Finding Signals in the Noise

Alarm:clock is a daily news site that evaluates privately-held technology startups in the areas of hardware, software, the Internet, and wireless communications. One industry overview and one company profile by alarm:clock’s editors come to Technology Review every Wednesday by special arrangement.

Finding Signals in the Noise
Digg, Memeorandum, Findory, Blogniscient, and other startups promise to manage news overload on the Web.

Few would dispute that we live in an age of information overload. In the last few years alone, blogs have increased the torrent of information each day to unmanageable levels.
This would explain, then, why a corresponding torrent of startups has surfaced recently to help us filter, manage, and control this flood of information. Some rely on insightful algorithms that understand popularity to filter the news, while others rely on the preferences of readers.

For example, Digg is a San Francisco startup that ranks news items by letting people choose which stories they like. It just landed $2.8 million in venture capital from Omidyar Network, former Netscape founder Marc Andreessen, and Greylock Partners. We also understand that a comparable site – Memeorandum – may close a round of financing shortly.

The concept of making users prioritize or create hierarchies for news is not new – Slashdot has been doing it since 1997. But the latest generation of sites like Digg and Memeorandum are showing that user-prioritized news is, indeed, a powerful and easy way to drive traffic – in some cases to a site created by a single employee with a lone server.

Memeorandum was built by founder Gabe Rivera in his spare time; it has already become a well-regarded news destination. Stories that are popular on Memeorandum gain that status by being widely linked by other sites.

So what’s next? What will Digg, Memeorandum, and other companies do with the money they raise? Most haven’t even tried to generate revenues by selling ads on their pages. Digg has built substantial traffic just with its technology coverage and Memeorandum has shown early success in both technology and politics.

These services could expand their destination sites to other topics, get the same breadth of coverage that Topix.net, an early entrant in the news filtering space, offers, and then perhaps partner or get bought by the kind of big publisher (Knight-Ridder, Tribune, Gannett) that bought Topix.

But Topix, at least, was relatively early to this game, and so reaped the rewards that sometimes await a first-mover. In fact, the space may already run the risk of being overcrowded.

Among other entrants is Inform.com, a recently-launched New York-based firm that automatically categorizes news by breaking down items by key elements. Other related offerings come from Findory, a Seattle-based venture started by a former Amazon employee, which bills itself as a personalized news site that learns and makes recommendations based upon the articles you read.

Another is Blogniscient, a service that uses a number of measures to rank blog entries according to the impact of the contribution they’re making to the blogosphere. The list goes on…

While most of these services claim they’ll simplify your life by imposing some kind of order on your news consumption experience, we still wonder about their ultimate utility. It wasn’t that long ago that simple RSS readers such as Bloglines, which allow you to subscribe to your favorite headline feeds, were hailed as the ideal method for organizing and consuming content. Call us old-fashioned, but we think RSS readers works pretty well.

Alarm:clock is a daily news site that evaluates privately-held technology startups in the areas of hardware, software, the Internet, and wireless communications. One industry overview and one company profile by alarm:clock’s editors come to Technology Review every Wednesday by special arrangement.

Mediaware
Gloolab’s software allows consumers to access their digital media remotely.

Company: GlooLabs
HQ: Palo Alto, CA
Founded: 2003

Management: David Arfin is CEO and founder. Prior to GlooLabs, Arfin was co-founder, CFO, and VP of business development for Flywheel Communications, an Internet rights-based management company. He was also founder and CEO of CLE Group, an early online continuing education program.

Investors: In October 2005, Siemens Acceleration in Communications invested in GlooLabs. Previous investors include Innovent, an investment arm of Nokia. GlooLabs has not disclosed the amount of these funding rounds.

Business Model: GlooLabs’ software is a Java-based platform that allows digital media stored on a home computer to be accessed remotely through any Internet-enabled computer, mobile phone, or PDA. For example, consumers could access their home audio collection while at work or share pictures and videos with friends and family without sending bulky e-mail messages or waiting for lengthy uploads. Additionally, GlooLabs enables mobile phones to be used as wireless MP3 players without the need for significant local storage capacity.

GlooLabs’ software works with a number of operating systems and is portable to different hardware platforms. The company makes money by licensing technology to service providers and device manufacturers. Important licensees include Samsung, which will use the technology in the Korean market. One of the first GlooLabs implementations is with Normsoft. For $34.95, that company will let consumers download an Gloolabs-built application that will enable them to access music through their PDAs.

Competitors: Nevo Media has comparable software. Sling Media’s Slingbox does something similar with TV, allowing owners to watch a video stream from their DVR or home cable or satellite connection on any computer connected to the Internet.

Dirt: It’s anybody’s guess which company will make portable media a reality for the general consumer. Apple Computer might do it with future innovations, but a lot of other companies, including Samsung and Nokia, are vying for a piece of the pie. Significantly, both Nokia and Siemens have invested in tiny GlooLabs. Its software has also been validated by good reviews; but so far it has barely registered in the marketplace. We hope to see it in devices in time for the 2006 holiday season.