Bowing to the inevitable, Microsoft took a big step today towards data portability by announcing that Windows Live contacts can now be exported to social networks and other Websites. Its Windows Live Contacts API will work with Facebook, Bebo, Hi5, Taged, and LinkedIn to start. Members of those social networks will be able to import their Windows Live contacts (i.e., their Hotmail address book) so that they can more easily find or invite those people into their social networks. Microsoft is also launching a site, Invite2Messenger, for importing social networking contacts into Windows Live. Right now that only works with Facebook.

Although Microsoft is part of the Data Portability Workgroup, this is a separate effort, confirms a spokesperson. So much for industry standards. But this is an important step in allowing people to take their contacts with them no matter where they reside, whether in their email or social networks. Instead of startups scraping Hotmail to ingest contacts, now they have a legitimate way of doing so.

In a way, this is a bit of a catch-up move. You can already import contacts easily from Gmail into services such as Facebook, Friendfeed and others. Maybe Microsoft had a touch of Gmail envy or were concerned about being left behind. At a certain point, an email service that doesn’t let you export your contacts could really be a damper on your social life elsewhere on the Web.

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Today, Web-based IM and chat room provider Meebo is releasing full-fledged APIs for its Meebo Rooms that will allow Websites to embed chat functionality in an automated fashion. Currently, Meebo Rooms can be embedded on sites or blogs manually by pasting in the appropriate code, which has already led to a proliferation of such widgets. There are more than 200,000 Meebo Rooms, attracting millions of visitors a month. (See our previous coverage here and here). Explains Meebo CEO Seth Sternberg:

Now, the servers of our partners can say, “I want to create a room.” It automates the creation process on a server-to-server basis. Also, we will be putting advertising into these rooms.

In addition to the APIs, the company is also announcing the Meebo Network, which will serve ads inside Meebo Rooms across the Web, splitting the revenues with the Websites hosting the rooms. Since each Meebo Room is formed around a particular interest, ads can be targeted. And to the extent that sites participating in the network have demographic data on their members, that can be used for ad targeting as well. Only Meebo Rooms created through the API will show ads, not the ones created manually.

The launch partners joining the Meebo Network are Piczo, Revision3, RockYou, Social Project, and Tagged. Revision3, for instance, will create a Meebo room on its site where fans can watch a synchronized loop of Web TV shows while chatting. Access to the full APIs and the ad network is by invitation only at this point. Social networks could use the new APIs to automatically add chat rooms to every group page. Rock bands or movie sites could add Meebo Rooms to their sites for visiting fans.

Comparisons can be made here to Userplane, a white-label chat service which was bought by AOL in 2006 and powers many of the chat rooms on MySpace. But there are subtle differences. Most notable is the fact that Meebo Rooms can spread anywhere on the Web. Anyone can grab the embed code and put it on their blog or MySpace page as I’ve done below. Notes Sternberg:

A user cannot take a room off of MySpace and throw it somewhere else. We have all our rooms networked. A user can take the CBS Jericho room, and throw it on their Wordpress blog. Our chat rooms are networked versus islands within Websites.

It is very hard to get a synchronous conversation going. You won’ get enough people on your MySpace page to have a conversation. But with Meebo Rooms, most of the traffic is coming from somewhere else. It solves the problem of the Web being so distributed.

The power of Meebo Rooms is that they let anyone create live conversations on their site by aggregating people with similar interests from other sites. In fact, it links people between sites. And that, hopes Sternberg, will give it enough scale to become an ad network of sorts. Meebo has raised $12.5 million from Sequoia Capital and Draper Fisher Jurvetson.

Meebo

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Piczo

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revision3

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RockYou

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Userplane

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Word about social network Hi5’s $20 million financing leaked earlier today. But that isn’t it for social networking funding news. We hear it from a good source, but without confirmation by the company, that Tagged has raised its own $15 million round, on a $102 million pre-money valuation.

We do not know who made the investment. This is Tagged’s third round of financing. They previously raised two rounds - $1.5 from angel investors in September 2005, and $7 million from Mayfield three months later.

Like Hi5, Tagged is profitable. Back in May they were adding more new users per day - 350,000 - than MySpace.

With nearly $1 billion in venture capital invested in new web startups from April - June 2007 alone, its clear that silicon valley is rolling in money again. With all the hype around Facebook, second tier (but still huge) social networks are an easy bet to get big money. Let’s all just hope for a soft landing.

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Silicon Valley based Tagged was a young-teen focused social network that, like Piczo, focused on security of its users first. It is part of a vague second-tier of social networks that assemble under the MySpace/Facebook giants and includes Hi5 (which is fast becoming a first tier player), Bebo, Piczo, Orkut and Friendster. They’ve raised two rounds of financing - $1.5 from angel investors in September 2005, and $7 million from Mayfield three months later.

Co-founder and CEO Greg Tseng told me today that the company has reached profitability on $600,000 in monthly revenues, and that user growth has spiked to 350,000 new users per day. That’s well ahead of MySpace, which is currently growing by 250,000 - 300,000 users per day.

Comscore shows Tagged spiking nicely compared to the copetitors (the last time we compared the networks was September 2005). Click the image for a large view.

There are at least a couple of reasons for the growth. In October 2006 Tagged went from an under-18 site, to allowing users of any age to join. Tagged still has tight security in place for users under 18. For example, profiles for 13 and 14 year olds cannot be viewed by the public or registered users over 16, and profiles for 15-16 year olds are private to non users and users over 18. Older users can still add these youngsters as friends, but they must know their email address or last name to request the friendship, and the younger user must also accept them.

Tagged is also very aggressive with signing up new users. At registration users are strongly encouraged to invite their entire address book as friends. It’s a highly viral, albeit controversial, way to quickly add lots of new users.

Lots of these new users are sticking around, too. Tseng says that half of their 40 million users are active and have signed in over the last month. Tagged is now generating 1 billion monthly page views (about half of what MySpace does in a day).

Tagged is getting serious about revenue growth. The $600k/month they currently generate comes mostly from a search deal with Ask.com and low CPM display ads. The Ask.com partnership may be on the rocks, however. Tseng says the deal is “not performing.”

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San Francisco based Piczo is having a media coming-out party today, with announcements on the current state of the service and key statistics. A few weeks ago CEO Jeremy Verba did the same thing in the UK - which we covered on TechCrunch UK.

Piczo is adding 35,000 new member registrations per day, 75% of which are teenagers between 13 and 16 years old. Ten million unique visitors come to Piczo sites monthly, adding up to 2.5 billion page views. While this isn’t much compared to monster competitor MySpace (which serves over 1 billion pages per day), it shows what the power of the network effect can do when applied properly - Piczo hasn’t spent a dime on marketing.

And unlike Myspace, Piczo is focused on safety first. It is virtually impossible to browse user pages on Piczo. There is no search or browse feature. Users must share their page URL with others for it to be found, and there are numerous ways for users, parents and others to report inappropriate behavior. Piczo has full time staff reviewing all complaints and takes swift action to protect its members.

Piczo was founded in early 2004 as a paid service. Based on early user feedback it was relaunched as a free service, and founder Jim Conning sent out 100 emails to Canadian teenagers announcing the new site. That is where Piczo’s marketing efforts began and, until now, ended. The result of those 100 emails has been a massive viral spread of the product.

Piczo brought in a high powered CEO late last year, Jeremy Verba. Verba was previously GM and Vice President of AOL’s Voice Services division, which he grew to over a million subscribers. In addition, he was co-founder and president of E!Online, a joint venture of CNET and E!Entertainment Television, now a part of Comcast. Piczo is well funded after pocketing a total of US$7 million over two rounds of financing from Sierra Ventures and Catamount in 2005 and 2006.

The Social Networking Space

I thought this was a good opportunity to look up Comscore numbers on the largest social networking players and see how things are evolving (these are U.S. numbers only). MySpace is still the king, with over a billion page views per day, 100 million registered users and 56 million unique visitors per month. If anything, their lead is growing over competitors.

But that doesn’t mean there won’t be other winners in this space, too. Facebook continues to dominate the college and high school markets, and their recent decision to open themselves up to anyone will almost certainly increase their userbase and page views. Bebo, Tagged, Piczo, Friendster, Tagworld and Tribe all also show very nice growth rates, with little or no marketing spends.

There’s still room to grow internationally as well. Bebo and Piczo both have a strong presence in the UK in particular. Of course, the argument that these companies will be successful in non-English speaking countries v. local competitors isn’t nearly as certain. We expect consolidation to occur in the next 12 months, and the largest independents (Facebook, Bebo, etc.) to be acquired by the big guys (Yahoo, Microsoft and Viacom in particular seem to be actively looking).

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Myspace competitor Tagworld will announce a large Series A financing by Draper Fisher Jurvetson sometime today. Tim Draper and Emily Melton will be joining Tagworld’s board of directors.

This comes just two weeks after news of competitor Tagged’s $7 million financing by Mayfield was leaked and reported by Matt Marshall.

My previous posts on Tagworld are here.

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