Editor's note: James Altucher is an investor, programmer, author, and entrepreneur. He is Managing Director of Formula Capital and has written ten books. His latest books are I Was Blind But Now I See and 40 Alternatives to College. You can follow him on Twitter @jaltucher.

The first thing, of course, is that Mike Lazerow, the founder of Buddy Media, met me. This sounds egotistical, but everything I did in the encounter was bad for me.

He cold-emailed me in 2007. I had just launched a company called Stockpickr.com. He liked the idea and his time with GOLF.com (which he had built and sold to Time Warner for $24mm) was running out and he wanted something to do. He liked the idea of Stockpickr and wanted to run it. Specifically, his email said:

“I’m a huge fan of Stockpickr and can help grow the business to the next level. Let me know if you’d like to discuss. You currently have a great site and with a little tweaking can turn it into a category killer.”

So we met at my favorite diner on 44th street. He told me the other day he remembered what I ordered. Bacon and a vanilla milkshake. For someone born with a heart condition, as Mike was, that order must’ve stayed implanted in his memory.

He pitched a bunch of great ideas of what I should be doing at Stockpickr. I did all the ideas. They were genius. In fact, I stole them all from Mike and didn’t give him credit. That’s the way I roll. And I did become a category killer as a result. Thanks Mike!

Although he didn’t become involved with the company (I ended up selling it a few months later) we became friends and would meet regularly for breakfast. So the first great thing that happened to Buddy Media was that to my great detriment I didn’t let him run Stockpickr and he was forced to come up with an infinitely better idea, which was Buddy Media [disclosure: I invested].

[See also, "The Day Stockpickr Was Going to Go out of Business - A Story of Friendship"]

2) He saw the potential of Facebook. Not everyone did. In July, 2007 I got laughed off the set on CNBC by saying Facebook would be one be worth north of $100 billion. In September, 2007, Mike bought a technology called AceBucks, which worked similar to how Facebook Credits works now. A bunch of us put together the first round but we had no idea how this would work. The idea is that AceBucks / Buddy Media would make games and people would buy or trade virtual goods using AceBucks. Sounds like Zynga right? Come to think of it, Mark Pincus (and Peter Thiel) was also in that first round of Buddy. Perhaps hedging his bets.

For whatever reason, the Zynga games caught fire and the Buddy games didn’t. I really like word games. Buddy had a boggle-like game and Zynga had one. I kept playing the Buddy game until I was the only one left. Everyone had moved to the Zynga game. Screw Zynga! In any case, the Buddy games and AceBucks weren’t really catching on.

3) He switched business models to survive. But Michael had gotten all these programmers together  who knew Facebook better than anyone else. What to do with them? He basically created the market – convincing companies that they needed a Facebook presence even more than they needed a corporate website because of the direct engagement with the customer. He transformed into a service business at first, helping companies one by one get onto Facebook. Building various tools and applications that businesses could use to manage that engagement with the customer. With Facebook you advertise once to get that “fan” for your brand but forever after you can market to them for free. The trick is to have the  tools to keep that engagement high so the fan continues to like you. And for that continuous engagement, companies would pay Mike’s team for his programming services.

This was in 2008. When the financial crisis was happening and it became much more difficult to raise money. By transforming from a gaming/virtual currency company with unkown prospects to a service business, Michael guaranteed that the company would remain afloat. When you have a service business (I had a website development business in the 90s so knew from experience) you can stay afloat by hiring and firing as needed when clients are added or dropped.

The problem with a service business is that you are only as valuable as the people who walk out the door every night. Mike knew this so…

[See also, "How I Disappointed Tupac's Mom"]

3) He became a software-as-a-service company. He saw that many of the services he was building for companies were the same. So he standardized them and created a platform of tools. This platform-as-a-service approach allows you to make money while you sleep. In other words, you now can command a higher valuation. Your tools and IP become valuable. They don’t walk out the door at night.

Companies can sign up, use the tools, add more games, apps, engagement tools, etc without the need for the usual overhead from a service company: project managers, programmers, workflow specialists, designers, etc. It was all done for them one time and they can just keep going.

It also created a huge moat around Buddy. Once a company signed up, they couldn’t easily switch because they were using all the tools that Buddy owned. Valuation got higher and Mike raised enough money at the right moment to stay in business forever.

4) He brought on distribution as equity partners. Many businesses take on standard VCs as investors and then fight it out for distribution. Mike brought on ad agency WPP, who had thousands of potential customers, as an equity partner. WPP’s interests were compleletly aligned with Mike’s so adding new customers never became a problem and the company continued to grow.  Every growing business should do this. It further locks in your moat and makes it easier to raise future money (VCs say “well if WPP is in then we should go in”).  In fact, VC demand was so great for Buddy at this point that when I called Mike to introduce him to a high profile VC (top 3 in the Valley) he wouldn’t take the meeting. “Too many meetings!” he said.

5) He worked beyond human capacity. One time I was thinking of starting a consulting business helping corporations develop their twitter strategies. I almost wanted to be a Buddy Media but for twitter instead of Facebook. I had customers ready to go including a major car company. I called Mike up asking for advice. He was getting off one plane and about to get on another. He was speaking at one conference on one continent and about to visit a client in another continent. I got scared. I had just met  the woman who would become my wife. I didn’t want to be flying all the time. This car company already wanted to fly me to Detroit.  I can’t remember if Mike gave advice or not on that phone call. I only remember that I was literally shaking when I heard how much he had to travel. I was too lazy! So I stopped the business. I think he loved what he was doing. But I knew I wouldn’t’ love it. It would kill me.

[See also, "140love - The Ultimate Dating Serice"]

6) He sold the company. 

Let’s summarize why. Facebook just had THE MOST SUCCESSFUL IPO in history. The newspaper headlines say it was a “flop”. That’s why some people write newspaper headlines and some people make a lot of money. The pessimists write the headlines and the optimists make the money. Facebook raised the maximum amount of money they could raise at the highest price and they paid the lowest fees paid in the history of investment banking. With decision-making and execution like that it adds to a long list of successful decisions that Facebook’s management continually makes. This IPO was very successful for Facebook, which is why their stock is cheap now. But further, go back and watch the Super Bowl. For the first time, more than half the companies didn’t put up their website URLs. They put  up their Facebook URLs. Many of those Facebook pages set up by Buddy Media. Facebook (and Buddy) are here to stay.

Salesforce.com, with their thousands of companies in need of additional SaaS Services, particularly services that allows them to manage their presence on Facebook, was a natural fit for Buddy and will do well as marketing budgets switch more and more to the Facebook ecosystem.

7) He sold for $800mm+. I’m not sure why the newspapers keep saying $689mm. Let’s carefully read the SEC filing together: It states that “total consideration” …”shall mean an amount equal to USD$745,000,000, plus the sum of (x) Closing Cash and (y) the Aggregate Strike Price Amount”.

So what are the “Closing Cash” and the “Aggregate Strike Price Amount”? We know the company has raised $90mm according to Crunchbase, with the last round closing in the latter half of last year – a total amount of about $55mm. The prior round was $30mm. Assuming they still have the $55mm in the bank leaves us with a price of $800mm. Now add in the “Aggregate Strike Price Amount” where they take care of all the issued options, many of which are significantly in the money. I don’t know what this number is. But it probably adds 10-20% to the deal price. We’ll know for sure when the deal closes. $800mm makes this the largest tech deal in NYC in over five years.

AllThingsD is reporting that Google was willing to pay more than $745mm but this $745mm is an arbitrary number. Given the tighter federal overseeing of Google acquisitions, plus the clear synergy between Buddy and Salesforce.com, plus the fact that this deal is probably closer to $850mm – $900mm in size, Google would’ve had to offer a billion or more to take the deal away from Salesforce.com.

So congratulations to Salesforce.com for finding the perfect complement to the services that they provide customers. And congratulations to Mike and team for a job well done, for riding the waves of anxiety and fear of obscurity that inevitably rise in every business. For surviving. For working hard. For selling.

Look, I get it, Microsoft. You want to show people who you know how to have fun, that even Microsoft can smile once in a while. But seriously, stop with the dancing routines. Your target audience doesn’t dance. We, at best, sway with the music, but never dance.

As GeekWire points out, the latest nightmare happened earlier this week at the Norwegian Developers Conference where several dancers took the stage and performed to a song with such classy lines as "The words MICRO and SOFT don't apply to my PENIS! (or vagina)" and “We are here to party and coding is our drug!” Laughter can be heard throughout the video as the attendees stand nearly motionless, likely in shock as if they were witnessing a train wreck in slow motion.

This comes the week after Usher took the stage during Microsoft’s E3 keynote for a nearly equally embarrassing show.

I was sitting in the audience for Usher’s 20120 E3 performance and can attest that most of the gaming industry found the show a bit misplaced; no one got out of their seat as Usher instructed several times. John Biggs said it best, though.

"I really loved seeing Usher on stage at Microsoft's #e3 event!" - Nobody

—
John Biggs (@johnbiggs) June 04, 2012

And of course there is this classic 2009 video of a Microsoft Store breaking out in an not-so-impromptu flash mob-ish dance. At the time I stated the store was trying too hard, but now, three years later, as Microsoft Stores have failed to be capture shoppers like the Apple Stores Redmond is clearly coping, I think they should be applauded for at least trying something.

Please, Microsoft, I beg you. A sweaty Steve Ballmer yelling and jumping around is better for your brand than employing a dance troupe to rally your remaining fans.

The Droid RAZR HD is coming. It’s yet to be announced, but several leaks fortel its coming. And the next Droid is set to go spec-to-spec with the Samsung Galaxy S III. This thing looks killer.

The leaked pics show a device clearly born of the same DNA responsible for Motorola’s hottest Android models. The backside appears to be made of carbon fiber like the RAZR and RAZR MAXX. There are microUSB and microHDMI ports on the device’s side like on the Droid X/X2 and Bionic. The casing’s relatively thick casing is spurring rumors across the blogosphere that this model might even pack the RAZR MAXX’s massive 3000 mAh battery, which, if included, would give this Droid a significant selling point over the Samsung Galaxy S III.

Per leaked benchmarks further detailed below, the screen is reportedly 1196×720 with several pixels likely dedicated to on-screen buttons. This is a significant step-up from the RAZR’s 540 x 960 screen and matches the Samsung Galaxy S III pixel for pixel.

A stray Nenamark benchmark further details the upcoming phone, revealing its Snapdragon S4 dual-core heart running at 1.5GHz. Fanboys will be quick to point out that this is the same clock speed and chipset used in the SIII headed to Verizon, but the Droid RAZR HD reportedly only has 1GB of RAM where Samsung’s latest rocks 2GB.

So far pricing and the target release date has yet to be announced (or leaked). That said, if Mr. Blurry Cam can get his hands on a unit, chances are the release is not that far out and considering the RAZR MAXX’s recent price drop, expect this model to cost either $249 or $299.

“It’s just as good as getting a personal instructor,” says basketball coach Julio Agosto, speaking on the Xbox Kinect’s new dribbling game, NBA Baller Beats. Agosto, an Emerald City Academy Basketball coach and father to b-ball Internet phenom, Jashaun Agosto, tells TechCrunch that Kinect’s digital eye is able to recognize and reward enough advanced dribbling skills that the new NBA game could replace human instruction at his basketball camp (at least the dribbling portion). This latest Microsoft development brings one more job closer to the chopping block of skills that can be done cheaper and more conveniently by a computer: sports and fitness coaches.

Baller Beats plays a lot like Rock Band but with a basketball; gamers are rewarded for dribbling to a (rockin’) beat, with the familiar vertical scroll of colorful, raised buttons indicating when users should bounce the ball, and in what direction around the body.

Evolving from its Rock Band inspiration, Baller Beats is the first title to recognize objects, allowing wanna-be athletes to hone their muscle memory with the very tools used in real-life gameplay. “Even a pro player can get a good workout,” gushes Agosto. Since this system is made for the home, players can practice to their heart’s content anytime they want.

Interestingly, Agosto argues that much of his dribbling coaching is cookie-cutter. Among the most important tasks he performs is training burgeoning young b-ballers to keep their eyes on their opponent, simply by asking them to read how many fingers he’s holding up as they dribble. Baller Beats performs the same functional incidentally, since gamers are forced to watch the screen as they play.

Advanced skills, such as dribbling through one’s legs, is equally monotonous, requiring a coach to passively monitor players as they perform hundreds of the same movement with pitch-perfect form. Observing an athlete’s form is essentially the same as spotting the correct outline of the human shape–the exact function that Kinect’s dummy digital eye uses to recognize movement. Agosto says the same is true for teaching proper shooting technique, for instance, by ensuring his students keep their elbows pointed downward.

In other words, it’s not that Kinect is some Skynet-like genius, but that many of the tasks that “experts” routinely perform are no more sophisticated than the assembly-line construction that robots replaced decades ago. Back then, robots replaced jobs that used our limbs; now they’re replacing our eyes.

The encroachment on sports and fitness training is just another notch on the wall for our robot competitors. Last year, the New York Times found armies of lawyers being replaced by computer software, which can just as easily dig through legal documents for keywords. In Florida, automatic learning software is replacing teachers, who have been reciting similar lectures for years.

Computers may not be able to replace high-level thinking…yet. But, in the meantime, what other seemingly sophisticated jobs are we doing that could be next on the automated chopping block?

Splashtop made waves (thankyouverymuch) in April when the mobile app company launched the Windows 8 Testbed Metro for the iPad. This iPad app allowed owners to experience the few highs and many lows of Windows 8 Metro. As Engadget put it then, it must be a bit uncomfortable for iPads, but it’s a very impressive app offering nearly all the functionality of Metro including the many multitouch swipe functions. And now it’s available for Android tablets, too.

The price is still the same: $49.99 but its current 50% off for an unspecified limited time. The app runs at a resolution of 1280 x 800 resolution and supports Android tabs ranging from seven to ten inches. Like its iPad counterpart the app supports Metro’s UI touch gestures allowing developers and consumers alike to experience most of Metro on their current devices.

Sure, it’s a bit pricy even at the $25 promotional price, but the app is fully functional even if it’s not as smooth as the real thing. If Windows 8 calls your name, it’s best to jump on the platform now. For most people Metro is not love at first sight. You have to learn to love Metro.

[Google Play] [iTunes]

Feature phones are not the future. Of course that verges on tautology; of course everyone will have a smartphone, until everyone has something smaller and better and even more integrated into the fabric of our lives, like Google Glasses or cybernetic jawbone/retinal implants or whatever Charles Stross dreams up next. But when, exactly?

I’ve spent a good chunk of my life wandering around and writing about the developing world, and as lots of folks have recently argued, that’s still feature-phone territory, and will stay so for the foreseeable future. OK. Fair enough. But when precisely does the foreseeable future end? Because when the smartphone revolution hits the developing world, that’s when things are going to get really interesting, because it will also be their computer revolution and Internet revolution, all the same time.

I’m particularly interested in sub-Saharan Africa (and it seems I’m not the only one around here) but it’s particularly hard to make predictions about sub-Saharan Africa, in large part because you still have to take all the statistics that come out of there with a sizable grain of salt. That said, here are a few interesting nuggets. Current smartphone penetration estimates range from 3% to 17%, but I’m most convinced by Samsung’s estimate of ~7%, up from 5% last year. Doesn’t sound like much, does it? But:

(source)

So if smartphone adoption in Africa follows the same path as dumb/feature-phone adoption, then right now is the rough equivalent of 2003, and smartphones will be 15% of the African mobile market in 2014, 23% in 2015, and 40% five years from now. A significant minority, but still a minority. Right?

Except that a whole cluster of factors make me think that rate of smartphone adoption in Africa will leave the rate of feature-phone adoption in the dust. The distribution channels are already mature and thriving. No-contract $100 Android phones are already competing viciously, eg Samsung’s new Galaxy Pocket vs. Huawei’s IDEOS. Smartphones are more desirable than dumb/feature phones were – again, they’re three revolutions rolled into one.

And, most importantly, sub-Saharan Africa is much wealthier than it was ten years ago. As The Economist points out, most of the world’s ten fastest-growing economies both to and since 2010 lie south of the Sahara.

So here’s my prediction: in five years’ time, most sub-Saharan Africans will have smartphones. Too optimistic? I don’t think so; after all, from 2003-2008, basic mobile-phone penetration went from 6% to 40%, and I believe the above is a fairly convincing list of reasons to believe that smartphone adoption will outpace that. Still, it’s quite an extraordinary thought.

The company who builds a 1st world smartphone for a 3rd world network gets the next billion users. mobility.com.ng/?p=11520—
Erik Hersman (@whiteafrican) May 29, 2012

The West still tends to think of Africa as a sea of unending poverty, violence, and despair; pretty soon, though, it may have no choice but to start thinking of it as a lucrative market. Half a billion users here, half a billion users there, pretty soon it adds up to some serious money. App developers, take note.

Snapchat hopes to outgrow its bad rap as a sexting app, but first it’s outgrowing the Stanford dorm room where it started. Today it announced it has hired a community manager and two engineers, and has now been used to share 110 million photos that each disappear after a set time limit.

Now its shooting to release a big iOS update by the end of June that will include “password recovery, bug fixes, a faster camera and drawing”. And to appease it younger core demographic who might not be able to afford iPhones, it’s building out an Android version.

Snapchat burst into the tech scene’s consciousness last month thanks to a New York Times article. But that piece framed its ability to let a photo’s sender select to have their picture disappear seconds after being received as being primarily for sending nude photos.

However, co-founder Evan Speigel refuses to be pigeon-holed. He told TechCrunch "I'm not convinced that the whole sexting thing is as big as the media makes it out to be. I just don't know people who do that. It doesn't seem that fun when you can have real sex." With $485,000 in seed funding and a growing team, Snapchat is determined to graduate into a real business.

I spoke with Spiegel recently and he was skeptical about multi-faceted web-first social networks getting mobile right for the next generation. You’ll notice Snapchat’s blog post didn’t mention a huge set of additional features. The one new thing will be the option to draw on photos before you send them.

Rather than get bloated, Snapchat plans to keep the experience quick and concise, and hold true to its mission to be “the fastest way to share a moment.”

Snapchat is currently available for iOS

Gizmodo posted a “story” yesterday entitled “We'll Pay You for Photos of Mark Zuckerberg.” Desperation aside, this is as crazy as it is stupid (And we’re not even sure it’s legal).

See, Mark Zuckerberg is the CEO of a company. Sure, that company is all about sharing with friends, but when you have more than 14 million people subscribed to your page, sharing a photo or a link on Facebook becomes an entirely different beast. He’s scrutinized on everything that he’s ever publicly shared. Just take a look at the IPO hoodie bonanza.

So it makes sense that a CEO, a businessman in its truest sense, wouldn’t want to be splashed across magazine covers and speculated about on gossip columns (which is essentially what Gizmodo’s media network, Gawker Media, is centered around). He kept his wedding fiercely private because marrying your long-time girlfriend, and likely one of the only women you can trust, is an intensely private affair.

So why bother him? I mean, if I (as a reporter) witnessed Zuck beating his dog or something totally insane, I would probably snap a picture and send it to my editors. It’s our job to expose the truth even if the truth is messy. It’s not, however, our job to sick the wild masses onto CEOs so we can rake in clicks from pictures of Zuck walking his dog. (From what I’ve heard, most public sightings of Zuck consist of him and Priscilla walking the dog — thrilling, I know.)

There are a couple of things to consider here:

Everybody cares about Zuckerberg, so these photos are sure to bring in some traffic. He’s a fascinating fellow, who changed the world in a very real way. Plus, he’s hella rich, and rich people are interesting. The same was true for Steve Jobs — people prodded into his life as they could, taking pictures of his car and perhaps too fiercely delving into his medical history. But did he like it? No.

Did he deserve it? Hells no!

Now, I understand that media can get a little cut-throat. Hell, Gizmodo basically ruined its reputation as a real tech blog the moment it paid for that iPhone 4 and got into a spat with Mr. Jobs. Sure, the site probably saw more traffic that day than it ever has (or ever will again), but now it’s a tech culture blog that never gets invited to any Apple events.

And guess what? They’ll never be invited to any Facebook events either once they get a picture of Zuck picking his nose.

Just like any of us, Zuck has the right to keep his private life off of Facebook. And Gizmodo’s price of $20 per photo is even more desperate than their story’s headline.

I’m disappointed, Giz.

Good luck dodging amateur photographers, Zuck. (And buy yourself a nice hat and some sunglasses. Looks like it’s going to be a long, weird summer.)

After disappointing post-IPO performances from Facebook, Groupon and Zynga, there’s been a clarion call from top investors like Union Square’s Fred Wilson, Y Combinator’s Paul Graham and Kleiner Perkins’ Mary Meeker for everyone to simmer down with valuations.

But from what we can tell, any adjustment is going to take several months. For the very hottest late-stage companies like Fab.com, growth investors don’t seem to be taking any heed from public market skepticism yet. I asked around about impact on different stages of the market and this is what I got:

Secondary Markets

This is tricky. In theory, you’d think that Twitter should be down by a proportional amount in private secondary markets given Facebook’s decline. But secondary markets can be so illiquid that it may take months before this is reflected in secondary market pricing (or ever, if the public market rebounds in the meantime).

For one, you can’t short shares. Plus, private exchanges like SecondMarket do everything with the consent of the company. If the company gives its blessing, they’ll arrange quarterly or annual sales of stock and the company has full control over who sees their financial data and how the offering is priced. I can’t imagine many companies in their right mind would be eager to do an offering right now. You’d think that the market would freeze.

But there have actually been two tenders on SecondMarket since the Facebook IPO, although SecondMarket couldn’t tell us which companies did them or what the prices were. One was for a gaming company and both offerings matched the prices arranged before Facebook’s debut. A third tender was signed this week and SecondMarket says that inquiries about arranging auctions have actually increased recently.

Twitter may also be able to grow into its valuation with improved revenues, even if the surrounding market performs poorly. The over-the-counter market doesn’t seem affected for the moment, but my sources on this are a little biased! “Twitter is still in play at $8 to 10 billion,” says one longtime shareholder, who says his broker is continuing to send him buying inquiries at that range, even post-Facebook IPO.

Twitter had been considering another share auction this summer on behalf of employees, according to a source who arranges sales of stock for privately-held companies. It will be interesting if they move forward or not. A private share auction last year valued the company at $7.7 billion. They didn’t respond to a request for comment on this.

The other thing to note is that the muppets who lost money on pre-IPO Facebook shares were the ones who bought them after the company filed its S-1 and shared its financials. Facebook’s last trade on SecondMarket before the company filed in February was $31.50, and its four-year average was $28.50 when factoring in stock splits, according to the company. That’s really close to the $27.10 price Facebook is trading at right now. Only in the months right before the IPO did Facebook shares climb to a peak of $42.72.

Maybe it was a panicky, “train is leaving” effect where buyers rushed in. So don’t get emotional. You’ll get burned.

Late-Stage Fundraising

Fab, Spotify and Square are all on the market raising at valuations that top a billion dollars. We hear that Fab is oversubscribed on a $120 million round with a lot of competition for the deal. We said earlier they were raising $100 million. Fab said this week that they’re on track to do $140 million in sales this year. One late-stage venture investor tells us all of the good, companies are still getting bid up “like insane.”

Square is still out there. They haven’t settled on a lead investor but they may come in at $2.5 or $3 billion instead of $4 billion, we’re hearing from multiple sources. But the pricing matches what was discussed prior to the Facebook IPO, so there is not really an effect here either. Square didn’t comment on this.

Spotify may be in more of a difficult position. The company says it has 3 million paid subscribers. A back-of-the-envelope calculation gets you to about $450 million in annualized subscription revenue assuming an average $12.50 monthly rate (although exchange rates screw with this). Then there’s ad revenue too. A source familiar with the company’s financials tells us Spotify has a 30 percent gross margin, but when you factor in sales, marketing, administrative and development costs, they go into the red. If an institutional investor were to go in on them at a $4 billion valuation, they would have to believe that the company has a chance of eventually being worth $12 billion or more.

There are institutional investors who have been burned by the last wave of growth rounds. So they may be more reluctant to participate this time around. T. Rowe Price is in the red on Zynga after investing in February 2011 at $14.03 a share. Zynga now trades at $6.05. Late-stage Groupon investors are also close to a world of pain. Investors who went in right before the IPO put nearly $1 billion into the company at the equivalent of $7.90 a share. Groupon’s now at $10.70.

“You can’t be comfortable at 1.3X,” an earlier venture investor in Groupon said. “Like Icarus, they got too close to the sun.”

But overall, the top companies seem to be unaffected for now. If a company is profitable and has growth that would make a hockey stick jealous, there shouldn’t be a problem. It’s the companies that fall just short of this that will feel downward pressure. It’s the same dynamic as in overall venture market. Even though the total amount of capital allocated toward the VC industry has shrunk over the last 10 years, the very best funds continue to do well.

The best companies might even do better in a down market. There will be fewer me-too rivals backed by less savvy money and fewer companies stealing away the best talent.

Early-Stage

The impact on the early-stage market is the hardest to predict since these companies are valued more subjectively. Pricing in these rounds also matters a lot less to the bigger funds, because at the end of the day, if you truly believe you’ve found the next Facebook, who cares if it’s worth $20 or 30 million?

If you look at the market activity at this level before the Facebook IPO, aggressive seed stage valuations were a phenomenon that was largely limited to Y Combinator and a handful of other companies. For the vast majority of early-stage startups, fundraising has been challenging.

The e-mail warning that Paul Graham sent to Y Combinator companies this week was probably a necessary one — even without the Facebook IPO. There was a bit of investor angst (some merited, some not) over the last batch of YC companies. Basically, it was just very pricey with an average valuation cap of $10 million on convertible debt for a class of about 65 companies. That’s fantastic for founders, but it started to rub certain investors the wrong way. And this is an issue that has come up in conversation with investors from about a dozen firms, from early-stage to top-tier, over the last month.

One investor in Pair told me they were frustrated when they found out everyone else was allowed in on the round with different valuation caps. They said the company hadn’t been straightforward with them about this until there was a priced round. In the past, Graham has talked about offering different caps to different investors if they take more risk by investing first or add more value than others. He’s called this “high-resolution” fundraising. It makes sense. But the issue here wasn’t different caps. It was transparency. (To be fair, a different investor in Pair told me they were informed about the variable caps.) I’ve reached out to Pair and they haven’t responded yet.

Two other super-angels from two different funds said they were more conservative with investing in the last YC batch because of the valuations. Sequoia also didn’t invest in the last batch, but said they would consider doing follow-on funding later.

This is partly just natural market behavior. When things get super-hot, it’s smart to look elsewhere for less obvious opportunities. Another thing to consider is that the feeling might also be mutual as YC has its own private internal system where founders can review different investors. The ones that don’t get high marks may have a harder time participating in future batches. So maybe this is just sour grapes. It’s hard to say. I obviously wasn’t in any negotiations myself, but I just sensed a lot more tension this year compared to previous batches.

Even before the Facebook IPO, Graham and other Y Combinator partners like Harj Taggar had already been telling founders not to blindly pursue the highest valuations. They also encouraged founders not to take on too much convertible debt. Although pricing lower than your original cap isn’t technically a down round, it might be perceived that way.

Another YC founder, 42 Floors’ Jason Freedman warned founders to act respectfully toward investors because the market could quickly turn. Back in 2009, he said that no YC company could get more than a $3 million valuation right out of the gate. “Times are good now but the trough of sorrow awaits,” he said in a widely shared blog post.

“If your company blows it out of the water, you’ll be just fine no matter what,” he added. “But if you’re like the 80% of companies that are in the middle, then you run the risk of having a priced round down the line that is below the cap.”

The next Airbnb or Dropbox will be fine, but the future OMGPOPs of the world need breathing room and supportive investors before they find their homerun. Having too high a valuation or cap could prematurely doom them if and when the market turns. As Peter Thiel said in a recent lecture at his Stanford class, “Companies are essentially broken the day they have a down round.”

So the valuation issue was already an ongoing conversation that YC was having with its portfolio companies. The Facebook IPO was just a good catalyst for reinforcing it.

Lastly, for the love of God, it was never a bubble.

If the market settles down by the fall, that’s actually a good thing. Bubbles, which happen when prices get wildly misaligned with fundamental value, often end with an abrupt and extreme contraction — the kind with devastating socioeconomic impact. I may have nerded out on Kindleberger’s Manias, Panics and Crashes before the Facebook IPO — just in case! And historical bubbles from the 17th century to 2008 have all sorts of bizarre characteristics. They tend to include masses of normal, unsophisticated investors and draw out unscrupulous and fraudulent actors.

But it’s hard to see an abrupt contraction happening here. If Facebook’s shares stay at the same range for awhile, being 30 percent over-valued is not that big a deal. This isn’t Pets.com or even this clusterfuck of an IPO from the original tech bubble. The ecosystem can stomach it. There won’t be scores of laid-off engineers in bread lines by August (…. barring a disorderly exit by Greece from the EU, which triggers panic and contagion into the global banking system and maybe a crisis of confidence in government bond markets. Haha. Gulp.)

Macro-apocalyptic thinking aside, the long-term trend of technology becoming embedded into every facet of life and industry continues. Plenty of capital is still coming in too. The bigger firms are raising a billion dollars or more. Sequoia is raising $1 billion. Andreessen Horowitz just raised $1.5 billion. NEA is out raising a potential $2.5 billion.

Then there are about 10 or so early-stage funds that have either recently closed or are raising right progressively larger funds right now. Dave McClure’s 500 Startups just raised a $50 million fund while Felicis just closed $70 million. First Round just closed another $135 million. True Ventures closed $205 million. Kleiner Perkins’ Aileen Lee is also starting a $50 million fund. In an interview two weeks ago at TechCrunch Disrupt, Michael Arrington prodded David Lee into a non-denial that SV Angel was considering raising a bigger fund worth up to $400 million.

There is still plenty of capital around at multiple life stages. But it’s better to correct now, rather than later when it could become a really dangerous bubble. We’ll all be better off for it.

Hear that noise? That’s the sound of a hundred press releases and announcements being ground to a pulp, the pulp being formed into a sort of hollow, vapid blog arrow, and that arrow being aimed squarely at Techmeme.

I don’t know, but ever since some of our most prolific writers left the blog game to either a) become entrepreneurs or b) become investors, the tech blogosphere has been quiet — too quiet. And by quiet I mean so noisy that its difficult for anything of any substance (or signal) to come through.

Gone are the days of “Facebook PR: Tonight We Dine In Hell!” or “How The Hell Is This My Fault?” or “SXSWi: Because Hell Doesn’t Have Enough Promotional Stickers“ or “Delta Flight 1843 From JFK To Hell” or any TC post with “Hell” in the title really.

Instead, the TechCrunch homepage has become so tame the most controversial thing on there right now is “Online Seniors: Tech-Savvier Than You Think” (sorry Frederic, I’m sure it’s a very interesting post). And its not just us … our competitors are drowning in a soup of slow news day posts like “Zuck Joins [Insert Web Service Here]” always using the excuse, “WELL MAYBE HE’S GOING TO BUY IT …” to prove its newsworthiness.

Well, here’s some news: Zuckerberg joining an online service doesn’t necessarily mean he’s going to buy it — And seriously how can you extrapolate that? You might as well also write “Zuck Buys Some Milk” or “Zuck Hasn’t Had A Poop In Three Days.”

Though I actually don’t mind embedding demo videos in posts as long as the videos are well done, I agree with Sarah Lacy here:

“Savvy PR folks — largely taking advantage of an obsession with volume and speed — have pushed journalistic standard practice from multi-source stories to single source stories, then to re-written press releases, then to cut and paste. And now, they have top industry blogs embedding actual commercials for the products.”

This is an accurate description of the current tech media landscape. And all we writers have to fight back with are our faculties of critical thinking. And, unlike old media organizations, our freedom to rant.

A culture of ranting encourages pushback, it encourages writers to fight back on the blog when PR people are bullying them into a story (and trust me, there are PR people out there who are huge bullies, you know who you are). Rants keep the companies and people in power in check and are part of our ecosystem’s system of checks and balances.

So it’d be a shame to see them die, buried in the mire of hurriedly written, PR sanctioned “write-ups.” Because a blog shouldn’t be a write up, it should be a war, or at least interesting — I wish it were legal to slap each TechCrunch writer who looked uncritically or apathetically at a press release or a news story and did a post on it anyways.

Instead, I’m just going to encourage them to write more rants, and I will write more rants as well, starting with this one.

So what do you guys want to rant about?

Image via. 

The initial public offering fever that seemed to be sweeping over the tech industry has cooled noticeably in the weeks since Facebook’s much-buzzed-about (and potentially botched) stock market debut. But it’s not a deep freeze in IPO land quite yet. Qualys, a Silicon Valley company that specializes in cloud security software for the enterprise, has just filed its S-1 with the Securities and Exchange Commission announcing its intent to hold an IPO and sell up to $100 million worth of its stock.

Qualys isn’t exactly a trendy company, but it works in a valuable space: Web security. According to Qualys’ website, it makes a suite of software as a service products that “enables businesses to continuously identify security risks, automate compliance and protect their IT infrastructure from ever-evolving cyber attacks.” It was founded in 1999 and is headquartered in Redwood Shores, California.

Qualys made $1.9 million in profits on $76.2 million in revenue last year, according to the filing. That’s not the biggest profit margin, but top-line growth is on the rise: Qualys made $21 million in revenue during the first quarter of 2012, up nearly 20 percent from its first quarter 2011 revenues. During Q1 2012 Qualys dipped into the red on the bottom line with a net loss of $285,000, which the company attributed to spending more on sales and marketing. Before that, Qualys had been profitable for several years, and it has $30 million in cash on its books.

Qualys has 313 full-time staff, 237 of whom are based in the United States. According to its website, the company’s investors include ABS Ventures, GRP Partners, the Hewlett-Packard Company, Trident Capital and VeriSign. The filing shows that the company’s single biggest shareholder, however, is its longtime CEO Philippe Courtot, who owns 39 percent of the company’s shares; Trident Capital holds 27 percent.

Qualys plans to trade under the stock ticker “QLYS”; it hasn’t yet selected a stock exchange. J.P. Morgan Securities and Credit Suisse Securities are acting as joint bookrunning managers for the offering, and RBC Capital Markets, Pacific Crest Securities, Robert W. Baird, JMP Securities, Lazard Capital Markets, and First Analysis Securities Corporation are acting as co-managers.

Omni-social reader MyPad has just released updates that lets its three million daily users browse and interact with Instagram photos in addition to reading and posting to Facebook and Twitter. MyPad’s free and premium iPhone and iPad apps now let you browse Popular and your network’s Instagrams plus leave feedback; batch upload, filter, and edit photos for publishing to Facebook ; access Twitter DMs, search, and trending topics; check in, listen to free music from Hype Machine, and more.

MyPad’s 10 million registered users are definitely digging the update, as sharing is up nearly 10x in the last few days. What was once a substitute for the missing official Facebook iPad app has blossomed into a bridge between our fractured social graphs.

This is the first update for MyPad’s iPhone app in eight months, and also brings Airplay mirroring so you can watch Ken Burns slideshows of photos from all your social networks on your TV. The iPad version meanwhile scores new Retina graphics.

All that data MyPad collects about what a user interacts with and what their friends share is powering its emerging business model as a mobile app discovery platform. If users slide past navigation bar’s Facebook, Twitter, and Instagram buttons, they’re shown recommendations of apps to download.

These suggestions seem accurate as MyPad developer Loytr’s founder Cole Ratias tells me 0.5% of people that see them download an app (that’s pretty high), and developers pay MyPad on a for each click to the App Store. Loytr is even talking to ad networks and servers like MoPub about using its data to power recommended app ad units on other properties.

Those partnerships could lure investors to the Series A Loytr is now raising. MyPad is proving itself a great example of how a nimble startup can survive by differentiating when the big dogs steam roll your value-add. Now it will be competing with Flipboard, though with deeper functionality and a familiar layout rather than a stylized one.

Stitching several full-featured social networks together in one app is a huge design challenge. Authorizing Facebook, Twitter, and Instagram in a row can feel like an endless cascade of permissions. And if you think Facebook’s mobile apps feel bloated, MyPad has 14 different feature tabs, though at least they’re all available with a tap from its navigation bar.

But if you’re experiencing app overload as Facebook spawns standalones like Messenger and Camera, or don’t want to turn to Path so you can cross-post to Facebook and Twitter simultaneously, MyPad could be the answer. So keep friending and following, your whole social life now fits in one app.

Click here to download MyPad+ for iPhone ($0.99), MyPad for iPad (free), or MyPad+ for iPad ($0.99). 

Earlier this morning, Google critic and Nextag CEO Jeffrey Katz used an op-ed piece in the Wall Street Journal to accuse Google of behaving like a monopoly. Google quickly responded with a line-by-line criticism of Katz’s arguments. I had a chance to talk to Katz about his piece a little while ago and while he argued that he wasn’t so much interested in engaging in yet another back-and-forth argument with Google, we obviously did touch upon Google’s reaction to his piece.

Starting our discussion, Katz noted how Google faces “undeniable issues,” especially now that the U.S. government and the European Union are looking into the company’s practices. Nextag, among others, has been subpoenaed by He also said that he wasn’t surprised by Google’s swift reaction given that the company has obviously been preparing to face these issues.

After reading his WSJ piece, one of his arguments continued to confuse me: Google, he said, needs to become more transparent when advertisers get better placement in its organic search results. Katz, it turns out (and some SEO experts agree with him here), argues that by buying lots of ads, big advertisers drive more traffic to their sites. The more traffic your site has, the higher up on the page it will likely appear on Google’s search results pages.

Katz also argues that Google, especially now that it launched its product listing ads in conjunction with Google Shopping, is pushing other results further down the page. While Google argues that it’s making all of its changes for the benefit of its users, Katz argues that users generally only look at the top of a search results page and by highlighting its own products, Google is pushing everything else out of its users’ sight.

The paid placement of these Google Shopping ad units, says Katz, also unfairly excludes Nextag and companies like it from advertising in this space. In his WSJ piece, Katz said that Google “should grant all companies equal access to advertising opportunities regardless of whether they are considered a competitor.” At the time, I wasn’t sure what he meant with that, but after my discussion with him, it’s clear that he feels that Google isn’t providing a level playing field here. The only way Nextag could participate, he said, “is if we changed our business model.” One could, of course, argue that just as these ad unites aren’t useful for musicians, they aren’t meant to be useful for Nextag, either.

If the only way to appear at the top of the search results is to advertise, though, he said, “then let everybody advertise.” “It’s like owning Interstate 5,” Katz said to illustrate this point, “and all the billboards – and then saying you can’t advertise here because you own competing rest stops.”

Katz dismissed the argument that users and advertisers could just move to other search engines. The world of advertising, he said, pretty much belongs to Google. Globally, Bing and other competitors just don’t matter.

Overall, Katz feels that Google (even though he calls them a “great company”) has an obligation to be more transparent and to provide equal access and a level playing field for sites and advertisers. Google, of course, argues that this is exactly what it is doing.

The iPad is a wonderful device to watch videos on, and a number of startups are aiming to provide users with interesting new ways to discover the best videos to watch. Most of these apps — like Showyou, or Squrl, or Fanhattan, or Shelby.tv — have some sort of a social discovery component, which allows users to see what their friends are watching, and conversely, share other videos with them. Most of them also tap into freely available videos on the Internet, although they occasionally partner to surface videos from major content players like Hulu or Netflix.

There’s another app maker that is taking a stab at powering social video discovery — but it’s doing so a little differently. For one thing, the new Ringz.TV iPad app, from RingGuides, is designed a little like an old-school electronic programming guide, but on the iPad. It provides a concentric ring of videos and content providers, which users can drill down into to discover more granular pieces of content.

The top level interface, for instance, is a list of content companies, which include both online-only producers like Machinima, as well as cable TV networks like truTV. Once you click through, the ring of content providers is replaced by a list of content choices, which are curated and include intermittent “featured clips,” which are basically just ads. Users can then create their own curated “rings” of content, which can be watched as a continuous channel or shared with friends.

The interface is based on the Ikonic Navigator EPG, which it owns the patent to, and is the product of many hours of customer research at CBS Television’s testing lab. It’s built to leverage the kind of channel surfing that is enabled by a touchscreen device like the iPad.

Part of the reason that the Ringz.TV app operates in the way it does is that CEO Robert May believes all the videos that the app showcases should be monetized, and partners should get a share of revenues. The EPG, therefore, is designed to support that business model. There are also a number of ways that Ringz.TV can highlight new content — by using using trending topics and allowing content partners to buy hashtags to promote their videos.

Launch partners include AnyClip, BAMM, MetaCafe, and Turner Broadcasting’s truTV, but the app will also allow users to highlight their own videos that are uploaded to Facebook or available in their iTunes libraries. For now, most videos are short-form promotional material. But as time goes on, May wants to bring more long-form video onto the app.

While the Ringz.TV iPad app is a cool way to watch video on that device, the company isn’t stopping there. It wants to enable crossplatform viewing on other devices as well. So it’s working on building apps for other devices — like iOS and Android mobile phones, and you could maybe even find the EPG on connected TVs and other devices in the future.

Everything is in readiness for our upcoming Philly meet-up where we’ll imbibe fine beverages, eat some DiNics, and talk about what you’re working on. The goal of this meet-up is networking and pitches so come prepared with a thirty second pitch and please, please, please no paper. We want to talk to as many of you as possible and in the our goal is to energize and assess the start-up arena in Philly (and everywhere we hold these things.)

The event is on June 19 at the Field House, 1150 Filbert St. from 6-10pm. We will have drink tickets for you so look for us at the event. If you want to tweet us, it’s @johnbiggs and @jordanrcrook. If you have specific questions, email me at john@techcrunch.com.

Please RSVP here.

As is our wont, we like to hold these on neutral ground and we’d love to sit down with you to chat about what you’re working on during the day. The official office hours reservations are closed, but if you want to stop by and wait for an opening, feel free. We’re holding office hours at Caribou Cafe near the venue, also on June 19, beginning at 12 noon.

Special thanks to our excellent sponsors who helped get this thing off the ground as well as Anthony Coombs who was our ears on the ground. We’ll also be hunting for Disrupt Battlefield companies, so get your pitch down cold.
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Gillmor Gang – Danny Sullivan, John Taschek, Dan Farber, Kevin Marks, and Steve Gillmor. Recording has concluded.

Here’s a bit of Friday eye-candy for you. It was almost one year ago to the day that Steve Jobs appeared in front of the Cupertino City Council, pitching his vision of a visually striking, spaceship-esque Apple campus that would accomodate 12,000 employees.

Apple’s original set of plans for their new campus tore around the internet last August, and the city of Cupertino has just released the company’s fourth set of revised files that dive into a bit more detail than those that have already made the rounds.

Truth be told, not a whole lot has changed since the last time Apple submitted an updated set of documents back in March — more visual flourishes have been added to their floor plans, and the levels on their rendered images seem to have been tweaked — but Apple seems to have refined the approach they want to take with their sizable auditorium.

In the previous revision, Apple’s underground auditorium seemed to be housed in a large circular room connected to an adjoining circular room meant for hands-on product demos and general milling around:

That plan seems to have changed somewhat, as the auditorium now appears to be housed in a more conventional rectangular room on the campus’s Basement 2 level:

If everything goes according to schedule, Apple plans to move into the new facility in 2015 though they still plan keep their Infinite Loop complex as their corporate headquarters. That said, there’s no indication as to when their construction efforts will finally begin — they’ve got quite a bit to clear out as it happens — but there’s little question that Apple’s Campus 2 is going to be a sight to behold once it’s all done.

In the meantime though, feel free to pore through the rest of Apple’s architectural minutiae right here, but be warned — they’re PDFs, and large ones at that.

Icenium is a brand-new integrated cloud environment (get it? i-c-e not i-d-e = Icenium) for mobile application development. The service, which is a spin-off product division at Telerik, is just now entering its private beta stage and is in search of developers willing to kick the tires. Initially, Icenium will focus on the iOS and Android development platforms, and will later expand to other mobile platforms, and eventually, to server and desktop.

Doug Seven is leading the Icenium division at Waltham, Massachusetts-based Telerik, after previously serving as the Director of Product Management for Visual Studio and the .NET Framework at Microsoft. Telerik, for those unfamiliar, makes developer tools for .NET and other Microsoft technology platforms (e.g., WPF, Silverlight, Windows Phone, etc.) Seven says that he’s been so quiet about what he’s been working on over the past year since he left Microsoft that the running joke is that he’s “VP of Black Ops.”

But what he’s been working on sounds pretty cool. With Icenium, the company is introducing an “ICE” that will allow web developers to use technologies they already know like HTML5, CSS3 and JavaScript to build applications that run natively on mobile devices and can be distributed through app stores. And because it’s in the cloud, you’ll be able to work from anywhere, without having to worry about the various native SDKs. Plus, you’ll also be able to see the app in action without having to deploy it to a mobile device, and see your changes to the app in real-time. The end result, of course, is the ability to iterate much faster.

Icenium is a lot like PhoneGap in that it’s leveraging web developers’ current skill set to help them create mobile applications, but unlike PhoneGap, which still requires an IDE of some kind (and, to reach multiple platforms, multiple IDEs), Icenium abstracts away the platform dependencies, explains Seven. It allows the developer to “focus on their ideas, not managing multiple development environments,” he says.

Icenium leverages Apache Cordova (PhoneGap) and all Icenium apps are, for now, Cordova apps, says Seven. However, “with Icenium we are eliminating the complexity that exists even when using Cordova,” he adds. “No downloading and installing xCode, or Eclipse, or the Android SDK. All the platform dependencies have been turned into cloud services that the clients, Icenium Graphite and Icenium Mist, can use. This enables cross-platform mobile development from any platform.”

TechCrunch readers (developers, that is) are being offered the very first chance to try out Icenium for free. Just sign up at icenium.com/techcrunch to get on the list.

Comparison shopping engine Nextag and its CEO Jeffrey Katz have been at the forefront of accusing Google of being a monopoly and abusing its position to crush smaller competitors. Today, the Wall Street Journal ran an opinion piece by Katz that accuses Google of not just promoting its own services and products on its search results pages, but also selling out its users because many of “the most prominent results are displayed because companies paid Google for that privilege.” Google, in what’s becoming an increasingly common tactic for the company, just published a detailed (and rather aggressive) response to Katz’s accusations. In it, the company’s senior vice president of engineering Amit Singhal argues that “there has never been as much choice online as there is today.”

Google gave Katz an opening for his attack when it launched Google Shopping and its new paid product listing ads last month. These are basically ads that also feature prices and product images and which will appear right underneath the standard AdWords text ads that often adorn the top of your search results pages today. Katz doesn’t specifically mention this new service, but it seems likely that this is what he’s hinting at when he argues that “Google should disclose, clearly and in plain English, when advertisers receive better placement in search results and when a result is a Google-owned property.”

In response to this, Google notes that advertising never influences its “natural” search results and that it clearly marks any ads on its site as such.

Katz also argues that “it’s easy to see when Google makes changes to its algorithms that effectively punish its competitors, including us.” Google’s response to this: “We built search to help users, not websites.” In his response, Singhal stresses that Google doesn’t make changes to its algorithm to hurt competitors. Katz, of course, doesn’t believe this for a second and argues that Google “has shifted from a true search site into a commerce site—a commerce site whose search algorithm favors products and services from Google and those from companies able to spend the most on advertising.”

Katz also gives some advise to European Union Commissioner Joaquín Almunia, who is responsible for Competition and who is expecting a response to his anti-trust concerns regarding Google next month. The Nextag CEO argues that Google needs to become more transparent about when advertisers get better placement in search results and when a result is a Google-owned property” (Google, interestingly, doesn’t answer this charge).

Google: “If users don't like our results, they can try Bing,Yahoo, DuckDuckGo, or even Google Minus Google.”

In addition, he says that Google needs to be less biased and “should also allow users to reduce the number of ads shown or incorporate a user’s preferred services in search results.” Google’s answer to this is pretty straightforward: “If users don't like our results, they can try Bing, Yahoo, DuckDuckGo, or even Google Minus Google.”

Katz’s last recommendation may just be the strangest of the bunch, though. He says that Google “should grant all companies equal access to advertising opportunities regardless of whether they are considered a competitor.” Given that Google’s advertising system is based on an auction-system, I’m not sure what Katz is hinting at here (feel free to let me know in the comments if you have an idea).

Maybe a discussion about whether Google behaves like a monopoly and is treating its competitors unfairly is worth having. I’m not sure Katz’s arguments today really add much to this discussion, though. Katz obviously wants his old search engine rankings back. His issues, it feels to me, are more about that than about whether Google is a monopoly or not.

Microsoft Hotmail is getting a makeover. At least, that’s what some leaked screenshots are showing. The service, which today is still branded under the “Windows Live” umbrella, is going to be slimmed down and simplified, giving it a  Metro-style look and feel.

The details were obtained yesterday via Microsoft enthusiast site LiveSide, and they’ve now amassed a whole collection of screenshots showing the new Hotmail in action. In the photos, the service is oddly branded “Newmail.” (“Get a Newmail email address for your new inbox…” reads the welcome message, for example.)

What, “Newmail?” Not not to worry – Microsoft isn’t attempting to rename its webmail service yet again. (That whole “Windows Live Mail” thing never really panned out, you know). “Newmail” is just a placeholder, we’re hearing, so you won’t be signing up for @newmail.com email addresses anytime soon. WHEW.

The folks at LiveSide note that Metro UI is clearly apparent at the top of the screen, in new Hotmail/Newmail’s nav bar. When you tap on the “Newmail” logo, you can then navigate between People, Calendar and SkyDrive, as well. (Maybe they’re all getting makeovers, then?)

Also of note, in a screenshot they’ve obtained, the service’s new look is described as having a “simple, fluid and interactive design,” which is “faster and cleaner” whether you’re on a “desktop, phone or tablet,” – the latter hinting at new Hotmail’s purported touch-friendliness.

Below, a few screenshots from the update, via LiveSide. (Head over there to see the rest). But first, the horror that is Hotmail today, for comparison purposes (admittedly, the theme selection was my fault):

Newmail/New Hotmail: