Yojimbo!

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Yojimbo!

(or “Your Circle of Friends vs. Your Social Graph”)


Two warring clans, Google and Facebook, have been posturing for the future of the web, but a new player emerged yesterday: Yojimbo.

Like the character in the classic Kurosawa film, Steve Jobs arrived with subtle swagger, showing two Apple products that didn’t compete with Palm, RIM, HP, Toshiba, Microsoft or Dell.

Today we saw the future of Apple–and perhaps our first viable Facebook competitor–in a product called PING.

Ping is a “social network for music” that that is best described as, “a better Facebook inside of iTunes.” If that wasn’t enough, Jobs showed a new gaming social network…err….“game matching service,” called Game Center.

Having demolished Palm and eclipsed Microsoft’s market cap, Jobs is longing for a new arm to lop off–and that arm belongs to Mark Zuckerberg.

No one saw this coming: FIGHT! FIGHT! FIGHT!

I’ve taken the liberty of inserting what Steve Jobs told me over Fraiche yogurt last night right between his public bullet points on the slide below. Really, Wall Street Journal and New York Times peeps, there is no need to fact check. Have a sense of humor call me or tweet me @jason (I’m so hard to find!).

Just reprint word-for-word the joke above and you’ll get the top slot on TechMeme, along with the 348 visitors it drives to the average story. (Note: this is a meta joke. For reference watch Kara and I discuss the background here).

Anyway, here is what Steve Jobs is thinking during the keynote:

Now, certainly you’ve heard about Apple’s huge data center in North Carolina. You know, the one that reportedly cost one *billion* dollars. Experts say that Apple’s data center cost roughly double what Google and Facebook spent on similar facilities.

Apple’s massive, cash-generating successes have come from soup-to-nuts services like iTunes and the iPod, the App Store and the iPhone. It’s a logical conclusion that Apple would want to take on the social and search layers next.

PING is not music service; it’s a social network precursor.

Game Center is not a game matching service; it’s a social network precursor.

The largest and most-loved Apple product line–to the tune of over 275 million units sold–is the iPod. Their second biggest revenue success is the iPhone, of course. In order to use it, you need to put in a credit card.


Facebook and Twitter have users. Apple has customers.

The difference? Customers give you their credit card number.


What if http://PING.Apple.com become your social network in 2011? What if that social network will be built off of:

  1. Music preferences from Ping/iTunes
  2. Video game preferences and rankings from your iPod, iPad and Game Center
  3. Photos from your iPhoto library
  4. Your social graph…err, “circle of friends”…from your iPhone address book
  5. Your calendar from your iPhone

In other words, Apple could integrate social networking into every single product line and Facebook will be left wondering how on Earth they lost their two most engaging businesses (photos and games) so quickly.


The New Gold Standard

Jobs has once again introduced his new “Gold Standard for Product Design”: service and/or software + social + device. At this point, there is almost nothing in the ecosystem Jobs does not own or control, with the exception of search and content creation. (Then again, he is the largest shareholder and a board member at Disney, right?).

For music, this formula would be: iTunes Store + iTunes Software + Ping + iPod.

For photos, this formula would be: iPhoto + Yet-to-be-released social photo service + iPhone camera.

For video games, this formula is: App Store + Angry Birds + Game Center + iPad/iPod Touch.

Recommendations

Recommendation One: Apple should buy Twitter now for five billion, and Evan and the team should take the money.

Why: First, Evan Williams would be a massive compliment to Jobs in the coming years–perhaps even a succession candidate (at least on the product side). Second, social networking threatens to move Apple’s cheese, and Jobs don’t like anyone threatening his cheddar. Third, Twitter as a unifying brand across Apple’s product line would simply be an organic integration. (It’s been occurring anyway).

Odds: 10 to 1

Recommendation Two: Apple should buy Zynga for $10 billion, and Mark Pincus and the team should take the money.

Why: First, Mark Pincus would be a massive compliment to Jobs in the coming years–perhaps even a succession candidate (at least on the business side). Second, social gaming is the lifeblood of Facebook’s revenue and engagement. Third, Zynga games would form a base of 50-100 million users in Game Center–instantly.

Odds: 7 to 1

Recommendation Three: Facebook should build or buy a camera and phone company and extend their brand into gadgets. Hey, Kodak has a billion dollar market cap and a 20B brand name – maybe Facebook could grab that? There are no struggling-but-promising mobile firms since Microsoft bought Danger and HP bought Palm. That being said, a RIMM + Facebook merger would be insanely interesting (but not advisable).

Why: Facebook will need a soup-to-nuts solution if they’re going to stay competitive. In the coming months, you’ll take a photo or video on your iPhone and instantly share it with your
“circle of friends” (aka social graph) without ever having to launch Facebook. Google has a foothold in Android and with the Nexus One. Microsoft has XBox, Zune and the forthcoming Windows 7 devices. Singular experiences win, and Facebook is in last place on that front. With no gadget strategy, they will lose to Google, Microsoft and Apple.

Odds: 3 to 1

In Summary

Kara Swisher has reported Steve Jobs’ explanation for the lack of Facebook support in Ping:

“onerous terms that we could not agree to.”

Let me put that through the Steve Jobs translating machine:


“Zuckerberg has no honor and I will cut his arm off and leave it in the town square for everyone to discuss while I eat rice (or frozen yogurt) with a blank stare.”


All the best,

JCal

Quick hits:

  1. Open Angel Forum London is October 6th. We are looking for angel investors from Europe with at least four deals in the past year and also European startups looking to raise an angel round. There are three tickets available to service providers (lawyers, accountants, headhunters, bankers, technologist, etc). Thanks to Silicon Valley Bank for their global partnership with me on OAF. Please spread the word!  http://openangelforum.com/2010/08/31/london-october-6th/
  2. Open Angel Forum Los Angeles is happening on September 20th. Again, we’re looking for startup companies who want to raise angel funding. More than 50% of OAF companies raise money from OAF members! Dozens have done so already, including epic startups like Backupify, Rapportive, Postabonand, Thumbtack and Ubercab (all five of which I personally invested in, as well).http://openangelforum.com/2010/08/26/now-accepting-applications-for-our-third-la-event/
  3. Future of Web Apps London, October 5th – For the second time, I will be keynoting this amazing event. I can’t recommend this affordable, high-quality event enough. Well worth a trip to the UK.http://futureofwebapps.com/london-2010/
  4. Recent investments: I’ve recently closed angel investments in Chartbeat and Storkbrokers. These are my 14th and 15th angel investments in the past 18 months, and I will be taking a one-year break from angel investing. I’m sorry, I’m not as rich as I appear to be. 🙂
  5. Mahalo 4.0 will be launching in November (or whenever is most epic). It’s really amazing, and I finally think the majority of people will understand my vision for a “knowledge engine” which combines Q&A, topic pages, how to articles and videos.
  6. Mahalo is hiring developers, either out of school or with one to 700 years experience, provided they are hard-working, resilient, resourceful and driven to change the world. If this describes you, send me your resume and a cover letter explaining why you kick ass. If you are lame, weak and want balance and peace in your life, please send your resume and flowery cover letter to Jimmy Wales atjobs@wikia.com.
  7. If you know anyone intelligent, considerate and fun, it is your Giri to have them signup for this newsletter: www.jasonnation.com
  8. I’m making progress on possible writers and researchers for this newsletter. If you know anyone who is epic, do let me know.
  9. The Launch Conference (my rebranded version of TechCrunch50) is February 23rd and 24th. Website coming soon. If you want to be a partner, there are three packages available: $7,500, $15,000 and $30,000. Email me for details. Tickets and website go up on September 20th.
  10. We could use another top-level partner for the 12 Open Angel Forum chapters. With 20-35 events next year, the $50,000 charter partnership is an absurd bargain: (about $1,500 to attend and sponsor every single event!). Email krute@openangelforum.com
  11. Mahalo is looking for five people to play video games and record them in our offices. Emailtyler@mahalo.com if you’re interested. Must be in Santa Monica, must be an expert on playing video games and solving all levels. Doesn’t pay much, but includes a sick work station, free food and ability to move up in a growing organization.
  12. This Week in Startups is on fire, with recent guests including the founders of Thumbtack (http://thisweekin.com/thisweekin-startups/this-week-in-startups-68-with-marco-zappacosta/ ), DuckDuckGo ( http://thisweekin.com/thisweekin-startups/this-week-in-startups-72-with-gabriel-weinberg/ ) and FFlick ( http://thisweekin.com/thisweekin-startups/this-week-in-startups-69-with-kurt-wilms/ ).
  13. Thanks to my peeps at Mail Chimp for their support.
  14. What do you guys think about the new fancy HTML format?

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