Acquisition Is The New Black – Is The Entrepreneurial Economy Back

Has anyone else noticed this trend of late? It appears as if corporate acquisitions have become the new black.

Nokia, for example, have acquired Bit-Side, Cellity and Plum so far this year. The Finnish mobile company is now reportedly targeting the London-based travel social network Dopplr.

After a hiatus, Google is also back in the M&A game. CEO, Eric Schmidt told Reuters Television:

“Acquisitions are turned on again…and we are doing our normal maneuvers, which is small companies. My estimate would be one-a-month acquisitions and these are largely in lieu of hiring.”

Google Acquisitions and Investments

Google acquired On2 Technologies last month and reCAPTCHA last week. MeetTheBoss has a subway-style map of the company’s acquisitions (thanks TechCrunch) – this may prove useful if you are trying to figure out their M&A strategy.

After a break of almost a year, Adobe turned on the spigot last month with the acquisition of start up Australian hosting and ecommerce company, Business Catalyst. They then fronted up for a billion dollar deal by acquiring Omniture, a web analytics business.

How can we forget Oracle’s billion dollar acquisition of Sun Microsystems last month.

Microsoft’s only acquisition so far this year has been BigPark, a Canadian interactive gaming company. Before this deal they had last made an acquisition this time last year.

IBM has kept up a steady pace in recent months acquiring Exeros Assets, a data discovery software company in May, both statistical analysis software developer SPSS and source code analysis company Ounce Labs in July and Singapore-based analytics and optimisation business Red Pill Solutions this week.

So, what does this mean for entrepreneurs and their financial backers?

Investors typically focus as much on the potential exit as they do on the team, the technology and the market when they are deciding whether to bring a company into their portfolio. Knowing that the corporate development VPs are once again actively scouting for deals for their companies will be comforting to venture capitalists and their limited partners. They will become more active in growing their portfolios again.

As a result the entrepreneurial economy or ecosystem will be sufficiently lubricated to begin grinding its gears and tending towards a state of equilibrium.

Microsoft Is (A)Live With Photo Sharing, Social Roll Out While Apple Searches

Microsoft has rearchitected its Live.com portal to be more of a social network on which users can pull in data from various sources and interact with their friends. TechCrunch has more coverage:

Users are automatically connected with any friends they have on Windows Live Messenger, which is by far the most popular instant messaging service worldwide (Comscore: Microsoft Messenger has 268 million worldwide users, compared to 116 million for Yahoo and 6 million for Google Talk).

Users are asked to build out their profile, and can also bring in content they create on blogs (or any RSS feeds, Flickr, LinkedIn, Pandora, Photobucket, iLike, Twitter, WordPress and Yelp. When you do something new on those sites, the information flows into Live.com for your friends to see (in a very similar way as FriendFeed, Plaxo and others do today). Eventually, says Microsoft, more than 50 partners will be supported. When users add photos, write reviews, and update their profiles directly on Live.com, that content will be put into the activity stream as well.

The hope, of course, is to get people to hang out a lot more at Live.com. At least those people who use Messenger, since they already have their contacts established. Like Yahoo, Microsoft is going with its strengths, which in their case is instant messaging.

Microsoft’s software plus services strategy has clearly infiltrated Live.com as well as their approach with Office. Live.com users can now access a variety of online services like mail, calendar, photos, online storage, etc., as well as downloaded services that include a mail client, instant messaging, Movie Maker, Photo Gallery, the Toolbar and other services. And now it’s also one big social network.

Included in this new roll out is a photo sharing site call Live Photos. ReadWriteWeb has a solid review.

They point out that the slideshow background changes color depending on the dominant color in the photo being displayed at any given time – this is an interesting feature and points to photo sharing services growing their intelligence of what is taking place inphoto as it were.

Furthermore:

You can share your albums with very granular permissions, and also share individual photos. Every photo can be tagged and your visitors can also leave comments.

On the other side of the spectrum, Apple is reported to be working on a search engine. This one’s more of a rumor than substantiated Valley lore at the moment. Again from TechCrunch’s Michael Arrington.

Open Mobile Markets: How To Drive Impetus

Open mobile platforms and markets are all the rage.

Apple generated $30m in the first month with its iStore, and has attracted a plethora of app developers of all shapes and sizes – from Electronic Arts through to start ups like Palo Alto-based Tapulous.

The first Android-powered GPhone is about to hit the streets and this means the Android market will be open for business. RIM is working on something similar and Microsoft is creating a platform for selling apps on its Windows Mobile systems called SkyMarket.

But take a closer look at the Android Market and one thing is glaringly obvious – it’s relatively deserted. Sure it’s a chicken and egg thing, but what made Facebook’s F8 platform so successful in gaining immediate impetus was the critical mass element.

Currently, only a handful of apps are ready for Android – MySpace has a basic version of its soc network ready, imeem’s Internet radio service and a number of weather related apps are the pick of the bunch.

Where is everybody? EA’s Spore, which is the best mobile game I’ve ever had the pleasure of playing would be a great marquee.

So here’s the rub. The beauty of the iPhone Store was that you could generate revenue immediately. The Android Market is currently missing that key revenue enabler – a closed commerce system.

As the number of app markets proliferates and the total addressable market mushrooms I suspect we’ll see a number of meta solutions appear. In particular meta systems that can market, track and monetize apps across all the platforms as well as tools that allow developers to code once, and release cross platform.

In the meantime, app store owners need to focus on getting traffic in the door, app developers buzzed about their platform and a monetization mechanism in place.

Synthe Your Photos: But Not Cross Platform

I first saw an early demo of Microsoft’s Photosynthe at the inaugural Web 2.0 Summit in 2006 and wholeheartedly joined in the standing ovation.

Microsoft has now launched the consumer version, which comes with a healthy 20Gb of online storage.

One key snag however…it’s not cross platform. FAIL.

More coverage via Robert Scoble.

Yahoo Search Now, Facebook Next: Microsoft Readies For Acquisition Integration

According to John Furrier, Palo Alto is abuzz with both Microsoft and Yahoo execs.

His take is that after Microsoft consummates the current deal it has put on Yahoo’s table to acquire their search business, they’ll be wandering down University Avenue to knock on  Facebook’s door (with a multi billion $ check in hand).

I haven’t had this verified, but can see how it would fit into Microsoft’s strategy. They already own a small piece of Facebook and given the social network’s recent bad rap it may be an opportune time for them to swoop.

UPDATE: Robert Scoble is also confirming the rumors swirling. Don’t bother going to the Garden Court Hotel (pictured above) for a sticky beak at what may be one of the most important deal talks ever in the history of the Internet, the meetings are taking place elsewhere.

UPDATE II: The blogging echochamber has been resonating with the continued vibration that Facebook is in Microsoft’s sights. Kara Swisher tells us that Mark Zuckerberg has denied the rumor. But who remembers how the YouTube founders adamantly told us they would never sell.

The beauty of the echochamber is that we also get some sound analysis emerging. Umair Haque makes some good points. I totally agree with him that it would be nuts for Microsoft to make the acquisition and then keep Facebook closed:

…only openness can maximize the value of network effects in this space, because there are no hard technological switching costs creating lock-in.

Facebook may become an integral part of Microsoft’s web plumbing, but to close its spigots would drive down its acquistion value.