Five Visionaries on What’s Coming Next in Technology

Every year for the past 13, the business and technology forum Churchill Club of Silicon Valley has held a very popular annual dinner where about five tech forecasters and finance people offer up their predictions on what’s coming next in technology in the next three years. On the panel tonight at the venerable Santa Clara Marriott are Curt Carlson, president and CEO of Menlo Park research lab SRI InternationalAneesh Chopra, first chief technology officer of the United States; venture capitalist and speed talker Steve Jurvetson, managing director at Draper Fisher JurvetsonAjay Royan, managing director of Clarium Capital, Peter Thiel‘s company (Thiel was supposed to be here); and futurist Paul Saffo, managing director of foresight (an appropriate title) at Discern Analytics. Emcee is Tony Perkins of AlwaysOn. I’m liveblogging the highlights.

If I remember previous events, this one is a little different in that Carlson, not each individual panelist, is presenting the trends. Each of the panelists raises a paddle with green on one side, to show they agree that the predicted trend will happen, red on the other to show they don’t. Yeah, it’s kinda hokey, but it’s fun. The audience votes with handheld devices as well as little red and green cards.

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What’s Google’s Marissa Mayer Up To?

We haven’t heard much from Marissa Mayer, one of Google’s highest-profile executives, since she left her longtime job as vice president of search products last October to become vice president of location and local services. Some saw that as a demotion, though it’s clear that Google is putting an especially heavy emphasis on local commerce and advertising. So, hoping she will reveal a bit more of what she has been and will be doing in the red-hot local e-commerce and ad markets, I’ll be watching Mayer’s fireside chat with Mike Arrington at the TechCrunch Disrupt conference in New York today. Here’s what she has to say:

Q: What’s Google like now with Larry Page as CEO? Mayer: Google’s always been focused on the user, and Larry even more so. The other thing that’s happened is we had projects that started small like Chrome and Android that are now large. There’s a lot of optimism. A lot of energy.

Q: Is it good for competition and the industry that there’s Facebook, Bing, and other significant competitors? Mayer: It causes everyone to work that much harder and get that much better.

Q: What are you doing now? Mayer: I’m VP of Maps and Local (guess her title has changed a bit?).

Q: Is Google scraping other sites’ content for its Place pages? Mayer: People expect results to be comprehensive. So we want to get people really good data when they search for local information. It’s really meant to be a directory. There’s not enough information there to make a decision… so you go to the reviews and other sites.

Q: Is Google going to show only its own reviews once it gets enough of them? Mayer: Today we aren’t getting a lot of [our own] long-form reviews. (So I guess not, for a while at least).

Q: What are Google brands that matter going forward? There’s so many, I’m confused. Mayer: We’re really trying to streamline that. Not as many separate brands like Hotpot, etc. There’s Maps and there’s Local. Maps is the geospatial location and it should be personalized. Places is the local side of it, the textual and descriptive side. Those are really the two big pillars in this space.

Q: How are things going on the mobile side? Mayer: Great. We just crossed the 200 million installs on Google Maps for Local. About 40% of our traffic for Maps is mobile. More on the weekends, could cross permanently in June.

Q: What’s your goal to be successful in the next year? Mayer: Get you places you want to go or didn’t know you want to go. Enhancing our data. On the very far reaches, I’m starting to look at contextual discovery: Can we figure out from your context just the right information you’re likely to want without searching for it. Like if you walk into a restaurant that your friend went to last week, maybe you could see what they ordered.

Q: What are you personally investing in besides Square and One Kings Lane? Mayer: Also Minted, Gene Security Network. I’ve been active as an angel for a little while. It’s fun. I love watching how companies go through the growth phase, and helping them get through that. I’m not on Angel List or anything like that.

And that’s it. Well, not much there, sorry to say. You’ll get more on what Mayer and Google are planning for the local market here.

Online to Offline: How Mobile Payments Will Shake Up Real-World Commerce

With Google queuing up the debut of its mobile payments system on Thursday and Square announcing plans to replace the cash register and the wallet in one fell swoop, there’s a lot of interest in the use of cell phones to pay for things in the physical world. This morning, we’re hearing a bit more about this hot area of investment at a panel at TechCrunch Disrupt in New York, which you can watch by livestream. Exploring the topic are Stephanie Tilenius of Google Commerce and Payments, Alex Rampell of “transactional advertising” platform TrialPay, and venture capitalist Lewis Gersh of Metamorphic Partners. TechCrunch editor Erick Schonfeld is moderating.

Q: How do mobile payments affect daily deals and other local commerce? Tilenius: We call it the age of mobile-local.Consumers will be able to walk around and get deals. You’ll see us embedding offers throughout our mobile experience. Gersh: We could retarget consumers [with advertising] who were in a retail store. It could be Groupon having local pickup for offers.

Q: How can you make local advertising work, beyond Groupon? Rampell: Local businesses would rather get a check than a click, and they’re willing to pay for that. Tilenius: Groupon is a great model, and congratulations to them for creating it. But Groupon has tapped into one element of it. Ultimately it’s going to be about customer management.

Q: What’s compelling about Near-Field Communication (which allows consumers to wave a cell phone at a product to get more information or to pay for it), which Google is backing? Tilenius: The ease of use is compelling. You could see a product in Gap and if it’s not in your size, you could use NFC to order one in your size and have it shipped to you tomorrow.

Q: How soon will mobile payments catch on? Tilenius: It’s going to happen quickly. There’s already a ton of activity in this space (though a lot of it is overseas). In Singapore, everybody uses NFC for payments.

Q: How would NFC help local or e-commerce? Gersh: If you go to a local coffee shop and say I can promise you 1,000 new customers if you install this device, they’ll probably do it.

Q: What do you think of Square’s latest announcement? Rampell: Square is really competing with cash. If you want to make a $500 purchase at a flea market, this works better than cash. They can manage the fraud problem. Tilenius: Square isn’t trying to compete with Visa and Mastercard. They’re servicing really small merchants and displacing cash. It would work well to pair deals with that.

How Social and Mobile Will Disrupt Online Advertising

It’s no secret that online display advertising is going through huge changes, thanks largely to the fact that banner ads have never worked very well. Everyone from Google to Facebook to Twitter to a gazillion ad technology startups is trying to figure out something that will work as remotely well as search ads. So I’m always interested to hear how smart folks think display ads will evolve. This morning a panel at the TechCrunch Disrupt conference in New York, which I’m watching by its livestream, will be exploring this. On the panel: former Yahoo/Right Media’s Mike Walrath, now with Moat, a “search engine for display ads”; Carolyn Everson, new head of advertising at Facebook; Eric Litman, CEO of mobile ad platform Medialets; and Gurbaksh Chahal of ad network RadiumOne. TechCrunch editor Erick Schonfeld is moderating.

Q: Is the online advertising we have now sufficient or broken? Walrath: It’s broken, the way we’re delivering it to marketers is fundamentally broken. Two things are bullshit: that usage of the Net will drive brand spending; and that if that doesn’t work, sight, sound, and motion (video, flashy stuff, etc.) will solve it. Neither will.

Everson: For 10 years, every digital company has been trying to say you should move more advertising online, and they haven’t figured out why it hasn’t. TV is still strong. You have to get the creative community comfortable with digital advertising. They do not feel comfortable enough with the medium to bring more advertising to the Net. Can’t just offer a billion little boxes.

Q: Don’t online ad budgets have to take from TV? Litman: To think that dollars are not flowing in, that’s an argument from 1998. There are dollars available to come from traditional media.

Walrath: We’re having the wrong conversation–the latest whiz-bang way to target an ad. Just incremental. Until we change the conversation, we’re going to be battling for table scraps from traditional media. Channeling Wenda Harris Millard (who famously said years ago at Yahoo that online ad companies needed to do more than sell the ad equivalent of pork bellies, meaning banners sold cheaply by the ton)… We need to show purchase intent and brand recall. Otherwise, the conversation is meaningless. (Amen!)

Chahal: Disagrees (not surprisingly). Display advertising works. People want to spend more money. You can make that multibillion-dollar display industry better. Everson: The top brands care about the social graph. 50 million “Likes” per day happen on Facebook, which drives Facebook’s latest ad offering, called “Sponsored Stories,” which turns Like and other actions into ads on Facebook.

Q: To what extent does mobile and location help brands? Litman: I don’t need an ad to tell me there’s a Starbucks near me. That’s not the model for local advertising. It’s really much more defining where people are within a store, walking down an aisle, and using a tool to compare products; the brand can pay slotting fees to get their products in those tools. We’ve seen a bunch of search dollars coming into mobile. Walrath: Most mobile ads I’ve ever seen have been a shitty experience. Can’t just show ads–they need to be intrinsic to the apps being used. Chahal: Mobile ads are still pretty new–$550 million last year.

Do@ Aims to Disrupt Mobile Search–Including Google

It’s ironic, or maybe apropos, that you can’t find anything about the new mobile search application Do@ by Googling it. Google doesn’t track the @ symbol at all. But the Israeli company (pronounced “do-at”), which launched its free iPhone app today at TechCrunch Disrupt in New York, is looking to do a number on Google. It aims to provide a new way to find stuff specifically when you’re on your phone and the iconic list of site links becomes cumbersome. Instead, a search using Do@ helps you zero in quickly what category of information you want and then sends you directly to the app that’s most likely to have just what you’re looking for.

Here’s how it works: Search for, say, “Bob Marley” using Do@, and you’re presented with a drop-down list with the query followed by categories designated with the @ sign, such as @music (where you’ll see results inside apps such as Pandora or iTunes or SoundCloud) or @movies (where the likes of Flixster or provide results).

These categories are relevant to the particular query, so a search on “sushi,” and you see “sushi @restaurants,” “sushi @food,” and so on. Then when you click on one of those, you’re whisked to an app or service such as Foodspotting or Flixster, which then shows its own mobile-optimized results for that query. You can swipe through multiple apps for a query to get more quickly to just what information you want.

You’re seeing only a selected subset of Web sites and services this way, of course, but for common queries made from a mobile phone, that may be better in most cases than a huge list of links. Do@ ranks the lists of apps and services itself at first, but you can choose your favorites or, if you’re signed into Facebook, get your friends’ amalgamated choices. Essentially, says cofounder Ami Ben David, publishers answer users’ queries themselves, using their own apps or services, their own brands, and their own business models.

The judges at the TechCrunch Disrupt startup competition who viewed the demo questioned how Do@ knows the results it’s presenting–that is, the results inside other apps and services–are actually relevant for users. “We try to stay away from making these decisions for users,” Ben David said. The judges, including Bing’s Barney Pell and Google’s Bradley Horowitz, weren’t really buying this, noting that Do@ needs to objectively determine whether its partner apps and services are actually delivering the goods.

When Ben David first demonstrated the service to me in early March, he said Do@, which has $8.6 million in venture funding including a recent $7 million round led by Draper Fisher Jurvetson, is “trying to be completely different.” That’s commendable, but it’s also the company’s key challenge. Google’s list of links may not be perfect for many mobile searches, but it’s still not bad, and Google’s Instant Search solves some of the hassle of doing multiple search queries on a phone keyboard. Persuading users to change their behavior, even for something that may work better in many cases, is a huge hurdle that virtually no Google rival has yet jumped.

And given that Do@ isn’t doing the heavy lifting to index the Web’s huge collection of sites, or vetting the actual search results its partners offer, its key offering amounts to a new user interface for mobile search. Which sounds like a set of features–albeit a very nicely designed set of features, one likely to be copied if it proves effective–more than a company.

AOL CEO Tim Armstrong at TechCrunch Disrupt: Content Still Rules (and Will Make Money. Eventually)

Long an apparent candidate for permanent obscurity after its ill-fated merger with Time Warner, the now-independent AOL has been getting more interesting lately. That’s thanks to its high-profile acquisitions of prominent online brands such as TechCrunch and Huffington Post as well as some interesting services such as So I’m tuning into the livestream of CEO Tim Armstrong‘s interview with TechCrunch editor Mike Arrington at TechCrunch Disrupt in New York. Here’s what he had to say:

Q: Is any of this stuff going to work? Can you make money off all this content? Armstrong: Yes (what else did you expect?). I love the fact that people think content isn’t a good business. It keeps other people out of it and attracts people who believe in it.

Will you do other deals? Armstrong: Holding off for now, but there could be more. I have a list in my head and ongoing discussions with people in this space. I see five or 10 companies in this space that are interesting.

Q: Yahoo? Amstrong: Implies no, not surprisingly.

Q: What would you do to run Yahoo? Armstrong: We had a leadership meeting in California recently with Yahoo executives. We were talking about what it takes to be a great company. One is having a real clear vision for the future. Second is having a clear execution plan with metrics. Third is culture, a good culture.

Q: What’s the deal with all the Thursday night drinking parties, given AOL’s official rules against drinking on the job? Armstrong: Doesn’t answer. It doesn’t have to do with drinking. It has to do with the culture we’re trying to create.

Q: When will you start monetizing the products being developed in Brad Garlinghouse‘s group (in Palo Alto)? Armstrong: I’ve told Brad for the new products I’m not concerned about monetization. I’m concerned about consumer usage. We’re working on nailing the consumer DNA.

Q: Won’t AOL and Yahoo be the same company in a year? Armstrong: Why? Arrington: Both companies are struggling. Armstrong: We clearly know where we’re going. We have more work to do. But we’re making tremendous progress. On target to get to industry growth rate in the second half of the year. I don’t think there’s any competitive dynamic in the market that prevents us from being successful.

Q (from Google’s Don Dodge): Why don’t paywalls work and why does local content monetize terribly? Armstrong: Local content doesn’t monetize terribly. I think local is going to monetize at a great level. Paywalls do work. How you pay matters a lot. Micropayments? Our strategy has been free content but I am a long-term believer in paid content for the Web. We’re at the start of the next evolution for content.

Beyond the Wow Factor: Why LinkedIn’s IPO Matters

It would be easy to take today’s blockbuster initial public offering by business networking service LinkedIn as a sign that the IPO, the fuel for the tech industry’s wealth-creation engine, is back. But one IPO on the first day won’t tell us that. It’s just as easy to dismiss the rocket-ride to well over double its already-raised offering price as a sign of another bubble. Again, one great IPO’s first day doesn’t mean everybody will party like it’s 1999 (though if it’s “brain-dead” to suspect there’s more than a little froth in Internet investing, take me off life support now).

Still, there are many other lessons we should take away from LinkedIn’s IPO. Here are a few:

* Social networking has arrived as more than a cute phenomenon. LinkedIn may not be Facebook or even Twitter, but it’s serious networking, using people’s social connections to create real value. A lot of people already know this, but for the rest, it’s well past time to stop listening to the Luddites who think Facebook and Twitter are nothing but places to tell people what you ate for lunch.

* At the same time, it’s also apparent that social networking won’t be a winner-take-all business. Yes, a lot of businesses and even professionals use Facebook for business purposes, and will continue to do so. But many more people recognize the value in having separate circles of friends, colleagues, business contacts, and the like. Now, I’d bet that Facebook could be the biggest winner–winner-take-most, if you will. But Mark Zuckerberg clearly won’t own everything social.

* This is the first real sign of whether individual-investor interest in IPOs has returned. It was already apparent that the (literally) marquee names like Facebook, or even Zynga or Groupon, would rock the world when they go public. They’ve got fame, huge and fast-growing revenues, and soaring private valuations already, so using them as a proxy for whether smaller fry would go public was always erroneous. LinkedIn, by contrast, is a much smaller business that’s closer to those of dozens of private Internet companies that to date have been unable to provide their venture investors and entrepreneurial teams exits besides getting acquired. You can be sure that those private Internet companies are using LinkedIn to research potential chief financial officers and arranging meetings with Wall Street investment bankers, if they weren’t already.

* Those shady private-market valuations, which have given Facebook, for one, $65 billion-and-up valuations, suddenly don’t look so crazy after all following the first IPO of an actively traded private company on private exchanges such as Second Market and SharesPost. LinkedIn’s $2.4 billion valuation on those marketplaces, in fact, indicates to some that the supposedly savvy investors trading shares privately vastly underestimated the value of these companies. No doubt LinkedIn’s market cap will be volatile, so it’s unwise to think that Facebook suddenly will be worth multiples of its already breathtaking valuation. But it’s clear that the limited number of shares being traded on these exchanges, as well as the limited amount of information these investors had, didn’t necessarily cause them to overpay. At the same time, it’s unlikely the SEC will back off from scrutinizing whether to regulate them–in fact, it may move even more quickly if this IPO sparks renewed interest in the exchanges.

* LinkedIn’s success proves that Web companies aren’t entirely dependent on advertising for revenues, providing hope that other business models such as subscriptions and paid services are credible alternatives. LinkedIn makes most of its revenues not from advertising but from paid services for recruiters and premium subscriptions.

* Nice guys don’t always finish last. Talk to almost any entrepreneur about LinkedIn cofounder and executive chairman Reid Hoffman, and you’ll get nothing but admiration, and not just because he’s an angel investor in many dozens of their startups as well as a partner in the venture capital firm Greylock Partners. Hoffman seems generous with his time–not least, full disclosure, with me as a reporter since LinkedIn’s earliest days. I remember asking him once, years ago, about the libertarian, government-bashing leanings of some of his more famous colleagues from PayPal, and he sighed and recalled how, as the liberal in the bunch, he kept pushing them to give back to people less fortunate than they. Regardless of your politics, though, isn’t it nice to see that you can become a billionaire without being a jerk?

* For individual investors, the rule for Internet company stocks still should be caveat emptor. That $8 billion $9 billion valuation likely won’t stay that high in coming weeks or months, not consistently anyway, as the pent-up enthusiasm for Internet IPOs gets spent (at least until Groupon or Zynga or Facebook cranks it up again). For all the success of LinkedIn as a company and as a bellwether for Internet stock issues, it’s still a speculative play, and its share movement may well drive home yet another lesson: Individual investors should never put money they can’t afford to lose into anything their dentist is investing in, their cabbie mentions, or the press is hyperventilating about.


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