One to Watch: Hot Potato

Some MLB.com alums have put together a company called Hot Potato to host real-time social conversations around events. Think Facebook + CNN and their ilk, but with curation so that conversations aren’t just full-bore gushes of comments.

Hot PotatoWe’d noticed the startup when CEO Justin Schaffer was quoted in a recent Ooyala press release about live-streaming video. Schaffer knows a bit about live video events; he was previously SVP of new media at MLB Advanced Media.

Today MediaMemo reports the company has raised about $1 million from First Round Capital, RRE Ventures, Betaworks and Ron Conway. Allen Morgan at the Mayfield Fund is also an adviser. Hot Potato, which was founded at the beginning of the year, is calling itself a “stealth location startup” and promises that it’s “connecting friends and fans around live events in real time.” It’s currently working on an iPhone app and was doing alpha testing around the U.S. Open tennis tournament.

Many people are trying to zero in on social TV/real-time space — for instance, Frog Design recently launched its tvChatter iPhone app — but big live events are really where it all comes together, because people are naturally paying attention to the same thing at the same time as their friends are, regardless of where they’re located. Facebook is perhaps best positioned in social TV, especially given its enormous active user base, but the company prefers to be hands off, making its Facebook Connect available as a platform for others to build on. Twitter also has yet to invest significantly in parsing its massive real-time conversation. There’s definitely an opportunity for a startup to come in and do this right.



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Inside Word: What The Netflix Prize Says About The Shortfalls Of Ad-Targeting Startups

The Inside Word is a weekly feature that looks at compelling industry debates and discussions unfolding on the blogs of employees at digital-media companies.

Blogger: Andrew Chen

Position: A self-described entrepreneur-out-of residence, Chen is a former entrepreneur-in-residence at early-stage VC firm Mohr Davidow Ventures and was a director of product marketing at behavioral ad targeting firm AudienceScience.

Blog name: Andrew Chen

Backstory: In October 2006, Netflix (NSDQ: NFLX) offered a $1 million prize to anybody who could build an algorithm that would improve on its system of predicting a user’s movie ratings by 10 percent. Last month, Netflix declared a winner, handing out the prize money to a team that had beat its algorithm by 10.5 percent.

Blog post: In a blog post, Chen writes that the story of the prize should put a damper on ad networks’ claims that they can distinguish themselves by offering better ad-targeting technology. “This means if you combine dozens of the best machine-learning people in the world, some of the cleanest datasets, you get a measly 10.5 percent increase,” he writes. “Compare this to starting a new ad network where you end up with noisy datasets, lots of crappy traffic, and a small team looking at the problem – that’s not an easy path to disruptive change.”

“In general, 10 percent is not a big enough number to counteract the other economic drivers in the ad market, which revolves around better deal terms, a larger selection of advertisers, better ad inventory, etc.”

Post-script: I asked Chen why—if there is, in fact, not much difference between the targeting technology of various ad networks—the ad networks nevertheless were making those claims. He responded: “First off, they are geeks and prefer to emphasize targeting. Second, they (and by extension, their investors) have Google (NSDQ: GOOG) envy, and they think data + algos can solve everything. Third, they look at the ad industry and see how backward it is from a technology standpoint, but don’t appreciate the tremendous amount of sales and marketing excellence in the industry. So as geeks, of course they think they can one-up the ad industry on technology, even though that’s not sufficient to win in the ad industry.

There are just a ton of variables that go into the performance of an actual campaign, of which targeting is merely one variable. And because most ad networks are black-boxes, you can’t really say, ‘we’ll run both of these campaigns side by side but use different targeting techniques and we’ll compare them.’ Furthermore, some of these variables clearly swamp the other ones - for example where the ads run has a huge effect, larger than the targeting technique in most cases.”

Know of an insightful employee blog? Please e-mail the URL to joe@paidcontent.org, so that I can include it in a future edition of the Inside Word.

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Fox News: John Stossel An Analyst, “Not Part Of The Hard News Division At Fox News”

With all the attention surrounding the White House's claims that Fox News is not a legitimate news network, it may have come as surprise to hear that Fox Business' latest hire, John Stossel, would be appearing at an anti-health care reform rally.

Greg Sargent wrote:

Yes, Stossel is an on-air personality. But at a time when Fox is embroiled in a high-profile battle with the White House over its legitimacy as a news outlet, it seems less than helpful for one of its proudly touted journalists to participate in an event decrying Obama's health care reform proposals as "government-forced health care."

A Fox News spokesperson, however, explained that Stossel is an analyst for the network, and not a hard news journalist.

"John Stossel is not part of the hard news division at Fox News," the spokesperson told the Huffington Post. "He serves as an occasional analyst for some of the network's programming and will host specials and a forthcoming primetime program on FOX Business Network."


Rippol Wants to Affect How You Find Video

Rippol, a bootstrapped video discovery site, launched into private beta today; NewTeeVee readers can get access by following this link. The site aims to harness user activity and demographics to make recommendations as to what to watch from an aggregated library of free premium streaming content (plus Netflix, if you’re a member). The site needs to do a much better job of communicating what exactly it offers, however. It also needs to execute better — my sign-up process through Facebook Connect was way more complicated than it needed to be, and left me anxious that I’d given my credentials to someone who might let them slip.

Rippol stack4But yes, Rippol’s a private beta, so let’s focus more on what it’s trying to do: introduce users to online video content they don’t know (or think) they’ll like. Rippol will compete with Clicker, SetJam, ffwd and all the big online TV aggregators like TV.com and Fancast.

San Diego, Calif.-based Rippol is 10 months old and has nearly 20 employees, most of them engineers working on something they’re calling “The Butterfly Effect Network.” It uses a combination of user action and feedback monitoring, friend relationships, and data mining from public sources like Twitter and blogs to make video recommendations. The system spits out impressive but vague statements like “This query cross-referenced 85780 vectors.” Founder Aaron Crayford recently sold his last startup, a competitor to Move Networks that was called Vusion (our coverage), to the non-profit Clarendon Foundation for an undisclosed amount.