Cashing Out: Week of April 17th – 23rd 2011 in Online Marketing News

Walmart seeks to strengthen e-commerce with acquisition of Kosmix

April 18 Walmart announced a new acquisition which they hope will strengthen their presence beyond brick-and-mortar retail. The deal, which will close during the first half of 2011, involves the purchase of Kosmix, a social media technology provider and developer of a platform for filtering and organizing content across social media.

Kosmix will join Walmart’s new Silicon Valley-based @WalmartLabs as part of what the group’s Vice Charmain and former Walmart CEO Eduardo Castro-Wright dubs an effort “to accelerate the development of [Walmart’s] social and mobile commerce offerings.”

While the retail behemoth’s $400 billion annual in-store sales secure its position as a dominating force in offline shopping, Walmart’s e-commerce could be better developed, with its online sales estimated at only about one tenth of Amazon’s.

It is likely that the minds behind Kosmix will help Walmart improve in this respect. The social media startup’s founders Venky Harinarayan and Anand Rajaraman are responsible for TweetBeat and AmazonMechanicalTurk, and their first company, the online shopping business Junglee, sold to Amazon in 1998 for a considerable amount of stock.

Twitter’s grab for TweetDeck could keep in UberMedia at bay

TweetDeck is rumored to be up for grabs, again.

The Wall Street Journal reported April 19 that Twitter is in “advanced talks” to purchase the Tweet managing program for roughly $50 million, about $20 million more than UberMedia reportedly offered for the acquisition of Tweetdeck in February.

The deal with that company never panned out, but had it solidified, it would have given UberMedia control of about one fifth of total Tweets served.

Twitter’s offer, and massive overbid, is likely a defensive move against a company they recognize as a rival. The microblogging service briefly banned UberMedia’s apps Twidroyd and UberSocial (then termed UberTwitter) in February for what they claimed were policy and trademark violations.

Another consideration might be the fact that, according to a CNN report, UberMedia is attempting the development of a direct Twitter competitor in the form of its own microblogging service, designed to avoid common complaints about Twitter like character limits and lack of organization.

Avoiding such a threat and maintaining control over Tweets may in fact be worth millions to Twitter. Whether or not the offer will be enough to bring about a deal, however, will be up to TweetDeck founder Iain Dodsworth.

ValueClick buys mobile ad network for $75 million

In a deal announced April 22 and worth $75 million, online marketing firm ValueClick has acquired mobile ad network Greystripe.

To date, Greystripe has brought in a total of $18.1 million in funding and is one of the largest independent networks of its kind, expected to earn between $25 million and $30 million in revenue this year. The deal will expand on ValueClick’s current focus on pay-per-click ads, and extend its involvement in mobile ads.

Entering the mobile ad arena is something other companies have paid more for, with Google’s purchase of AdMob totaling $750 million and Apple’s acquisition of Quattro Wireless worth the slightly more conservative sum of $275 million.

With spending on mobile ads up 48 percent since last year, and expected to hit $1 billion this year, it’s easy to understand why companies are so eager to jump on the bandwagon.

Acquisition of Dogster just a first step for SAY Media

They grow up so fast.

Only six months old, SAY Media announced April 19 on its blog that it has made its first acquisition: Dogster Inc., the creator of community sites for pet owners Dogster and Catster.

SAY Media was created last year with the merger of VideoEgg and Six Apart, but is already on track to make further acquisitions of vertical sites, bringing hundreds of content-specific sites into the SAY family, if CEO Matt Sanchez’s vision for the company materializes.

Sanchez says on the SAY Media blog that this first is “an important milestone,” adding that the company is only just beginning to “to build our portfolio of owned and operated properties by acquiring and launching media sites with strong point of view, passionate editors, and active and engaged communities.”

Ad.ly ousted by Facebook

About a week after rumors began to surface that Facebook would soon be taking stricter measures against users posting unauthorized sponsored material on their social network, Facebook has removed Ad.ly, a company that runs celebrity endorsements on social media, because it violated part of the network’s terms of service.

InsideFacebook reported April 20 that Ad.ly failed to comply with the site’s demands not to “send or otherwise post unauthorized commercial communications (such as spam) on Facebook.” In other words, Ad.ly had been directly monetizing Facebook’s communication channels with their paid celebrity page updates, behavior which, in Facebook’s opinion, degrades both the quality of communication on the site and the user’s experience of it.

Ad.ly still operates with the same business model on Twitter, where it recently had Charlie Sheen pitching Internships.com.

Amazon’s cloud outage drags on for days

Beginning mid-day Aprl 21, a partial failure of Amazon Web Services’ Elastic Compute Cloud (EC2) brought down sites like Quora, FourSquare and Reddit, with some sites, like the NYTimes project site still affected April 22.

Amazon’s North Virginia EC2 was still not operating normally as late as the morning of April 23, though most affected sites were up and running by then.

The reaction by and large has been a newfound disillusionment with cloud computing, leading some to call the outage a “disaster.” Forbes went as far as headlining their story on the incident “the day the cloud died.”

Certainly, the event has had a widespread effect, though the extent of the impact is only so great because cloud computing provides a much needed service for so many. As Quora’s apology for the outage put it, “We’d point fingers, but we wouldn’t be where we are today without EC2.”

Report on smartphone tracking stirs up consumer, corporate reaction

An April 20 article on O’Reilly had smartphone users wary, if not downright paranoid about being tracked on their devices. The report warned that the location of iPhone and 3G iPad users was being intentionally tracked and stored over long periods of time.

The data, which started being collected with the introduction of iOS 4, includes latitude and longitude of your actual location, as well as time stamps, though the article posited that it is unlikely this information is being shared with third parties or that it will do any real harm. Still, the authors posed the question of “why this data is stored and how apple intends to use it.”

The Wall Street Journal added fuel to the fire with an April 20 article revealing that Google’s Android devices have similar location tracking capabilities, though the piece also reminded readers that smartphone users have likely already consented to being tracked, whether they realized it or not, when agreeing to the companies’ terms of service.

Google has admitted to the practice of collecting location data and time stamps, though a statement they’ve issued assures users that “all location sharing is opt-in by the user.”

There might be some viable and valid answer for why these companies are keeping such close tabs on the location of their users, but they’d be best to disclose it. As with anything else, the less one knows about something, the more one tends to fear it, and nobody wants to inspire fear in their consumers.

Location, location, location: EBay to buy Where

According to an April 20 article on AdAge, EBay has announced their imminent acquisition of Where, a mobile location-based service, for an unconfirmed $135 million, as estimated by Boston Innovation.

EBay plans to use Where’s mobile and location services to introduce retailers to e-commerce and help them to better reach customers.

Where’s app helps users find nearby businesses and its hyper-local ad network runs ads within the Where app as well as in others. The service will be synched with PayPal, which will be used as a payment service.

The deal is to be finalized during this year’s second quarter.

PlayStation network hacked but Anonymous denies involvement

This week saw an assault of nerds on nerds, leaving gamers more than miffed at hackers for interfering with their access to a favorite network.

Sony announced on the PlayStation blog April 22 that their PlayStation Network and Qriocity music services had been affected by an “external intrusion” on their system.

Some have pointed the finger at Anonymous, the hacktivist organization that has vowed to wage war on anti-Wikileaks groups. But, the group, which recently attempted a Sony Store boycott, defended themselves on AnonOps, stating “for once we didn’t do it.”

At the time of writing, Sony’s networks are still not up again, and the company appears to be in the dark as to who is truly responsible for the hack.

About Emily Wilkinson

Emily Wilkinson is a Montreal writer and editor who recently joined ReveNews.com. Her experience comes largely from her work at print publications like La Scena Musicale, where she alternated between positions as content manager, copy editor and journalist.
She believes in the importance of strong writing, be it in journalism or in other media, like blogging or even social networking. Her prerogative: though language will and ought to evolve, a good writer need never sacrifice the communicative power of text that is written with thought and care, whatever the venue.
Find Emily on Twitter @EditorWilkinson

3 Responses to Cashing Out: Week of April 17th – 23rd 2011 in Online Marketing News

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