Microsoft has acquired Seattle based social networking site WebFives.

WebFives was initially founded in 2004 by former Microsoft engineer Mike Toutonghi as Vizrea and offers social networking with a focus of mobile media, including video, music and photos. Users are provided with standard social networking profile pages complete with blogging, and have the option of accessing their sites via computer or via a WAP specific page.

According to The Seattle Times, Toutonghi told WebFives users that the service will stop at the end of the year because of the Microsoft acquisition, making the acquisition a technology buy as opposed to a community buy. Toutonghi went on to encourage users to sign up to MSN Spaces and/or Windows Live for their social networking experience.

Price of the acquisition was not disclosed.

Google’s Streetview was celebrated at launch, but caught some flack when they were captured the public in some embarrassing situations.

Google’s hoping to avoid similar issues when they complete their launch overseas. According to Google’s senior privacy council, Google will begin altering photos to make sure that faces and license plate numbers aren’t recognizable. The move’s more aggressive than how unflattering photos or personal information are being handled in the U.S., where users have to write in for image take downs. But if it’s embarrassing enough, chances are it’s already been plastered all over the internet.

Jakob Lodwick, the co-founder of IAC owned video site Vimeo, left the company today. The reason? Apparently Lodwick didn’t see eye to eye with the IAC brass on creative issues, and specifically had a run in with IAC chief Barry Diller three weeks ago.

That’s not surprising, given the picture Lodwick chose to include with his goodbye post. A source close to Lodwick says “he was let go.”

Lodwick’s girlfriend, Julia Allison (who made a scandal at our August Capital party last summer – see video here), wrote a blog post saying “Dear Jakob, I wish I hadn’t found out you left the company you’ve been with for the last seven years from your blog. Love, Julia.”

Lots of drama out in NYC this evening.

New figures released by comScore show that YouTube remains the outright leader in online video.

Based on videos viewed, Google owned sites (YouTube + Google Video, but mostly YouTube) commanded a 28.3% market share in the United States in September with Fox Interactive Media (FIM) sites (MySpace and others) on 4.2%. The figures (see chart) demonstrate that YouTube doesn’t dominate video viewing as much as would be expected, suggesting that the long tail is alive and well in the sector given the top ten video sites only hold 45.2% of all videos viewed online.

The unique viewer numbers for video destinations also show Google leading, but by a smaller margin of 39.4% vs 22.6% for FIM sites. These figures are for people visiting the actual video sites themselves suggesting that much of YouTube’s dominance comes not from YouTube.com itself, but from people embedding YouTube videos (28.3% of all videos viewed vs 4.2% for FIM).

Notable in its absence from both top ten charts is the IAC owned Vimeo, who according to this post fired founder Jakob Lodwick today. Clearly Vimeo isn’t performing although it has positioned itself well with support for HD video. IAC usually takes long term positions in companies it owns (Ask.com for example) so it’s not on Deadpool watch yet but you’d expect IAC will be looking at ways of improving its performance going forward.

AdBrite might have just secured an additional $23 million in funding, but at midnight tonight its business prospects may look decidedly dimmer. Competing ad network Etology is cutting deals with some of AdBrite’s biggest customers to take over their ads.

A big chunk of the ads that AdBrite serves are for porn sites on behalf of the AVN Media Network. These AVN Ads make up 31 percent of AdBrite’s total daily impressions (259 million out of 824 million total, according to the respective Websites). Yes, porn is the lifeblood of many of these online ad networks—don’t act so surprised.

Since December, 2004 AdBrite has been supplying the technology, billing, and payment platform for AVN Ads. Now that deal is going to Etology, who will manage the site from now on and relaunch it with a new look. Before that happens, AdBrite is trying to redirect all of its members to its own new adult advertising sub-brand, BlackLabelAds. If you go to the AVN Ads Website, you will see a big pop-up trying to switch advertisers and publishers with existing accounts over to BlackLabelAds. Yet, according to Etology, it has already secured the loyalty of 1,268 (and counting) of the biggest porn sites on AVN Ads, including YouPorn, PornTube, and RedTube. (Out of 6,614 total). Those 1,268 sites account for 108 million daily impressions (or 42 percent of AVN Ads’ total, and 13 percent of AdBrite’s total). The other 151 million impressions are still up for grabs. Etology is trying to lure them with a 75 percent share of revenues, versus the 70 percent they got from AdBrite.

I caught up with AdBrite co-founder Philip Kaplan on the phone to get his take. He notes that all the current 6,614 sites that run AVN Ads have AdBrite code on them, and that is going to stay there unless they take it off. “If you were an AVN Ads user before, you are automatically a BlackLabelAds user.” But he is really not too worried about losing the porn business because it is not where he sees the future:

Adult is an interesting thing. It is a lot of pageviews, it is not a lot of revenues. Most of the major players support it, but as the Internet advertising business is growing and more mainstream advertising is coming from TV and print, it is becoming less and less significant.

In the meantime, he is happy to fight it out with Etology for the porn advertising business, but it is not where he is planning on spending the bulk of the new money he just raised.

Here is what the new AVN Ads Website will look like:

Flux, a new social network joint venture between Viacom and SocialProject, had a limited launch in September.

The platform is the cornerstone of Viacom’s social network strategy. Instead of building independent networks for MTV and its hundreds of other brands, they’ve built a distributed platform that shares users, infrastructure and content, but allows for distinct branding and community building around each property. And Flux isn’t just for Viacom – third parties are using it as well.

When Flux launched it had only a few hand picked non-Viacom partners. Today they are opening up the platform for anyone that wants to join.

Like Ning, it’s fairly easy to create a Flux social network. The look and feel can be customized via templates or by uploading your own CSS, and the network can be mapped to your domain name.

Once created any Flux member can join your network with a single click. Since Flux is already gaining users via their launched Viacom and other properties, this gives young communities a deeper pool of users to draw from. And the fact that new users do not need to create a new profile, friends list or login credentials gives them a greater incentive to join. User data is exportable, Flux says, if the partner creates a privacy policy stating that.

Partners have three integration choices. fShare, the basic integration, allows users to take content from the site and easily embed it into other social networks. Flux Lite allows partners to create a basic social network. Flux custom gives nearly full control over the look and feel and has additional features. Partners can choose any integration, it just takes a little more work to use the custom features. Flux will add new developer features over time as well. The chart to the right (click for larger view) shows the various options.

We’ve created a test social network on Flux, at techcrunch.flux.com. And we’re also integrating their fshare functionality into the main TechCrunch site as an illustration of how it works – see the button below each post.

Flux partners can choose to show Flux ads on the site, or use their own. Flux says they are currently selling at a $1.50 CPM and will split that 50/50 with partners. If a partner chooses to display their own ads instead, they must split revenue with Flux 50/50 as well.

Flux v. Ning

Flux and Ning have very similar features and will compete for communities looking to build a social network (and there are lots of other choices as well). Ning has an established platform, lots of money, and 130,000 existing communities (including Playboy). Flux also has a great platform, and the leverage of all the Viacom properties to promote it.

Ning sees the threat from Flux. CEO Gina Bianchini wrote a fiery point-by-point comparison of the two services earlier this week – Flux disputes some of the facts.

Ning is currently supporting Google’s Open Social platform. Flux says they will fully support Open Social beginning in January.

Website-creation tool Doodlekit is over a year old but has somehow managed to fly under the radar, even after releasing its free version this past October.

Several similar services are out there: Weebly, Synthasite, Jimdo, Google Pages, SiteKreator, and Sampa to name a few. They all intend to make it possible for non-techies to make modestly attractive and functional websites without touching a line of code.

Doodlekit succeeds in this respect, but it goes even further by providing a suite of advanced features, all of which can be set up with a few clicks of the button: forums, customizable forms, shopping carts, advertising, user accounts and profiles, restricted areas for approved members, file uploading, full site search, RSS feeds, photo albums, blogs, basic site statistics, and domain mapping. Some of these features are available for free, but many will require that you pay $15 or more per month. See this pricing sheet for how the service packages break down.

All in all, it’s nice to see a website creation tool that appreciates the fact that many low-level users won’t be satisfied with flat pages anymore. They want to collect data from their users, support small online communities, publish rich media, etc. Doodlekit is moving in the right direction while others (with the possible exception of SiteKreator) continue to provide a fairly limited range of dynamic content possibilities.

As the WYSIWYG market develops, I’d like to see companies like Doodlekit leverage easy database creation/management tools like upcoming Blist. Then, a wider range of people will be able to collect, manage, and publish their organizational data online without needing to rely on web developers. As for more short-term improvements to Doodlekit, it would be nice to see an even better WYSIWYG HTML editor (I have yet to find any online that doesn’t end up frustrating the hell out of me). They could also take some tips from Weebly and implement drag-n-drop editing functionality, which I find more intuitive and satisfying than clicking through several pages to make changes.

Suggestions and long-term visions aside, Doodlekit strikes me as a solid offering in its current incarnation. The company says it has reached 1,700 hosted sites since starting to offer a free version six weeks ago. I expect that number to increase substantially as the word gets out.

U.K.-based peer to peer lending startup Zopa is gearing up for their U.S. launch. Reports of the launch have been circulating for some time (WSJ), but now it seems only days away. The service will be available at us.zopa.com, but is currently under password protection.

Zopa’s peer to peer lending service differs from U.S. rivals by working with credit unions to offer person-to-person loans instead of a loans coming directly from lenders on the service like Prosper and Lending Club (works through Facebook). GlobalFunder.com is a yet-to-launch competitor. With Zopa, lenders will place their money in Zopa branded CDs that are then loaned out online. Borrowers apply for loans through their online community by posting their case for the loan and filling out relevant details about their credit risk. Interest rates on five year loans can range from 8.75% to 16.99%, depending on their credit risk.

It’s worth noting that Zopa’s investor, Benchmark also invested in Prosper. The lending market is anticipated to be very large. According to the research firm Online Banking Report, around $100 million in new P2P loans will be issued this year, mostly by Prosper, with new loans growing to as much as $1 billion in 2010 and $9 billion in 2017. Prosper already registered an S-1 with the SEC and reported $96.4 million in loans.

Adding further details to the launch, Allen Stern received an email outlining some differences between the U.S. and U.K. (which TCUK covered) versions. The key differences listed are:

• No risk for investors.
  Your funds will be federally insured. No more worrying about whether your borrowers will pay your loan back.
• Pick who you want to help.
  Investors will choose exactly who they want to help.
• Set your rate.
  Investors will choose how much they want to earn, up to a ceiling.
• No waiting.
  Borrowers will get their loans immediately upon approval.
• Lower your monthly payment.
  Borrowers can actually reduce their loan payments after they’ve borrowed. They’ll do that using rich profiles…

This morning, Fred Wilson of Union Square Ventures discloses to the world his failure rate as a venture capitalist of 17 years (20 percent over 32 investments, which is enviable in VC circles). He’s also had 11 deals (40 percent) with 5X+ returns, so it more than balances out.

Wilson is more at ease talking to the world (through his blog) than most VCs. But all venture capitalists should have to disclose their personal failure rates. After all, measuring performance should go both ways between VCs and entrepreneurs, not to mention venture investors. Sometimes, you can learn a lot more from failure than from success. Wilson shares what he’s learned from his failures. Either a business turns out to be a dumb idea, he says, or, more likely:

It was a decent idea but directionally incorrect, it was hugely overfunded, the burn rate was taken to levels way beyond reason, and it became impossible to adapt the business in a financially viable manner.

. . . Of the 26 companies that I consider realized or effectively realized in my personal track record, 17 of them made complete transformations or partial transformations of their businesses between the time we invested and the time we sold. That means there a 2/3 chance you’ll have to significantly reinvent your business between the time you take a venture capital investment and when you exit your business.

So it’s pretty clear to me that most venture backed investments don’t fail because the business plan was flawed. In my experience at least 2/3 of all business plans we back are flawed.

Most venture backed investments fail because the venture capital is used to scale the business before the correct business plan is discovered. That scale/burn rate becomes the cancer that kills the business.

We’ve all heard variations of that be-nimble-or-die philosophy, but it bears repeating.

What have you learned from your business failures? Comments, as always, are open.

It is now official. Google has confirmed earlier reports that it will bid in the upcoming wireless spectrum auctions. Already, it is toying with other prospective bidders, waiting until next Monday, the last possible day, to file its application with the FCC.

In mid-December, the FCC will release its list of eligible bidders. The auction itself begins on January 24, and could continue through March. Google exec Chris Sacca also notes that because of anti-collusion rules, Google will not be saying anything else about the auction until it is over.

Google’s “Blogger in Draft” program that tests functionality for Google’s popular Blogger blogging platform has rolled out OpenID support for comments.

The new service will allow anyone with an OpenID account, including LiveJournal and TypeKey services to log in and validate a comment on blogs running under the Blogger in Draft service. Google notes that the feature is a test and that they will seek user feedback, but all things being equal this will end up being provided on Blogger itself.

The bigger news, particularly for rabid OpenID advocates is a suggestion from Google that they are “working on functionality to let Blogger’s URLs (both Blog*Spot and custom domains) be used for commenting elsewhere on the web,” which sounds a lot like code for Google is looking at turning Blogger logins into OpenID log ins in a similar way that AOL did with its user base.

It doesn’t take Sherlock Holmes to know who is driving this, and Google even drops a hint in the example link: “http://brad.livejournal.com/”; LiveJournal founder and former SixApart employee Brad Fitzpatrick joined Google in August and is credited as the founder of OpenID.

OpenID advocates are passionate about the potential of the idea, but despite the noise and companies such as Digg, Yahoo and even to some extent Microsoft adopting OpenID it has failed to capture the broader public’s imagination. If the 1000 pound Gorilla in the room decides to adopt OpenID across its range of products, presumably with Blogger being only the first step of a broader rollout, OpenID may finally take off outside of the first adopter and tech communities.

Thanks to David for the tip

When Facebook took a $240 million investment from Microsoft last month at a $15 billion valuation, they became, in theory, one of the most valuable Internet-only companies on the planet.

But that valuation was tenuous at best. Microsoft and Facebook expanded their year-old advertising relationship as part of the deal. And Facebook was unable to get a third party to pony up cash to justify the valuation. Only a single (financially conflicted) entity was willing to say Facebook was worth $15 billion – that wasn’t good enough supporting evidence for the valuation.

Until now, that is. Kara Swisher is reporting that Facebook has grabbed another investor – $60 million from Hong Kong billionaire Li Ka-shing.

Facebook has now raised just shy of $340 million in capital. That’s enough to keep them going as a private entity for years, if they choose to do so. Their $15 billion valuation may or may not be real, but they certainly have a lot of cash to fiddle with.

New Israeli startup IRSeek is indexing public Internet Relay Chat (IRC) channels at the rate of 6 million conversations a day. 300 million conversations have now been indexed by the company. The most popular networks, including EFnet, DALnet, Freenode and QuakeNetUndernet, are all being monitored – IRSeeK is now “listening” to 2000+ channels across 10 networks.

There are few IRC search engines today, and most focus on specific niches or single networks, the Company says. Nearly two decades worth of data contained on IRC servers has effectively been lost. IRSeek wants to make sure that future conversations are properly indexed and and searchable. It’s a huge untapped knowledge-base.

So if you want to see what people are saying on IRC about, say, iPhone unlocks, now you can. The most popular search terms populate a query could on the front page of the site.

The company was founded by Eran Cohen (CEO), and Ariel Berkman (CTO). Development began in mid-2006.

The company says a channel is dropped when file sharing activity is detected and private conversations are not eavesdropped in anyway. Still, some IRC users, who have a possibly unreasonable expectation of privacy, may be troubled by IRSeeK. Personal information is often revealed in IRC chats. That information is now indexed and searchable. Searches can also be conducted by IRC nicknames, and all conversations involving that nickname (or even if they were just in the room) are linked. Of course, nicknames aren’t unique and many users may choose the same nickname over time. But even so, the knowledge that everything being typed can be later found by others may have a chilling effect on users.