Thoughts from the Shelf

Microsoft today launched their new Messenger TV service (Screen shots of which are here), an add-on to their popular MSN instant messaging service, allowing users to watch videos online whilst exchanging messages.

Through the Windows Live Messaging console these videos can then be easily shared amongst friends in your IM community, creating what is said to be a unique social experience and opening up an untapped advertising market.

The service will provide a range of TV clips several minutes in length, provided by companies such as UK based Channel 4. Channel 4 will provide clips of shows including Peep Show, Property Ladder, Father Ted and Shameless, whilst other content producers will include ITN, Reuters and National Geographic as well as record label EMI.

Other content tipped to be played on the service includes South Park and Pimp My Ride, as well as music videos from Kylie to Britney Spears. The service will run adverts ahead of the clip as well as an advertising banner throughout the duration of playback.

The service is initially being launched in 20 countries, many throughout Europe, which is home to 95 million Windows Messenger users. Microsoft has around 14 million monthly unique users of Windows Live Messenger in the UK alone. It will also launch in New Zealand, Australia, Singapore, Brazil, Canada and Mexico but not the United States.

“We see Windows Live Messenger as media in its own right, one that has been somewhat untapped as an opportunity,” – MSN UK exec producer Peter Bale.

Channel 4’s director of new media technology John Gisby commented on the deal with Microsoft.

“Our core audience is spending increasing amounts of time online and expects to be able to watch its favourite Channel 4 shows this way.”

John Mangelaars, the vice-president, EMEA, of consumer and online for Microsoft said “Online video has exploded in popularity over the last year, but to date it has been something people watch on their own. Messenger TV is set to change all that,”

The move by Microsoft comes less than a week after they pulled out of a long run take over approach for Yahoo, aimed primarily at its position in the online advertising market. This move certainly demonstrates the company’s eagerness to expand into that market.

In even more social networking news, it was announced today that internet portal AOL has bought social networking site Bebo for £425 million.

Bebo was launched three years ago and has a membership of over 40 million worldwide users, combining “community, self-expression and entertainment to enable its users to consume, create, discover and share content.”

Bebo is one of the leading social networking sites in the UK and the US trailing rivals Myspace and Facebook. Bebo also leads the market in New Zealand and Ireland, and is run by only 100 employees spread across three global office locations.

At first this seems a lot of money for a company with such few resources, but when you consider News Corp bought MySpace for $580m in 2005 which is now estimated to be worth more than $15bn, and Microsoft bought only 1.6% of Facebook last year for $240m, the price doesn’t seem so high.

A quote from AOL chairman Randy Falco says: “Bebo is the perfect complement to AOL’s personal communication network and puts us in a leading position in social media. This positions us to offer advertisers even greater reach and marketers significant insights into the desires and needs of consumers.”

With its acquisition of Bebo it is clear that AOL see the social networking site as an advertising goldmine which will allow them to offer advertisers access to user targeted adverts based on comprehensive user profiles and trends.

The average Bebo user views on average 78 pages a day with a daily average of 33 minutes a day being spent on the site.

“Bebo has an incredibly strong brand identity, particularly with the teenage and young adult market, so it will be very interesting to see how AOL makes best use of their new youthful Trojan horse.” – Alex Burmaster, European Internet Analyst

Research outfit eMarketer recently released a report stating that by 2011 $4.1 billion will be spent worldwide on social network advertising, up from $480 million in 2006. It is clear the struggling internet portal is looking for a significant chunk of this to turn its fortunes around.

In relation to The Shelf’s popular social networking themed posts, news broke last week that Facebook has raided Google in order to fulfil the position of chief operating officer. The position was filled in order to provide Facebook, who last month saw their first ever dip in visitors, with a more experienced management and advertising figure as the company tries to make more money out of targeted advertising without alienating users.

The defection by Sheryl Sandberg from internet search giant Google was first announced last Tuesday marks a period of adjustment for Facebook who only three months ago suffered huge setbacks in efforts to inject more commercialism into is social site.

In her time at Google Sandberg has helped the search giant build up one of the most rivalled advertising models in the world in the position of vice president of global online sales and operations.

No doubt 23 year old founder Mark Zuckerberg will use the opportunity as somewhat of a mentoring scheme in how to future direct Facebook’s expansion, who Sandberg will report directly to.

Of the capture of Sandberg Mark Zuckerberg stated that she is “a great manager who will help scale Facebook’s operations globally,”

In the past eleven months Facebook has seen its user base triple to 66 million users, becoming the second largest social networking site behind Myspce. But Facebook remains dwarfed even further by Sandberg’s former employers who make more than $16 billion to Facebook’s $100 million in annual revenue.

There have also been recent mistakes by the Facebook owner that have led to questions about Zuckerberg’s judgement after marketing tool Beacon was allowed to track users’ purchasing patterns across dozens of sites and display the information on pages of listed friends within the Facebook network.

But although mistakes have been made and the social networking site has plateaued of late, many still expect great things in the future. Planning to go public in 2009/10 Facebook could still turn out to be the biggest internet success story since Google went public in 2004.

Throughout 2007 The Shelf has extensively featured some of the most popular bits of technology released. From Facebook to the iPhone to the PS3 we have featured articles on all three, but as we move into the New Year The Shelf looks at some technologies that could have a bright twelve months ahead of them over the next five days.

The first technology sees us look at the mobile internet. Currently restricted to where there is an internet connection, web applications have there restrictions, and although mobile internet access is becoming increasingly popular unlimited connectivity regardless of location is a long way off.

Last year we saw three technologies launched by Google, Adobe and Microsoft that are aimed at blurring the boundaries between offline and online environments. Named Gears, Air and Silverlight respectively, each application aims to take endless achieves of web content and make them available offline.

Adobe’s has already demonstrated an Ebay type Desktop application using Air which allows users to do all the work of setting auctions up offline, with the auction going live the next time the user connects to the internet.

“Adobe AIR lets developers use their existing web development skills in HTML, AJAX, Flash and Flex to build and deploy rich Internet applications to the desktop”

Silverlight offers and reversal of this service in that it allows desktop applications to be built and run within a web browser.

“Silverlight enables developers and designers to easily use existing skills and tools to deliver media experiences and rich interactive applications for the Web.”

Gears does not allow the creation of new applications but does allow users to take web applications offline. Google Gears would therefore allow developers of online office package Zoho to use Gears to allow users to use their applications in a similar way to that of a normal desktop program.

“Google Gears Beta is an open source browser extension that enables web applications to provide offline functionality using JavaScript APIs”

As part of The Shelf’s first technology of 2008 we tip more examples of applications built with or using these three tools to further merge the online and offline user experience.

Social networking site Bebo yesterday announced plans to link up with rival Facebook that will allow software developers to create applications that can be used across both sites. With nearly 100 million the move will provide developers with the opportunity to develop compatible features for both networks.

Recently The Shelf documented plans from Google to create Open Social, a similar cross network development strategy for which a number of big social networking sites signed up for, excluding Facebook. Open Social was supported by Myspace which alone has 110 million users.

Facebook had huge success after first opening up its network to developers, and now within a few hours the same application could be run on Bebo. Since Facebook started to allow third party applications six months ago thousands of applications have been developed for the social networking site.

As part of the deal however Bebo profiles will not be able to link directly to Facebook users, a step that acknowledges both Facebook and Bebo audiences use each social network for differing purposes.

“We think people use social networks for different things: Facebook is a great social utility, whereas you use Bebo to share media and entertainment.”

Bebo is part of the Open Social alliance as well and is the only network to complete deals that cross both alliances. The interaction of both APIs will be live by early 2008.