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The deal with Google buying reCaptcha

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Google 收购 reCAPTCHA
Image by Fenng(dbanotes) via Flickr

I had no idea why Google would buy a company, reCaptcha, that does captchas. For those of you who don’t know, captchas are the little squiggly text that people enter to prove they are human. The word “captcha” actually stands for: Completely Automated Public Turing test to tell Computers and Humans Apart

With these things are all over the internet, why would Google buy this specific company? I found out a few reasons. First, they are the original gangsters – it turns out the guy who invented captchas is the founder of reCaptcha. Second, they way they do the captcha words is quite innovative. Check this out: reCAPTCHA takes scans from newsclippings, articles and old books that can’t be read by machines (because they are scans) then feeds them to humans in a captcha one at a time with other words that it knows. The user then enters both words. The word that reCAPTCHA knows is tested – if correct, it now learns an additional word to use on other challenges. This is how they build up their database of words from scans.

Google has for the past 6 years been scanning books like crazy. They have millions of books scanned. What they don’t have is text of those books available to be searched. The thought is that if you use captchas to surface all the words of those books one at a time, this will enable a massive crowdsourcing project to build a database of literature. Very interesting experiment. I never really hear of such clever business development deals. I love it.

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Written by Mike Lewis

September 21st, 2009 at 6:09 am

Why YouTube’s Losses Are Much Smaller Than Expected

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Picture 3There’s been a lot of buzz about a month ago about how YouTube loses money and is a horrible business.  Most of these articles came after Credit Suisse’s published an estimate of YouTube’s losses at $470M a year.  This is a large number and people pounced on it. However, there is a good report i just read (PDF only and downloadable here) that challenges Credit Suisse’s assumptions with some more accurate numbers.  For instance, Amazon Web Services could provide storage for 50% of the costs included in CS’s study.  The survey ends with:

Regardless of what you may hear, YouTube costs are a fraction of any other company running similar operations. Most of Google’s bandwidth is free or near-free; its hardware is cost-optimized; and its data center costs are mostly committed or sunk. The top customers of our sourcing advisory service, whose prices are on average 20% better than the average market level, cannot deliver content as cheaply as Google’s massively scaled operation. Surprisingly enough, the ones that come closest are often thosethat leverage the scale of others through using cloud services.
But even if a fair accounting of its costs showed a loss, YouTube gives Google the ability to achieve needed improvements in lowering cost of other operations. Loud stories about YouTube’s losses can only help deter copyright lawsuits and demands from content owners. Skepticism is warranted — but be ready for surprise news of profitability in the future.

The article does explore the upside of allowing the market to believe the YouTube business is quick unprofitable.  With license-holders eager to renogotiate and reap larger profits, it’s better to all them to perceive that it’s much too expensive to host and deliver these files and thus license payments should be low.

But this is clearly wrong.  In yesterday’s earnings call, Google had this to say about YouTube:

“Monetized views” on YouTube have more than tripled over the last year, said SVP Jonathan Rosenberg. Executives would not say whether YouTube was profitable, although they did say it was on a trajectory to become a “very profitable business for us” in the “not too distant future,” giving a collective heart attack to analysts who have speculated about how much money the site is losing. In a follow-up call with analysts, CFO Patrick Pichette said that the company wanted to reaffirm that YouTube’s business model was credible. “There’s been so much press with all these documentations of massive costs and no business model,” he said.

Interesting to think about next time someone speaks up about how horrible the YouTube business is.

Written by Mike Lewis

July 17th, 2009 at 8:27 am

Go narrow and do 1 thing well

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Image representing Qloud as depicted in CrunchBase
Image via CrunchBase

I did an interview last night for USC business school where i was asked a lot of questions about Qloud and its beginnings.  Questions like “What advice would you give to aspiring entrepreneurs? What have you learned?”  Well here goes…

i often hear people talk about “doing something big.”  While I admire their desire to change the world, i find it interesting that quite often the companies that do end up changing the world started as small passion projects/startups.  And the business model they find is usually nowhere in sight at the beginning.  Some examples:

  • Facebook started as a Harvard-specific tool to get people to better interact with each other.  After it worked well for Harvard, it expanded to the Ivy’s (and Duke & Stanford), then slowly to other schools and eventually everyone.  That wasn’t it’s original goal.  They just wanted to make it easy for people to hook up – i mean, connect
  • Craigslist started as an email list to share functions, jobs and stuff in San Francisco.  They sat in an office and got emailed tips as to what was going on.  They then added some comments and emailed it out and eventually just posted it to a web site.
  • The Google guys were in grad school and staring at some big servers they had.  One idea they wanted to try was to index the entire web.  Once they did that, they then had to brainstorm as to what they could do.  They never started with the desire to dominate web advertising.  Larry Page Speech
Kathy Sierra at SXSW

This thought of doing something you believe in and are passionate about regardless of the size really hit home for me when i heard Kathy Sierra’s keynote at SXSW this year. She had 16 points on how to make breakthroughs happen.  Point #15 was Don’t mistake narrow for shallow. She pointed at hyper-focused blogs like Passive Aggressive Notes and the “Blog” of “Unnecessary” Quotation Marks as mastering a very tiny sliver of the internet. But you could point to the 3 i mention above (Facebook, Craigslist, and Google) as examples of companies that started narrow and gradually expanded to be game-changers.

When thinking about companies, i think it’s important people try new ideas and things they are passionate about. You’re going to be working 24 hours a day 7 days a week on one idea, so you have to love it. Or as Tim O’Reilly says Work on Stuff That Matters.  It’s clear that startups don’t have all the answers when they begin so at least you can start with something you’re willing to continuously think about.

I was again struck with this thought this morning when i read Clay Shirky’s great post about newspaper and the change they are going through.  He too talks about Craigslist saying:

Imagine, in 1996, asking some net-savvy soul to expound on the potential of craigslist, then a year old and not yet incorporated. The answer you’d almost certainly have gotten would be extrapolation: “Mailing lists can be powerful tools”, “Social effects are intertwining with digital networks”, blah blah blah. What no one would have told you, could have told you, was what actually happened: craiglist became a critical piece of infrastructure. Not the idea of craigslist, or the business model, or even the software driving it. Craigslist itself spread to cover hundreds of cities and has become a part of public consciousness about what is now possible. Experiments are only revealed in retrospect to be turning points.

So, my advice to aspiring entreprenuers is – (a) focus o  something you love; (b) don’t focus on changing the world but rather focus on doing something, one thing, extremely well.  If you execute on those 2 points, it’s easy to expand into something more powerful and profitable.

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Written by Mike Lewis

March 31st, 2009 at 1:42 pm

Mobile World Congress wrapup

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I spent the week at MWC in Barcelona this past week.  I made my way to a bunch of booths and companies.  It was a huge show.

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Here are some thoughts:

  • Phone Operating Systems
    • There were many new phones released at the show.  LG announced 50 phones, Samsung had 22 more, Sony/Ericcson announced a new suite of walkman phones, and even Acer announced new phones.  Which each new announcement, you saw that they are all using Windows Mobile.  Windows mobile is EVERYWHERE.  Regardless what you think about it, you can’t deny its traction in the marketplace.  It seems again that Apple will be the better device but Windows will be on more.
    • Windows Mobile is not a good OS for the phone.  It’s bloated and has way too many menus but there aren’t alot of options.  For this reason, i’m hopeful for Android.  Even the new 6.5 still uses 8-bit graphics.
    • There were barely any Android phones at the show and almost no coverage about it – if it’s the new phone of the future, you wouldn’t know it by this show. It seems that very few handset manufacturers are planning on using it. I was surprised
    • Nobody wanted to say it, but the iPhone still kicks the crap out of almost every phone at the show.  Only Blackberry is close. Nokia is getting there too.
  • Microsoft - I went to their booth to check out Live, Windows Mobile 6.5 and My Phone:
    • Microsoft Live – i aksked their expert to give me the demo and explain to me why i should care.  He showed me MSN messenger, Hotmail, their photo tool and i kept asking, “why should i care?” and he could never give me an answer.  There is nothing special here.  I think this suite is a good metaphor for the company itself.  Internet 1.0
    • Windows 6.5 – It is an improvement over 6.1 but it’s still worse than iPhone. They tried hard to make it like the iPhone but worked just as hard to make it not exactly like it.   Instead of a grid of applications, it’s a honeycomb layout.  My big disappointment is that 6.5 isn’t released until mid 2009.  That’s exactly 2 years after the iPhone launch and it’s still inferior.  I don’t think they’ll ever get it together.
    • The App Store – i was equally excited about this but the big problem is that this isn’t even scheduled to be ready untl late 2009.  They didn’t even have screenshots of it.  Even the MS rep joked that it was typical Microsoft vaporware.
    • My Phone – this is the one thing that i liked from Miscrosoft. It sends all your information from your phone up to the cloud.  You can access it online (numbers, calendar, messages).  You can even search your text messages online.  That’s cool. Of course it’s not tied into Live (see above) because that would make too much sense.
  • Yahoo!
    • they have an app for Blackberry and iPhone.   The app has a “Pulse” which can connect to other social networks and list your friends’ status and activity.  Very much like Plaxo Pulse – even the same name (although nobody in the Yahoo booth had heard of Plaxo).   it’s pretty cool but nothing revolutionary.
    • Remember the days when Yahoo was competing with Google? They are now so far behind that it’s not even funny – especially on mobile. Google has an mobile OS, location-aware apps, Maps on every device, and mobile sites for mail, docs, and tasks.  Yahoo! on the other hand has a huge booth to announce that they now have an application that displays news, mail and RSS feeds.  I’m not impressed.
  • Some other companies i saw:
    • ARM – this is a British company that makes processors.  They compete with Intel but on small devices like cell phones and mp3 players.  Among their typical devices, they also looking to get the chips into laptops.  Not as a replacement processor but as an addition.  The idea is that if you are only going to be surfing the web, you can switch to the ARM processor and get around 19 hours of power.  Whoa
    • Omnifone – this is a Rhapsody type service specifically for mobile phones. They have worldwide liceses from the labels and is working on all Sony/Ericcson phones.  They claim to have a US service at the end of ’09.  I was also amazed how uninformed they were about Rhapsody.
    • TruPhone – a great skype-like app.  It’s an app that that lets you make international calls from your  phone over the internet to get low rates.  It’s a good integration in that if you call someone’s TruPhone app, it rings your regular phone and if both people have the app, it’s completely free.  It’s like Skype but made specifically for phones rather than desktops.
    • Samsung.  They have a Blue Earth phone which is a very cool environment friendly phone.  It has solar panels on its back and is made out of recyleable materials.  I was excited to see it but was pretty disappointed to find that it was only a prototype and they haven’t actually made any of these phones.

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Written by Mike Lewis

February 20th, 2009 at 10:16 pm

Real-Time Search

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I got quite inspired when reading this post by John Borthwick.  First of all, the YouTube data really surprised me in that YouTube is now the 2nd largest search site online, bigger than Yahoo! at over 3 billion searches a month.

Second and more importantly, i started thinking about real-time search.  Finding out what is happening right now on the web is really cool and going to becoming increasingly important and interesting.  As real-time events happen such as earthquakes, sporting events, meetups, etc. we’ll want to search the web and find out what people are thinking.  This is a fascinating new arena that comes with real-time messaging.  We’ve always has AIM and Facebook‘s status messages, but we’ve never had a way to search through them and get a snapshot of what’s happening.  Until now.  Go to Twitter’s search at http://search.twitter.com and type in something and you’ll immediately see what people are thinking and doing on the web.  It’s incredible

picture-31

I’m still getting my head around what this means and how it’ll play out but i have to imagine that real time information will be quite valuable.

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Written by Mike Lewis

February 10th, 2009 at 2:02 pm

Google Latitude

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Image representing Google as depicted in Crunc...

A new feature was released today from Google called Google Latitude.  It’s allows you to post your location onto Google Maps and to see your friends’ locations.  It’s done using GPS and other technologies (Gears, etc.) and works really well.  Here are some thoughts i have on it

First, I like the way it looks and works. The interface is extremely simple.  Entering in info is done inline and the interface is definitely not cluttered with too many bells and whistles.  Adding and viewing friends is also braindead simple.  Overall, it’s a snap to use

It’s a social app but it’s different than a social network. For instance it’s (a) only really useful for people you know, (b) more interesting for people you live close to, and (c) limited to only location information. It’s only a map.  Again, very simple

google-lat

Not everything is great though. One thing i don’t understand is why they force you to access it (on the web) through iGoogle.  I have a homepage already and see no other reason to go to iGoogle.  That’s annoying and i wish it had it’s own site like Google’s Calendar, Reader, Maps, Mail, etc.  Also, I also wish it would use my profile from other Google products. It seems now that i have a different profile for Gmail, Calendar, Orkut, FriendConnect and Reader.  Why can’t there be just one?

Since i’ve had a iPhone, i’ve become much more aware of the usefulness of my location.  When this information is layered onto web services, those services can become much more useful.  I like this new app because it shows that there’s a whole other layer (location) that is just starting to be explored. I can imagine many applications starting to layer in location and serve information based on this.  Ad targeting, ticketing, messaging, groups all change when this is added.

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Written by Mike Lewis

February 6th, 2009 at 2:07 pm

Leaders and Followers

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There’s a new book by Seth Godin called “Tribes” which talks about the startup culture and out-of-the-box thinkers.  Two interesting parts of the book are the parts about followers and the parts about Leaders.

A good question exists talking about the difference between employees and followers.  Employees show up each day and do their tasks whereas a follower is someone who is following a calling. Followers work because they believe not because they are told to do so.   Great companies illustrate this.  You can see people flocking to Facebook and Apple because those companies inspire.  They don’t recruit but spread gospel.  It’s interesting.

This relates directly to the talk about Leaders.  The following characteristics were thrown out in the book:

  • Leaders challenge the status quo.
  • Leaders create a culture around their goal and involve others in that culture.
  • Leaders have an extraordinary amount of curiosity about the world they’re trying to change.
  • Leaders use charisma (in a variety of forms) to attract and motivate followers.
  • Leaders communicate their vision of the future.
  • Leaders commit to a vision and make decisions based on that commitment.
  • Leaders connect their followers to one another.

Makes me think about how i interact with my coworkers and how i behave at work.  Some people are better than others at finding a vision and staying focused on it.  What do you think?  Is this hard for you to do? Do you know some people who are particularly good at it?

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Written by Mike Lewis

January 20th, 2009 at 7:26 am

Recording Life

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I just read a great article by Clive Thompson called “Head for Detail” about Gordon Bell‘s latest experieement.  Please just read the first 2 paragraphs.  It’s about Gordon and how he is recording everything he’s doing (video, audio, emails, web, everything).  He’s been doing it for the past 14 years and is able to bring up almost eveyrthing.  Clive writes about Bell, saying:

He[Bell] had a tiny bug-eyed camera around his neck, and a small audio recorder at his elbow. As we chatted about various topics–Australian jazz musicians, his futuristic cell phone, the Seattle area’s gorgeous weather–Bell’s gear quietly logged my every gesture and all my blathering small talk, snapping a picture every 60 seconds. Back at his office, his computer had carefully archived every document related to me: all the email I’d sent him, copies of my articles he’d read, pages he’d surfed on my blog.

This really resonated with me as i am already trying to record my life. I have photos up on Flickr, i have my ideas going to my blog, i have my mundane thoughts going to Twitter, my videos going to YouTube, and my friend interactions recorded on Facebook.  I’m already on the web but just in the totality that Bell is.  Storage is getting cheaper and cheaper it’s gone from $233,000 for a gigabyte in 1980 to less than $1 today.  Soon there will be enough storage in your cell phone for your entire life to be stored.  I do this because i want to remember. I want my memories to be accesible all the time and reading the article made me realize how inefficent i’ve been in capturing them.

I really like articles like this becaues they make you think about where the world is going and wonder how human interactions and functions will change.  It touches on how humans will change when we no longer have to remember stuff.  I already don’t remember phone numbers beceuase of your cell phone. What if you don’t have to remember people’s names and interactions and you free you mind to be more creative.  Just imagine – that’s what i’m doing now….

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Why did Flickr stop innovating?

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Image representing Flickr as depicted in Crunc...
Why aren’t you better?

I’ve been a big flickr fan for years.  I take a lot of photos and that’s always been my favorite spot to put them.  Flickr‘s been great at pioneering the 2.0 photo experience. They were the first to have a photostream view – not just albums. And they were the first to have tags which allow you to organize your photos in a better way.  However, they haven’t done much lately.  Sure, they added videos which is GREAT but that’s about it.  The look hasn’t changed, there aren’t many new features and i feel that they are getting out developed by facebook’s photo experience and Google‘s Picasa.   Sure those sites have different goals for their photo experience but at least they are moving forward. What’s Flickr done for me lately? Nothing.

Both Facebok and Picasa allow you to specifically name who is in each photo. Facebook does this by “tagging” a photo with a user and Picasa does this by analyzing the faces in the photos.  Both are brain dead simple to use and are really slick.  I’ve always used Flickr’s tags to do this with thier photos but i’d like to more specifically associate a photo with a user.

I also think that Flickr could make the “editing” of photo metadata easier.  The order a picture shows up in your photostream is effectively the date you took it – but if you upload a photo much later, you have to go back and manually adjust the dates so it appears in the right spot. Flickr has always made title and description editing amazingly simply by keeping it in-line but adjusting the date and privacy of a photo still takes you to another page.  Why can’t they make that easier? Same thing with setting a group of photos to a later date. This is too hard to do.

The bottom line is that i still love Flickr but i feel that it’s getting stagnant.  i’m starting to think that Flickr has officially become a Yahoo company and not a nimble startup.  And i don’t want to hitch my wagon to something that is in maintenance mode.  I knew this day would come and i think the day might finally be here. I think i could say the same about delicious too.  That site could have been much bigger than it is.

I’m wondering now – where should my photos go? What’s going to be be even better.  I don’t like how Picasa is only albums but i do like how they are at least getting better and better.  Is there a 3.0 photo experience that i can use?

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Written by Mike Lewis

December 30th, 2008 at 6:40 pm

New Microsoft Services

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Image representing Microsoft as depicted in Cr...

Image via CrunchBase

I’ve been pretty anti-microsoft for a while because it seems that they always miss the boat.  However, they do have LOTS of cash (40+ billion) and a huge development force.  Becauase of this i was surprised they didn’t get more press for the news they spit out last week.  Four big things appeared out of last week’s Professional Developer Conference (PDC):

  1. They announced Azure, a set of cloud services that competes with Amazon’s S3.  Another big player will really solidify the category.
  2. They showed off Windows 7 which is getting high good hype from the blogosphere.
  3. They showed off new Web-based versions of Microsoft Office that were really nice.  They are really late here but if they can get up to parity with Zoho they could dominate
  4. They also released new Mac and Mobile versions of Mesh and further explained how that’ll enable new kinds of Internet-connected apps to be built.

All in all it was a HUGE week for Microsoft. I just don’t know why nobody noticed.  It is because we’re all Mac fanboys and want them to fail (I know i do)?  What do you think?

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Written by Mike Lewis

November 3rd, 2008 at 3:03 pm