Home / techdirt.com rss archive / October-01-2007


Do People Always Search To Be Sent To Another Site?
Mashable points us to a study done by online research firm Compete about which search engines do better in "search fulfillment." That is, what percentage of search queries on a particular search engine lead to someone clicking through to a search result. Yahoo clearly beats out Google (who then beats Microsoft). The theory, then, is that Yahoo does a better job pointing people to what they want to know about, since more of the queries end up in clickthroughs -- and that may certainly be true. However, it's not the only explanation. John Battelle weighs in to suggest that Google users may simply refine their queries a few times before clicking through to the desired results. Another possibility is one that happens to me all the time: if I'm searching for information and not a website, I may not need to clickthrough at all. I can just see the information needed in the snipped found in the search. So you could read the study as saying that Microsoft and Google provide...

More 700MHz Auction Fun: Frontline Asks FCC To Ban Verizon Wireless From Bidding
For something as boring as a spectrum auction, the upcoming 700MHz auction sure has its fair share of excitement. There are the rumors of Google and even Apple potentially bidding on the spectrum. Google requested that the FCC attach some specific conditions to the auction, which the FCC gave some lip service to, but hardly a full endorsement. Meanwhile, Verizon Wireless initially liked the conditions set by the FCC (meaning it thought it had a good chance of getting the spectrum) until it began to think through the scenarios (or heard more credible stories about competitive bids) and then suddenly decided to sue the FCC, claiming that the rules being set are illegal. Of course, others can play the lawsuit game too. Frontline Wireless, a new company basically built to bid on this spectrum, is now accusing Verizon Wireless of breaking the law in not disclosing the details of a recent meeting between Verizon Wireless officials and the FCC about the auction -- as required...

Judge Voids Election Results Over E-Voting Results That Couldn't Be Audited
Apparently a judge in Alameda County, California, has voided some election results after the e-voting tallies from Diebold machines couldn't be audited. The vote was on a controversial ballot measure, where the end result was quite close. Some activists went to court to demand a recount, but elections officials had already sent the machines back to Diebold, who had conveniently erased 96% of the necessary audit information. The issue will return to the ballot in the next election. Either way, this highlights one of the problems of e-voting machines that have no verifiable audit trail, and it's nice to see a judge actually recognizing that. Of course, this time it was for a ballot measure that can wait until the next election. What about cases where these machines were used for electing officials?

Looking For A Travel Deal? Have Your Browser Do The Walking... Out Of The Country
With the Internet, we now have a whole range of options when we need to book travel, ranging from online travel services to "name your own price" services. Whether or not we are better off still is up for debate, but now a new angle has emerged in the quest for lower prices. Booking travel through non-US websites may yield travelers a better deal -- even for the same exact offering. In one example, the rental car price quoted was 58 percent lower when booked through the foreign site. Travel companies defend this practice, claiming that they need to be able to set different prices in different markets in order to compete. But, this is merely the economic principle of price discrimination at work -- if you're able to get a higher price for any reason, then it technically is exactly what the market will bear. The mere fact that American customers visit different websites than Spanish customers naturally segments the market. So, by being able to increase their utilization...

Xero Really About To Be Bought? But, Why?
You may recall the bizarre tale of Xero Mobile, a company that was formed out of the ashes of Gizmondo, the UK gaming handheld provider whose spectacular failure revealed all sorts of sketchy details involving executives taking ridiculous salaries and buying themselves luxury cars (which one former Gizmondo exec famously crashed last year). There were all sorts of questions about whether or not Xero was simply an attempt to repeat Gizmondo, which lost investors an awful lot of money with stories of potential riches from a handheld gaming device that would make money through ads. Xero's plan was almost identical, though it would support mobile phone service via ads, rather than a gaming device. Xero followed Gizmondo's strategy, raising a lot of money, and even doing a reverse merger to get its shares publicly traded. Of course, the company never seemed to get very far, other than the occasional highly promotional press release. The latest news, however, is that the company...

Nokia Finds The Shortest Route To Navigation Info: Buys Navteq For $8 Billion
Nokia made a bit of a splash this morning by announcing plans to buy digital mapping/navigation firm Navteq for $8.1 billion. Navteq is definitely the leading player in the space, followed by TeleAtlas -- and the two companies basically dominate the market. Earlier this year, you may recall, navigation device maker TomTom announced plans to buy TeleAtlas, though that deal is not yet completed.Many people are speculating on what this could mean for Garmin, TomTom's main rival in the navigation device space. Garmin uses Navteq for its maps, but it seems hard to believe that Nokia would simply cut off Garmin. That would take a huge chunk of revenue out of the deal, making it a lot less worthwhile. What's much more interesting is how this shows the strength of Nokia's commitment to really leveraging mobile devices for location-based services and navigation information. People have talked about such things for years, and Nokia's purchase certainly suggests that they're about...

Will Investors Pressure RIAA To Change Its Ways?
The Motley Fool had an article last week predicting that the RIAA will soon be forced to abandon its lawsuit-happy business strategy, as a number of lawsuit targets have not only been winning in court but also getting their legal fees covered by the recording industry. The article makes a lot of points that Techdirt has been making for years, but a couple of things are particularly interesting about the article. First, the Motley Fool is a mainstream investment site that's read by a ton of people on Wall Street. If the financial press starts writing stories about how the lawsuits are a waste of money, these companies could start to feel increased pressure from their shareholders to find a new strategy. Secondly, the article makes an important point about the effects of file-sharing on musicians: file-sharing can hurt artists by reducing their sales, but it can also help them by getting the word out about their music. The former effect is more important to the superstars,...

eBay Evaporates $1.43 Billion In Supposed Skype Synergies
eBay made a few announcements this morning concerning Skype, and while the press seems focused on Skype founder/CEO Niklas Zennstrom leaving the company, that's hardly the interesting part of the announcement. Instead, the important news is in the fine print, concerning how much eBay is paying Skype as an earnout. Back when eBay bought Skype, there was an initial payment, and then an earnout based on how many new users and how much revenue Skype brought in. At the time, we noted that Skype really didn't have that many users and while it was a good product, we didn't see the synergies with eBay. Two years in, and it seems that this view was correct, as the supposed synergies never showed up. And, while Skype has continued to grow, the pace has certainly slowed. Back when the company was bought, at peak times there were usually around 5 to 7 million users online. These days, it seems like it's usually 8 to 10 million. That's not bad, but it's hardly astounding growth.And,...

NHL Sued For Trying To Take Over Team's Website
A few years back, Major League Baseball demanded that all MLB baseball teams hand over their websites to the league as part of their effort to create MLB Advanced Media, a division devoted to managing the online presence of Major League Baseball. While MLB may go way overboard in claiming control over certain content, its online efforts have been quite a success. There was a rumored (and later scrapped) IPO plan -- but the company is apparently still doing amazingly well, with talk of it being valued somewhere around $5 billion. Already, MLBAM has tried to expand its coverage by running websites for other sports and even musicians.All of that success apparently caught the attention of the National Hockey League, who had apparently let teams run their own damn sites for a while. However, it recently decided to bring them all in house -- but teams aren't thrilled with the idea. In fact, the NY Rangers are now suing the NHL for antitrust violations in trying to take over...

Apple Sued For Cutting iPhone Price
Apple certainly surprised a lot of people last month with its sudden and steep price cuts on the iPhone. It certainly isn't a surprise that technology prices drop over time -- but to have them drop by a third after just two months seemed a bit extreme. While some early adopters just shrugged and figured it was the price of getting the device first, others weren't too thrilled about it. Apple quickly decided to fork over $100 credit to upset early adopters, but apparently that wasn't enough to satisfy one litigious individual who has decided to sue Apple, AT&T and Steve Jobs personally over the price cuts. It's difficult to see how you can sue a company for cutting its prices (especially on such a high-priced item in a competitive market), and the details suggest this case won't get very far. The key to the lawsuit seems to be the highly questionable claim that Apple cut the prices in order to make life difficult for anyone who was trying to resell an iPhone at profit....

Suddenly Everyone Wants An Online Office Suite
Just a couple weeks ago, we noted that both Google and IBM were coming out with free products that competed with Microsoft's dominant office suite offering, noting that it was looking increasingly like Microsoft supposed monopolistic domination of the space might not be as strong as some (i.e., European regulators) believed. It certainly looks like more companies smell blood in the water. Adobe has now announced that it has purchased Virtual Ubiquity, makers of an online word processor called Buzzword, just to throw some more well-backed competition into the space. Of course, at some point, you have to wonder how this market shakes out. Obviously, Microsoft is still dominant, but can that continue when it charges so much against free products? The real question, though, may be what everyone else in the market can do to compete. We recently had the Techdirt Insight Community tackle exactly that issue for a client, and the experts there came up with a few key areas that...

Radiohead Tells Fans To Name Their Own Price For Latest Album Downloads; Gives Them A Reason To Pay
The band Radiohead is apparently coming out with a new album; the first after its original record deal was completed. It appears that, like many other musicians, they're realizing that the traditional recording industry business model doesn't quite make sense for them. While there was some buzz about an apparent hoax website about the band's new album, it turns out the real thing is a bit more interesting. That's because Radiohead is doing two smart things. It's telling fans they can name their own price for digital downloads. You just pay the band however much you think the downloads are worth and they'll be happy. But that's not all (though, that's what most folks are focused on). Rather than just offering up the content, they're also trying to give people a reason to actually buy something else. In this case, it's a "discbox," which will include the new album on both CD and vinyl, as well as an additional CD of seven extra songs and photos, artwork and lyrics. The...

Early Internet Bank Shut Down By The Feds Over Mortgage Defaults
If you remember the earlier days of the web, you'll probably remember NetBank, which was one of (if not the?) first internet-only banks out there. It offered high interest rates in the early days, making it popular with online folks in the late 90s. To be honest, I hadn't heard much about it lately and wouldn't even have known if it still existed until I read that the FDIC was shutting the bank down after it had too many mortgage defaults. The FDIC, of course, insures bank accounts up to $100,000 -- and all of the insured accounts are going to be transferred to ING (another popular online bank). Unfortunately, it appears that more than a few people had more than $100,000 in their accounts, totally around $109 million in accounts that were uninsured. For the folks who had more than $100,000, they now need to get in line with various other creditors for whatever is left of NetBank -- meaning that they'll probably get pennies on the dollar. While some may paint this as a...