It's been a few blissful months since we've thought about or had to interact with the Joojoo, but the court case Michael Arrington and TechCrunch filed against Fusion Garage just reached a significant milestone: the judge threw out several of Arrington's claims while importantly holding that TechCrunch and Fusion Garage were in fact business partners with legal obligations to each other. Here's the basic timeline so far: since there was (unbelievably) never a contract between TechCrunch and Fusion Garage to develop the CrunchPad / Joojoo, TechCrunch had to rely on a variety of alternative arguments in its initial complaint, which reached a zenith of optimistic fabrication in something called "misappropriation of business ideas." (We ran down the whole list way back in December, and also broke down Fusion Garage's subsequent motion to dismiss in February.)

The court didn't buy most of those arguments and dismissed everything but the breach of fiduciary duty claim in this latest ruling, which is both a significant loss and a significant win for TechCrunch: breach of fiduciary duty has always struck us as TechCrunch's strongest argument, and the court's now effectively ruled that Fusion Garage and TechCrunch were indeed involved in a joint business venture with legal obligations to protect each others' interests. That's not a bad position from which to proceed -- although TechCrunch now has to prove that Fusion Garage actually violated its duty by releasing the Joojoo on its own, which is a whole new fight. (The court also gave TechCrunch 20 days to try and amend some of its other claims, but "misappropriation of business ideas" was basically thrown out the window entirely.) So what's next? We're guessing another few months of cheerfully hostile motions accusing the opposing party of thwarting discovery and some firecracker depositions, all culminating in a matched pair of snippy motions for summary judgment. The suits, they dine well tonight.

P.S.- How or why either company continues to pay for all these legal bills is beyond us, but we've actually heard rumors of a Joojoo 2, so things could get even crazier. And potentially even less responsive to touch-based events.

Joojoo lawsuit shocker! Court rules Fusion Garage and TechCrunch were business partners, tosses most everything else originally appeared on Engadget on Sun, 29 Aug 2010 21:27:00 EDT. Please see our terms for use of feeds.

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Success in Silicon Valley, most would agree, is more merit driven than almost any other place in the world. It doesn’t matter how old you are, what sex you are, what politics you support or what color you are. If your idea rocks and you can execute, you can change the world and/or get really, stinking rich.

For the most part I’ve sat on the sidelines over the years during the endless debates about how we need to do more to encourage more women to start companies. What I mean by “sat on the sidelines” is this – until today I haven’t really said what I felt. Now I’m going to.

Here’s why. Yet another article, this time in the Wall Street Journal, takes a shot at us and others for not doing enough to help women in tech. Says Rachel Sklar, a perennial TechCrunch critic:

“Part of changing the ratio is just changing awareness, so that the next time Techcrunch is planning a Techcrunch Disrupt, they won’t be able to not see the overwhelming maleness of it,” said Ms. Sklar, referring to the influential tech conference.

Yeah ok, whatever Rachel. Every damn time we have a conference we fret over how we can find women to fill speaking slots. We ask our friends and contacts for suggestions. We beg women to come and speak. Where do we end up? With about 10% of our speakers as women.

We won’t put women on stage just because they’re women – that’s not fair to the audience who’ve paid thousands of dollars each to be there. But we do spend an extraordinary amount of time finding those qualified women and asking them to speak.

And you know what? A lot of the time they say no. Because they are literally hounded to speak at every single tech event in the world because they are all trying so hard to find qualified women to speak at their conference.

What’s The Real Problem?

I could, like others (see all the links in that Fred Wilson post too), write pandering but meaningless posts agonizing over the problem and suggesting creative ways that we (men) could do more to help women. I could point out that the CEO of TechCrunch is a woman, as are two of our four senior editors (I’m one of the four). And how we seek out women focused events and startups and cover them to death.

But I’m not going to do that. Instead I’m going to tell it like it is. And what it is is this: statistically speaking women have a huge advantage as entrepreneurs, because the press is dying to write about them, and venture capitalists are dying to fund them. Just so no one will point the accusing finger of discrimination at them.

That WSJ article also criticizes Y Combinator for having just 14 female founders out of their 208 startups to date. But I know that Y Combinator wants – really, really wants – female founders and that there just aren’t very many of them. I know this because Y Combinator cofounder Jessica Livingston has told me how excited they are to get applications from women, and that they want to do everything they can to get more female applicants. What they probably won’t admit, but I suspect is true anyway, is that the rate of acceptance for female applicants is far higher than for male applicants.

The problem isn’t that Silicon Valley is keeping women down, or not doing enough to encourage female entrepreneurs. The opposite is true. No, the problem is that not enough women want to become entrepreneurs.

Why? I was asked that question as part of a New York Times interview earlier this year. I dodged it completely, and referred them to Cyan Banister, the founder of Zivity, instead:

Q. Do you anticipate that there will be more companies led by women at the TC50 and Disrupt this year?

A. Women are really tough. I have no idea why. We invited a team founded by a woman to Disrupt. But they canceled. There just aren’t a lot of female tech entrepreneurs out there relative to the number of men, I think. We celebrate the ones we find whenever we find them. There’s a chance we’ll write about what they’re doing, simply because they’re a fairly rare thing in our world. But it is really hard to find female entrepreneurs in tech, in my experience. I really think this is an industry-wide problem.

Q. How do the female tech entrepreneurs and investors in your community feel about this situation?

A. There’s a fascinating company, Zivity, it’s a venture-funded, adult photography community — yes, they put up pictures of naked women online — it was co-founded and is run by a woman, Cyan Banister. She wrote me in response to a post about women who are entrepreneurs, saying, basically, though these are not her exact words, women [stink] as entrepreneurs a lot of the time because they are nurturing and not risk-taking enough by nature. She also said when men roll the dice and take risks, that society doesn’t punish them at all, and it’s in their nature to take stupid risks.

I didn’t respond to that. I didn’t want to jump into that debate. And I guess I still don’t.

Is Cyan right? I don’t know, I’m from Mars, not Venus and I cannot speak intelligently about the nurturing and risk tolerance needs of women. But I will say this. The next time you women want to start pointing the finger at me when discussing the problem of too few women in tech, just stop. Look in the mirror. And realize this – there are women like Sklar who complain about how there are too few women in tech, and then there are women just who go out and start companies (like this one). Let’s have less of the former and more of the latter, please. And when you do start your company, we’ll cover it. Promise.

We can't say we'd ever heard of StreamTV, but all the company had to say was "Tegra 2 Android Froyo tablet" to get us to meet up with them in NYC earlier today. The Philadelphia start-up is planning to bring its Elocity A7 -- essentially a re-badged Compal's NAZ-10 -- to an Amazon order page near you, and from what we saw during the hour-long demo it may just be a contender for your stashed away $399. The 7-inch tablet has an extremely responsive 800 x 480 resolution, capacitive touchscreen -- yes, multitouch worked in the browser and photo gallery -- with a front-facing 1.3 megapixel cam on the left bezel. We actually got to make a quick Fring video call to one of the other tablets in the room, though it was rather lagging since we were running over it all 3G.

Surrounding the tablet is an SD card slot along with USB and HDMI ports, the latter of which did come very handy for hooking up the tablet to a 22-inch HDTV and watching an extremely smooth 1080p clip. (Thank you 1GHz Tegra II-720 CPU!) Speaking of, we also got to play a racing game, Asphalt 5, on the device, though the accelerometer steering was a bit flaky. Besides that, we've got to say the entire tablet experience was pretty smooth -- you can see for yourself after the break and in the upcoming episode of the Engadget Show -- but the unit we saw was running Android 2.1. The SteamTV's CEO says they'll only be shipping 2.2-running units come October and with a supplemental GetJar app store since it cannot preload Google's Marketplace because of restrictions. He also tells us they'll be including an HDMI cord and wireless keyboard in the box -- all for $399. It all sounds rather promising, but so do all these future Android tablets!

Continue reading StreamTV Elocity A7 tablet packs Tegra 2 and Android 2.2, coming to Amazon for $399 in September

StreamTV Elocity A7 tablet packs Tegra 2 and Android 2.2, coming to Amazon for $399 in September originally appeared on Engadget on Sat, 28 Aug 2010 08:25:00 EDT. Please see our terms for use of feeds.

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Editor’s note: The following guest post is by Ashkan Karbasfrooshan, the CEO of WatchMojo, a producer and distributor of premium video content. Follow him on Twitter @ashkan or @WatchMojo

Last week, Erick posted an article on TechCrunch titled “Industry Insiders Say Online Video Advertising Is Reaching A ‘Frenzy Point.’” It was a surefire way to get online video entrepreneurs excited, right? Not so fast.

The article quoted two CEOs of large online video businesses—namely Keith Richman of Break Media and Jason Glickman of Tremor Media—whose basic argument was as follows:

It very well may just be the big ad networks and properties like Hulu that are seeing the vast majority of new ad dollars.

“If you are not in the top 10 on comScore you will have a tough time” notes Break CEO Keith Richman, “money goes to the guys who are big,”

That led Erick to summarize and wonder:

Video is definitely shaping up to be a large and growing business for the bigger players and ad networks, but will those advertising dollars trickle down to the smaller guys as well?

While one might think that the top 10 firms in a given industry will prevail, it’s important to think of legendary General Electric CEO Jack Welch’s rule that a company should be either No. 1 or No. 2 in a particular industry, or else leave it completely.

Online video frequently draws comparisons to search, which today has become a two-horse race between Google and Microsoft. Considering that the high-profile and defunct Veoh was a perennial top-10 competitor in video, one wonders: is anything other than No. 1 or No. 2 in video really a winning a strategy?

It depends.

Size vs. Quality

Indeed, as with everything, size matters.  But seeing how history repeats itself, it’s helpful to think of how the frenzy around large ad networks on the web fizzled and made room for something else: quality.

Increasingly, marketers have grown wary of focusing solely on size (as measured by reach).  A few years ago, marketers would pick up the phone and place one or two orders allowing them to reach 100 million uniques while paying rock-bottom CPMs.

Today, many are paying more attention to where the ad placements reside (and how the ad views are being counted).  This is why after the acquisitions of ad networks Right Media and Blue Lithium, the frenzy around online ad networks has waned a bit, and some ad networks (namely AdConion and Valueclick) have even begun to diversify to boost their offerings of quality (via content).

Without a doubt, CEOs Glickman and Richman are right that size is a major consideration. But that doesn’t mean that smaller or mid-sized video companies will fail, especially if they can play the quality card and leverage those who have size.

The Four Pillars of Online Video

In fact, while both men have built strong and valuable businesses, in their prognosis, they omit a major strategic consideration.  While online video companies tend to specialize in one of seven areas, ultimately they end up choosing one of four: Technology, Distribution, Advertising or Content.

While incomplete and not a definitive breakdown or categorization of where each company focuses on, the following table is useful to understand who is doing what in the online video space:

CONTENT DECA, DBG, Eqal, Fora.tv, Funny or Die, Generate, Howcast, Katalyst Media, Machinima, Mania TV, Next New Networks, Revision3, VideoJug, WatchMojo.	TECHNOLOGY Adobe, Apple, Avid, JumpCut, Sorensen, On2, blip.tv, Brightcove, Feedroom, Justin.tv, KIT Digital, Livestream/Mogulus, Ooyala, Maven, Permission TV, Qik, uStream, StudioNow, VMIX, Akamai, BitGravity, Edgecast, Grid Networks, Limelight Networks, Panther Express.
ADVERTISING Adap.tv, Auditude, Brightroll, Broadband Enterprises, Freewheel, Overlay.tv, Panache, Scanscout, Tidal TV, Tremor Media, Video Egg, Yume.	DISTRIBUTION 5Min, AOL, Break, DailyMotion, Hulu, Kaltura, MSN, Metacafe, Nabbr, Revver, Vimeo, Yahoo!, YouTube, Blinkx, Cast TV, Clicker, Clipblast, Dabble, Everyzing, Google, Mefeedia, Pixsy, Truveo.

While Technology, Distribution and Advertising firms have a binary, winner-takes-all, zero-sum outcome, Content firms can leverage others in those three segments.  Thinking back to Jack Welch’s mantra, I’d argue that you have to be #1 or 2 in Technology, Distribution and Advertising (think of the search engine industry) but not necessarily so in Content (hence, the four TV networks, for example).

Enter YouTube

Of course, talking about all of this without mentioning the eight-hundred pound gorilla is foolish.

Today, YouTube retains 44% of the online video audience.  Its parent Google accounts for the lion’s share—roughly 65% market share—of the search market, which in turn garners 40% of the online advertising pie. It then uses its $30 billion war chest to fund forays into new tech and media areas.

As a result of this major reality, companies who operate in the Technology, Distribution and Advertising spheres are handicapped because they are fighting for 56% of the total online video market (less, when you consider that the No. 2 player in the market, Hulu, is equally protective of its domain and doesn’t let just any company operate in its sandbox).

In other words, without Google’s blessing,

• a video Advertising or Technology firm’s product cannot gain traction on YouTube;
• and a Distribution video company is competing head-on with the No. 1 and No. 2 search destinations online (with YouTube being the second largest search engine) and the No. 1 video site online.

One can cling to the fact that unless you’re a Top 10 player according to comScore you’re doomed, but I would argue that if you operate in Technology, Distribution or Advertising, unless you’re name is Google or YouTube, you might not be spared, either.

An Uphill Battle

Meanwhile, Content companies can leverage YouTube’s platform as they pose no threat to the GooTube machine.  They augment it by providing professional content for marketers to advertise alongside of within YouTube.  This being said, they are not completely immune either.  So long as Google doesn’t break down individual content producers on YouTube for comScore and Nielsen reporting, most of the content producers will will face an uphill battle convincing marketers that they are worthy of their request for proposals (RFPs) and ad dollars.

So long as this is the reality, then indeed, Content companies are just as much at the mercy of GooTube as Technology, Distribution and Advertising firms are, albeit in a different way.

The Power of the Platform

A couple of years ago, VCs tripped over one another to fund Facebook-ecosystem start-ups.  Facebook itself launched the fbFund, but recently admitted that the fund was dead. Playing in Facebook’s sandbox was challenging at best and daunting at worst.

Yes, Zynga built a powerful company by leveraging Facebook, but diplomacy ran its course.  For every Zynga there are hundreds of companies whose fate turned of a dime.  Take, for example, Offerpal who laid staff off after Facebook threw itself into the arms of a competitor.  Countless others never even made it into the limelight to begin with. It wasn’t just Facebook; Twitter and Foursquare have all been cast as the flavor du jour.

YouTube Remains the Biggest “Platform” of All, Maybe

One company that has been overlooked as a potential platform for other startups to build a business on remains YouTube, which Google acquired for $1.65 billion in 2006.

Facebook, Twitter and YouTube are fundamentally different: developers build apps on Facebook and Twitter’s platform; content producers create videos and distribute them across YouTube – but conceptually, all three provide the backbone that helps monetize the creators’ brainchild.

Why?  One word: Advertising

Video—which is what constitutes YouTube’s DNA—is a natural canvas for advertising to flourish.  It’s important to note that social networking (Twitter, Facebook or Foursquare’s DNA) is the latest form of communication, and communication tools like email, instant messaging (and now tweeting) have rarely proven to be money makers in an ad-supported ecosystem.

Ironically, yet fittingly, the fact that Google owns YouTube has proven to be a larger hindrance to technology companies than media companies.  For media companies, YouTube absorbs expensive bandwidth costs and reduces marketing costs by providing a targeted and captive audience, leaving them only with the third major cost: content production itself.

As such, while it’s true that size and reach are going to be a major hindrance for small and mid-sized video companies, regardless of whether they’re in Content, Technology, Distribution or Advertising, I’d still rather be producing quality content. Whereas the Content firms (small, medium or large) can leverage the strengths of the other three to build valuable businesses, in Technology, Distribution and Advertising, unless you are No. 1 or No. 2, then you won’t have the gunpowder to stay in the game.

Photo credit: Flickr/Paulo Brandão.

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