How are companies spying on each other these days? One of the surprising ways I’ve heard about recently is through the webcam in boardrooms.

That’s right, apparently it’s easy to hack into some companies’ video conference systems, because they lie outside typical security measures. Companies sometimes set up video conferences so they can be accessed directly on the Internet—leaving the door open for eavesdroppers to listen in on meetings, or even remotely monitor a conference room via the camera.

One local software company is helping organizations guard against this threat—and many others. Boston-based Rapid7 is one of the leaders in the growing cluster of IT security companies around town. Rapid7’s approach is complementary to firms like NitroSecurity (recently acquired by Intel/McAfee) and Q1 Labs (bought by IBM), which help organizations guard against security threats in their computer networks and systems.

What Rapid7 does is help organizations find security flaws throughout their IT infrastructure, and then test whether they’ve been corrected. To fuel its growth, the company raised a $50 million Series C round from Technology Crossover Ventures in November—one of the largest tech venture rounds in the Boston area lately. (Rapid7 has raised $59 million to date.)

“There’s a lot of cyber-espionage going on in business,” says Mike Tuchen, Rapid7’s CEO (see photo, left). The activity ranges from stealing sales plans, financial information, and intellectual property, to the aforementioned boardroom eavesdropping, he says. And, of course, it’s not just companies spying on each other; it’s governments and nation states as well, all trying to get their hands on everything from Citibank credit card numbers to the special sauce in Apple’s iPad design.

What’s a CEO to do? If you’re Mike Tuchen, you take a promising company and try to make it better. Tuchen joined Rapid7 as chief executive in 2008. (The company has been around since 2000.) Previously he worked at Microsoft as a group program manager and general manager of SQL server marketing. An engineer by training, he also worked at Sun Microsystems and co-founded Paramark, a dot-com-era online advertising startup.

When he arrived at Rapid7, brought in by Bain Capital Ventures (the firm’s original VC investor), Tuchen saw a company that had “a great engineering and sales team” but not much else. He says he didn’t have to tear up the company, just bring in some key additions: marketing, channel partners, new processes, and a broader product roadmap, including a more international market focus.

So far the effort seems to be paying off. The company has grown to about 240 employees (about half in Boston), and Tuchen says revenues … Next Page »

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—Venture capitalists invested $269 million in 23 deals in the San Diego area during the last three months of 2011, according to the MoneyTree Report from the National Venture Capital Association, PwC, and Thomson Reuters. That was almost a 20 percent gain in dollars, but a 28 percent slide in deal count from MoneyTree data for the fourth quarter of 2010. For the full year of 2011, the MoneyTree VC survey said $829 million was invested in 104 deals in San Diego, a 5 percent decline in dollars and a 17 percent slide in deals from the $871.7 million sunk into 126 San Diego deals in 2010.

—What should students study now to be prepared for the workplace 10 years from now? We asked that question of 22 Xconomists, including San Diego Xconomists Ramesh Rao, Duane Roth, Drew Senyei, Larry Bock, and Robert Noble. We’ve compiled all 22 answers in an Xconomy special report on education, which you can find here.

—San Diego Gas & Electric hosted a grand opening of its new Energy Innovation Center, which is designed to serve as an energy innovation showcase and education facility, and to meet the U.S. Green Building Council’s requirements for a platinum LEED (Leadership in Energy & Environmental Design) certificate. The center includes a full commercial “food service demonstration kitchen” where San Diego chefs can test their recipes on energy efficient appliances and restaurant owners can learn about the advantages of new and more energy efficient equipment. Utility officials said Commercial kitchens are particularly energy intensive.

—San Diego-based Tealium raised $1.1 million in Series A financing from private investors, and plans to use the funding to expand development of the tag management technology the company created to help enterprise customers manage their online marketing. Tealium said the investors include Limelight Networks CEO Jeff Lunsford, former Visual Sciences CEO Jim MacIntyre, Collective CEO Joe Apprendi, EyeWonder CEO John Vincent, and eValue Group CEO Thomas Falk.

—After previewing their plans last year, the X Prize Foundation and San Diego-based Qualcomm Foundation officially unveiled the Qualcomm “Tricorder” X Prize, a competition offering $10 million to the team that can develop new wireless diagnostics technology. The winning entry must be able to accurately diagnose a set of 15 diseases across 30 consumers in three days, capturing real time, critical health metrics such as blood pressure, respiratory rate, and temperature, and providing information in a consumer-friendly way.

—Qualcomm’s leadership has been talking for several years about the anticipated competition between its ARM-based semiconductors and the CPUs developed for desktop computing in the expanding market for smart devices. Now some of those skirmishes are beginning. Illinois-based Motorola Mobility (NYSE: MMI)  said recently it would use Intel’s (NASDAQ: INTC) latest low-power x86 Atom processor in a number of future Motorola products, marking Intel’s opening move into the smartphone market. A Motorola spokeswoman told me by email, “We will continue to use multiple chip set vendors.” Qualcomm (NASDAQ: QCOM) already has hundreds of mobile devices using its Snapdragon processor, and has been working with manufacturers on hundreds more.

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A lot has happened in the technology world in the past year. So let’s take a minute to reflect on the defining moments of 2011 and where we stand now, as a local tech community with increasingly global impact.

This is by no means comprehensive, or even a summary of the most important stories of the year. It’s just a select few of the biggest highlights and lowlights, organized in spaghetti western fashion (cliché alert).

The Good: Oracle Buys Endeca

Some might argue this wasn’t necessarily “good” for the local tech scene, but Oracle’s $1B+ purchase of Cambridge, MA-based Endeca, the enterprise search and business intelligence firm, was one of the biggest deals of the year, and was kept under wraps pretty well. It will be interesting to watch whether Endeca’s technology and talent give Oracle a leg up in its competition with IBM, SAP, Microsoft, and Google. Endeca, which started in 1999, stands as a testament to the notion that billion-dollar tech companies can be built—and are being built—in Massachusetts. (See Acme Packet, Progress Software, Wayfair, and others on their way.)

Honorable mention: Carbonite, TripAdvisor, and Zipcar each went public with successful IPOs in 2011. That’s three more publicly traded tech companies in Boston that seem to be thriving in a tough market. Who will join them in 2012?

The Bad: RSA Gets Hacked

No one would argue this isn’t bad—and not just for local companies. In March, RSA Security reported a data breach involving its authentication products, which are widely used by big companies and government agencies. The Bedford, MA-based division of data storage giant EMC said it had … Next Page »

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Strange name. Big money. Newton, MA-based Cyber-Ark Software said today it has raised $40 million in investment led by Goldman Sachs and Jerusalem Venture Partners. The deal includes the purchase of stock from existing shareholders as well as growth capital. Cyber-Ark had previously raised $25 million in venture and angel capital.

Cyber-Ark works in the field of information security and identity management software. Basically it helps businesses, banks, and other organizations manage user privileges, sensitive data, and applications security, while protecting against insider threats. Cyber-Ark has been profitable, with 37 percent revenue growth in 2010. The company, which started in 1999, has 170 employees worldwide. It also has the distinction of making my top 10 “boring companies that are actually interesting” list from earlier this year.

This has been a busy fall for New England security software companies. Back in October, IBM acquired Waltham, MA-based Q1 Labs the same Intel’s McAfee snapped up New Hampshire-based NitroSecurity. And last month, Boston-based Rapid7 said it raised a $50 million round on the same day as CounterTack said it had raised $9.5 million and was moving to the Boston area from Virginia.

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This week’s wrapup of Xconomy Seattle tech headlines features two great entrepreneur/investors who will be featured at Mobile Madness Northwest, our action-packed half-day forum Dec. 6 at F5 Networks. We’re pairing up two people whose experiences span big-company products and proto-company startups: Wesley Chan of Google Ventures, and Charlie Kindel, formerly with Windows Phone (and a bunch of other products over 21 years at Microsoft).

As we found out in this profile, Chan led the projects that became Google Analytics and Google Voice—the latter of which prompted his move up to Seattle, where he’s still based today. But instead of working on big projects inside of Google, Chan is now a partner at Google Ventures, where his investments run all the way from consumer apps to life sciences.

Kindel left Microsoft earlier this year to devote more time to angel investing, mentoring and advising startups, and creating a new company of his own. The details of what he’s working on are still under wraps, but Kindel’s experience gives him an interesting and extremely informed perspective on the future of innovation in mobile.

Moderating the discussion with these two smart guys will be Chetan Sharma, the well-known mobile industry consultant and adviser. Get your tickets here—the clock is ticking on the special Saver Rate, our last discounted pricing promotion before the event on Dec. 6.

Other things catching our attention in the past week:

—Windows Phone has a lot of catching up to do if it wants to take the strong third-place competitor’s spot in the mobile platform battles. And critical to that task is getting developers to create a strong ecosystem of digital products and services. Brandon Watson, the developer team lead for Windows Phone, took a look back at the first year of WP7 on the market and reveals some of the specific steps his crew is employing to woo developers to Redmond’s side.

—The Clarisonic skin-cleansing device has been quietly piling up sales (and celebrity customers) by putting the sonic-wave technology behind Sonicare toothbrushes into a cosmetic application. And it’s paid off, now that cosmetics giant L’Oreal has acquired parent company Pacific Bioscience Laboratories for an undisclosed sum.

—Hackathons are growing up. Seattle-based Startup Weekend had quite a year in 2011, even if you don’t count the growing international footprint for its signature events. The entrepreneur education nonprofit’s potential has now been recognized by Google, which inked a new two-year global sponsorship deal. That will give Startup Weekend some cash, but it also allows Google to tap into the organization’s worldwide community of entrepreneurs, hackers, designers, and investors.

—Amazon has been getting a lot of attention in the public policy sphere for its resistance to state-by-state efforts to collect sales taxes online. The e-commerce pioneer has been staunchly, sometimes belligerently opposed to those efforts, and it may be paying off: A bipartisan group of U.S. senators is backing a new national law that would set a nationwide standard for sales tax collections online—something Amazon has long supported. Amazon and its sometime-foes at the National Retail Federation are both supporting this new bill.

—PopCap Games, the casual game maker recently acquired by Electronic Arts, sponsored a new survey that shows an increasing willingness by gamers on social networks to use digital currency and buy virtual goods. The survey shows a pretty significant change since last year, the kind of pace PopCap and others are looking for as they stake out new ways to make money in the free-to-play arena.

—Stockbox Grocers isn’t a tech startup, right? The company, a project of two entrepreneurs from the Bainbridge Graduate Institute, turns surplus shipping containers into mini corner stores stocked with cupboard staples and fresh produce. But in a profile, we showed how even something as low-tech as retail can be heavily influenced by cheap, powerful technology and “lean startup” methods.

—Meanwhile, down in Portland, the team at Urban Airship continues to make news. This week, we saw the mobile app infrastructure provider featured as one of the inaugural investments from Intel Capital‘s new $100 million app-focused fund. The deal also comes with a partnership that will make Urban Airship’s services available to developers working on apps for Windows-based notebooks powered by Intel’s processors.

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Those guys in Portland are pretty busy these days. Urban Airship, the Oregon-based supplier of push notifications and other services for mobile app developers, is being named today as one of the first two investments from a new $100 million mobile application-focused investment fund from the venture arm of tech giant Intel (NASDAQ: INTC).

The amount of Intel Capital’s investment wasn’t disclosed, but the money is part of Urban Airship’s $15.1 million Series C round announced last week, which also included Salesforce.com and Verizon as investors.

In addition, Urban Airship and Intel are partnering to make the startup’s notification, payment, subscription, and location services available for developers working on apps for Intel’s own PC app store, called Intel AppUp, which focuses on portable devices like ultrabooks and netbooks powered by Intel’s Atom processor.

That could be a significant step for Urban Airship. The startup, which had previously been focusing solely on smartphone app developers, already has about 20,000 customers and says its revenue has grown “exponentially year over year.” But adding the Intel collaboration raises the possibility of expanding into millions of devices that run the Atom processor, which could pose a fresh challenge to San Diego-based Qualcomm (NASDAQ: QCOM) and its Snapdragon wireless “system on a chip” technology.

“Our mission is to shape mobile experiences that are constantly getting smarter, more fun and more useful,” Urban Airship CEO Scott Kveton said in a release today. Intel made the announcement at its Intel Capital Global Summit in Huntington Beach, CA. The other company named as an initial investment for the new AppUp Fund is German developer 4tiitoo.

The news also comes on the heels of Urban Airship acquiring San Francisco’s SimpleGeo, a mobile location-services startup. Not bad for a team that first started wooing developers by bringing donuts to people waiting in line for an Apple conference in San Francisco.

Intel has a large semiconductor research and manufacturing office in Hillsboro, OR, which is about a half-hour outside of Portland. The company is one of Oregon’s largest private employers, according to the Intel website.

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Time to round up the latest local funding and deals numbers. Some of this is catch-up from last week.

$500 million—The amount of a planned secondary stock offering by Mountain View, CA-based professional networking service LinkedIn (NYSE: LNKD), according to a November 3 regulatory filing. The company’s principal shareholders include LinkedIn founder and CEO Reid Hoffman, Sequoia Capital, Greylock Partners, and Bessemer Venture Partners.

$500 million—The size of a seventh investment fund closed last week by ABS Capital Partners of San Francisco and Baltimore. ABS invests in late-stage companies in business and education services, health care, and media and communications and technology.

$50 million—New venture financing announced November 3 for Coraid, the Redwood City, CA-based maker of storage systems for virtualized data centers. Crosslink Capital led the round, which was joined by existing investors Allegis Capital, Azure Capital Partners, and Menlo Ventures and new investors Seagate Technology and Kinetic Ventures.

$16 million—The total amount of funding collected in the past two weeks by San Francisco-based streaming video startup Ustream. The company announced October 25 that it had raised $10 million from KT Corporation to open a joint venture in Korea. On November 4, founder and CEO John Ham said that the company had raised an additional $6 million from original investors DCM and Softbank. Ham also said that he would step down as CEO, but remain as chairman of Ustream’s board.

$15 million—New venture financing announced November 3 for Gogobot, a San Francisco-based travel site where users can get vacation advice from social-networking contacts. Launched in 2010, Gogobot is backed by Redpoint Ventures, Battery Ventures, and CrunchFund.

$15 million—New funding announced November 1 for Mountain View, CA-based Appcelerator, which makes software for developing HTML5-based mobile, Web, and desktop applications. Mayfield Fund, TransLink Capital, Red Hat, eBay, Inc., Sierra Ventures, and Storm Ventures provided the funding.

$3.15 million—A Series A financing round announced last week for Chart.io, a Silicon Valley startup focused on cloud-based tools for visualizing business intelligence data. Avalon Ventures led the round, which was joined by Bullpen Capital. Avalon’s Rich Levandov has joined the board of Chart.io, which emerged from the Y Combinator startup incubator in 2010.

$3 million—New funding announced November 3 for Rounds, a San Francisco-based maker of a video chat application popular inside Facebook. Verizon Investments was the lead funder, with Rhodium and Draper Fisher Jurvetson partner Tim Draper also participating.

$500,000—New funding announced last month for San Francisco-based CrowdOptic, which makes software that helps event producers monitor how attendees are using their mobile devices during live events. The funders were not named.

$100,000—The amount Santa Clara,CA-based chipmaker Intel plans to hand out to young entrepreneurs each month through its new Intel Innovators program, which will debut December 1. People aged 18 to 24 can apply for the grants via Facebook; fans will decide how half of the money is distributed, while a panel of judges will distribute the other half.

Twelvefold—The new name for San Francisco-based BuzzLogic, which specializes in what it calls “emotive-based advertising.” The company says it measures the influence, authority, and emotional connections evoked by Web content and designs ads to match.

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New England area security, consumer Web, database, and medical device tech startups have been acquired by firms near and far at a feverish pace in the last week.

—CustomMade, a Cambridge, MA-based provider of an online marketplace for connecting consumers with artisans, raised $2 million in funding from an unnamed group of investors.

—A trio of area Web startups inked financing deals late last week. Cambridge-based education-focused startup BetterLesson nabbed a $1.6 million investment from Highland Capital Partners, General Catalyst Partners, New Markets Ventures, NewSchools Venture Fund, and angel investors. Wikets, a recommendation technology startup, took in $1.5 million in seed funding from from Andreessen Horowitz, Battery Ventures, and angel investors. And Newton, MA-based online video delivery startup PeerApp added $8 million in financing from a group of investors that included Summit Partners. Cedar Fund, Evergreen Partners, and Pilot House Ventures Group.

—This week we’ve seen a slew of acquisitions. Boston-based Localocracy (developer of community platforms) was picked up by AOL’s (NYSE: AOL) Huffington Post Media Group, for a price tag of less than $1 million, according to tech media reports. Hopkinton, MA-based EMC (NASDAQ: EMC) bought Concord, MA-based Zettapoint, a database management technology developer, for an undisclosed sum. In the medical devices space, Hudson, NH-based Atrium Medical will be acquired by Sweden-based Getinge Group.

—More on that: (NYSE: IBM) announced its acquisition of Waltham, MA-based security software developer Q1 Labs, marking Big Blue’s 19th acquisition of a Bay State company since 2003. Financial terms weren’t disclosed for the deal, which is expected to close this quarter. Q1 CEO Brendan Hannigan will lead IBM’s newly formed Security Systems Division, which includes Q1 and other security technology IBM has acquired in the last decade.

—And still more: Portsmouth, NH-based NitroSecurity will be acquired by Intel (NASDAQ: INTC) subsidiary McAfee for an undisclosed sum. Nitro makes technology enabling organizations to much more quickly protect their IT infrastructure from cyber threats and other intrusions.

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Lots of action in computer security, especially around New England.

On the same day IBM said it’s acquiring Q1 Labs of Waltham, MA, the security firm McAfee, a recent subsidiary of Santa Clara, CA-based Intel (NASDAQ: INTC), said it has agreed to buy NitroSecurity of Portsmouth, NH. Terms of the deal weren’t disclosed.

NitroSecurity specializes in what’s called security information and event management. Basically, its software helps organizations protect their network infrastructure and IT environments against increasing levels of cyber threats and intrusions—and Nitro claims to do it fast, in minutes rather than hours.

The company started in 1999 and is led by CEO Ken Levine. A year ago, NitroSecurity announced a $6 million Series B financing round from Brookline Venture Partners, First Analysis, and NewSpring Ventures. The firm also said then that it had acquired the security business of LogMatrix, a Marlborough, MA-based company focused on IT and network management. No word yet on whether NitroSecurity’s staff, which totals about 100, will be moving west or staying put.

Nitro’s software encompasses “network security devices, firewalls, operating system and application logs, vulnerability assessment scans, identity and access management systems and privacy systems,” says Levine in a statement. “It will complement the extensive McAfee security portfolio and help to meet the demanding compliance and protection needs of our joint customers.”

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Time for our data-driven roundup of business and technology news and deals in the San Francisco Bay Area. From biggest to smallest:

$6.3 billion—the aggregate value of the 101 merger-and-acquisition deals involving venture-backed companies in the third quarter of 2011—an 8 percent increase over the second quarter, according to data released today by Thomson Reuters and the National Venture Capital Association (PDF). That good news was balanced out by some bad: only 41 venture-backed companies have managed to go public in 2011, only five of them in the third quarter.

$300 to $350 million—The reported amount that Intel, the Santa Clara, CA-based chipmaker, is paying to acquire Telmap, an Israeli maker of navigation software. Intel said in a blog post that Telmap’s local search and mapping services “helps bring to life our vision for integrated, uniform experiences across consumer devices.”

107 million—The number of iPhones Apple will sell worldwide in 2012, according to a prediction from Janney Capital Markets analyst Bill Choi. That would be a 27 percent jump over predicted 2011 sales of 84 million units.

$30 million—The reported size of the latest funding round for Mountain View, CA-based Coupons.com, announced today. Greylock Partners contributed the funds, joining a group of institutional investors who put $200 million into the digital coupons company in June.

$15.5 million—A new funding round announced today for Axcient, the Mountain View-CA-based provider of backup and disaster recovery services. Scale Venture Partners led the round, with existing investors Allegis Capital, Peninsula Ventures, and Thomvest Ventures joining in.

$4.9 million—A Series A venture round for Mobeam, a Cupertino, CA, startup with software that uses the LEDs illuminating most mobile handset displays to communicate data directly to the laser barcode scanners in supermarkets and other retail locations. According to today’s announcement of the round, Yet2Ventures, Samsung Ventures, Mitsui, and unnamed independent investors provided the funds.

$4.4 million—A Series C funding round announced today for Enkata, the Redwood City, CA-based customer experience analytics startup. New investor IT Farm Corporation participated in the round, which was joined by existing investors Apex, ComVentures, Sigma Partners, and Enkata CEO David Stamm.

More than 250,000—The number of websites that use fonts from Typekit, the San Francisco-based cloud typography startup acquired today by Adobe. The startup had raised just over $2 million from True Ventures, Freestyle Capital, and individual investors Ron Conway, Caterina Fake, Matt Mullenweg, Chris Sacca, and Evan Williams. The financial terms of the acquisition were not disclosed.

20,000—The number of core Twitter users who generate 50 percent of all tweets, according to a Yahoo study cited in this week’s New York magazine cover story on Twitter.

300 percent—The increase in sales at London- and San Francisco-based Huddle in the company’s latest fiscal quarter, according to a release. The company makes business collaboration software platform that competes with Microsoft’s Sharepoint server. Huddle also announced that it has stolen a key international executive away from Salesforce.com: Simon O’Kane, former managing director of Salesforce.com’s UK and Ireland operations, has joined Huddle as its vice president of enterprise.

$100 per month—The starting price of Pantheon‘s new cloud-based platform for building and hosting enterprise websites based on the Drupal content management system. The San Francisco company introduced its service on Friday.

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—TechStars has upped its game in the incubator wars by adding a $24 million fund that will help it offer startups in the competitive program another $100,000 in financing, on top of the small stipends that founders get for the 12-week entrepreneurship bootcamp. The new money, which won’t take effect until next year’s classes, signals that the Y Combinator approach of offering significant seed-stage money may become a competitive need for top-tier incubators.

—Ben Elowitz of Wetpaint explained how being obsessed with the smallest details in TV gossip content can help build a more meaningful distribution system for online media—and might even have some benefits for more hard-core journalism down the road. After being featured as our Xconomist of the Week, Elowitz also saw his startup featured as one of the media partners in Facebook‘s new “open graph” initiative.

—Intel continued fulfilling its pledge to invest more in research initiatives after shutting down its previous standalone labs earlier this year. This time, it was the unveiling of a new research center focusing on “pervasive computing,” the idea that devices and areas of the home and other buildings will be connected, backed by powerful computing, and able to learn by observing human interactions with the environment.

—Startup Weekend is announcing a new board of directors, bringing in notable names from entrepreneurship around the country to help build the nonprofit’s international education mission. The board will now be made up of Kauffman Foundation president Carl Schramm, entrepreneur and educator Steve Blank, venture capitalist Greg Gottesman, investor Brad Feld, Great Kansas City Community Foundation head Laura McKnight, and Kauffman entrepreneurship manager Nick Seguin.

—Speaking of Startup Weekend, community-education startup TeachStreet is hosting an education-focused version this weekend at the UW. The event features some big names, like keynote speakers Vinod Khosla and Mitch Kapor.

—A new art-buying startup called MyArtMatch is officially taking the covers off its website today, offering users a way to curate virtual art collections and even make real-life purchases of prints. The startup is led by founder and CEO Bruce Worrall, who previously worked at digital-art startup Gallery Player.

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You reach for the peppers, dicing them to the perfect size for your famous homemade stir-fry. As the knife does its work, cameras mounted around your kitchen are watching. They log your knife technique and the size of the dice, while sensors at the stove relay the temperature when you add them to the mix.

All the information is beamed to a computer that crunches the data, essentially learning the recipe—and then storing it online, so it can help your cousin in Florida make sure he’s nailing the steps the next time he busts out the wok for a dinner party.

As crazy as that might sound, the march of cheap, powerful, connected, and increasingly smart gadgets means scenarios like this could be just over the horizon. And a rebooted research partnership at the University of Washington is aiming to decode the path to those experiences.

It’s called the Intel Science and Technology Center for Pervasive Computing, a project that brings $2.5 million per year in direct funding from Intel (NASDAQ: INTC). The center is headquartered at the UW, and will be co-led by Dieter Fox, a professor in the UW’s computer science department. Anthony LaMarca, a scientist at Intel, is the other leader. Check out the video below, via Intel, for a glimpse at the vision for the new center.

Fox tells me that the program has at least a three-year commitment, with an option for two more years of funding if Intel wants to continue the investment. The results of the research are intended to be made widely available as published papers and open-source software, Fox says.

Although the UW will be the center’s hub and will have nine people working on the project, researchers from Stanford, UCLA, Cornell, the University of Rochester, and the Georgia Institute of Technology also are part of the core research team. Among the other UW researchers is Shwetak Patel, an expert in sensor networks who just won a MacArthur Foundation “genius grant.”

Fox says the new Intel team is designed to iron out a few wrinkles seen in other types of collaborative research—being small enough to be nimble, but large and diverse enough to tackle wide-ranging subjects like that super-connected smart kitchen.

“Intel put actually quite a bit of trust in the team, where they say, ‘OK, we’ll bring together the best people in the field, and they’re going to do very interesting research.’ And they did not say we should work toward something that could, say five years from now, be a product that Intel could sell,” Fox says.

What Intel does gain (other than some nice press, of course) is insight into the next wave of computing platforms—things that could run on some nice Intel chips.

And that kitchen scenario I sketched out above isn’t just a writing exercise. It’s an example of one practical area that Intel’s research money is targeted toward. Fox says the targets will help the team focus its efforts, which is one key when you bring together researchers from fields as different as low-power sensors and camera-based interfaces.

The new Intel center is a rejiggered strategy for the company’s outside research spending. It previously sponsored standalone labs that collaborated with universities, but switched earlier this year to this new kind of embedded approach, partially to save money on overhead and staffing.

The UW-based Intel center and its counterparts across the country are the keys to a $100 million Intel program to bankroll research at universities. The other centers already announced are working on visual, secure, embedded, and cloud computing research.

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Foreign visitors to Silicon Valley continually mention how willing we are to help, network and connect strangers. We take it so for granted we never even to bother to talk about it. It’s the “Pay-It-Forward” culture.

The Chips are Down
in 1962 Walker’s Wagon Wheel Bar/Restaurant in Mountain View became the lunch hangout for employees at Fairchild Semiconductor. When the first spinouts began to leave Fairchild, they discovered that fabricating semiconductors reliably was a black art. At times you’d have the recipe and turn out chips, and the next week something would go wrong, and your fab couldn’t make anything that would work. Engineers in the very small world of silicon and semiconductors would meet at the Wagon Wheel and swap technical problems and solutions with co-workers and competitors.

A Computer in every Home
In 1975 a local set of hobbyists with the then crazy idea of a computer in every home formed the Homebrew Computer Club and met in Menlo Park at the Peninsula School then later at the Stanford AI Lab. The goal of the club was: “Give to help others.” Each meeting would begin with people sharing information, getting advice and discussing the latest innovation (one of which was the first computer from Apple.) The club became the center of the emerging personal computer industry.

Helping Our Own
Until the 1980’s Chinese and Indian engineers ran into a glass ceiling in large technology companies held back by the belief that “they make great engineers but can’t be the CEO.” Looking for a chance to run their own show, many of them left and founded startups. They also set up ethnic-centric networks like TIE (The Indus Entrepreneurs) and the Chinese Software Professionals Association where they shared information about how the valley worked as well as job and investment opportunities. Over the next two decades, other groups — Russian, Israeli, etc. — followed with their own networks. (Anna Lee Saxenian has written extensively about this.)

Mentoring The Next Generation
While the idea of groups (chips, computers, ethnics) helping each other grew, something else happened. The first generation of executives who grew up getting help from others began to offer their advice to younger entrepreneurs. These experienced valley CEOs would take time out of their hectic schedule to have coffee or dinner with young entrepreneurs and asking for nothing in return.

They were the beginning of the Pay-It-Forward culture, the unspoken Valley culture that believes “I was helped when I started out and now it’s my turn to help others.”

By the early 1970’s, even the CEOs of the largest valley companies would take phone calls and meetings with interesting and passionate entrepreneurs. In 1975, a young unknown, wannabe entrepreneur called the founder/CEO of Intel, Bob Noyce and asked for advice. Noyce liked the kid, and … Next Page »

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American innovation lost big again as the U.S. Senate passed “patent reform” and caved to big business lobbyists at the expense of true innovators in small companies and universities. Bottom line: America has dominated innovation in the world for 100 years based on our patent system and protection of risk-takers. Innovation is the one thing we still dominate in the world economy. It is our job engine. The first rule of governing should apply here: If it aint broke don’t “fix” it.

The sponsors, Senator Patrick Leahy of Vermont and Representative Lamar Smith of Texas, worked extremely hard and were well-meaning, but the big lobbyists hijacked the process. The bill was conceived to solve the problem of truly frivolous lawsuits in the technology and banking industries. That problem was solved in five minutes, and then the big companies got ahold of the Bill and added all their bells and whistles and it passed based on sheer inertia. Few in Congress like this law, but they went along because big companies have more power than true innovators. Many will cheer it just to suck up to their representatives. Not me. Few, like Senator Maria Cantwell of Washington state, had the courage to call the bill what it is and that it “tramples the rights of small inventors.”

We gave some real competitive advantage to Europe and China with our “first-to-file” from first to invent. Now big companies and foreign firms with fleets of patent lawyers can “scoop” university professors and independent inventors by filing first. Our national investment in research and development has been devalued.

A lot of the reform was driven by the fat and happy tech companies like Intel, Cisco, Google and large New York banks. I call them the “infringers lobby” because their overt goal is to use their market power to steal other’s ideas without paying. That is what this bill does with its business methods section and also the new “post grant review” provisions.

These poor companies, most with market caps over $100 billion, whine loudly about how they are being harassed by the little guy. Never a larger load of horse manure have I heard in my 25 years of starting companies. They have forgotten their roots as venture capital-funded companies who relied on patents to get their funding in the first place. Now that they are less innovative, bloated bureaucracies, they want to repress the innovations of the little guy.

These technology companies and big pharmaceutical companies and others will use the new post-grant review clause to slow the patent process down, and to bleed small companies dry. It happens now, and will be much worse in the future, by big companies filing objections to the true innovations over and over, drying up small inventors’ ability to raise capital.

We have inadvertently put another nail in the coffin of American competitiveness. Our future, and the only way we can compete with China, is our unique ability to invent. It is the core American ideal. We can find our way out of any problem, and the little guy, be he Henry Ford, Thomas Edison, Alexander Graham Bell, Steve Jobs, Jonas Salk, or Gordon Moore, can dream big and invent new industries. All protected in their infancy by a strong patent system.

Not a single job will be created by this bill. Just happy smiles from big oil, big tech, and big pharma, lawyers and lobbyists, and with downright glee in China and the EU.

The most alarming fact is this law is just part of an even larger assault on innovation in the USA. Everywhere you turn, there is less capital available, higher taxes proposed on small business investors, more regulations on IPO companies and investors, an FDA gone wild, and crazy immigration and border policies that drive the best and brightest from our shores. The talk in Washington seems to be all about innovation saving us, and the policies seem to be all about killing it.

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New Venture Partners is a VC firm with a twist: It invests exclusively in corporate spinouts. The firm—which has U.S. offices in San Mateo, CA, and Murray Hill, NJ—counts among its successes Flarion Technologies (bought by Qualcomm), GeoVideo Networks (acquired by Wire One Technologies), and Silicon Hive, a spinout from Philips Electronics that was acquired by Intel in March.

In a two-part interview with Xconomy last summer, New Venture partner David Tennenhouse explained why in-house research projects at large corporations often get stranded—and why many of those ventures make for great spinouts.

How has corporate incubation held up through the recent economic turmoil? And how do those incubators differ from the plethora of venture-funded incubators that have popped up over the last year? Xconomy posed those questions and more to New Ventures East Coast partner Robert Rosenberg.

Rosenberg helped found New Venture Partners in 1997, after a stint as a manager at the Boston Consulting Group. He is currently a director of Real Time Content, ShopWell and TimeSight Systems.

Xconomy: Are large corporations still investing in internal ventures, and if so, are more VC firms getting interested in spinouts?
Robert Rosenberg: There is still a huge amount of R&D in the corporate setting, and it has remained steady through all kinds of economic cycles. It’s intended to foster products that can be used by the mother ship. But sometimes, … Next Page »

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I’ve never been particularly fond of the term “killer app,” which has thankfully receded from the lexicon of tech writers—no doubt from heavy overuse.

But during Qualcomm’s Uplinq conference for mobile app developers earlier this month, I was struck by the potential “killerness” of the wireless giant’s initiative in mobile augmented reality, or AR. What initially seemed like an amusing kind of virtual curiosity last year (when Qualcomm and Mattel demonstrated an AR version of the game “Rock ‘Em Sock ‘Em Robots”) struck me this year as a far more pragmatic and relevant technology—with a broad range of potential applications. What Augmented Reality really represents is a potential revolution in the mobile user interface—by simply aiming a camera-equipped mobile device towards an object (or anything, really) and seeing a layer of relevant data, images, or apps superimposed over the real world.

The combination of AR software and hardware that Qualcomm (NASDAQ: QCOM) has developed makes it possible to overlay 3-D virtual images and video content on top of the real world, as viewed through the camera of a smartphone or tablet computer. While there are some AR mapping technologies that use GPS and internal compass inputs to provide virtual labels (visible in the field of view) for shops along a street, say, Qualcomm has focused its R&D efforts on a different approach, called vision-based AR.

Jay Wright

“It’s a different set of technologies that require computer vision technologies that are capable of recognizing things in the field of view,” says Jay Wright, Qualcomm’s senior director for AR business development. While Qualcomm’s technology lies mostly in its proprietary software, Wright says the company is also integrating its AR software closely with its mobile chipsets.

Wright says the AR field traces its roots back to the aircraft maintenance business, as part of an effort to make the complexity of aircraft maintenance and repairs easier for mechanics. The idea was to devise a see-through display that would be head-mounted, so mechanics could superimpose the manufacturer’s schematic for a wiring harness while peering inside a panel at the real thing. “It makes a lot of sense,” Wright says, “because wires need to go in the right place inside of airplanes.”

Qualcomm is now working to make its AR technology the preferred software worldwide, in the tradition of Facebook, Google, and Microsoft.  “What we are doing commercially is we are taking this software technology for vision-based augmented reality and we are making it broadly available [for free] to all Android developers, and we also just announced that we’ll be making it available to iOS developers as well,” Wright says.

Because vision-based AR apps are very computationally intensive, Wright says, they take a lot of processing power. So Qualcomm has optimized its AR software to perform especially well on the company’s higher-end Snapdragon chipsets. By making its software widely available to app developers (Wright says more than 7,000 so far), Qualcomm is both driving demand … Next Page »

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Intel Capital, the venture investing wing of the giant Santa Clara, CA-based chipmaker Intel (NASDAQ: INTC), announced yesterday at an event in New York that it has invested $24.5 million in four information technology startups. The new Intel portfolio companies include Burlingame, CA-based CrowdStar, which makes social games for Facebook and mobile devices; Las Vegas-based webcaster iStreamPlanet; Calabasas, CA-based Music Mastermind, which is developing an online platform that will let musicians create and share songs; and Orangeville, Ontario-based PerspecSys, a cloud data security company working with Salesforce.com.

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It’s no secret that some big West Coast players have shown interest in Boston’s homegrown mobile technology lately. In the past few weeks, San Jose, CA-based eBay (NASDAQ: EBAY) has bought Where, a location-based mobile advertising and recommendations provider, and mobile payments startup Fig Card, to roll into its PayPal division.

But Boston-based Skyhook Wireless has a slightly different relationship with a Bay Area Internet giant. It’s been wrestling in court with Mountain View, CA-based search engine giant Google (NASDAQ: GOOG), around its location-finding technology for mobile phones. Skyhook has sued Google for alleged patent infringement, as well as alleged interference by Google with deals Skyhook had inked with Motorola and Samsung for devices running on Google’s Android smartphone platform. (You can read more about the lawsuits here and here.)

It looks like there’s still a long way to go for that case to be resolved—last week lawyers from both sides met before a Suffolk County Superior Court. Google’s lawyers asked for the judge to throw out the case, on the basis that Google had pre-existing agreements with device makers, in which some of its standard apps automatically collected location data. Meanwhile, Skyhook’s lawyers re-emphasized their claim that Google road-blocked Motorola and Samsung from following through on agreements to ship smartphones with Skyhook’s XPS software, which determines a user’s location using WiFi, cellular, and GPS access points.

Yesterday, the judge denied both Google’s motion to dismiss the case and for a summary judgment, court documents show. The case will now to go into full discovery to gather the necessary documents and depositions, a period that could take six months—a timetable suggested by Google lawyers last week.

So it’s a small victory for Skyhook, but its legal work is just beginning. “Their goal is to try and bleed us out and our goal is to try and make sure we get the facts brought to light,” Skyhook CEO Ted Morgan told me this week.

Meanwhile, Skyhook has been nabbing some bigger victories out of the courtroom. This week it announced that MapQuest, the San Francisco-based mapping division of AOL, will use Skyhook’s technology in an upcoming turn-by-turn navigation app for Android phones. Skyhook has inked similar deals with UberMedia, Citysearch, and Priceline over the past few months.

“In the meantime what we’re doing is going after all the top Android apps that offer location,” Morgan says. “That way we’ll get on every Android device, but it will be through the apps instead of device makers.”

Google’s and Apple’s impending appearances before a U.S. Senate committee also shed some positive light onto Skyhook’s technology, he says. Lawmakers have expressed concern over reports that Apple logs user location data on mobile devices. Google, which has claimed that … Next Page »

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Troubled 4G wireless network operator Clearwire (NASDAQ: CLWR) had some positive news today, reporting that it and majority shareholder Sprint had resolved a dispute over wholesale pricing. Sprint (NYSE: S) will pay at least $1 billion over the next two years for use of Clearwire’s service, the companies said in a joint statement.

Interim Chief Executive John Stanton told the Wall Street Journal that the cash allows Clearwire to “operate efficiently over the next couple of years” and plan for expansion. Stanton took over the CEO’s job last month, after Bill Morrow and two other top officers left the Kirkland, WA-based company. Clearwire said at that time that it believed an agreement with Sprint was imminent. Clearwire founder and longtime wireless leader Craig McCaw resigned as chairman a few months back, and late last year Clearwire reported that it was cutting 15 percent of its workforce.

The deal announced today gives Clearwire $300 million this year, $550 million next year, and a $175 million prepayment to allow Sprint continued access to Clearwire’s 4G services. The two companies also said they have an agreement for Sprint phones that operate both on Sprint’s 3G network and Clearwire’s 4G system.

Stanton also declined to comment when asked by the WSJ whether Clearwire was discussing a possible takeover by Sprint, and said Clearwire would need more money if it decides to expand its 4G network to include a second type of technology, known as Long-Term Evololution or LTE. He did say Clearwire’s current investors, which also include Google, Comcast, Time Warner Cable, and Intel, may be interested in helping.

Clearwire’s current network is based on a technology called WiMax, but the company has tested LTE systems, and said it is “technology agnostic.” LTE is more widely used by other wireless companies.

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Besides snow and rain (and other April Fool’s jokes), ‘tis the season for business plan competitions around Boston. You might know all about MIT’s $100K contest and Harvard Business School’s equivalent, but there’s a lot more going on out there—and a lot of talented young people vying for a taste of entrepreneurial success.

Here’s a quick sampling of five university-based contests going on around town, and their finalists (certainly not a comprehensive list):

—Tufts University is running its seventh annual $100K business plan competition. The final pitches are happening next week, April 6. Here are the five finalists in the social entrepreneurship bracket: Educate Lanka (student scholarships, Manjula Dissanayake), Give 2App (smartphone apps for nonprofits, Artem Efremkin and Shabazz Stuart), Kabuk (earthquake kits, Mustafa Tuzcu), Saathi (sanitary pads, Nithyaa Venkataramani), and Sanergy (green toilets, Gaurav Tiwari).

And the six finalists in the classic competition: InstaCard (cash in gift cards, Warren Davis), Rentcycle (local business rentals, Kevin Halter and Sean Zinsmeister), Roof For Two (motorcycle accessories, Andrew Altman), RxCap (smart pill containers, Nathan Scott), Salary View (college career services, Kenny Berlin), and Saves on a Plane (airfare deals, Ade Baptista).

—Babson College, which says it founded the first college business plan competition in 1984, is in the midst of its $100K+ undergraduate and graduate business plan competitions. The final round takes place on April 14. Here’s a rundown of the three graduate finalists: Atiken Renewables (agricultural waste to energy), Golden Health Guide (online reviews of home medical products), and SkyCrepers (fast-serve crepe franchise).

And the three undergrad finalists: Down to Earth Waste Solutions (small-business waste collection and composting), Nodes (online collaboration and group social networking), and Redeemr (business intelligence and customer retention for small to businesses).

—Boston University’s $50K “new venture competition” is down to its final four, just like March Madness. The BU finals are next week, April 6. Here are the four finalists: ACCEasy (accounting software for Russian businesses, Katsiaryna Akhlopkava), Handlebikes (better bicycles, Fredrik Fjellsaa), Nyumba (pneumonia diagnostics by cellphone, Andrea Fernandes), and RayVio (efficient ultraviolet LEDs, Yitao Liao).

—The MIT Entrepreneurship Competition’s $100K business plan contest is well underway. The semi-finalist teams (five teams in five tracks, plus wild cards) are currently in their mentorship program hurtling towards the finish line on May 11. You can see a full list of the semi-finalists, which were announced in early March, here. A few that caught my eye, mostly because they have interesting names: SaferTaxi (mobile track; cab rating and registration system), iHelmet (products and services; no idea what they do), Boss (life sciences; bone graft tool), Waste to Watts (emerging markets; sounds self-explanatory for power generation), and All Cows Eat Grass (music lessons) and VisualizeMe (social graph), both in the Web/IT track.

—Lastly, Harvard Business School’s business plan contest is just getting started. Business plan entries are due next week, April 7; there’s a “business venture” track and a “social venture” track. The whole competition is done by the evening of April 26.

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