The Seattle-Search.com Blog

Is Classmates.com a casualty of the Facebook revolution? In what seems to be a death knell to what looked like the first pure-play social networking IPO in U.S., United Online (NSDQ: UNTD) has canceled the proposed IPO of its Classmates.com social networking unit. The company originally announced its plan to hive off the company in August, and in late November it said it expected to raise $177.7 million via the sale. But, citing the standard “market conditions,” the company now says that such a move wouldn’t be in the interest of stockholders. In other words, the interest wasn’t there. While there had been some excitement over a social networking pure-play IPO, Classmates.com, with its subscription-driven business model and earth-bound growth rates, couldn’t fully capture the buzz. United Online said it will take a $4.5-$5.5 million charge in Q4 associated with the aborted process. Release.

A recent report from Cowen & Co. analyst Jim Friedland spells out exactly why United Online couldn’t cash in with Classmates. One line sums up his thesis: “We expect the Classmates.com subscriber base to peak in the first half of 2008, followed by a steady decline to zero by 2012.” Much of the report hones in on the fact that Classmates is no Facebook. The biggest difference is that Facebook is free and offers far more robust features. Other factors weighing on Classmates.

According to analyst Joe Weisenthal, the following were the most critical deficiencies in sizing up a prospective Classmates IPO.

– Classmates has little value for young users, since there’s no need for them to re-connect; they’re already connected through other sites. Meanwhile, Facebook is making major inroads into Classmates’ adult demographic.
– User engagement is 95 percent lower than on Facebook, suggesting that users see little value in the service they’re paying for
– The company’s auto-renewal system has come under investigation at the FTC, potentially causing churn to spike.

Whrrl is a new service that allows mobile phone users to chronicle every social activity in their lives — writing reviews of movies or restaurants or uploading photos from concerts and sporting events. It then plots that information on a map and combines it with similar content from friends, creating a personal mobile city guide. It also provides the real-time locations of people as they wander from place to place in a city, tracking chosen friends as dots on a map.

Whrrl — not to be confused with a competing service called Whirrl — is the first offering from Pelago, a Seattle startup that scored $7.4 million from Kleiner Perkins Caufield & Byers, Amazon.com founder Jeff Bezos and Trilogy Equity Partners last year.

Led by Jeff Holden and Darren Erik Vengroff, both of whom previously held high-ranking positions at Amazon.com, Pelago is one of a number of companies trying to tap the emerging arena of location-based services. The idea is that mobile phone users will want to locate friends — who may be at a nearby restaurant — or at the very least get a review of the restaurant that a friend wrote a few weeks ago. The service is also accessible on a PC.

Google also is moving into the arena with the purchase of Jaiku, a company that allows mobile-phone users to create a running Web log of events, recommendations and other information. Jaiku describes its mobile product as “a live phone book that displays the activity streams, availability, and location of your Jaiku contacts right in your phone contact list.” Twitter, which also allows people to share small tidbits of information with friends, also is a potential threat.

Whrrl is not available to all mobile phone users. Only subscribers to AT&T, Sprint and T-Mobile — on about eight to 10 phone models — can download Whrrl. A portion of the service is free, though Pelago plans to charge less than $3 a month for the location-based service. Pelago, which plans to pursue more funding early next year, employs 34 people.

<http://www.whrrl.com/

Seattle social networking startup Blue Dot is scrapping its name and repositioning the service — now dubbed Faves.com.Users of the new site can create a personalized Web page populated with their favorite news topics. For example, a Seattle Mariners’ fan who also enjoys surfing and cooking could sign up to receive information about those specific topics from other users who have bookmarked related content. That puts Faves.com in direct competition with sites such as Topix.net, Digg and Stumble Upon. The concept also is similar to what Seattle’s SportsUltra is trying with its customized sports news service.

<http://faves.com/home>

Online Revenue News relates an interesting case study on why now is a great time to convert a popular, parked domain name into a retail business with an Amazon aStore.

The aStore model allows you to setup a site with any number of products or categories of products from Amazon;s inventory. There’s lots of room to add a creative touch with customization including colors, links, and sections that are displayed.

You can create an aStore in as little as 5-10 minutes. In this case, the stores are:

* GPSOnline.net - A GPS Superstore
* WCWineCellars.com - Wine Cellars & Wine Accessories
* MamasGiftBaskets.com - A Great Selection of Gift Baskets Online

It would be interesting if Amazon allowed the actual domain name instead of having to 301 redirect the name or implement them in a frame.

Speaking of Amazon, the world’s largest Web retailer launched Askville.com, an information-sharing Web site where users can ask questions and answer queries from others, today.

The site, open to all of its customers, has been in beta testing since December 2006 and has already been open to a few users, Amazon said. Similar services are offered by Yahoo Inc’s Answers and other Web sites such as AnswerBank. Google Inc also had an “Answers” section, which has been discontinued.

Microsoft Gatineau Analytics Beta Open to US Residents
If you’ve been have been anxiously awaiting the launch of Microsoft’s new Web Analytics suite, named Gatineau, the time is now to now sign up. The sign up form is here and is available only for US subscribers for the time being.What is the benefits of Gatineau, you ask? Project Gatineau is closely related to Microsoft adCenter – for example, adCenter customers will be able to use their existing account to access Project Gatineau if they choose to use the web analytics service.

But it also a full-fledged web analytics offering with a lot of great reports and tools for measuring your site traffic and understanding your visitors including click and visitor tracking, marketing campaign reporting, conversion tracking, demographic and geographic segmentation, paid and natural search analysis, visitor information including browsers, languages, operating systems and resolutions. You will need to create an adCenter account but you won’t need to buy any advertising – the account can be used for Gatineau only.

Microsoft Corp. and the SEMPO Institute have announced an education alliance in which personnel from 20,000 affiliates of the MSN search engine will have access to SEMPO Institute’s online learning program designed to provide in-depth knowledge of best-practices in search engine marketing.As part of the new alliance, personnel from the MSN affiliates will be able to take SEMPO Institute’s Fundamentals of Search Marketing class. SEMPO Institute also offers online classes in Advanced Search Engine Optimization and Advanced Search Advertising. Fundamentals consists of 14 lessons intended to give the student a high level understanding of the essentials of search engine marketing.

Since SEMPO Institute launched in early 2007, the student feedback has been very positive – 80% say they would recommend the Fundamentals course. “All companies need the fundamentals of search marketing in order to implement an e-marketing strategy,” says SEMPO President Jeffrey Pruitt. [24x7]

In the trend to keep up with a wired clientele, Seattle’s Hotel 1000 is leading the pack, at least on the West coast, according to the LA Times’ Travel editors. It’s more than the 1000’s ability to deliver high-definition movies from the Internet to a giant flat screen in your room.

A variety of the hotel’s services are connected to a single fiber-optic backbone, including the Internet-based TV system, electronic do-not-disturb buttons and room phones that offer free Internet-based calling to anywhere in the U.S. — doing away with the traditional practice of jacking up in-room calling rates in search of profits.The avant garde leadership is not without a few bug fixes. French press coffee makers with six-step instructions could perplex operators, crtiicsd opined and the TV remotes, must be pointed at an infrared sensor instead of the television screen. In spite of the vagries, Hotel 1000 can still fulfill at least one ultimate geek-on-the-road fantasy. A recent guest’s call to complain about a broken remote was met with a peculiar response from the front desk clerk: “I’ll send an engineer right up.”

Google’s stock will top $900 next year. Online voting won’t happen in our lifetime. And Microsoft Corp. will make a big push into virtualization, possibly buying Citrix.

Those were among the forecasts Tuesday night at the WSA annual predictions dinner as five panelists from the Pacific Northwest technology industry — Matt McIlwain of Madrona Venture Group; Kelly Smith of Curious Office Partners; Jonathan Sposato of Picnik; Enrique Godreau of Voyager Capital; and Steve Lidberg of Pacific Crest Securities — fielded a variety of questions about the future of the industry.

Moderator and P-I columnist, John Cook, has the story.