Cashing Out: Week Of July 31st – August 6th 2011 In Online Marketing News

This week in Google, Microsoft, and Apple’s patent pandemonium

There’s been a war waging this week. The stakes? Patents. The concerned parties? Google, Microsoft and Apple.

The conflict has been steeping for some time, but the latest battle started August 3, with a Google blog post accusing Microsoft, Apple, and Oracle of using “bogus patents” to wage “a hostile, organized campaign against Android.”

The writer of the post, Senior Vice President and Chief Legal Officer for Google, David Drummond, took the companies to charge for “banding together” to buy Novell and Nortel’s old patents “to make sure Google didn’t get them.”

Drummond argues that this is a blatant attempt on the part of Microsoft, Apple, and the other companies involved, to make licensing an Android device more expensive than licensing other similar devices:

“A smartphone might involve as many as 250,000 (largely questionable) patent claims, and our competitors want to impose a ‘tax’ for these dubious patents that makes Android devices more expensive for consumers. They want to make it harder for manufacturers to sell Android devices. Instead of competing by building new features or devices, they are fighting through litigation.”

Then came the first two responses from Microsoft.

A tweet, from Microsoft’s Brad Smith and then another, from the company’s Frank Shaw, undermining much of the basis of Google’s argument that they hadn’t been included in the bidding on the Novell and Nortel patents.

Smith’s Tweet reads as follows:

“Google says we bought Novell patents to keep them from Google. Really? We asked them to bid jointly with us. They said no.”

And Shaw’s Tweet, which reads “Free advice for David Drummond – next time check with Kent Walker before you blog. ” included a picture of an email from Microsoft Head of Communications Kent Walker. The email details Google’s rejection of an offer by Microsoft to go in on a joint bid.

Google came back at them the following day, saying the offer was rejected as useless:

“A joint acquisition of the Novell patents that gave all parties a license would have eliminated any protection these patents could offer to Android against attacks from Microsoft and its bidding partners.”

Microsoft’s latest reaction, in the form of more tweets from Frank Shaw, simply illustrates how neither company is willing yet to put an end to this very public feud.

As it stands, Microsoft is claiming the only reason Google turned down their offer is that the search giant was holding off to acquire patents of their own to be used against others.

One might say things are about to get ugly, except they already are.

Amazon and Walmart on different sides at meeting on ecommerce sales tax law

If and when national legislation pertaining to an online sales tax is written, Walmart and Amazon want to make sure they’ve had their say.

According to an August 5 report from Bloomberg, the two companies participated August 3 in the annual meeting of the American Legislative Exchange Council (ALEC), a non-profit, conservative group that “brings state legislators, corporate lobbyists and policy experts together to write model state laws.”

Though the representatives from Walmart and Amazon were both present to help with the creation of a federal ecommerce sales tax law, the two parties obviously had differing opinions as to what such legislation should look like. Walmart, a brick and mortar giant, would naturally like to see one of its biggest competitors pay sales taxes on the goods they sell, while Amazon has time after time opposed the idea.

Even Utah Senator Wayne Niederhauser, who presented his proposed state sales tax legislation to the subcommittee, commented on the tension around the table. “The group was pretty polarized,” the Bloomberg report quoted him as saying. And he reportedly characterized a 15 minute bout of arguing as an “animated debate.”

Facebook launches new application-only Ads API

August 1, Facebook officially launched its new Ads API, a platform for both marketers and third-party developers, that will vastly simplify and improve the experience of leading large and complex ad campaigns on Facebook.

The platform, which until recently was being being tested on 20 brands, helps developers create tools and services to manage campaigns and track performance on a greater scale.

As InsideFacebook’s Josh Constine noted:

“Before the start of the Ads API program, the bulk uploader system for the manual self-serve tool was the most efficient way to run ads on Facebook. This restricted large scale ad purchase, A/B testing and dynamic bid optimization, making it difficult for advertisers to obtain optimal performance and see the potential of Facebook ads.”

Though the platform is finally available to a bigger audience, applicants to the program need to meet certain requirements. John Yi, Manager for Facebook’s Marketing API Program, explained in a video statement:

“To gain access to our ad creation and management systems, you have to demonstrate the ability to build significant value for our users and our marketers.”

ValueClick acquires ad tech firm Dotomi

Continuing what TechCrunch’s Leena Rao calls an “acquisition spree,” ValueClick has acquired personalized ad technology company Dotomi. The deal, announced August 2 is estimated at $295 million, with a little over half in cash and the rest in stock.

Last year, ValueClick bought Investopedia, and ReveNews reported on their acquisition of Greystripe earlier this year.

Dotomi works with retailers to provide data-driven, intelligent display advertising, using anonymous data to better target ads. Though considered by some to be an upgrade for ValueClick, the general industry opinion is that Dotomi’s re-targeting technology alone is probably not what lured ValueClick toward an acquisition. Rather, ValueClick likely appreciated Dotomi’s existing presence and marketer relationships.

That assumption is supported by Interclick CEO Michael Katz, who had this to say about the deal:

“Dotomi has several deep integrations with major retailers directly which now gives VCLK hooks into those marketers, minimizing their dependency on agencies in a time when that’s critical if they want their ad network business to thrive. I think the technology is an upgrade but I think this is really about the marketer relationships, not to mention it puts them in a great position for a big Q4.”

Similarly, Cross Pixel Media’s CEO, Alan Pearlstein, believes ValueClick could have developed similar technology on their own, but that doing so would not have had the same value as acquiring Dotomi.

“This is another acquisition that is great for our industry. It validates data-driven marketing, and also validates buying relationships much like Google’s purchase of AdMeld did. There is ample retargeting technology out there and it isn’t terribly complicated to build. Obviously, ValueClick could have done that much as Google could have. So, they are buying the entrenched relationships with these acquisitions.”

Hulu re-spawns cookies as consumers opt-out of tracking

According to a new report from Evidon, 500,000 internet users have chosen to opt-out of online tracking. But is it really that easy for consumers to avoid it?

Apparently not, when you consider the discovery that Hulu has been re-spawning cookies and using ETags.

As Adotas reported August 1, the company has been caught “employing Flash cookies for cookie re-spawning (and not for the first time).” While re-spawning allows sites to reinstate cookies that a user has already deleted, the use of ETags results in tracking tools that are persistent and difficult to get rid of, even if consumers perform a cookie purge.

The information came to light in a follow-up report by independent privacy advocate Ashkan Soltani and privacy lawyer Chris Jay Hoofnagle. The study found that Hulu had used KISSmetrics codes to re-spawn cookies that included a tracking ID that remained in place when the user visited other sites also using KISSmetrics.

Furthermore, the report shows that the script “includes other code that indicates its author is aware of tracking and the risk of data collection about the user. For instance, it includes a function to detect the collection of information that credit card companies require websites to control more carefully.”

Oh, for shame.

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