It’s been a busy week around here for the big tech companies. At Xconomy, we don’t usually report on things like product releases from Microsoft or sales figures from Amazon—our main focus is on new ideas, models, and companies—but readers need to understand where the big players are heading so they can see the gaps and opportunities for new businesses. So, for each of these pieces of mainstream tech news, I’ll tell you why savvy innovators and business leaders should care.

—Google (NASDAQ: GOOG) demonstrated its Web-based Chrome operating system for the first time in public yesterday. It won’t be available for another year, but the tech community is scrambling to understand all the implications. (Google’s Seattle engineers have contributed technology to the Chrome Web browser, helping to boost security—one potential advantage of a cloud-based operating system).

Sure, a fully cloud-based OS is a direct threat to Microsoft’s business model and the ecosystem of companies that support Windows. But more than that, it could reshape the landscape of online advertising by providing a new platform for launching ads on mobile devices, video channels (YouTube), and Internet TV. Perhaps the only thing that can slow down Google’s dominance on the Web is the federal government. In other words, this could get ugly.

—Microsoft (NASDAQ: MSFT) has teamed up with LinkedIn to provide info about your business contacts within Outlook e-mail. It’s all part of Microsoft’s Outlook Social Connector, an add-in that feeds you data from your social networks. Integrating e-mail with social networks and search is a fast-growing area, with startups like Gist in Seattle (backed by Paul Allen and Foundry Group) helping lead the way. Gist’s CEO T.A. McCann told TechFlash that he’s known about Microsoft’s effort for a while and doesn’t see it as a direct challenge. Gist’s offering is more advanced, he said, and it includes features like integrating with Salesforce.com and the iPhone. But startups and investors beware: if you’re in this crowded space, you better have a product that cuts through the noise and has a way to attract customers fast.

—RealNetworks (NASDAQ: RNWK) is in discussions with Viacom’s MTV Networks to sell off at least some of its stake in the Rhapsody music service, as first reported by PaidContent. In a regulatory filing, prompted by a tender offer to issue new stock, Real said it is in talks to reorganize the management structure and/or corporate governance of the division, which might mean giving up its majority ownership stake (51 percent) in Rhapsody. Back in September, digital-media guru Bill Baxter (now at Seattle-based Cozi) wrote in Xconomy about Rhapsody’s fierce competition with Pandora, iTunes, and piracy. Message to startups: the world of digital music services is probably not where you want to be.

—Amazon (NASDAQ: AMZN) has been busy ramping up operations ahead of the holiday shopping season. Its billion-dollar acquisition of Zappos is helping it expand into shoes and apparel, and its Kindle sales look poised to take off, especially now that Barnes & Noble’s competing e-book reader, the Nook, has sold out until January. Amazon has really become the business and technology model to follow in online retail and product search. While there is still room for e-commerce startups to compete in various niches, they would be wise to study how Amazon built its brand and customer relationships before branching out to the wider world of retail.

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Who says consumer websites are dead? Maybe you don’t need the ridiculous traffic of, say, Seattle-based Cheezburger Network (LOLcats) to survive on advertising revenues. Maybe user-generated content around a targeted niche, especially where there are purchasing decisions being made, can work well after all.

That’s the sense I got after talking with Tom Seery, the founder and president of Seattle-based RealSelf. Launched in 2006, RealSelf.com provides information about cosmetic treatments in an online community format that includes user reviews, doctor listings, and expert advice from cosmetic surgeons, dentists, and dermatologists. The treatments in question—a multibillion dollar market worldwide—run the gamut from nose jobs and tummy tucks to orthodontic braces and breast implants.

RealSelf is particularly interesting because it sits at the intersection of a number of fast-growing (but also challenging) areas for startups—social and community review sites, health 2.0, and ad-supported media sites. The company has gained some traction, growing 150 percent year over year in Web traffic; it now gets more than 700,000 unique visitors per month, Seery says. In terms of local startups with a similar strategy for capturing niches of Internet content (but these are not competitors), I’d mention Avvo, TeachStreet, Raveable, Redfin, Urbanspoon, and Zillow.

Like most promising startups, the story of RealSelf began with some important personal and business observations. Seery was a longtime employee of Bellevue, WA-based Expedia (NASDAQ: EXPE), and he saw the competing startup TripAdvisor plug away at hotel reviews and other user-generated ratings until 2004, when IAC (which then owned Expedia) had to buy it. “That was the ‘aha,’” Seery says. He thought, “Where else can we take this empowerment of consumers?”

Around the same time, Seery’s wife was researching a laser cosmetic treatment, and was having a hard time finding trustworthy reviews. So he thought, “Let’s create TripAdvisor for the cosmetic space.” The key adjustment he made was to introduce medical experts to the user community. The challenge there, as with most e-health sites like WebMD and Revolution Health, is that doctors are …Next Page »

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I sat in on a good venture capital panel yesterday at Mobile Northwest 2009 in Seattle. No huge arguments or chair throwing to speak of (we’ll see what we can stir up at the next few Xconomy Forums). But some solid and useful observations from Geoff Entress of Voyager Capital, and also a prominent Seattle-based angel investor; Adrian Smith of Ignition Partners in Bellevue, WA, an expert in telecom and wireless; and Puneet Tandon of Bellevue-based T-Mobile USA, who is looking to sign partnerships with top entrepreneurs in digital media and social networking. (You can also see some comments from mobile VC Tom Huseby’s keynote here.)

The panel was moderated by Tricia Duryee, the Seattle-based correspondent for mocoNews, a website that covers wireless telecommunications. Here are my quick “top three” takeaways from the discussion of the local mobile industry:

1. The panic may be over, but caution rules. Entress says he’s added nine companies to his portfolio this year, out of a total of 32 he’s involved in (and six mobile firms, including TravellingWave, Swype, Dashwire, and Treemo). “We’re definitely not out of the woods yet,” he said. “But 2010 might be a good year for selling companies.”

2. It’s not all about the iPhone. Entress and Smith pointed out that Apple has only 17 percent of the smartphone market, so there’s plenty of opportunity on other platforms, like the BlackBerry and devices that use Windows Mobile. “Apple has a huge amount of mindshare,” Smith said, “but the critical thing is the development environment around [mobile applications].” Tandon agreed, saying, “Barriers to doing business with us [carriers] perhaps have been lowered.” Entress stressed the importance, especially for startups, of trying to avoid “getting locked into any one carrier, handset, or operating system.”

3. Watch advertising, input technologies, and connected devices. Tandon pointed out that by sometime next year, there are projected to be 3.3 billion Web-connected devices, and 70 percent of them will be connected via wireless operators. That means carriers will be willing to pay to know “who are the social influencers in your subscriber base,” he said. Smith and Entress said Google’s $750 million acquisition of AdMob signifies that mobile advertising is here to stay—but that the deal was the “first one out” (like YouTube for video), so don’t look for anything near that sort of valuation again. Entress added that he’s working with a number of startups selling new ways of inputting text on mobile devices (using speech recognition, touch-screen methods, and so forth). For all our fancy gadgets, it seems we still struggle to communicate.

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Craig Mundie is a geek, and I mean that in the best possible way. Microsoft’s chief research and strategy officer, the 17-year veteran of Redmond, WA, still talks like an engineer, throwing out terms like “heterogeneous machine architectures,” “GUIs” (graphical user interfaces), and “clouds and clients” like there’s no tomorrow. It’s kind of refreshing, given that he is in charge of setting the long-term agenda for one of the most powerful companies on the planet.

Mundie is in the midst of a weeklong tour of some top universities around the country. He called me yesterday from Cambridge, MA, where he had just finished a presentation to Harvard University students, faculty, and guests. He visits the University of Illinois at Urbana-Champaign (my alma mater) today, and comes to Kane Hall at the University of Washington tomorrow afternoon. It’s similar to the college tours Bill Gates used to do.

From what I can tell, the goal is to stir up interest in computer science, give audiences a glimpse of future computing systems as Microsoft sees them, and stimulate discussions about how these technologies can help solve some pressing global problems. (You can read more about Mundie’s tour and demos in this Seattle Times story.)

Besides hearing Mundie’s thoughts on computer science education and the future of computing, I wanted to drill down and ask him about the challenge of taking on Microsoft’s strategy development (after Gates stepped down last year) in the most difficult economic times in recent memory. I also wanted to ask him about the deeper culture of Microsoft, the renewed role of research in the company’s future, and the importance of nurturing relationships around the world—and his secret ally in that quest.

Here are some edited highlights from our conversation:

Xconomy: What are you trying to get across to university audiences on this tour?

Craig Mundie: In these presentations, I’m trying to get them to think not only about how computing evolves, but with that evolution, what kinds of problems will become approachable, and what are the new methods? Several things are evolving in parallel [and leading to more heterogeneous and complex machines]. That begets the requirement of how to do programming around parallel computing. With very high-scale computing facilities, the cloud and the client come together to form one system that people will program. They will use those things together with new display and sensing technologies.

Just as the GUI revolutionized computing, we could see a similar revolution with more natural interactions with machines, rather than just “type and point and click.” That will expand the number of people who can interact with computers. With the diversity, rooms can become computers [for instance]. You won’t think of them so much as a computer.

X: What are some of the global problems you think advanced computing will help solve?

CM: Beyond the computer science realm, I’ve talked about energy and the environment. I show one piece of research work we’re doing to compose computational models, a simplified climate model, at Princeton and Microsoft Research. It shows linkages between deforestation in the Amazon and atmospheric temperatures around the rest of the world. If you were a policy person, these kinds of things would give you tools to support your decision making.

In energy, we’re doing computer modeling and direct visualizations. I showed a model, loaned to us from TerraPower [the nuclear power firm spun off from Nathan Myhrvold’s Intellectual Ventures …Next Page »

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[This post also appears on OVP's blog---Eds.] The University of Washington’s Computer Science and Engineering (CSE) department’s Affiliates day is one of the most fun and rewarding days of the year for me as venture investor and geek. It involves a showcase of projects and research areas by professors and students and is a festival of creativity, new ideas, and engaged smart people. It is a day my colleagues and I look forward to every year.

Last Thursday’s meeting ended with a panel on “The Changing Face of Venture Capital” moderated by UW’s Ed Lazowska, who prompted us with a series of provocative questions. On the panel with me were Greg Gottesman of Madrona Venture Group, Ron Howell of WRF Capital, Bill McAleer of Voyager Capital, and Cam Myhrvold of Ignition Partners.

One of the first topics was the impact of the recession on startups and venture capital. Most VCs expressed the opinion that money was harder to find but that if you could get funded, it was a great time to start a company because skilled people were available, cloud computing providers such as Amazon have made it possible to do with less capital, and there were fewer competitors being funded. There was recognition that it has to be done with less, given the exit markets. But if anything, Greg Gottesman said Madrona is sticking to its model and not changing given a one-year blip.

Cam Myhrvold made the point that there were a lot of entrepreneurs using Amazon Web Services and open source to quickly bootstrap companies with much less capital than prior years. My comment was that if you play at the application layer using open source and AWS, you better think hard about marketing and customer knowledge since there are few technical barriers to entry.

One topic that was raised was why should entrepreneurs go for VCs over angels, money aside. I disagreed that money could be ignored and said that the quality of money was critical in these times. The recession has meant that almost all companies have needed more cash and, given that outside funding is tough, insiders had to step up. Many investors have not stepped up, which has made all VCs more conscious of the quality of their co-investors.

Ed asked what areas were particularly attractive for Seattle, and we got a consistent set of answers. Digital media, gaming, software, and the emerging areas of IT applied to green tech and IT applied to biology are core areas of interest. Each firm had its own areas of interest—for instance, Bill McAleer liked mobile apps and the application of social networks to the enterprise as one of his areas. Bill related a story from a recent trip to NYC where the cab driver was touting his favorite iPhone app—a map of all the public bathrooms. When asked about really innovative new ideas, Greg Gottesman mentioned 3-D printers and how his son was willing to empty his bank account to get one.

At OVP, we like the investment thesis that green tech and biology are becoming more compute-intensive, and that companies that can bring a view of IT applied to these areas are particularly attractive.

My conclusion from the evening is that Seattle is a great place for innovation and has a set of dedicated VCs who want to see a vibrant, risk-taking community. Each firm had its own areas of focus, some overlapping, but all were focused on creating great companies and skilled entrepreneurs here in Seattle. I left feeling that we were lucky to have UW CSE, a great research department generating innovative ideas, and a VC community very committed to fostering growth.

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Doing some home remodeling? Need someone to clean that pesky gutter? Karim Meghji has an offer for you.

Meghji and Dave Richards, both veterans of Seattle-based RealNetworks (NASDAQ: RNWK), have been busy working on their home-services networking site, HelpHive, since it was first publicly introduced in May. The community site helps people find reputable businesses in the Seattle area that do home repair, maintenance, remodeling, cleaning, and the like. The idea is that consumers leave reviews, and people in your social network can recommend local businesses for getting specific jobs done. If done right, it should work a lot better than doing Google and Yellow Pages searches.

Up to now, HelpHive has been free for both consumers and businesses that sign up to be on the site. But today, the company is starting to test a paid model for businesses. (It’s still free for consumers.) So home-services businesses—everyone from plumbers and electricians to landscapers and carpet cleaners to pest control—can pay an annual fee ($99 for an introductory premium plan) to be listed on the site. Then HelpHive uses a “pay per job” model, whereby the company takes a 5 percent commission on any referral that leads to an actual job; if the referral doesn’t lead to a job, the business pays a nominal $5 fee, which is aggregated monthly. That’s different from a lot of online services that charge primarily for leads or referrals, or phone calls, whether or not they turn into revenue for the company. (Which approach is more lucrative depends on how well the service companies do.)

“As their business ebbs and flows, we’re more directly tying our compensation to their compensation,” Meghji says. And, he adds, “Our leads or referrals are higher quality.”

Meghji says the site is getting 9,000 to 10,000 unique visitors per month, and has some 7,600 businesses listed. The plan, he says, is to “stay focused on Seattle. Get it right, get the business model working, and once we get the formula really figured out, then we would look to replicate it in other markets.” Other Internet companies working in the home-services space include Colorado-based ServiceMagic and Silicon Valley’s Redbeacon.

HelpHive has been self-funded since its inception in the summer of 2008, with some contributions from friends and family. The company has four full-time employees and a couple of part-timers. Meghji says it’s still too early to talk about raising outside funding. “The goal is to show the business model connects to the overall value proposition,” he says. “We want to make a good case with real data, and prove the model.”

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Social media monitoring and business networking software just got a little hotter. Jive Software, the Portland, OR-based maker of social business software, announced last night it has raised a $12 million Series B round from Sequoia Capital. Sequoia previously invested $15 million in Jive in 2007. Jive says the money will be used to expand its product development, as well as enlist new partners and hire more sales and customer support people.

It’s a huge vote of confidence in Jive, and it speaks to the increasing importance of software that helps companies collaborate, network, and build communities around their brands and products. Last month, Jive released a new tool for monitoring social media and helping businesses engage with online communities—a trend that several other Northwest companies are pursuing, such as Seattle-based Appature, Marchex, and Visible Technologies.

Back in March, Jive rolled out an updated version of its flagship product, a platform that combines software to help employees collaborate more effectively with tools for building online communities. It was an important part of Jive’s strategy to sign up more big companies as customers, and it seems to be working—in addition to giants like Intel, Nike, Electronic Arts, SAP, and VMware, Jive has added Cricket Wireless, Experian, InterContinental Hotels Group, Lufthansa, McAfee, and others this year. The company says its revenues in the third quarter of 2009 were double those from the same period last year, and it has maintained profitability.

On his company blog, Jive CEO Dave Hersh wrote, “Jive is in the midst of the greatest period of product innovation in the company’s history. We have recently and will soon deliver new products that will push the envelope on what people think Social Business Software can do.”

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It’s one of the great mysteries of the modern Internet. How can Web publishers make more money from their content? For everything from blogs and journalism to games and entertainment, publishers and software companies alike have been trying to solve this problem for many years.

Now BigDoor Media, a six-person startup in Bellevue, WA, thinks it has found the right approach, at least for a certain market. Its basic idea is to provide a revenue stream for entertainment publishers that bridges the gap between traditional advertising and subscription models. BigDoor, which is emerging from stealth mode today with a beta version of its software, provides an “offer platform” that acts as a gateway to a website’s premium content. Instead of paying for a game by credit card, say, a consumer can opt to fill out a survey, sign up for a newsletter, or buy an advertiser’s product (like Fiji Water, for instance).

This is not an entirely new idea. And in fact, BigDoor operates in a similar space as many other Seattle-area startups we’ve reported on, including AppBank (for social entertainment applications), DevHub (for creating and hosting websites), Mpire (for online-ad optimization), Wetpaint (for social publishing), and Others Online (for behavioral profiling of audiences), which was acquired this summer by the Rubicon Project. These companies have different customers and revenue models, but they are all fundamentally trying to help Web publishers make more money from their content.

What seems to set BigDoor apart is the experience of its founders. Keith Smith and Jeff Malek spent about 10 years in the online advertising world with Bellevue-based Zango, the controversial “adware” company that closed down earlier this year. Smith was CEO and co-founder of Zango, while Malek was vice president of engineering and products. Zango had success but eventually ran into problems, in part because adware in general—software that tracks which sites you visit and delivers targeted ads—became widely reviled by people who felt it violated their privacy or was just plain annoying.

The key is that Smith and Malek seem to have learned from their mistakes as well as …Next Page »

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Microsoft’s latest reorganization, which involves labs in both the Seattle and Boston areas, has a new face. It’s Lili Cheng, a 14-year Microsoftie with experience in both research (social computing) and products (Windows Vista user experience). Cheng now officially leads three separate groups that are being rolled into one: her Creative Systems Group within Microsoft Research in Redmond, WA; Rich Media Lab led by Kostas Mallios, also in Redmond; and Startup Labs in Cambridge, MA, led by Reed Sturtevant.

Yesterday, chief software architect Ray Ozzie announced the creation of the new entity, called FUSE (Future Social Experience) Labs, which will focus on social computing as applied to Microsoft products in entertainment and business. Sturtevant, the founding managing director of Startup Labs, is leaving the company, while Mallios will continue to report to Ozzie and is taking on business development duties involved with technology incubation.

But back to the lab’s new head, who spoke with me from Cambridge yesterday. Cheng, after inheriting about 70 staff members from Startup Labs and Rich Media Lab, now manages about 80 people in FUSE Labs, and says she will be splitting her time between the Seattle and Boston areas. She said the employees of Startup Labs (there are 30-some staff members) will be staying in Cambridge.

As Cheng explains, the goal of FUSE Labs is to “bridge the gap” between research and products—an oft-heard refrain at Microsoft (and most big companies)—by working on projects that are two to five years away from commercialization, and interacting closely with product teams.

The specific focus of the lab is social computing—applying social media (things like Twitter, Facebook, and other social-network technologies) to problems in business collaboration and entertainment. The high-level strategy here is to “embed social activity into business scenarios” for Microsoft, Cheng says. She didn’t say anything more specific about Microsoft’s plans for social media, or about how the employees in Startup Labs and Rich Media Lab will be integrated into the social theme. But she adds, “Interacting with other people is so personal and emotional to every single person out there. It’s important for every company out there.”

Cheng’s team has previously built applications like Kodu, which lets kids create games and stories using an Xbox controller and share them on a community games channel; and Salsa, a prototype that connects your e-mail inbox with social networks. (The latter sounds a lot like what the Seattle startup Gist, led by ex-Microsoftie T.A. McCann, has built and is actively testing.)

Asked what her greatest challenge is in the new job, Cheng said it’s addressing how to “take best advantage of this amazing opportunity.” Having been in the social computing space for many years, she says, now it’s time to “just go for it.”

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Seattle-based Pet Holdings, owners of I Can Has Cheezburger and other humor websites, has formed a partnership with Dogster, a San Francisco-based social networking site, whereby Dogster will sell ads for Pet Holdings’ animal-related sites. The news was reported by TechCrunch, which also notes that the Cheezburger network will hit one billion page views this week. Financial details weren’t given, but TechFlash reports it’s the first deal Pet Holdings has done with a premium ad network in a very specific niche. The deal makes sense, as Dogster will benefit from Pet Holdings’ greater traffic, and Pet Holdings will benefit from Dogster’s ad monetization expertise.

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Portland, OR-based Jive Software announced it is providing the social networking and collaboration software for National Journal Group’s 3121, a professional networking tool designed for U.S. congressional members and staff. Financial terms were not disclosed. Jive works with a number of U.S. government agencies, including NASA, the Army, the Air Force Medical Service, and members of the intelligence community.

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Every time I look at Gist, it’s a little different. Given it’s a scrappy startup trying to navigate the worlds of e-mail, social networking, business software, and Web search—each a huge market opportunity, each hugely competitive—this is probably a good thing.

The Seattle company, backed by Paul Allen’s Vulcan Capital and Colorado-based Foundry Group, is announcing today that its software, which has been in private beta trials for the past year, is now available to the general public. Gist bills itself as an online service that helps people manage their personal and professional relationships more efficiently.

The basic idea is to provide a Web dashboard that finds your contacts from your e-mail inbox and social networks (Outlook, Gmail, Twitter, Salesforce.com), and keeps you up to date about these contacts—even ranking their importance—through online information from blogs, articles, tweets, and updates on Facebook and LinkedIn. So, before your next business meeting, instead of having to Google around or search on Twitter to get up to speed on notable developments, Gist will surface any recent activity involving your contact, says Gist founder and CEO T.A. McCann.

It’s an ambitious product. Since the company’s $6.75 million Series A funding round from Vulcan and Foundry Group was announced in May, Gist has buckled down and focused on listening to customers (about 10,000 and counting) and improving its software and interface. It also moved into new office space near Qwest Field.

Among the new wrinkles in the software: Gist can filter information based on which people you’re meeting with this week, or which people you’ve exchanged new e-mail with; the software can also hook into customer relationship management through your Salesforce.com contacts; you can invite other people to try Gist, so there’s a viral component to the product distribution.

“There are probably a whole bunch of users who can get a lot out of Gist,” McCann says. “We think Gist is something people will want to talk about and share with other professionals.”

For now, the software is free, and will remain so for the rest of the year. But come early next …Next Page »

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Marcelo Calbucci, the founder of Sampa and Seattle 2.0, announced today his team has launched TweepML, a service and format for Twitter users to share lists of other users quickly and efficiently. The service makes it easier to follow multiple Twitter users at once (at a given company, say), instead of having to find them individually. A number of startups have agreed to support the TweepML format, including Gist, OneRiot, and Gnip.

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Raveable is a year-old Seattle-area startup that launched its hotel review summarization website in May. If there were a Raveable entry for Raveable itself, here’s what it might say:

Ranked 116 out of 340 tech startup websites in Seattle.

The good: Team is ambitious and knowledgeable; large market; useful technology; fun interface; customer focused; strong word of mouth.

The bad: Relatively new; pre-revenue company.

Best kept secret: Gaining attention from angel investors and VCs.

The idea of Raveable is to help leisure travelers quickly make sense of all the user reviews out there on the Web, and choose a hotel that’s right for them. So the company aggregates reviews from sites like TravelPost (Kayak), MyTravelGuide (Priceline), CitySearch, Yahoo Travel, and VirtualTourist, and provides a bullet-point analysis of the pros and cons of each hotel—for 55,000 establishments and counting in the U.S.

The company was founded by Philip Vaughn and Rafik Robeal, former Microsoft veterans with expertise in database applications, data synchronization, and mobile social networking. Raveable grew out of difficulties they’d each had in booking hotels quickly; they found they were sorting through dozens of reviews on multiple sites, without having a top-down view of how various hotels stack up against each other.

“We want to make it really easy to make a decision,” Vaughn says. “We were really frustrated by ‘Everything is 3.5 stars, everything is above average, everything is good.’”

The technology behind their approach is semantic analysis of text—an area that’s been in research for decades, but is increasingly being applied to Web search and corporate software. The goal is for the software to understand the meaning of sentences in user reviews—including the topic, the context, and the sentiment. So if reviews say the rooms are great, beds are comfortable, or parking is expensive, that’s pretty straightforward. But if they say the service could be faster, rooms get cold, the view is sick, or the place is in good need of repairs, say, the software relies on statistical models (trained and updated by the founders) to ascertain whether the sentiment is positive or negative.

Vaughn gives a sense of historical perspective, pointing out that Raveable fits into the trend …Next Page »

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Seattle-based Zooppa and Fisher Communications (NASDAQ: FSCI) announced today they have teamed up to host a user-generated video competition for Seattle-area neighborhoods. Community members will submit short videos to Zooppa.com, a user-generated advertising site, and Zooppa will post the videos on KOMO’s new network of 43 neighborhood websites.

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MySpace CEO Owen Van Natta confirmed in a press conference call today that the social networking website has purchased Seattle-based music service company iLike. Financial details were not disclosed, but the rumors surrounding the deal point to about $20 million being spent by MySpace for the Seattle startup. According to Van Natta, the company will remain in Seattle, with its 26 employees joining the MySpace team.

iLike is the most popular music application on MySpace’s rival network Facebook, with around 10 million users on the site, and around 50 million users total. The big question now, for analysts and music lovers alike, is what kind of response Facebook will have to its rival acquiring such a popular component of its website.

Van Natta said iLike will remain integrated into the various groups and networks it is part of, but the question remains how comfortable those networks will be now that iLike is an arm of a major company rather than an independent startup. For now, at least, it’s business as usual at iLike, according to a statement made by the company on its website. “The iLike.com website and applications will continue to operate as they always have—except that we’ll be working to make them even better in the weeks and months to come.”

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Jambool, a micropayments and virtual currency startup founded in Seattle with offices in San Francisco, announced it has raised $5 million in venture funding led by Madrona Venture Group. The startup, led by Amazon veterans Vikas Gupta and Reza Hussein, raised $1 million last year from investors including Bay Partners, who also participated in the current funding round.

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Seattle-based iLike may be acquired by MySpace for $20 million, according to a report today in TechCrunch. iLike is a music service company with Facebook and iPhone programs that help people find new music and create playlists. It recently launched a new iPhone app that finds local concerts based on the music found on a device. According to anonymous sources cited in TechCrunch, MySpace may close the deal with iLike by the end of this week.

iLike has around 10 million Facebook users. If MySpace acquires iLike, it will own an app on an enormous chunk of Facebook music listeners. MySpace is a major rival to Facebook in social networking, and when it comes to music, iLike is by far the most popular Facebook app. MySpace owning it would therefore make for some interesting changes in that rivalry.

iLike was founded in 2002 by Ali Partovi, Hadi Partovi, and Nat Brown. It has raised $16.5 million in funding from the likes of Vinod Khosla and Ticketmaster. Currently, the company has more than 50 million registered users for its website and various platform applications.

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Colin Wong called me from Malaysia last night. His startup, Bellevue, WA-based Sharein (formerly ZoeCity), has rolled out an interesting new product and website today—a bookmark tool for sharing links with friends, family, and customers to Twitter, Facebook, and e-mail, all from your Web browser.

It’s not earth-shattering technology, but it’s part of a new generation of browser-based social media tools that are changing how people browse and share information online. Wong’s startup seems to have a lot in common with other sharing sites like Cambridge, MA-based Shareaholic, and Mountain View, CA-based ShareThis. “The goal is convenience, to make it easy for the user,” Wong says. “It’s not a power tool, but for the average user who wants to share.”

What differentiates Sharein from the competition, Wong says, is the ability to combine sharing to social media sites with all forms of e-mail, as well as providing analytics on things like how many people have re-shared a given link and its overall reach. “Once we get more traction, we’ll expand on the consumer side,” Wong says. He adds that once his team has more data on how people are using the tool, Sharein can add recommended links and other features that will be more attractive to advertisers.

“It’s going to gain a lot of momentum,” he says. “You look at Twitter, there’s quite a lot of sharing. We’re finding the older generation is more comfortable with e-mail, but the new generation is basically doing link sharing through Twitter.”

Wong has been CEO of the company since 2007, when it was founded as ZoeCity, a social network for the Christian community, by entrepreneurs Rocky Tannehill and Jyde Ojo. Previously, Wong worked for Google on the AdSense product team from 2002 to 2006. Originally based in Silicon Valley, he moved to Seattle in early 2005 and worked out of Google’s Fremont office.

Sharein currently has 10 employees—four in Bellevue, and six developers in Malaysia. The company is backed by angel investors, and Wong says he will probably look for additional funding towards the end of this year.

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First of all, Blackbox Republic is not a hook-up site. Let’s just get that out of the way. It’s also not a porn site, sex site, or dating site. It’s a niche social network, looking to fill the void between Facebook, Match.com, and Amazon, and it’s starting out by targeting members of an emerging community called the “sex-positive” movement.

OK, that all sounds scurrilously vague. But here’s my understanding. Blackbox Republic, based in Portland, OR, is trying to create a new kind of social website—one that is more targeted and exclusive than Facebook, more personal and community-oriented than Match.com, and has e-commerce tools built into it like Amazon. The company is announcing today that it has raised $1 million in seed funding from angel investors, and it is gearing up for a full site launch in late summer or early fall. It is led by CEO Sam Lawrence, the former chief marketing officer at Portland-based Jive Software, and April Donato, vice president of community relations and a sex-positive blogger (see photo below).

So what does sex-positive mean? “We mean that sexuality is not an issue,” Donato says. That means people in the startup’s target community don’t have any hang-ups when it comes to other people being gay, straight, bisexual, polyamorous, or what have you. They don’t identify with those kinds of labels. They gather at events like Love Parade, Electric Picnic, Afrika Burns, and Burning Man.

I’ll be the first to admit, I don’t fully get what’s new about this movement—or the real difference, say, between a “sex-positive” encounter at Burning Man and “free love” at Woodstock. (I’m dating myself, without having been to either.) It seems to be a guilt-free product of the “millennial generation,” people born between 1978 and 2000, who are projected to make up 40 percent of the U.S. population in 2018. What’s important here is that, by some estimates, the sex-positive community numbers in the tens of millions worldwide—which could be an incredible market to tap. “We think the next big thing on the Web is ’social niche-working,’” Lawrence says. “It’s finding an addressable market and going after them.”

Coming from Jive, a leader in social business software, Lawrence knows a thing or two about social networks and building online communities. He says the genesis of Blackbox was when he and Donato went to Burning Man in the Nevada desert last summer. “It’s a very emotional place,” Lawrence says. “Two things were going on. People there were establishing really meaningful relationships with each other. There was no goal, no agenda, they were just part of a big experience. Second, there was a thriving gifting economy there.” People would freely give each other everything from hugs to frozen margaritas, with seemingly no expectations in return.

As Lawrence explains, “These are people who are so open about themselves, they are willing to talk and share the most intimate parts of their lives.” But right now, he says, they don’t really have a place to go online to freely express themselves. So he and Donato decided to build a business for this community, and hatched a plan for Blackbox. Lawrence left Jive at the end of March this year, and the two of them are currently on a 50-city tour to promote their site and connect face-to-face with …Next Page »

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