Apple Secretly Acquired “Pandora For Books” Startup BookLamp To Battle Amazon
by Josh Constine @joshconstine
TechCrunch has learned that Apple has made another acquisition, one that it is using to boost its e-books effort and “beat Amazon at its own game.” It has bought BookLamp, a startup based out of Boise, Idaho, that developed big data-style book analytics services.
[Update 6:45pm PST: Apple has confirmed our report of the acquisition. The company tells us “Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans.”]
A second source says Apple bought BookLamp’s employees and technology for a price that was “higher than $10 million, and lower than $15 million.”
BookLamp’s most well-known product was the Book Genome Project, a platform that let users find suggestions for books to read based on natural language analysis of other titles. BookLamp’s tech and talent could help Apple improve its iBooks service with better recommendations, search, and categorization.
TechCrunch has reached out to Apple for confirmation on the deal with BookLamp, as well as to BookLamp’s CEO Aaron Stanton and several former employees including Matt Monroe, and Dan Bowen. Stanton said “Sorry, Josh. I can’t help you”, which meshes with the strict gag order Apple places on companies it buys. But in the meantime while we wait for an official response from Apple, here’s some more evidence we’ve amassed.
We first heard of the sale via an anonymous tip (thank you, anonymous reader). Digging around, we found that several employees appear to have decamped from Idaho to the Cupertino, California-area where Apple is headquartered.
Prior to the exit, BookLamp had raised around $900,000 from local backers. Yes, it looks like BookLamp is Apple’s first acquisition out of Idaho. And it turns out BookLamp had also been in talks with Amazon at one point, but how far they went is not clear. Amazon ultimately went on to acquire GoodReads, another competitor in the book recommendation space, and Apple bought BookLamp.
Hush Hush
As is typical for many Apple M&A moves, the whole thing has been kept very quiet. Like “library voices” quiet.
When BookLamp announced in April that it would be shutting down the Book Genome Project, it described the closure in vague terms, thanking users for being a part of its “journey to date” as the company “evolves its mission.”
To keep up appearances and throw people off the scent, BookLamp still has an office in Boise, and a second office in Cupertino, but none of the startup’s 10 employees work in either. “This was just the line created for them so that they didn’t have to explain what was happening. They’ve all moved to Apple,” our source says. “We were wondering when someone would come knocking and asking more questions
Indeed, as we started to look into this story, we could see BookLamp employees tagging Facebook posts in Cupertino, Palo Alto and San Francisco – while listing their state of residence as Idaho, where the company was located. Despite the site’s shut down, several members of the core team haven’t changed their current employer from BookLamp or updated their current city. These signals are hallmarks of how Apple handles acquisitions.
BookLamp was one of the first companies to get incubated in the Water Cooler, a hybrid co-working facility in Boise – a city that has produced some other notable tech companies and tech exits like MarkMonitor (sold to Thomson Reuters), First to File (sold to CPA Global), and Proclarity (sold to Microsoft).
Relative to other startup acquisitions, BookLamp went for a modest price. But that understates the company’s ambitions and track record. From what we understand, prior to the acquisition, BookLamp was working on a number of B2B projects alongside its initiative it described as “Pandora for books”.
Book Genome Project
BookLamp’s public-facing product was designed to scan the writing style of books you like and suggest novels or authors with a similar feel. It could also break down plot themes and content, allowing for better search-ability and discovery. One source suggests that Apple bought BookLamp to power an ebook search competitor to Amazon.
We covered BookLamp back in 2011. At the time, BookLamp wanted to do for books what Pandora did for music: scanning content for quantifiable similarities to power recommendations. Last year, Book Genome Project and BookLamp CEO Aaron Stanton said it was indexing “40,000 to 100,000 titles a week.”
After doing its analysis of a book you liked, BookLamp could offer suggestions that match its “BookDNA”. It could, for instance, recommend “The Templar Legacy” by Steve Berry for fans of Dan Brown’s “The Da Vinci Code” because they both feature ‘catholic institutions’, ‘history / academics’, ‘strategic planning’, and ‘libraries’. Its stated goal was to divorce its suggestions from what’s popular and just show you what’s most likely to become your next page-turner.
Unabridged Data
Beyond the Book Genome Project, BookLamp also Kickstarted the creation of a sort role-playing game for reading called The Game Of Books, where you’d level up and earn badges for reading around specific themes like science fiction or murder mystery.
But the startup’s serious business of providing content analysis to e-book distributors was happening behind the scenes. Among its customers were Amazon, Apple and a group of publishers in New York. For them, BookLamp provided data analytics services that ranged from automatic book screening for proper categorization (Apple) to providing a platform for the publishers that they could use for screening manuscripts to consider whether a book would sell well with a particular demographic, or how much marketing budget should be allocated to it.
lang_story_charPart of the reason that Apple made the move to acquire BookLamp was because of this long list of clients. “At first Apple and BookLamp talked about growing their contract, but then they talked more from a strategic standpoint,” a source says. “What Apple wanted to do was, instead of contract, they wanted to make sure whatever work was done was done just for them.”
And what is that work? The details are not clear yet, but the source says, “in broad strokes, the goal that [founder Aaron] Stanton and three of the folks he was working with from the original BookLamp crew is to beat Amazon at their own game.”
“I can tell you that in the next year to 18 months you will see some fairly major initiatives focused on books and reading coming out of Apple.”
This is somewhat bolstered also by another detail from our original tipster, who claims that Apple is looking to poach yet more search talent from eBay to flesh out a search team using BookLamp’s technology.
Illuminating iBooks
There are several big ways Apple could be using BookLamp to bolster its own e-book platform.
One option would be to use BookLamp to build a competitor to Amazon X-Ray, which lets readers see where and how often terms or characters pop up in a book. That could be useful for classifying books into categories or flagging ones with sexual or violent content as being unsuitable for kids – or simply providing feature parity with Amazon’s Kindle app, which offers X-Ray on iOS.
Considering Amazon’s headway into self publishing, it’s enticing to wonder whether BookLamp’s technology for screening manuscripts to figure out their market fit, or the other tools they were developing and using, may end up getting implemented under their new owner to determine what it should promote. BookLamp’s algorithms could augment Apple’s human editors who choose what’s highlighted on the iBooks homescreen.
The most obvious way, though, would be to use BookLamp’s content and style analysis to power individualized iBooks recommendations.
The Game Of Books
Right now, Apple’s iBooks app doesn’t focus on personalization. It features Top Lists like the App Store, featured selections, author spotlights, and categories, but lacks “if you like that then read this” style suggestions. With books often available from many e-book distributors (and even more so on iPhones subjected to jailbreaking – learn more at http://kubadownload.com/), companies like Apple need to offer extra value somehow. If Apple can make you recommendations you trust, you’ll probably follow through and buy or rent your books from it.
While BookLamp once used the name to turn reading into a sport, it’s now become a weapon in the real Game Of Books between Apple and Amazon.
Google is collecting medical data to paint a picture of perfect human health
By Rich McCormick
Google has started to collect medical data from volunteers as part of an ambitious project designed to build a database of records that show what a healthy human being should be. The project, developed by Google’s experimental Google X wing and called Baseline Study, sees the company first harvesting anonymous genetic and molecular information from 175 people. According to The Wall Street Journal, Baseline Study will soon draw information from thousands more in a bid to create a picture of a person in perfect health.
“Project Baseline will collect genetic and molecular data”
The project is designed to pull together a huge amount of data that will not only allow medical professionals to detect and treat major health issues such as heart disease and cancer earlier, but will also enable them to detect trends and patterns in human health, making medicine more about the prevention of illness than the cure. It’s helmed by Dr. Andrew Conrad, who joined Google X in March 2013 after helping develop cheap, high-volume HIV tests for blood plasma donations. The Wall Street Journal reports Conrad has built of a team of between 70 and 100 experts for the projects, from medical fields including physiology, biochemistry, optics, imaging, and molecular biology.
Project Baseline will use Google’s computational power to identify “biomarkers” in the data that could help people stave off or avoid health issues. Medical science has traditionally discovered biomarkers for late stage diseases, but it’s Google’s hope that Project Baseline will also be able to crunch through data to detect tendencies in our bodies that can be addressed before they become life-threatening.
Dr. Conrad posits an example where the data allows researchers to pick out a biomarker that shows some people can break down fatty foods efficiently. Others, he suggests, may lack the marker, putting them at risk from heart disease. By identifying such trends before the disease has become too severe and treatment is necessary, Project Baseline’s information could suggest people change their behavior before their first heart attack, or enable scientists to develop something to help at-risk people break down fatty foods.
“The exam includes the collection of bodily fluids including urine and tears”
Dr. Conrad warns against expecting the data to spit out an immediate cure for cancer, saying that advances will be made in “little increments.” The project began this summer when a clinical testing firm that Conrad declined to name enrolled 175 people in an exam that demands the collection of bodily fluids including urine and tears. The unnamed clinic, plus other facilities at Duke and Stanford Universities, will run further exams in the future, collecting samples and removing information such as names and social security numbers from participants.
The rapidly decreasing cost of collecting genetic and molecular information has only recently made Project Baseline possible. Participants’ genomes will now be sequenced – a process that once cost $100 million, now reduced to around $1,000 – along with their parents’ genetic history. The Wall Street Journal says data on how they metabolize food, nutrients and drugs, how fast their hearts beat under stress and how chemical reactions change the behavior of their genes will also be recorded.
“Participants’ genomes will be sequenced”
The project promises much, but by collecting so much information about participants, it also raises privacy concerns. What happens if a person’s molecular makeup get into the hands of others? Already Google has clarified the medical data it receives will be anonymous by the time it gets its hands on it, and specified that such information would not be shared with insurance firms. Dr. Sam Gambhir, a Stanford doctor who has been working with Google for more than year, says that the issue of privacy has been discussed. “Google will not be allowed free rein to do whatever it wants with this data,” he told The Wall Street Journal.
It’s unclear how Project Baseline will tie in to Calico, the Google company tasked with extending human life, but it’s obvious the company is serious about making humans live longer. But although Google X is actively entering the health care market, creating glucose-measuring contact lenses, the company’s leaders have expressed their frustration at the industry’s regulation and restrictions. Speaking earlier this month, Google co-founder Sergey Brin said health care in the US was “so heavily regulated that it’s just a painful business to be in;” at May’s Code conference, he expressed his exasperation over how jealously medical companies guard their data, suggesting that by applying machine learning to existing sets of data to pick out patterns, hundreds of thousands of lives could be saved every year.
Google and Apple have both announced health-tracking platforms this year, but Project Baseline looks to be more ambitious than both Apple’s Healthkit and Google Fit. If Google’s attempt to apply its number-crunching capabilities to our medical records pays off, the hundreds of thousands of lives Sergey Brin mentions could be spared. We might also get the dubious pleasure of meeting the world’s healthiest person in the process.
eBay sold almost $2 billion in Apple products last year alone
by John-Michael Bond @BondJohnBond
Apple just announced its earning results for the third quarter of their 2014 fiscal year, but it is not the only one raking in cash via sales of its products. According to information acquired by Computer World, eBay also is profiting, selling almost $2 billion in Apple products in 2013 in the U.S. alone.
What’s interesting is where the two company’s sales diverge: iPod sales, for example, only account for 1% of Apple’s sales, while they make up 7% of eBay’s total sales of Apple products. The biggest earner for both companies when it comes to Apple hardware, however, is the iPhone, accounting for 55% of eBay’s sales and 53% for Apple.
eBay mostly profited off Apple products that are in the obsolete or retired hardware department. Thanks to sales in the “Mac Laptop, All” category, the retailer was able to earn $161 million from legacy PowerBook, iBook, and PowerPC Macs. When it comes to selling old tech gear, eBay is still a powerful force in the market.
Unlike AT&T’s disdain for Leap customers, T-Mobile is taking care of MetroPCS subscribers
By Kevin Fitchard
If you want to see contrasting approaches to how major wireless carriers handle acquisitions, you needn’t look much further than how AT&T and T-Mobile are handling their respective purchases of Leap Wireless and MetroPCS. Both AT&T and T-Mobile are cannibalizing their acquisitions for valuable spectrum, of course, but T-Mobile actually seems to see some value in keeping Metro’s customers.
T-Mobile has already shut down Metro’s CDMA and LTE network in three cities – Las Vegas, Boston and Hartford, Conn. – but the carrier told FierceWireless it’s managed to keep 92 percent of the MetroPCS customers in those markets on its subscriber rolls. T-Mobile said it gave affected customers three months warning and replaced their CDMA devices for GSM/LTE equivalents at little or no cost. T-Mobile is now in the process of shutting down CDMA in Philadelphia, targeting a Sept. 30 sunset date.
Meanwhile AT&T hasn’t even begun shutting down Leap’s CDMA networks, but Leap’s Cricket Communications customers are already leaving in droves. In its second quarter earnings call, AT&T reported a net loss of 405,000 prepaid subscribers, most of them fleeing Cricket customers.
“Reported” is perhaps a bit of exaggeration, since on its call AT&T chose to focus on its “record-breaking” postpaid subscriber additions and churn rates. The loss of nearly one tenth of Leap’s subscriber base in just the first three months since its acquisition didn’t really seem to bother AT&T much at all.
AT&T hasn’t entirely left former Cricket customers hanging. It’s been offering them replacement GSM/LTE phones, but those devices just happen to be trade-in smartphones left over by customers in AT&T’s Next upgrade program. Nothing quite says “I value you” like a premium customer’s discarded handset.
T-Mobile won’t report its Q2 earnings for another week, so we’ll see if the recent MetroPCS network shutdowns ate into its subscriber growth. But so far it seems to be doing a better job managing its operational integration than AT&T. While prepaid gains for T-Mobile were flat in in first two quarters after the MetroPCS buy, T-Mobile went on a tear over the last six months, adding 465,000 net new prepaid customers in the first quarter alone.
Microsoft’s Strategy For Nokia Becomes Clearer
Sarah Cohen
4Q14 earnings, an announcement of 18,000 layoffs, and the release of a memo from Microsoft’s EVP of devices Stephen Elop about rightsizing – has brought about a clearer picture of Microsoft’s plans for Nokia ‘s phones, which it acquired in April for $7 billion.
Nokia was one of many cellphone manufacturers that struggled as Apple ‘s iOS and Google ‘s Android gained dominance of the smartphone market and displaced cellphones and other smartphones. Rumors of Microsoft’s buyout interest, or lack thereof, in Nokia circulated for years before an alliance shifted to an acquisition. But when Microsoft announced the acquisition last year, the natural question was how the software company planned to generate profits from a cellphone maker that was bleeding money.
Nokia’s still bleeding money, and cost Microsoft 8 cents from its earnings per share last quarter. But strength from Microsoft’s cloud computing and the sense that CEO Satya Nadella, who replaced Steve Ballmer in February, is containing Nokia’s losses has impressed analysts. Microsoft expects Nokia to break even by 2016, said Amy Hood, CFO of Microsoft, during the earnings call on Tuesday.
Daniel Ives, managing direct at FBR Capital Markets, said after a decade of missed opportunities, Nadella seems like he’s taking an honest look at Microsoft and “skating with the puck” in front of him. “He’s playing a long game,” said Ed Maguire, senior analyst at CLSA, leveraging the cloud and Nokia as a way to sell applications.
Despite being obtuse to the suffering of 12,500 former Nokia employees set to lose their jobs while he praised his business unit, Elop laid out a framework for cost cuts in a memo to employees on July 17. Devices would focus on high and low cost Windows smartphones, suggesting a phasing out of feature phones and Android smartphones. Two business units, smart devices and mobile phones, would become one, thereby cutting overlap and overhead. Microsoft would reduce engineering in Beijing and San Diego and unwind engineering in Oulu, Finland. It would exit manufacturing in Komarom, Hungary; shift to lower cost areas like Manaus, Brazil and Reynosa, Mexico; and reduce manufacturing in Beijing and Dongguan, China.
According to reports that same day, Microsoft would sunset Nokia X Android phones, Asha and Series 40 phones within 18 months.
Nadella gave hints about how Microsoft will make money on Nokia during Tuesday’s conference call. Devices, he said, “go beyond” hardware and are about productivity. “I can take my Office Lens App, use the camera on the phone, take a picture of anything, and have it automatically OCR recognized and into OneNote in searchable fashion. There is a lot we can do with phones by broadly thinking about productivity.”
In other words, the sale of a smartphone is a means to other sales.
Over time, Microsoft may move away from all phones but premium smartphones, said Maguire. It may shutter or divest more manufacturing assets.
The next generation of Windows, Windows 9, promises to unify phones, tablets, PCs and gaming consoles with one operating system, noted Kirk Materne, managing director at Evercore, and the unification may lead to efficiencies and new opportunities throughout Microsoft.
