharePoint’s Swiss-army knife approach to work collaboration you need to buy— take a deep breath here—BizTalk Server 2006 R2, SharePoint Server, Visual Studio Team System, SQL Server, Server 2003, and Office 2007. Oh, and Exchange. Can’t forget Exchange.

To me SharePoint is the epitome of Microsoft’s extend and embrace strategy. If you buy into it, you have to buy into an expensive complete server to desktop package. It’s not quite the same thing as selling your business’ soul to Redmond, but it’s close.

Google, on the other hand, says you can just use its open services and applications, like Google Apps Premier and Standard editions to do pretty much everything Microsoft can do for you, with one big difference. With Google, it’s either free of charge or the company charges you a pittance. Except, of course, Google doesn’t have a way for you to integrate work across networks the way SharePoint does… Hmmm… or will it soon with OpenSocial?

After all, Microsoft is already trying to link Web 2.0-type sites with SharePoint and you can use SharePoint across the Internet today. Social networking sites that are integrated with SharePoint are just one more step away. Now that I think of it, Google may have been planning OpenSocial for quite a while now.

This may look to be just another dust-up between Google and Microsoft. It may appear to be just a fight over Web advertising revenues. But I think it’s more, much more. I think it’s a fight between whose technology model is going to control the business network, and bigger even than that, whose business model is really going to call the shots in the early 21st century.

The Google/Microsoft war may just be beginning.


Google Unveils Open Social Platform for Developers

November 1, 2007

By Michele Gershberg

Google Inc will offer Internet developers an open system to create applications across Web sites, a move that could challenge the features behind the explosive popularity of social network Facebook.

Google’s OpenSocial system gives developers standardized tools to build applications and embed them in many sites, eliminating the need for small startups or even one-person shops to customize their programs for each site.

It also has the potential to lure developers mostly allied with Facebook by allowing their applications to find a home on many other Web sites.

“This is about making the Web more social, how do you have your friends go along with you to any site on the Web?” said Joe Kraus, Google director of product management, in an interview.

Google said it had initially signed on about a dozen partners, including social network LinkedIn for business professionals, its own Orkut network and Friendster.

Developers who are testing the program include key companies behind Facebook applications, such as music recommendation service iLike and Slide, which created the “Top Friends” ranking application.

Industry blogs have speculated for nearly a month that Google aimed to unleash a major challenge to Facebook, whose decision to open its site to developers in May helped it grow to more than 48 million users.

Facebook, which secured an investment from Microsoft Corp. last week that values it at $15 billion, is due to announce its own new advertising strategy on Nov. 6.

Google had also been interested in a partnership with Facebook as it competes more closely with Microsoft for drawing Web audiences and advertisers.

Developers briefed on OpenSocial said it will help them seek the widest distribution possible for their applications, some of which are already used by millions of people on social networks.

“For months we’ve been approached by other Web sites that want us to build iLike widgets for them and we’ve been unable to build it for them,” said iLike Chief Executive Ali Partovi. “The benefit OpenSocial offers us is we can essentially … syndicate what we do to other social networks.”