Microsoft to Enter Social Networking with Wallop
Microsoft began spreading the word about its social networking venture, Wallop, in late 2003, but has since been very quiet about its dealings with the project. After some renewed buzz about Wallop in recent weeks, Microsoft finally talked about Wallop last Wednesday, saying that it had passed the project on to a 12-person, San Francisco-based startup company called Wallop, Inc., which will be led by former Microsoft executive Karl Jacob.
Wallop is receiving funding from both Microsoft and venture capitalist (VC) firm Bay Partners, though the precise amounts of the investments are unknown. Unlike their past deals, Microsoft will take a minority equity stake in Wallop and will have a non-voting seat on the board.
Despite revealing a little more about Wallop, Microsoft has remained fairly tight-lipped about the details of the social networking site. The venture is known to be the product of Microsoft’s IP Ventures, which connects its R&D department to the VC community by making technology developed by Microsoft Research to entrepreneurs looking to license and cultivate it.
At first glance, this seems to be another link in the chain of Microsoft’s recent late-comer offerings. However, Jacob does not think this is the case with Wallop, which he says will solve the problem of the current social networking model. Jacob says that current social networks are too impersonal because they boil down to just making more friends on a superficial interaction level, which makes it difficult to share personal information with desired users. Wallop will seek to avoid this friend-of-a-friend model by using algorithms that will monitor interactions on the site and subsequently create a network for the user automatically. Jacob also indicates that Wallop will solve the problems of personal security associated with today’s social networking sites.
Microsoft has supported these notions by intimating that Wallop will offer more advanced methods of finding people and will let them interact in a way that is more like the way people do in the real world. This seems to indicate that Wallop will not connect people through their similar interests and tastes, as current social network giants MySpace and Facebook do.
One hint that Jacob revealed is the notion that instant messaging can be merged with social networking in an effective way that would lead to tighter online communities. Avoiding the particulars of the concept, Jacob said that “there is clearly a nexus between instant messaging and social networking and there is going to be a lot of interest innovation in that area.”
In addition to these purported stand-alone properties, Jacob indicates that Wallop will not be advertisement-supported. He does not believe that “advertising is the only business model that will work in this space.” Though he would not divulge further details about Wallop’s revenue model, Jacob simply said that the social networking site will have a “very different” approach. “I think there are a lot of interesting models for generating revenue in this space that have not been explored.”
Frog Design Inc. has been called on to design the user interface for the site, which is currently all Flash.
Wallop is expected to be unveiled later this year.
Sources:
http://www.newsday.com/technology/wire/
sns-ap-microsoft-wallop,0,7008257.story?
coll=sns-ap-technology-headlines
http://www.internetnews.com/bus-news/
article.php/3601836
http://seattlepi.nwsource.com/business/
268013_wallop26.html
http://www.wallop.com/wallop.html
