Twitter may buy Virginia-based Summize, a Twitter search engine, says Jason Calacanis. A source close to Twitter says that the two companies have been in discussions around a merger over the last couple of weeks, but won’t comment on whether an actual sale has occurred, or the terms.

The deal certainly makes sense. Unlike rival Friendfeed, Twitter still lacks a search feature. And Twitter has relied on Summize in the recent past to help reduce load on the Twitter API. Summize is also one of (or the only) Twitter partner that has access to their XMPP stream.

Summize employees have recently been spotted at Twitter HQ as well, although that could be explained by the close working relationship.

Summize has raised just $750,000 in an angel round of financing. Twitter has raised over $20 million.

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My Yahoo, the leading customized homepage provider, has finally rolled out its redesigned interface to all of its users. Yahoo has allowed users to upgrade to the new interface for over a year, but has taken its time in rolling it out to everyone.

New features in this release include:

• More modules from content providers (New York Times, WSJ, etc.)
• More modules that integrate content from other parts of Yahoo’s network (Flickr photos, Calendar, Movie Showtimes)
• Better support for Third party email (Gmail, POP) and other services (Netflix and Facebook)
• More layout options, tabbed browsing, other navigational improvements

The interface has been in need of a facelift for some time, as Yahoo has watched its userbase dwindle from 56.9 million users last November to 41.6 million in June. Comparatively, iGoogle has has seen increase from 23.8 users in November to 24.3 million unique visitors in May. Google performance isn’t exactly stellar, either (maybe iGoogle could use a refresh too), but at least it hasn’t been losing users. So where did My Yahoo’s 15 million lost users disappear to? We’re guessing Facebook, which has gone from 92.7 million visitors to 123.9 million in the same time period.

Also notable is Yahoo’s announcement that they intend to allow external developers to create their own applications and modules for use on My Yahoo, along with other parts of the Yahoo network.

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Facebook now has vaporware. After a lot of huffing and puffing at the beginning of the year, Hasbro and Electronic Arts are finally getting ready to unveil their official version of Scrabble on Facebook. Today, they announced that the Facebook app EA has been working on for more than six months will be launched later this month, although a version on Pogo (EA’s online casual gaming site) is available today.

There is a Facebook Scrabble app in private beta (see screen shot at left), but the company is still testing it. It is not clear what is taking EA so long. After all, this is just a Facebook app, not a fully-featured video game like Spore.

It is also not clear what will happen to Scrabulous, the unofficial version of Scrabble that has become one of the most popular apps on Facebook. Scrabulous, which was developed by two brothers in India, was almost shut down earlier this year because Hasbro claims that it infringes on its trademarks. Scrabulous was in acquisition talks with many different companies, including Electronic Arts (which has the domestic license to digital versions of the game) and Real Networks (which has the international digital rights), but everyone balked on price.

Rather than force Facebook to shut down Scrabulous immediately, however, Hasbro and Electronic Arts realized that they would suffer an extreme backlash if they took away everyone’s favorite Facebook game without offering up an alternative. Now that the alternative is almost here, it remains to be seen whether they will try to eliminate the competition. In response to question about what Hasbro now plans to do about Scrabulous, spokesperson Gary Selby respondsl:

Hasbro has been consistent in stating that Scrabulous infringes upon our intellectual property, and we are keeping our legal options open. Today we are focusing on the coming launch of EA’s legitimate social networking version of SCRABBLE. We have no further comment at this time on Scrabulous and our legal strategy going forward.

What is clear is that if Hasbro and EA allow Scrabulous to live, the official version of Scrabble will have a hard time gaining any traction. Real Networks launched an offical version of Scrabble for Facebook members outside the U.S. and Canada a while back, and it has attracted a grand total of only 5,643 daily active users, compared to the 451,107 people who play Scrabulous every single day.

Because of the licensing issues, the EA version of Scrabulous will also be geographically hobbled. Only Facebook members in the U.S. and Canada will be able to play each other. If you live in the U.S. and want to play a friend in London, forget about it. Then there is the simple inertia of people who may see little point in installing the official version if they and all their friends already have Scrabulous installed.

What this means is that EA’s official version of Scrabulous, which it has committed resources to develop, may have little chance of success unless EA can get rid of Scrabulous first. But if EA and Hasbro try to push players to their version of the game by forcing Facebook to shut down Scrabulous, they will still have to deal with a lot of angry Scrabulous fans. Do people love Scrabble so much that they don’t care whose version they play, or will they boycott the game in solidarity with two developers in India? We may soon find out.

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Dissident Yahoo shareholder Carl Icahn and Microsoft have been talking to each other (as has everyone else involved in a possible Yahoo deal, including Yahoo and AOL over the weekend). In a letter to shareholders, reproduced below, Icahn notes that he and Microsoft CEO Steve Ballmer have been discussing possible transactions over the past week, and that Ballmer ” made it clear to me that if a new board were elected, he would be interested in discussing a major transaction with Yahoo! . . . immediately.”

Microsoft is throwing its weight behind Icahn’s proxy battle, going so far as to signal that an Icahn-controlled Yahoo is the only one that it is willing to restart negotiations with. Icahn says Microsoft won’t enter into any deal with the current Yahoo board because of the risk that the company will be “mismanaged” in the nine months or more it could take to finalize a deal of this size. He states:

Steve made it abundantly clear that, due to his experiences with Yahoo! during the past several months, he cannot negotiate any transaction with the current board.

In a coordinated statement it just released, Microsoft confirms that while it has “concluded that we cannot reach an agreement” with the current board and management at Yahoo, and that “after the shareholder election Microsoft would be interested in discussing with a new board a major transaction with Yahoo!”

Microsoft is basically telling the market that the only way a Microsoft deal can be revived is by voting the current board out. Yahoo’s stock is up 10 percent this morning on the news to $23.50, last time I checked.

Icahn makes it sound like he and Ballmer are closer than two teenage Best Friends Forever, talking on the phone for “as long as an hour,” gossiping about what they plan to do to Yahoo. But Microsoft is not guaranteeing anything, just that it would talk to Yahoo again if a new board is elected that is more open to a deal than the current one. It would be Microsoft’s fiduciary duty to do so anyway. Ballmer just likes slapping Yahoo around. He is not really committing to anything.

Yahoo, for its part, plans on arguing at its shareholder meeting that selling its search business to Microsoft makes no sense. But one of its counterpoints to Icahn’s original five-point plan, that Microsoft is no longer interested in a full acquisition of Yahoo, is now officially invalid.

Update: Yahoo responds, saying these announcements are silly because Yahoo’s current board is ready to negotiate a full sale of the company with Microsoft. Here is the full statement (I’ve bolded parts of it for emphasis):

Yahoo!’s Board of Directors continues to stand ready to enter into negotiations with Microsoft Corporation for an acquisition of Yahoo!. Indeed, as recently as June, Yahoo!’s independent directors and management approached Steve Ballmer about just such a transaction, only to be told that Microsoft was no longer interested even in the price range which they had previously proposed. Now Mr. Ballmer and Mr. Icahn have teamed up in an apparent effort to force Yahoo! into selling to Microsoft its Search business at a price to be determined in a future “negotiation” between Mr. Icahn’s directors and Microsoft’s management. We feel very strongly that this would not lead to an outcome that would be in the best interests of Yahoo!’s stockholders. If Microsoft and Mr. Ballmer really want to purchase Yahoo!, we again invite them to make a proposal immediately. And if Mr. Icahn has an actual plan for Yahoo! beyond hoping that Microsoft might actually consummate a deal which they have repeatedly walked away from, we would be very interested in hearing it.

Read both Microsoft’s and Icahn’s coordinated statements after the break:

Read the rest of this entry »

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Sazell, launched in private beta today, is a social media site that lets you take a snapshot of any website and puts it in a Flash widget that you can embed on any site. A snapshot consists of the image chosen for the page, and highlighted or inputted text.

When “snapping” a page, the user first highlights the text they want to include in their snapshot, and then clicks the Sazell bookmarklet. The user is then taken to a page where they can add tags to their snapshot. After submitting, users are taken to a page for their snapshot where other users can rate, comment, share or favorite your snapshot. Users can browse other users’ pages and subscribe to them via RSS. All snapshots are indexed and the ones with the most views are listed on the Popular page and recent “snapped” pages are listed on the Upcoming page. Snapshots can be embedded individually on a website with their Flash widget, or a user can embed their recent snapshots, or the most popular snapshots from the entire site.

Update: Below is an image of what the widget looks like (we had to disable it because it was messing up the TechCrunch site on IE browsers, but you can play with it here):

Essentially a social bookmarking site, Sazell is entering a very competitive marketplace. Digg and Reddit are direct competition, seeing as how they both offer very similar widgets. Although, it’s more like Youtube for websites than it is a social bookmarking site. It measures popularity by views, not by votes or ranking. And the snapshots themselves are simply clips of images and text without any additional commentary by the person who creates them. Once embedded on a page, they are pretty static. The text is not clickable, and you need to select “view more details” to get the link of the original Website being excerpted.

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Facebook is continuing its war on Facebook apps that push the limits on acceptable user interaction. Last week it was Slide’s Top Friends App, which it briefly suspended. Later Facebook also suspended another popular app, Social Me.

This time they’re targeting Slide’s rival RockYou and their Super Wall application, which tends to have a lot of spammy user content. But instead of shutting down the application wholesale, they’ve simply turned off the viral components of the app - invitations, notifications, etc.

The consequences have been just as dramatic. A month ago Super Wall had 2.4 million average daily users. Today it’s 600,000 and falling fast.

RockYou CEO Lance Tokuda confirmed that Facebook had shut down features of Super Wall, but says they’re working with Facebook to fix the issues and expect things to return to normal soon.

One thing is clear in all this: Facebook is serious about slapping down app developers who go too far in their efforts to grab new users.

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Consumer VoIP startup Ooma launched nearly a year ago and offered consumers free phone service for life, all you had to do was buy the hardware for $399.

Just one problem. The sticker shock of paying $399 up front for the hardware put a lot of users off. And there weren’t many places you could actually buy the Ooma. It went on sale on their website in August 2007. When a number of key executives left the company (we grabbed Sarah Ross, their former VP Communications), some blogs said they were in big trouble.

Amazon started selling Oomas later in the year, and customer reviews are overwhelmingly positive.

A year later the company is still going. They added marketing executives Rich Buchanan to the team from Sling Media earlier this year - the guy that led the Sling marketing team to sell 100,000 units in its first six months of operations, and 500,000 units as of mid 2008. Buchanan brought Tami Bhaumik with him from Sling as well, who is now Ooma’s VP Marketing.

Ooma is also now being sold in 26 southern California Best Buy retail stores, with a nationwide rollout scheduled later this month.

The company has also tweaked their business model. They still offer the free service for a reduced price of $250, with optional additional features in a premier service add on for $13/month. The premier features include a second line, three-way calling, message screening and custom rings.

I’ve been a happy Ooma customer for a year now. I also use Vonage, and Ooma’s call quality is better and there are fewer problems in general. If I didn’t have one I’d buy one now.

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It looks like green lights all the way for the launch of the iPhone App Store this week. Most developers have been told they must submit their applications by 12 PM PDT today (Monday) to be considered for inclusion in the launch: “Have your application be among the first available when the App Store goes live. To ensure your application can be considered for the exciting launch of the App Store, submit your application by 12 PM PDT, on July 7, 2008. We will continue to accept applications after this time, however your application may not be available until after the launch of the App Store. Conduct final testing of your application with iPhone OS beta eight and submit your app today.”

The store will almost certainly launch by Friday when the 3G iPhone is released, but some app developers say the App Store will likely launch a few days before that. Most developers will only get a few hours notice prior to the go live time, and Apple is keeping a tight reign on PR, as usual. The store could be launched as early as Tuesday.

If you are a developer who has an app to show, make sure you submit a demo video to us for review on launch day.

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Instant messaging, a technology that actually predates the Internet, hasn’t seen too many changes over the years. The AOL Instant Messenger of today is not that different from the AOL Instant Messenger from 1997. There has been some new technology with the integration of instant messaging, VoIP, and webcam capabilities with services such as Skype, but two things have remained the same. Voice chat has been real-time, and text chat has been near-real-time.

Say2GO, a new near-real-time voice messaging system, is attempting to change this. The new technology, they refer to as “voicing” is closer to voicemail than IM. The product, currently in limited beta, provides users the ability to send and receive voice messages that are transcribed using voice recognition and sent as both audio and text. The desktop client uses the Microsoft Speech API for the voice recognition element, so it is only available on Windows and XP users are required to download and install the client libraries from Microsoft. Without the voice recognition library, the client reverts to being a standard IM client with a neat clean interface such as the contact list being displayed in cover-flow style.

The idea and technology is still fairly new, and it shows. After spending 10 minutes to train both of our speech recognition libraries, Nik and I tested Say2GO and we saw very poor results. Nik said “Another test of the speech recognition software,” and it translated into “man another said the phone is the victim mission the way you read into.” I saw fairly better results but they were still off. I had said “Why did I spend ten minutes training this software,” and it translated into “why didn’t spend ten minutes training in software for.” Nik has a thick Australian accent and an absurdly loud fan on his computer, so that may have affected the transcription.

MSN Messenger has a similar capability called MS Voice Clips, that they added in 2005, which enables users to send 15 second or less voice notes to friends through MSN Messenger. Unlike Voice Clips, Say2GO enables you to playback your recording, cancel, or schedule it to be sent later.

Microsoft seems especially interested in this technology seeing as how Say2GO recently won the First Prize in ISV/Software Solutions in Microsoft’s 2008 Partner Contest, out of 47,000 member companies. They are heavily promoting the new speech recognition libraries, as once you train your profile in one application it can also be used in other apps that use the same library.

With voice recognition where it is at at the moment the feature on its own probably will not be a strong incentive for users to switch to a whole new IM client - but Say2Go intend to support existing IM networks rather than building out their own. Voice recognition is only the first part of planned ‘added’ services that can be used on top of these networks. Currently Say2Go supports the ICQ network, with support for other networks expected in the near future.

Will we ever bury voice recognition? Read more at Techcrunch IT >>

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Paragon Lake, a startup that aims to make the custom jewelry design process more efficient, has raised $5.8 million in a Series A funding round led by Highland Capital Partners and Canaan Partners. The company, which was founded in 2006, has been developing a web-based jewelry design tool for independent jewelers that it hopes to release in the next few months.

The online software aims to offer jewelers a 3D modeling environment with a simple user interface that should be significantly less expensive than traditional modeling programs. Jewelers will be able to create 3D models of custom jewelery as their customers describe it in real time, eliminating the crude sketches and time consuming back-and-forth exchanges that are part of the process today.

As part of the deal Canaan’s Dan Ciporin will join Paragon Lake’s board, which already includes Bob Davis of Highland. Both investing venture funds have had previous experience with services that helped expedite consumer product design: Highland has invested in VistaPrint, a service that lets businesses design printed materials like business cards, and Canaan previously invested in Blurb, a custom book printer.

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