Online humor site JibJab, which is behind ElfYourself and loads of other zany videos has hit a big milestone: it’s now processing one million paid transactions per year. That’s big news for the company, which pivoted in late 2007 from an ad-supported business to one that generates revenue primarily through premium services and downloads.

JibJab earns money through a few channels. First, it offers a premium membership for $12/year that gives members access to its full range of customizable “Starring You” videos, which let you insert your friends’ faces into funny video clips like the site’s amazing take on the original Star Wars Trilogy . Membership also gives you access to all Ecards and ‘Everyday Fun’ messages. Unpaid users have access to some of this content, but much of it is reserved for premium members.

If users want to download their custom videos they can do that too for a few dollars (premium members get a discount on downloaded goods). Finally, the site also sells physical goods emblazoned with photos of you and your friends.

CEO Gregg Spiridellis declined to break down how many transactions each of these revenue streams accounted for, but he did say that the site is seeing 2x growth in terms of premium transactions since last year. You can see Spiridellis talk more about this in the interview above. JibJab has raised $16.9 million since 2006.

One day before its scheduled IPO, Tesla Motors is increasing the allotment of shares that will be sold to the public from 11.1 million to 13.3 million, according to an amendment to its S1 filing. The additional shares are being sold by existing shareholders looking to cash out at the IPO, including Tesla founder and CEO Elon Musk who is selling an additional 909,212 of his personal shares. Other selling stockholders include VantagePoint Venture Partners (238,748 shares), Bay Area Equity Fund (88,586), Westly Capital Partners (72,625), Compass Venture Partners (22,931), as well as friends and family like Elon’s brother (and OneRiot CEO) Kimball Musk (12,692). Tesla itself won’t make any additional money from the bump in shares, but more shares will be available to the public.

If Tesla shares open at the high end of its expected range of $14 to $16, the Silicon Valley electric car company will debut with a $1.5 billion market cap (based on 93.5 million total shares outstanding after the IPO and a concurrent $50 million private placement with Toyota). After the offering, Tesla’s largest shareholder will still be founder Elon Musk, who will own 28.4 percent of the company (worth $426 million at that valuation, versus a potential windfall of $14.5 million for the shares he is selling). The second largest shareholder will be Daimler (through an investment arm called Blackstar Investco) with 8 percent of the shares, and the third largest will be the government of Abu Dhabi (through Al Wahada Capital Investment) with 7.8 percent of the shares. The two biggest VC shareholders will be Vantage Capital Partners with 6.6 percent and Valor Equity Partners with 5.25 percent.

It takes a ton of money to crack into the car business. Even before the IPO proceeds, Tesla has already raised $783 million in venture capital and government loans. Tesla is expecting to raise about $210 million in the IPO, bringing the total raised to just over $1 billion.

And so far the company isn’t making any money. Last year, Tesla lost $56 million on revenues of $112 million. In the March quarter of 2010, it lost $29.5 million on revenues of $20.8 million. As of March 31, 2010, the company still had $188 million in cash. But it expects to spend up to $125 million this year, as it gears up to manufacture its Model S sedan (including $42 million to buy a factory in Fremont, California formerly operated by Toyota and GM).

While Tesla is known for its sexy roadster, it the Model S which will make or break the company. It is a more affordable electric sedan which the company hopes will start to make inroads with the general car-buying public.

Exclusive – Mobile application developer Geodelic has raised $7 million in a Series B financing round led by MK Capital, with previous backers Clearstone Venture Partners and Shasta Ventures participating.

The round brings the total amount of capital injected into the company to more than $10 million.

Initially incubated by Clearstone in 2008, Geodelic develops a free application for mobile phones that come with ‘search-less search’, meaning the app automatically browses and shows your points of interests in your immediate vicinity. The company was founded by Rahul Sonnad, who previously founded thePlatform, a Web video publishing service he sold to Comcast back in 2006.

The Geodelic app, which is available for iPhone and Android, lets you swipe through locations to quickly find a good coffee joint, closest bank, grocery store or favorite restaurant.

The application is also capable of learning what you seem to like, presenting you results based on your profile. Users get the added benefit of Geodelic’s integration with select reservation and review services (e.g. OpenTable).

The Geodelic network also contains content-specific mobile guides, which can soon be created by anyone. One example is the Hollywood Walk of Fame, which enables users to discover the attraction, locate their favorite stars of stage and screen and to access photos and biographies straight from the app.

Additionally, Geodelic technology has been licensed by carriers such as Korea Telecom to allow enterprise customers to quickly deploy mobile guides and to interact with their consumer base.

Geodelic’s makes money by partnering with brands and marketers to create a network of so-called Experiences. The startup’s authoring system allows businesses to publish location-triggered content to Geodelic users on the fly and provides detailed, real-time statistics they can use to improve their location-based offerings. A relevance engine even tracks user behavior, allowing marketers to reach consumers as efficiently as possible at the point of sale.

To date, the Geodelic application has been downloaded over half a million times on Android phones, the company says. It is also available for iPhone (iTunes link), and currently in development for Blackberry devices.

Affiliate marketing platform Skimlinks has launched its latest product that aims to make it even easier for publishers to place revenue generating affiliate links in their content. Dubbed SkimWords, the feature, which is currently in beta, differs slightly from the company's main offering. Rather than simply converting existing retailer links to affiliate links on-the-fly, it looks at the page's content and converts any references to known products into fairly non-obtrusive geo-targeted links to retailer sites where the item can be purchased. The fact that these links are location-aware - at the country level - is perhaps noteworthy since it accommodates a site's international traffic and therefore hopefully doesn't leave much money on the table.

Apprupt, an affiliate network for mobile apps, has today launched its self-service platform for "appvertisers" (a slightly silly name). It enables app developers to sign up to apprupt on a cost-per-install basis, enabling them to track their marketing campaigns for both paid and free apps. Features include account management (including campaign spend), and reports and analytics providing "the ability to determine the ROI at any given time" by measuring the number of app downloads generated.

Facebook recently announced it would be opening an office in Hyderabad, India, to be able to provide better round-the-clock and multilingual support to its ever-increasing number of users, advertisers and third-party developers.

According to Business Standard and India Times, the company is set to launch its India operations from the ‘City of Pearls’ – its first office in Asia – within the next two months.

In a press release on Sunday, the State Information Technology and Communications department said Facebook had been granted permission by the government to set up an office in a business incubator at the Raheja Mindspace special economic zone (SEZ).

The new office will add to Facebook’s operations in Palo Alto (California), Dublin (Ireland) and a recently opened office in Austin (Texas).

According to The Economic Times, an Indian government official also said that Facebook has been allotted about 50,000 sq ft space and is going to recruit close to 500 people for running its operations. Facebook, which has nearly 8 million users in India and nearly 500 million users across the globe, would reportedly invest $150 million in the initial phases.

Perhaps they can use the $120 million Elevation Partners just pumped into the company?

It seems interest in the development of electric cars has really picked up steam in recent months, especially in Japan. A research team at Tokyo-based Waseda University has manufactured the ULV [JP], a one-person electric vehicle with a number of selling points: it’s cheap, it’s small and light (72.6kg), and it has a decent driving range (80km).

Read more…

Another day, another iSuppli teardown. The folks at iSuppli have found that iPhone 4, according to their estimates, cost $188 to make. While this is almost comically low, it says something about Apple’s ability to mass produce phones and the high margins they’re able to make on relatively low-cost products.

The gyroscope chip, for example, apparently costs Apple $2.60 while it costs $2.90 in quantities of 200,000. These disparities pop up in a number of places, which, sadly, lends an air of WTF to the proceedings.

Read more…

Mobile entertainment startup mSpot is debuting its free music cloud service today that allows you to sync your entire music collection across Android phones and PCs/Macs to the public today. The service, which was launched into private beta in May, streams music to your browser and Android phone.

Here’s how it works. The service’s application that operates in the background of your computer managing the upload and day-to-day syncing of your music library. In addition, it can upload playlists, coverart, ratings and song information you may have entered using iTunes. The application will manage your music for you, making automatic updates whenever changes occur in your library, and on across different connected devices.

And mSpot's cloud service automatically re-syncs music when new songs and albums are added. The service also promises to handle transitions between spotty and solid coverage areas and reduces data charges on your mobile plan. Other features include the ability to see lyrics of songs and to make a ringtone out of any song.

MSpot is betting big on this service. The company has been developing this proprietary playback
technology that allows users to play songs from the cloud instantly for four years. mSpot mobile application automatically senses network conditions and adapts playback accordingly even without network coverage.

While mSpot offers free storage for the first 2 gigabytes (approximately 1600 songs), additional storage is available for purchase ranging from 10 gigabytes (8,000 songs) for $2.99, 20 gigabytes (16,000 songs) for $4.99, and 50 gigabytes for 9.99.

mSpot’s streaming service will be incredibly an useful application for Android users. But that’s until Google launches its own cloud-based music streaming service, which is expected to take place later this year. The company even acquired streaming technology Simplify Media to boost its service.

Lala did this as well, but Apple has shut that service down after acquiring it. And we expect that Apple will be launching a cloud-based version of iTunes soon, which would also pose a serious threat to mSpot’s offering.

Mspot is best known for its Mobile Movies site, which will let users stream full-length movies on their mobile phones, on the web, so you can enjoy mSpot’s online streaming movie service on your computer. mSpot has struck deals with Paramount, Universal, Image Entertainment, and Screen Media Ventures to stream full-length movie rentals to users' PCs and cell phones, allowing you to switch between both devices as you pick up and leave off throughout a movie. The PC streaming functionality builds upon the mobile movie service mSpot launched last year. The service, which just launched an iPhone app, includes 1000 titles that can be streamed to both a computer and mobile device.

Apple this morning announced that it has sold over 1.7 million of the iPhone 4 through Saturday, June 26, three days after its launch on June 24.

The company went as far as to call it the “most successful product launch in Apple’s history”, citing its iconic chief executive Steve Jobs.

Bloomberg had predicted Apple would sell over 1 million on launch day alone, but the Cupertino company has not disclosed sales numbers for June 24 specifically.

Just for your reference: it took Apple 28 days to sell 1 million iPads, 59 days to sell 2 million of them and 80 days to sell 3 million.

Jobs also says in the press release announcing the first iPhone 4 milestone that he’s sorry about “all those customers” who were turned away because the company did not have enough supply.

No word (yet?) on the antenna issues that continue to plague a subset of iPhone 4 owners.

Yahoo wants to help people write effectively for the Web by publishing a custom style guide, as was announced last April.

The stylebook, entitled “The Yahoo! Style Guide: The Ultimate Sourcebook for Writing, Editing, and Creating Content for the Digital World”, will be released on July 6 by St. Martin's Griffin, and will be available in dead tree form in a variety of stores, but also – naturally – in digital form for Apple’s iPad and Amazon’s Kindle.

The company’s core team of editors, led by Chris Barr, senior editorial director of Yahoo, says it has revisited its in-house style guide and divided the guide into six sections covering, for one, the basics of grammar and punctuation.

In addition, Yahoo aims to cover some basics in the guide “even seasoned print editors and writers making the move to online writing struggle with”, citing examples like creating accessible websites, minimizing legal risk, writing for mobile devices, and improving a site's rank in search results.

The company targets professional journalists, bloggers, technical writers, editors but also web developers, designers, small- and medium-size businesses, advertising and PR agencies and … newspapers folks.

List price for the book is $21.99, but you can get it online at $14.84.

Now give me a second while I go check if everything is alright with regards to my Capitalization for this post.

According to website analytics company StatCounter, Google Chrome has now overtaken Apple's Safari in the US browser market for the first time on a weekly basis, claiming third place overall.

StatCounter, which says it analyzed some 874 million pages viewed on its network of over 3 million websites in the US alone for the week 21 to 27 June 2010, pegs Chrome’s market share at 8.97%, ahead of Safari with 8.88%. Internet Explorer still dominates the US Internet browser market with 52%, followed by Firefox with 28.5%, still according to StatCounter.

Worldwide, both StatCounter and Net Applications put Google’s Chrome solidly in the third spot, although the market share percentages differ between both companies’ findings.

Either way, Chrome now overtaking Safari in the US too is an important feat for Google, who introduced the browser less than two years ago.

(Via press release)

Twitter recently launched a tool called Blackbird Pie that enables anyone to easily embed single tweets on their blogs and websites. But it doesn’t offer a solution for tracking or sharing conversations between Twitter users.

Enter Bettween, which does just that, stylishly.

We’ve covered the first version of the web app, which made it easy to visualize what is being said between two specific Twitter users (e.g. @aplusk and @mrskutcher), but a recent update brings more goodies.

Aside from a fresh UI, you can now limit the visualized Twitter back-and-forth with a start and end point in time, making it easier for people to see and share messages that they care most about. Also new is the ability to sort tweets in ascending or descending order.

The biggest change, however, is the fact that you can now embed Twitter conversation on your own site, with the ability to customize the widget to match its look and feel.

It only takes a couple of clicks, but of course you need to find people who’ve actually conversed with each other on Twitter. Unlike these two:

Remember Steve Jobs' advice regarding the iPhone 4's reported reception issues - it's all your fault - relayed via an email from the Apple CEO himself (yes, one of those emails). Well, perhaps unsurprisingly, it hasn't gone down well with UK early adopters of the company's latest smartphone. That's according to a rather opportunistic "flash" survey from rightmobilephone, which found that 63% of respondents were "particularly angered" by Jobs' email in which he told one early iPhone 4 adopter to "avoid holding [the phone] in that way". The mobile phone comparison website polled 836 iPhone 4 users, 93% of whom claimed to have already been affected by a loss of signal whilst gripping the handset to make calls, whilst 78% of owners dubbed the fault "an insult".

Editor’s note: In the following guest post, PR consultant Vijay Chattha of VSC/AppLaunchPR gives some unsolicited marketing advice to Research in Motion.

Another profitable quarter and another hit to RIM’s stock price. People are buying Blackberries, but investors are not buying RIM. Why? Short answer. No buzz. Despite continuing to reign supreme as America's smartphone of choice, RIM's Blackberry devices are not creating enough excitement in the market. Sure, RIM saw 20 percent profit growth in the first quarter of 2010, but they've also watched their market share dwindle as rivals Apple and Android grow. If there was ever a time for a change, it's now.

BlackBerry, which is still ranked ahead of the iPhone and Android in worldwide popularity, can't keep telling the market its working on an iPhone-killer that remains in the distant horizon. It needs a business makeover.

As a branding and PR executive, I've taken some of the planning process around our work with mobile startups and applied it to RIM with five ways the Canadian company can boost their hopes and bring sexy back to Blackberry. (They can thank me later).

1. Leverage Obama
The number one celebrity in the world is a crackberry addict, yet RIM's dropped the ball on capitalizing on this once-in-a-lifetime product endorsement. Maybe the company is hesitant to become too seemingly political, but this is a man who's selling US Weekly covers on par with Brangelina. Experts estimate his endorsement of BlackBerry would be worth roughly $50 million, I believe that's grossly low. Obama is worth at least $250 million in annual comparative advertising value, or the price it would cost to buy that much print, online and TV time. But what is RIM marketing doing to capitalize on this opportunity? If the President of the United States trusts the security of the RIM operating system, shouldn't you? Now that's a tagline! RIM needs to move fast. Obama's popularity is waning like a Hollywood marriage, so seize the moment.

How?

Make a 'Barackberry' version. Bullet-proof, global data roaming and super secure, just like Barack's berry. It could become the 'must-have' tech toy from D.C. to Dubai. RIM should charge $10,000 so that all the hedge fund types buy in as well. Barackberrys should be given out at uber-influencer events such as TED, Davos and young exec confabs like the Summit Series.

2. Launch your Silicon Valley-based presence. Go big or go back to Canada.
RIM, based in Waterloo, Ontario is not part of the smartphone race conversation between Android and iPhone because a great deal of the conversation happens in Silicon Valley. To get into the conversation, RIM needs to get into Silicon Valley. RIM needs to step up its game and launch a massive Silicon Valley presence—and not just its existing outpost in Redwood City. A big presence in Mountain View or a swish office in San Francisco is the answer. There should be free food and Molson Beer flowing round the clock. Announce it at the Blackberry's DevCon, which is taking place in San Francisco this September.

3. Buy Hollywood
From Silicon Valley to Silicone Valley, RIM needs both ends of the Golden State. Apple understands the value of product placement and, for over a decade, has garnered more product placement than nearly any other tech brand. Featured in TV shows like The Office and Entourage, Apple products are dominating pop culture. Apple products were featured in 40 percent of the top box office hits of 2009. In fact Steve Jobs himself is the American most kids admire, even more than Oprah. But unlike our kids' admiration, Hollywood can be bought quickly. After all, even Carrie Bradshaw sold her iconic Apple computer for an HP in the latest Sex and the City movie. RIM needs to step up and put a Blackberry in the hand of damn near every “connected influencer” character out there.

Own a movie. A good one to start with would have been Wall Street: Money Never Sleeps. Come on. Every banker has a Blackberry. What better device to use to bring down the global economy than a BB Bold? Gordon Gecko has Blackberry written all over him. And he needs an upgrade from the brick he used in the original movie.

While you're on Sunset Avenue, revamp your TV ads which feature the Beatles and U2. Ask yourself what you are selling? Mobile phones or Flomax? While BlackBerry is spending millions for the rights to "All You Need is Love," Apple is being pitched by labels and bands, many of whom want nothing in return but the free promotion of having their music featured in TV ads. After Feist's '1-2-3-4' appeared in an Apple iPod nano commercial, sales of her song spiked 586 percent, according to Nielsen SoundScan. Instead of breaking the bank, BlackBerry could be breaking new bands.

4. Scrap your apps.
BlackBerry App World is a failure. Billing, developer marketing, and technical support are weak. A poll of AppLaunchPR developers rate the App World last in terms of developer relations and ease of use of all major smartphone app platforms.

Beyond technical issues, RIM needs to change its developer payouts. Recent projections show Apple's profit from apps may only equal 1 percent of total profits. It's only promoting apps to sell hardware. Period. If that's the case, then why should BlackBerry even worry about making money from apps? Apps should be a loss leader.

Blackberry apps should give 100 percent of the revenue to developers and even go one better. Instead of U2, focus more TV ads around your hot apps and their developers. Make them the rockstars. Oh yeah, and where's RIM's own mobile ad network? Now that's really the hottest accessory for 2010. Google has one, so does Apple. RIM announced a strategy to work with multiple networks and no one listened. Perhaps something more strategic is necessary to help developers market and distribute their apps.

5. Focus on an iTunes-killer, not an iPhone-killer
One of Apple's most valued assets is that the company holds more credit cards on file than any other company besides Amazon. ITunes is the true barrier to entry in the smartphone race.

First, purchase a music subscription service like Spotify or Rdio. Blackberry users want music but can't find anything within the device. RIM should seize this opportunity. Music and apps are only two customer billing entry points. RIM may want to consider strategic M&A to broaden its credit card database.

RIM reminds me of a line from the movie Swingers: "You're money and you don't even know it." RIM is well positioned from a cash and market share perspective to make BlackBerry a global, mobile, must-have addiction, but the company needs to make bold moves now or risk becoming Nokia.

Opera has released its latest State of the Mobile Web report, and once again it has registered reasonable growth, with Opera Mini users increasing by 4.2% compared to April 2010. Since that month, page views have also gone up 7.7%, Opera says.

For this report, Opera analyzed one 24-hour period to see how Opera Mini is used throughout the day in the top 10 countries (Indonesia, Russia, India, China, Nigeria, Ukraine, South Africa, the United States, Vietnam and the United Kingdom). Turns out that for all of those, regardless of differences in economy, culture or location, the four hours between 8 PM and midnight apparently account for a disproportionate amount of mobile data consumption.

Opera found that during said 24-hour period, the highest level of Opera Mini use is at nighttime, from 8 PM to midnight with little difference in data consumption between weekdays and weekends, in all of the top 10 countries. Curiously, users in the UK appear to be just as likely to browse on their phones between 8 AM and noon.

Other fun tidbits from the report:

- Night owls: compared to users in the other top 10 countries, users in the United States are more likely to be browsing with Opera Mini between midnight and 4 AM.

- Early risers: compared to users in the other top 10 countries, users in the UK are more likely to be browsing between 4 AM and noon.

- In general, evening browsing (between 4 PM and midnight) is more common than daytime browsing (between 8 AM and 4 PM), except in China and the UK where daytime/evening usage is about even.

Is this consistent with your mobile browsing habits, considering you’re in either one of the top 10 countries?

Elevation Partners has quietly amassed another huge chunk of Facebook shares on the secondary market, according to a recent letter to its limited partners. Elevation spent $120 million for five million more Facebook shares. This is on top of Elevation's $90 million, 2.5 million share purchase back in November.

That November deal has already gone up 2.5 times in value in a short eight months, making Facebook one of the better performing deals in Elevation's portfolio and an enviable holding for any firm. Even though the bulk of Elevation's Facebook shares were purchased at the more recent price, if you blend the two deals, there’s still an on-paper gain. Blended together, Elevation’s 7.5 million shares were purchased at a $14 billion valuation, and Facebook is trading at upwards of $24 billion on the secondary market today.

Sure, the appreciation looks good, but a lot of people– including us when we first broke the story– have alleged that these deals are ones any hedge fund could do. That's not actually true, according to several sources close to the deal.

Facebook controls who buys its shares on the secondary market, and Elevation has tight ties with the company. Elevation founders Roger McNamee and Bono were personal investors in Facebook, and Facebook COO Sheryl Sandberg's brother-in-law is Mark Bodnick, another Elevation partner. This isn't an accidental tie-up.

Elevation's premature obituary is a popular story these days. Things haven't worked out as planned for the firm—at all— but that's not unique in the venture market these days, and the tide is turning for Elevation. The Palm-albatross is gone, and the firm didn't lose money on the deal—not a trivial milestone considering it was 20% of the fund. (Photo above from the good old Elevation days.)

Today, Elevation is clearly switching strategies. Ambitious ideas of remaking the media business and investing huge percentages of a fund in revamping legacy companies are gone. The fund has more than $100 million left to invest, and that money likely won't go into another Palm or Forbes, but another Yelp or Facebook.

These mature Web 2.0 companies have far more assured success, the question is how much of a multiple late-stage investors like Elevation can make. As an added plus, these type of deals don't take anywhere near the hand-holding and work that the big ambitious, swing-for-the-fences turnarounds required. That was likely the real reason Elevation was laying off support staff last week, not necessarily an indication of the firm's health. Elevation is simply becoming a different firm.

And Elevation is playing a new role for the Web 2.0 ecosystem too—staving off the dreaded IPO. Rumors of a Facebook IPO have swirled since at least 2007, despite Facebook founder and CEO Mark Zuckerberg's long time apprehension to rush into the world of short-term traders and activist hedge funds.

There are a few good reasons for a company to go public. An IPO can net a company a lot of cash, allow employees to get liquidity on their shares, and give a privately-held company a frequently-priced stock currency it can use for acquisitions. But Facebook has managed to do a lot of that with the secondary market, and it can still control who buys its stock.

That's a template that only the highest valued Web 2.0 companies can follow, and if Elevation can raise a second fund, it'll aim to compete with firms like DST to scoop up the best ones.

Amazon just introduced a audio and video to the Kindle, but the only way to experience the new Kindle multimedia books is on an iPad, iPhone, or iPod Touch. A baker’s dozen of titles already come in multimedia editions, including Rick Steves’ travel guides, Best of the Beatles For Acoustic Guitar, and Bird Songs: 250 North American Birds In Song.

Adding music or narration to digital editions of books is fairly straightforward, and given the popularity of audio books, being able to both read and hear a book should be popular for some genres. Video can work also, but I suspect that more often than not it will be treated as something to be tacked on at the end rather than as an integral part of the original work. I guess it depends on who picks the videos: the author, or the publishing company’s marketing department. Trial and error will determine whether people really want video with their books. In any case, the Vook now has competition.

The big takeaway here, however, is not that Amazon is making it easier for people who buy books to be distracted by something other than reading. It is that they are adding these features to the Kindle software which runs on Apple products rather than on its own more technically limited, black-and-white device. Amazon’s own Kindle reader supports text-to-speech and regular audio books, but not video. With this release, Amazon is expanding the digital audio books to the iPad and iPhone. But the Kindle apps on Apple devices adds a feature you cannot get on Kindle’s own device in terms of video.

In other words, if you want that extra feature, Amazon is basically telling you to buy an iPad. Of course, it would help if the dozen or so Kindle books that come with the extra audio or video were more of the must-read or must-hear variety.

Editor’s note: The following guest post is by Krishna Subramanian, co-founder of mobile ad exchange Mobclix.

Mobile search is still one of the big unclaimed prizes on the mobile web. Everyone from Google and Yahoo to Apple is going after it, but Microsoft’s Bing may stealthily become the king of the castle by aggressively promoting Bing through mobile apps. Let’s look at each player’s mobile search strategy.

Apple: In The Driver’s Seat

During the Apple keynote in April, Steve Jobs announced the new iPhone 4.0, iAd and a few other features even he didn't seem too excited about. Out of the many mediocre features, Mr. Jobs happened to squeeze in a declaration that, " On mobile, search hasn’t happened. People aren't searching on their phones." During the keynote at WWDC this month, Mr. Jobs declared that iPhone 4 users would have the opportunity to select their search engine from among Google, Yahoo, and Bing. Out of the three, Bing got a special endorsement from Mr. Jobs.

Is Mr. Jobs trying to blindside the other players in this space by making them think he is not concerned about search? I'm sure all of the search traffic he is sending to Google is driving him nuts. Meanwhile, Google has happily—and quite beautifully—optimized their search results page on the iPhone to make it extremely convenient for local searches by incorporating phone numbers, maps and more within the Safari window.

Remember the days you would dial 411 or, even more recently, send an SMS to GOOG for information about local businesses or venues while you are on-the-go? Does anyone do that anymore? I'm sure people love paying $1.75 to find out the name of the local pizza shop. By the time you dial 411 and struggle through the automated voice menu, you could have pulled up addresses, phone numbers and reviews to the five nearest pizza places and be one click away from an interactive map.

Apple brought the traffic to mobile search, but why not make money off it? Google, Yahoo! and Microsoft all see the value of controlling search across mobile devices—not just the iPhone. Similar to the web, these three goliaths want to be the starting point for every consumer query. All three have launched iPhone specific apps with slightly different flavors as they try to first win the hearts of the iPhone user.

Yahoo! Doesn’t Know What It Wants To Be

Yahoo! is all over the place in the App Store. It has two iPhone apps in the iTunes App Store. Within the reference category, the Yahoo! Search app is ranked at #30 with 658 comments. For the most part it includes many of the same core features that the other search apps offer.

To get more mindshare from users, Yahoo! has sprinkled many other apps in various categories with the Yahoo! Finance and Yahoo! Shopping and Yahoo! Entertainment apps and a pretty successful Yahoo! News app (#47 with close to 50,000 comments). This attempt to build interest just dilutes Yahoo!'s audience across multiple apps—which, if combined together, could have a significant impact.

It’s Google’s Game To Lose

As the default search engine plugged into mobile Safari on the iPhone, Google has always had an advantage driving mindshare to its mobile apps. It was the first one to use voice activated search and has steadily built out its host of features since making it easier to access core Google products like Gmail. The Google Mobile app is currently ranked first in the reference category for iPhone apps with more than 2,000 comments.

Hello, Bing!

Far behind when the gates opened, the Bing team is pushing out new features as fast as possible, trying to draw from Google what works best. Interestingly enough, the results (even on a local level) are quite different from the very accurate Google search results. The Bing search app received a nice endorsement from Mr. Jobs at the WWDC keynote, so lofty expectations are already set. It is currently ranked No. 2 in Reference.

Microsoft released an updated Bing app last week with a few new notable features: Visual Scanning (very similar to the Red Laser iPhone app eBay acquired earlier this month) and tapping into social graphs through Facebook and Twitter status updates. The entertainment angle is allowing Bing to create a unique niche that ties back to search. It also redesigned its mobile browser search to make it more of an app-like experience.

Advertising as a Distribution Channel

The biggest hurdle is getting these app installed on as many devices as possible, but thanks to all the apps in the App Store there is an abundance of ad inventory available for marketers. App developers, if you don't already love these big boys, you should. They have been spending significant amounts of money (think six figures-plus) desperately trying to get in front of as many of your users as possible, which translates into more money in your pocket.

All of the search giants use in-app marketing to push their own apps. Yahoo! and Google have done a great job avoiding creative saturation by building out a wide array of messages, colors, languages and landing pages, as well as making use of geo-targeting.

Boom! Bing Changes the Game

As the Bing team continues to spend more money on advertising, they recently changed the game, significantly crushing Google in the app rankings. How? Easy…

Attaching yourself to successful apps with consumer brand power is a sure fire way to rise to the top."We absolutely market our applications on the iPhone, I don't think of it as unique to anything else. It is like promoting on the toolbar," Yusuf Mehdi, Senior Vice President, Bing recently told TechCrunch co-editor Erick Schonfeld. "Yes, it has been effective.”

For example, Bing took the Top 100s by Year app that allows users to stream songs by decade for $1.99, rebranded it to Top 100s by Year by Bing, made it free and inserted advertising to drive users to download the Bing Search App.

The Top 100s by Bing app instantly surged to the top of the App Store and remained in the top five for weeks. It remains at the top of the music category hovering near favorites like Pandora and Shazam. And, as I mentioned, the Bing search app is currently No. 2 in Reference, and in the top 100 free iPhone apps overall.

Ads within the Top 100s app that drive users to download the Bing app:

Fresh off the success of leveraging sponsored apps to drive downloads to the Bing app, Microsoft has recently reached out to a new audience segment by sponsoring the ESPN World Cup Trivia app, which is ranked No. 6 in the sports category.

Rather than taking the viral nature of the Top 100's music app, Bing and ESPN are also running display inventory to drive additional traffic to the World Cup Trivia app.

So where does this leave the Bing search app? How about in the top 100 of all free apps and, more importantly, at one point it even squeezed Google's app out of the top 50 free apps. Bing has taken a simple concept, executed and proved the value of the model by consistently keeping their brand top of mind across top apps in different categories.

Mobile search is here, whether you want to believe it or not. Take Apple's recent acquisition of Siri for a small sum of around $200 million to $250 million. It will be pretty easy to use that as the nucleus for an Apple-owned local search product for mobile. Not to mention the valuation is around the same price tag as what it paid for Quattro Wireless.

As the market grows, Yahoo!, Google, Bing and Apple will become more cut throat. Don't expect to see Bing ads on Google Mobile Ads or Apple featuring Yahoo!. Likewise, we may not see as many new Google and Bing apps in the App Store in the near future. But they will keep pushing forward as much as they can. After all, they probably don’t have much time before Mr. Jobs begins to think differently about mobile search.

This is a guest post by Gang Lu, a Shanghai-based blogger and consultant. His blog mobinode.com covers the Chinese and Asian Web industry, and he also co-founded OpenWeb.Asia workgroup and KUUKIE.com.

Twitter hit $1 billion valuation within 3 years. Facebook reached equal valuation with 2 years. It only took Groupon a year and a half. In April, a consortium led by Russian investment company DST  invested $135 million on Groupon, making the valuation of Groupon shoot up to $1.35 billion.

The excitement has lead to many Groupon-clones in China. This market is already overheated and much crazier than people expected. Reports say there are between 100 and 200 Groupon-clones in the market already. Some of them already raised a large bucket of money, and several deals are around $5 million. RenRen, the leading Chinese social network, launched its own group purchase site called Nuomi, and it only took hours for 152,095 users to buy an offer for 2 movie tickets, 2 cokes, 1 box of popcorn and 1 Häagen-Dazs ice cream.

But what are the odds of survival for the Chinese clones?

1.  Group Purchase, New and Old business model. If you think sites like Tudou, Youku are copycats of YouTube and Renren, Kaixin001 are copycats of Facebook, I can understand that because there were no video-sharing sites, social networks sites similar to those western services in China. But the Groupon model isn’t 100% new for China. Group Purchase (in Chinese it’s called Tuan Gou) is hugely popular in China especially in home improvement/home decoration market where thousands of people got connected online and buy the same products together in street shops in order to get a good bulk-discount.

I met the co-founder of the leading group buy service site TG.com.cn weeks ago. He said his company is expecting rmb 50 million after-tax income and getting ready for an IPO. So the consumer education cost for Groupon model is nearly zero. It is an ‘old’ model, but one that has ‘new’ features to Chinese consumers since the purchases are online and there’s the ‘deal of the day’ strategy. No one ever made the online group purchase experience so easy in China.

2. An easier model to survive? Unlike video-sharing, social networks, Twitter models which are all about burning money to build its user-base at the beginning, Groupon clones are making cash-flow since the first day. And the Groupon model focuses on one deal in one city. In China, it’s not difficult to find a deal and the Internet in China is very geographically-based. It should be relatively easier for those startups to survive.

However, if you have many targeting the same market, then it’s all about how to do the marketing in the end. Can you offer better share with those merchants? Do you have enough money to reach more industry sectors and grow faster? Surviving is one thing, at some point, you may also need huge money to burn. (Why did Groupon raise such amount of $$$ even when it’s already hot!!)

3.  Better Service or Better Price? I’ve read some feedback from some Chinese Groupon users complaining about the service. 'Cheap price does not mean we also accept cheap service', they said. Groupon can offer you good price, but they can not guarantee whether or not the merchants are able to offer mass customers the service with the good quality. When your users come to you only for cheaper price, be careful, because that might also imply the customer loyalty is low. Especially in China, your customer can quickly move to another one with cheaper price or a big one with better service guaranteed.

4. Happy or Sad story in the end? Startups vs. Big guys. This is typically a sad story in China. When Web giants see interesting new business models, instead of partnering with you or acquiring yours, they launch something on their own. Renren’s Nuomi has shown its super power with huge user base. Taobao, has launched its Groupon service on ju.taobao.com, and Dianpin (the leading Yelp-like service) has also launched its t.dianping.com.

They have not started heavy promotion yet, but they are watching the market until they are fully ready and the market is more mature. So why are Chinese VCs still rushing for those startups? How do they expect these sites to exit one day? A few very lucky ones could take the lead in the end with enough money to burn, or one of them could be acquired by Groupon if it comes to China one day? I’m not so sure.

5. Innovation or just Interesting? The Groupons’ Aggregator There are so many Groupon services in China, and I am assuming there are more to come. So the question becomes, where to efficiently find the best deals on each service. The answer is obvious; we need a search engine. Now we see the sites such as tg123.com, niutuan.com, 122.net to aggregate and navigate Groupon services. I don’t know what kind of partnerships are  involved, but it’s smart, isn’t it? At least, it perfectly fits for overcrowded Chinese market.

Before you finish the reading, the following is a list of our favorite Groupon-clones (via web20share.com).

1. Lashou

• Highlights: recently has closed $5million investment and company valuation is reported around rmb 1 billion.
• Main Group Purchase Item: Restaurant, Pub, KTV, SPA, Hairdressing, Yoga and other selected featured firms.
• Currently Covered Cities: Over 100 cities including Beijing, Shenzhen, Guangzhou, Nanjing, Daqing, Nanchang etc.

2. Meituan

• Highlights: it’s founded by Wang Xin, the guy also co-founded first Chinese Facebook, Xiaonei.com (now Renren.com) and first Chinese Twitter, Fanfou.com (now closed);
• Main Group Purchase Item: Restaurant, Pub, KTV, SPA, Hairdressing, Yoga, etc.
• Currently Covered Cities: Beijing, Shanghai, Wuhan

3. Mituan

• Main Group Purchase Item: Quality local living services
• Currently Covered Cities: Hangzhou

4. Cooltuan

• Main Group Purchase Item: Restaurant, SPA, Photography, Hairdressing, Cinema, Gym, Live CS Show, etc.
• Currently Covered Cities: Shanghai

5. Manzuo

• Main Group Purchase Item: Delicacy, Tour, Gym and SPA, etc.
• Currently Covered Cities: Beijing

6. Groupon China

• Main Group Purchase Items: Food & Beverage, Pub, SPA, KTV, Hairdressing, Yoga, Training and transaction, etc.
• Currently Covered Cities: Beijing, Chengdu, Fuzhou, Guangzhou, Nanjing, Hangzhou, Jinan, Nanning, Qingdao, Shanghai, Shenyang, Suzhou, Tianjin, Xiamen, Taiyuan and Zhengzhou.

7. Groupon365

• Main Group Purchase Item: hottest, and the most fashionable goods
• Currently Covered Cities: Qingdao

8. Tuank

• Main Group Purchase Item: Restaurant, Pub, KTV, SPA, Hairdressing, Yoga and other selected featured firms.
• Currently Covered Cities: Nanchang

9. Runtuan

• Main Group Purchase Item: Restaurant, Pub, KTV, SPA, Hairdressing, Yoga etc.
• Currently Covered Cities: Guangzhou

10. 55tuan

• Main Group Purchase Item: Restaurant, KTV, SPA, Hairdressing, Yoga etc.
• Currently covered cities: Beijing