myYearbook, a social network for teenagers that launched in 2005, has raised $13 million in a Series B funding round led by Norwest Venture Partners, US Venture Partners, and First Round Capital. The new round brings the company’s total funding to $18.6 million.

myYearbook says it sees 10 million unique visitors monthly, and also makes the claim that it is the third largest social network in the US. (Not quite. It is only a fraction of the size of MySpace or Facebook, and Bebo and imeem also attract more monthly unique visitors. According to comScore, myYearbook had 4.5 million unique visitors in June, versus 5.2 million for Bebo and 6.4 million for imeem). When we last wrote about them, there was speculation that the site may have more high school users than Facebook. This is almost certainly no longer the case. Facebook has seen dramatic growth since that time, with 37.4 million uniques in June, with 10 percent of those between the ages of 12 and 17, says comScore. MyYearbook has a larger percentage of users in that age group (23.8 percent), but less than a third as many total.

Still, myYearbook continues to produce impressive stats if you look at Hitwise, with 384% in year-over-year growth.

The site intends to use the money to further expand its feature set and reach out to new members. As part of the deal, Norwest Venture Partners’ Sergio Monsalve will join the company’s board of directors.

Source:TechCrunch.com

Chief Executive Steve Ballmer on Thursday defended Microsoft Corp’s need to make heavy investments in its Internet businesses but said the company was “done,” for now, with pursuing Yahoo Inc . “There’s nothing under discussion between the two of us,” Ballmer told investors of how six months of various talks had reached an impasse earlier in July.

“We had a set of principles, we talked about them, it didn’t work out,” he said. “Fine, we’re done. We can move on.”

The message for Microsoft’s annual meeting with Wall Street analysts, an all-day affair at its headquarters in Redmond, Washington, was that it had a post-Yahoo plan to turn around its online services division and a strategy to take advantage of future opportunities, even as its Internet chief departs.

“There is this huge, huge, huge new opportunity around the Internet and online and we have to embrace that opportunity and invest in that opportunity,” Ballmer said.

Shares of Microsoft have fallen 8 percent over the last week since the company forecast an outlook below Wall Street estimates and revealed an additional $500 million investment into its online unit, even as it chalked up further losses.

Charles Di Bona, a software research analyst at Sanford C. Bernstein, said Ballmer’s comments did not give enough details about how that additional investment will be spent and how the company arrived at that decision.

“It’s spending $500 million dollars and then it says we’ll tell you later how we’ll spend it,” said Di Bona, who has an “outperform” rating on Microsoft. “The market’s concern is not about how it is running its core business. It’s about decisions about larger chunks of money that people can’t track.”

Ballmer said Microsoft is willing to endure online division operating losses that amount to between 5 percent to 10 percent of the company’s total operating income, which reached $22.5 billion in fiscal year 2008, until the search and advertising business reaches “scale.

Google recently commented that social media will become a “big part” of Internet marketing strategies in the future. New research from Deloitte suggests that before businesses implement such strategies they need to fully understand what drives social media to gain maximum benefit.

In partnership with Beeline Labs, Deloitte’s Ed Moran researched businesses that have started to use social media and build online communities. He found that many social media sites were failing to realize the full potential of their communities. For some, said Moran, it was the inability to reach the critical mass of involvement required and for others it was focusing on the bottom line instead of what their community needed.

Social media requires time, great community managers and providing what the community wants, yet many businesses start off by throwing money at online social technologies. Of the 140 or so businesses that Moran studied, 6% spent over $1 million on building social communities yet “a disturbingly high number of these sites fail,” said Moran (via WSJ ).

To maximize social media activity it’s imperative to build up a strong community both in numbers and commitment. The use of dedicated staff that have time to be involved in the community instead of tacking it onto their other marketing responsibilities will also ensure consistency and engagement and businesses should look to measure success not by the number of visits, but by increased loyalty and word of mouth impact.

A few key findings from the report, “2008 Tribalization of Business”, include:

- 37% of the communities have been running for 6 months or less

- 27% of the communities have 101-500 members (37% have less than 100)

- 13% of the communities are run by 2-5 full-time managers

- 52% of the companies surveyed plan to increase spending on community

Yes, you can destroy your blog. It’s not difficult just follow all the above hints and soon you will see your site traffic drop and visitors vanished. Of course this article is to show you what NOT to do.

Excessive Ads - Hey, there’s nothing wrong with making some money from your blog (that’s why your reading this blog right?). But, when your advertisements begin to take up more space on your blog than your content, you’ve got a problem. People visit blog to learn and discuss topics that interest them. They want to share their ideas or ask questions. They DON’T want to have to sort through a million ads, to find your content. Think of it this way, you don’t tune in to your favorite TV show to watch the commercials do you? Well neither do your readers.

Lack of Interaction - Many people view blogging as the digital version of giving a sermon. The blogger sits behind his pulpit (keyboard) and preaches to his or her loyal followers. However, if you look at the most successful blogs online, you’ll notice that the interaction is a HUGE part of the blogs success. The ability to leave comments, read other comments, and interact with the content that you’re consuming is what has made blogging what it is. If you don’t make yourself available to your readers, don’t answer any questions and don’t accept any feedback on your content, you’re dooming yourself to the digital equivalent of talking to yourself.

Over Posting - Believe it or not, posting too often can drive away readers as well. If you’re slamming your readers with a high number of posts each and every day, there will be no way for them to keep up. Also, it’s going to be tough to keep up the quality of the posts if you’re cranking them out at such a frantic pace. If you slip into the mistake of posting too often, your “signal to noise” ratio will drop considerably, meaning readers will have to sort through more information to find something worthwhile or valuable to them. That’s a quick recipe for a failed blog.

Fights - Now don’t think for one second that you’re going to agree with everyone all the time. And yes, I still stand by my statement that controversy is good. However, I’ve seen many bloggers allow themselves to get completely side-tracked by their fight with another blogger to the point that it consumes the blog. A good general rule of thumb is that when you get into name calling and personal attacks, it’s time to shut it down. If you allow a fight to go on long enough, you’ll lose readers who simply don’t want to hear the pissing and moaning anymore. Remember, your subscribers read your blog to get your thoughts and opinions on the subject matter. Unless that subject is fighting with other bloggers, chances are your fight will be interesting for a while, but in the end it will lack substance for your readers to survive on.

Playing Follow the Leader - I borrowed that phrase from Max but the premise behind it is 100% true. If you don’t bring anything unique to your blog, whether it’s a distinct style, a special way of covering the information, etc. chances are your blog will die. There are simply too many other options out there for people to read. If you’re not interesting and exceptional in some way, readers will have no reason to return to your site. Find the one thing that makes your blog exceptional, and make that your brand.

Most smaller businesses know by now that search engine optimization is an effective way to get their sites noticed by the almighty search engines. But a recent survey indicates that SEO is the best way to generate online leads. Is your site optimized for search? Paul Bruemmer writes on SearchEngineLand about a recent study done in the UK by eConsultancy on online marketing.

The study demonstrates that “natural search is the best tactic for generating online leads, concluding it is greatly underused despite the fact that it outperforms nearly all other types of online marketing.”

The stats:

Natural search (79%) is the most frequently used online marketing tactic for lead generation, followed by email marketing in-house lists (75%) and paid search (71%). Over half (52%) of company respondents said natural search was “very effective.” Just under half (48%) said paid search was very effective.

Bruemmer writes: ” While online lead generation is becoming more important for many businesses, only a little over half of the company respondents in this survey felt their company wasn’t exploiting this type of marketing as effectively as it could be, illustrating that online lead generation delivers results but could be utilized better.”

Bruemmer notes that according to the report, a larger proportion of online lead generation budgets go to paid search advertising even though “natural search is perceived as providing the best value for the money. Companies haven’t invested in natural search over and above other internet marketing tactics because it requires more effort, but don’t make that mistake in your search marketing efforts.”

Bruemmer addresses in-house search marketing managers in his emphasis on “taking advantage of all search marketing tactics,” but for many smaller businesses, their marketing managers are wearing many hats or in some cases don’t exist. SEO is crucial to a Web site’s success and eConsultancy’s survey validates the point but is it worth hiring an SEO consultant for?

In the course of profiling many small and mid size businesses, it is clear that SEO is becoming increasingly recognized as a necessary part of an online strategy. But it seems that there is no universal approach to how to implement an effective SEO strategy: Some smaller businesses are outsourcing to their Web site developers, some to SEO consultants, and some are trying to learn the art of SEO on their own. Which practice is best of course depends upon the nature of the business, it’s size, and the ability of those involved to implement effective SEO strategies.

As more and more people download albums and watch movies via the web, are we heading for an ‘internet crunch’?Did it take your browser a little bit longer than normal to open this article? Have you found yourself twiddling your thumbs recently as you wait two or three seconds (rather than the usual millisecond) for an email to send? Perhaps you’ve even found yourself making a cup of tea while waiting for the homepage of a particularly image-heavy website to download. Using the web, do you sometimes feel like you’re stuck in 1998 – all slow connections and snail-paced emails – rather than 2008?

If so, it might be because somewhere else on the web, a few thousand people are watching last week’s Question Time or downloading the new Coldplay album (though heaven knows why). Welcome to the internet crunch. As more web-surfers listen to music and watch TV shows and movies, there is great concern that the broadband infrastructure won’t be able to cope, and that things will slow down and possibly even come to a standstill.

New audio- and video-based sites have started to take up more and more bandwith, yet the networks – all those miles of fibre-optic cables that were laid in recent years – have not been properly upgraded. As a result, the infrastructure of the internet, the physical stuff it is built on, will potentially struggle to cope with increased demand for new, improved, snazzy online services.

All of these new services are putting an extraordinary strain on the infrastructure. For example, downloading a film in the Blu-Ray format (that’s high definition) takes up as much bandwith as a whopping 2.5m emails or 100m webpage downloads. Fifteen years ago, people like me thought it was amazing that we could send an email to a friend; today’s web-users think little of sending the equivalent of a couple of million emails as they download the latest Hollywood blockbuster.

And when you consider that the first episode of The Apprentice was watched 100,000 times via iPlayer – which must be the equivalent of someone sending millions and millions of emails, or visiting an ordinary website a few billion times – it is clear that the bandwith and infrastructure issue is one that needs to be resolved.

Is there likely to be a collapse of the internet, or is than an exaggeration? Clearly the infrastructure needs to be improved, but who should fund that improvement? If we demand that the government stumps up the money, won’t that mean increased government control – and therefore more government regulation and restriction – of the internet in general? Does anyone want that?

These questions will be answered in the future when the real internet needs will be visible.

It has long been assumed by many investors that acquiring Valueclick (VCLK) would be the first step in “plan B” for Microsoft (MSFT) if its bid to take over Yahoo (YHOO) was unsuccessful. When MSFT’s Steve Ballmer recently ruled out a slew of acquisitions of smaller internet players after pulling its bid for Yahoo, ValueClick’s stock seemed to lose some of its “takeover bait” premium over the next couple of trading sessions. Since that time, the sell off in ValueClick shares has intensified and the stock has set new 52 week lows three times over the last week as rumors swirl that it is now hunting for some strategic acquisitions of its own. As might be expected, investors appear to be pricing in 1) concerns over dilution that might accompany any acquisition 2) typical “sell the buyer, buy the seller” arbitrage or 3) that an acquisition is signaling the switch of management efforts to acquiring instead of being acquired.

Much of the chatter regarding ValueClick acquisitions has focused on the possibility of their acquiring a company that would gain them entrance to the “Pay Per Click” [PPC] advertising space, the very high margin business that the Google empire was built upon where advertisers bid for placement in search results that are offered when consumers seek information on specific keyword search terms. This business was invented by Goto.com, which became Overture.com and was acquired by Yahoo and is now Yahoo Search Marketing. This space has been dominated by Yahoo and Google (GOOG), with Microsoft making a late run to gain a foothold in this space and round out “the big three” in the PPC space. While there has always been a “second tier” of companies trying to gain traction in the pay per click space, none have been able to come close to challenging “the big three” for various reasons.

While we are not in a position to know if there is any substance to the rumors, it does seem that the recent upheaval at Yahoo might make a historic opportunity for the right company to make waves in the pay per click space. If a Yahoo/MSFT deal were to reemerge or if Yahoo moves forward with its plans to outsource much of its premium PPC business to Google, the combination of the #2 and #3 players or the #1 and #2 players in this space would leave the door open for another company to slip into the #3 position. While we don’t think there is any magic associated with being the #3 player in PPC search, we do think that there are quite a few deep pocketed advertisers out there who view both Microsoft and Google as their most feared competitors and would like to see their advertising dollars flow to someone else, particularly newspaper publishers, magazine publishers, TV, radio and other legacy media companies.

Another factor that could make for a historic opportunity to enter the PPC search fray is the current market valuations of the second tier players. Just over a year ago, all companies in the online advertising space (but particularly the owners of ad networks) were being bid up to new trading highs after the frenzied buying of many of the other players ((ie.Aquantive, Doubliclick, 24/7 Media, Linkshare, Digitas) in this space for large premiums to their trading prices. As the deal volume dried up, much of the money flowed out of these names and many are now trading at historic lows.

The two names we have seen tossed around most often as a ValueClick acquisition targets fit neatly into this category - Miva (MIVA) and Think Partnership (THK).

Miva Media Solutions, previously known as Findwhat.com, is the largest of the second tier networks. With over $100 million in annual click revenue flowing through the company’s North American and European networks, Miva stands out as the quickest option for an acquiror looking to gain heft quickly. Miva also owns a number of valuable content sites including the rapidly growing Spill.com, Screensavers.com and WeatherStudio.com in addition to a growing toolbar segment that currently boasts of over 6 million active users.

In addition to offering the possibility of instantly becoming the next largest player in PPC behind MSFT, adding highly regarded content sites and leveraging the possibilities inherent in having an installed base of over 6 million toolbars, ValueClick and others have to look at the current market valuation of MIVA as extremely attractive. With a current market cap of $32.5 million (closing price July 1), no debt and over $22 million in the bank, the same marketplace that one year ago placed a valuation on these operations of just over $225 million is currently placing a value on this same business of less than $10 million. While the $250 million+ valuation achieved during the height of the ad network buying frenzy of a year ago might be on the high side, its hard to imagine that there are not buyers out there willing to pay three or four times the current trading price to take down such a large piece of pay per click market share. ValueClick in particular does seem like a company with the complementary assets, existing clientele and market cache’ necessary to take a business like Miva’s that is struggling to be profitable and significantly expand the margins by reaching the critical mass of advertisers necessary to ramp profitability quickly. With an existing CPA (Cost Per Action) network and display advertising business that reaches 74% of US internet users, its quite likely that ValueClick’s reach and brand name would bring many more advertisers into the fold quickly and also that existing advertisers would be more likely to bid higher and spend more through a ValueClick ad network than they would through Miva owned network.

The company whose name seems to be most frequently mentioned as a takeover candidate for ValueClick is called Think Partnership, (THK). Think Partnership (hereinafter THK) is in many respects similar to ValueClick, albeit a smaller version as it is most widely known for the affiliate marketing platform (Kowabunga) within its “network” segment and the lead generation operations within its “Direct” segment.

THK’s Kowabunga is a highly regarded player in the affiliate marketing space that has long been a thorn in the side of ValueClick, whose “Commission Junction” is the largest player in the affiliate marketing space. While Kowabunga is much smaller than Commission Junction, many high profile corporate names have either chosen Kowabunga over ValueClick’s Commission Junction when they started their affiliate program (like Microsoft and Yahoo Search Marketing’s affiliate programs ) or migrated to Kowabunga after testing the Commission Junction platform (like Intuit). Taking ownership of Kowabunga would make ValueClick’s Commission Junction not only the largest affiliate program provider, but also the “go to” provider for the largest names in technology, not to mention that the removal of a competitor like Kowabunga from the playing field might allow them to raise their percentage take on affiliate transactions.

While the lead generation operations within THK’s “Direct” segment are much smaller than ValueClick’s lead generation ops from a revenue standpoint, THK has actually had more success at maintaining strong margins while steering clear of Federal Trade Commission sanctions. Additionally, the specific niche’s served by THK’s direct segment (home based business owners and life stage niche marketing) would be complementary to ValueClick’s lead generation offerings.

Despite the obvious synergies of the THK businesses above with ValueClick, it is a third aspect that makes it most attractive to ValueClick. THK’s ValidClick AdExchange offers ValueClick an entry into the Pay Per Click space with what is arguably the most differentiated offering in the PPC space and also what is likely the fastest growing ad exchange. The ValidClick AdExchange platform combines a unique patent pending technology for eliminating click fraud combined with an exclusive technology alliance with Fair Isaac Corporation (FIC) that uses analytics based on artificial intelligence and patented profiling technologies that adapt to each click and conversion, scoring publishers on their ability to drive conversions for advertisers. This new exclusive partnership with the company whose FICO score has become the standard in the lending industry makes the ValidClick Ad Exchange that much more attractive to a company wanting to differentiate themselves from the pack in the PPC space. It has also caused many of the second tier networks to run their own ads through ValidClick’s Ad Exchange to take advantage of its Click Fraud protection.

Recent comments by THK management and our own channel checks in several verticals suggest that the ValidClick exchange is experiencing exponential growth in clicks, searches and revenues generated. In the verticals we tested, we saw more than 100% growth in Q2 over the record clicks and revenue achieved by the network during Q1 2008. This Google-like growth stands in stark contrast to the declines in revenue experienced by most of the other Pay Per Click search networks (including Miva) over the last few quarters as Click Fraud concerns seem to have scared more and more advertisers away from second tier PPC networks. These concerns appear to be making the ValidClick’s click fraud prevention technology and alliance with Fair Isaac that much more appealing.

Despite the success of the ValidClick network, THK’s stock has recently traded down to a historical low, with a market cap settling in the $27 million range. With its existing business pieced together by acquisitions totaling nearly $90 million over the last three years, several business segments that appear to be flourishing and a company campaign to divest non core assets that could raise cash greater than its existing market cap, we believe that THK might look like a tremendous bargain to ValueClick and more importantly, a quick entry into the PPC space with a unique offering whose technology solves the biggest problem (Click Fraud) plaguing the second tier PPC networks.

We believe that ValueClick is uniquely positioned to make waves in the Pay Per Click space if it should make an attempt to enter the fray. We also believe that the timing is perfect for such an entry. The current Yahoo conundrum that will likely result in only two of the big three Per Per Click networks surviving combined with the capitulation among investors in the small cap online advertising names makes the “perfect storm” and possibly a historic opportunity for a well financed player with a good name to stake a claim to be the new “first tier” player in this highly profitable space. ValueClick’s sterling balance sheet (over $160 million with no debt) and scale would likely be attractive to MIVA and/or THK’s management team if they are in fact entertaining offers. We believe that they are and note that both have recently announced steps to divest of assets that would not be appealing to a ValueClick or other similarly situated suitor.

We also note that timing is of the essence as there may be some increase in the valuations accorded many of the online advertising assets when Interactive’s (IACI) spin off is complete next month and they begin shopping with their $1.5 billion cash war chest and a stock currency whose valuation will be based on the prospects of Ask.com rather than many of the slower growth businesses that plagued IACI’s valuation for so long. It will likely take just one deal by IACI, CBS’s (CBS) recently acquired CNET or one of the other media players who would benefit from owning an ad network to make the valuations move back to historical norms - much higher than where the currently reside.

A new study suggests that attitude rather than availability may be the key reason why more Americans don’t have high-speed Internet access. The findings from the Pew Internet and American Life Project challenge the argument that broadband providers need to more aggressively roll out supply to meet demand.

Only 14 percent of dial-up users say they’re stuck with the older, slower connection technology because they can’t get broadband in their neighborhoods, Pew reported Wednesday.

Thirty-five percent say they’re still on dial-up because broadband prices are too high, while another 19 percent say nothing would persuade them to upgrade. The remainder have other reasons or do not know.

“That suggests that solving the supply problem where there are availability gaps is only going to go so far,” said John Horrigan, the study’s author. “It’s going to have to be a process of getting people more engaged with information technology and demonstrating to people it’s worth it for them to make the investment of time and money.”

Nonetheless, the Pew study does support concerns that rural Americans have more trouble getting faster Internet connections, which bring greater opportunities to work from home or log into classes at distant universities.

Twenty-four percent of rural dial-up users say they would get broadband if it becomes available, compared with 11 percent for suburbanites and 3 percent for city dwellers.

Vint Cerf, one of the Internet’s key inventors and an advocate for the idea that the government should be more active in expanding broadband, suspects that many more dial-up users would be interested in going high-speed if they had a better idea of what they’re missing. He pointed out that broadband access is available from only one provider in many areas, keeping prices high and speeds low.

“Some residential users may not see a need for higher speeds because they don’t know about or don’t have ability to use high speeds,” Cerf said. “My enthusiasm for video conferencing improved dramatically when all family members had MacBook Pros with built-in video cameras, for example.”

Overall, Pew found that 55 percent of American adults now have broadband access at home, up from 47 percent a year earlier and 42 percent in March 2007. By contrast, only 10 percent of Americans now have dial-up access.

Despite the increase in overall broadband adoption, though, growth has been flat among blacks and poorer Americans.

Of the Americans with no Internet access at all, about a third say they have no interest in logging on, even at dial-up speeds. Nearly 20 percent of nonusers had access in the past but dropped it. Older and lower-income Americans are most likely to be offline.

Pew’s telephone study of 2,251 U.S. adults, including 1,553 Internet users, was conducted April 8 to May 11 and has a margin of sampling error of plus or minus 2 percentage points. The error margins for subgroups are higher — plus or minus 7 percentage points for the dial-up sample.

Source: CNN

Microsoft will announce today that they have acquired San Francisco based semantic search engine Powerset. The acquisition price is not being disclosed, but our understanding from sources close to the deal is that the previously rumored $100 million is “roughly accurate.”

The company had raised $12.5 million in venture financing, plus another $8 million or so in convertible debt as bridge financing. That means investors will get a decent return (but not a home run), and the founders and employees will also take some real money off the table.

The concept of article marketing has been around for awhile and there’s a good reason for that. I’ve never found it to be the best method around but it will give you some decent backlinks and possibly a bit of exposure for a very small investment. The real beauty comes in the simplicity of it. You just have to write an article about your niche and click a few buttons.

There is one tip I have for you. I really wouldn’t bother hiring an article submitter to send it off to a bunch of directories. The duplicate content penalty removes a lot of the link juice and at the end of the day you’re not much better off than if you had just done the directory submission. The only way it would be worth it is if you use a service like Isnare to get thousands of submissions for $2. It’s still basically directory submission but at least it’s cheap. EzineArticles –

This is just one of many sites in the genre of top article directories. Google doesn’t tend to penalize their articles, it’s not too rare for them to rank favorably in a search, and they’ll usually hold a decent page rank. This makes for a decent long-term linkback with a good chance of relevant traffic.

How exactly do you use it? Well like I said its pretty simple overall. You just have to write an article in your niche. They usually just need to be about 450 words long. Sign up for an account with them and you’ll get 10 free article submissions. The form is pretty standard for the industry. You’ll pick the appropriate category, write a little summary, and then add the appropriate link to your resource box. You cannot use a direct affiliate link in the box. It needs to be a link to a personal website or blog. It’s okay if that page is full of affiliate links as long as you keep the actual box clean. They’ll “review” your first ten submissions and decide whether you’ll get pushed up to a platinum rank. The truth is that any readable article will get through, so don’t sweat it too much. Your articles will be reviewed and accepted within a few days. That’s it. Associated Content –

This is another good choice for article submissions. My tip is to write one article for EzineArticles and then take five minutes and quickly rewrite the article enough to pass copyscape. Then you can submit this one to Associated Content. If you want you can repeat for the process for submission to a few other top directories, but let’s get these two under our belt first. It works in a similar fashion to EzineArticles. You sign up for an account and then submit your pieces. Submission occurs through a four page form, but you can skip most of the parts about adding pictures and citing sources.

The important part here is to keep the entire article clean. They will not accept blatant advertising and they will ban accounts if you put affiliate links in the article. You need to follow the rules and link to your own site via the related links section. The really great part about their system is that they will pay you for the articles. You can usually get about $3 for a standard 500 word SEO article. If they don’t want to buy it you can submit it for free and still earn a few cents for the pageviews. It may not be a king’s ransom but I consider it incredibly cost effective advertising.

One special note is that Google seems to really like AC articles for specific topics. I once wrote a test article in a few minutes explaining why I liked Trident Splash gum. I stumbled it and dugg it and then left it alone. I’ve received about 950 pageviews over the last few months and it ranks in the top ten for Trident Splash. If you know what you’re doing you can get some great links while making money.

This is really basic information to get you started with article marketing. Learn the basics first with these websites and you’ll be on your way to capturing a nice chunk of your market.