Los Angeles’ Silicon Beach tech community was bustling Thursday night, thanks to a unique networking event produced by TechZulu and hosted by several Santa Monica upstarts. Taking the age-old pub crawl tradition to new digital heights, the first-ever TZ Tech Crawl attracted over 400 attendees who toured some of the hottest technology companies in LA. Walking in LA? The Park Me app ensured there was ample parking for all, and once situated, most enjoyed the exercise and mild weather while walking between stops. For those not quite ready to make such a radical step, thankfully Uber is now in LA and stood at the ready with promo credit for new riders. The event kicked off at shared work space Coloft, where some entrepreneurs in residence continued to work unfazed by the hundred or so revelers munching healthy snacks and preparing to take Silicon Beach by storm. At the first stop Goodreads, the world’s largest site for bookworms offered a trivia contest where crawlers could take home some new literature for their bookshelves. After getting to know a few fellow crawlers on the long walk down Santa Monica Blvd., the next stop was in-image advertising leader GumGum. Although the tacos went fast and the keg eventually ran dry, the energy was high and the churro cart stole the show. At nearby CallFire, the cloud-based voice messaging and communications experts were making ice cream and playing ping pong amidst business card swapping and making new friends. Down the road, Mark Jeffrey gave demos of his new Glossi platform, which enables anyone to create and share their own digital magazine. And Launchpad LA showcased some of the companies in its mentorship program, which according to SoCalTech.com is leading the local incubators in both funding and exit events. General feedback from the community was a resounding thumbs up for the TZ Tech Crawl. Recruiting for programming talent was a common theme at each of the stops and the networking among all participants was at a fever pitch. Several people mentioned it was “a great idea” and asked when the next event would be held. When I asked TechZulu founder Efren Toscano to define the essence of the evening, his reply was simply “it’s only the beginning.”
Los Angeles-based digital ad technology provider OpenX Technologies this mroning said it will open its fifth data center. OpenX currently operates data centers in Los Angeles, Virginia, Amsterdam and Tokyo to support about 5,000 publishing clients worldwide. The data centers support OpenX's real-time bidding exchange OpenX Market, which processes more than 1 million bids per second during peak processing times. The new data center is expected to come online during the third quarter of 2012 and will be located in Chicago.In 2011, OpenX estimates it served 1 trillion ads and anticipates being at 300% of that rate in 2012.
A federal judge has handed Taco Bell a victory in a potential class-action lawsuit alleging that the company sent text spam to consumers. U.S. District Court Judge Cormac Carney ruled that Taco Bell wasn't legally responsible for text messages allegedly sent by the mobile marketing company Ipsh (now part of The Marketing Arm), even if Taco Bell paid for the campaign and knew its details. "Knowledge, approval, and fund administration do not amount to controlling the manner and means of the text message campaign," Carney wrote. The case stemmed from a 2005 campaign promoting new items on the menu -- chicken and steak Nachos Bell Grande. As part of the initiative, owners of 12 Taco Bell franchises in the Chicago area allegedly ran a campaign that involved sending text messages to local residents and asking them to vote for the variety of nachos they preferred. The local owners tapped the ad agency ESW Partners, which in turn arranged for Ipsh to handle the mobile portion of the campaign, according to court papers. Georgia resident Tracie Thomas, who says she received two SMS messages, sued Taco Bell for the campaign. She alleged that the fast-food seller violated the federal Telephone Consumer Protection Act, which prohibits companies from using automatic telephone dialing systems to make calls to cell phones unless the recipients have consented. "Unlike more conventional advertisements, wireless spam can actually cost its recipients money, because cell phone users must frequently pay their respective wireless service providers either for each text message call they receive or for a text plan that includes a number of messages," she alleged in her complaint, filed in U.S. District Court for the Central District of California. Taco Bell successfully countered that Thomas couldn't prove that the company "controlled the means and manner of how the text message was sent." Carney quietly granted Taco Bell's motion for summary judgment late last month. Earlier this week, Taco Bell asked Carney to order Thomas to reimburse the company around $6,000 in court costs. That motion is still pending. If other judges follow Carney's reasoning, the ruling could make it harder for consumers to sue advertisers -- as opposed to their agencies -- for campaigns that potentially violate the text-spam law. For that reason, Internet legal expert Venkat Balasubramani said this week in a blog post that the decision "could be somewhat of a blockbuster ruling." He added that he expects the decision will be appealed. Thomas's lawyer, Jay Edelson, tells Online Media Daily that his client is still considering options.
How sweet is this tweet from Marie Claire fashion director and “Project Runway” judge Nina Garcia: “'I’m @jcpenney's HQ. Thank you Ron Johson (sic) for the walk through of JCP’s prototype. Get ready to shop! Its going to be a game changer!” Well, the stock zoomed almost 10% before settling at a nearly 5% gain for the day after Garcia hit the Tweet button a few minutes before 2 p.m. EDT. Apparently, it doesn’t matter that Garcia might be construed as a less-than-impartial voice after cutting a deal to be the retailer’s "resident Style Voice and fashion collection curator," as a press release put it last week. “This means she'll help the retailer's merchandise and design teams figure out what's trendy, as well as drum up publicity through social media and public appearances,” blogged Charlotte Cowles in New York’s “The Cut.” If Garcia proves as effective in trendspotting as she apparently has in drumbeating, Penney may have found the transformative bullet it has been seeking to reverse its downward spiral. “Investors attributed the rally to short-sellers, who bought Penney shares after Garcia’s tweet in order to close out bets that the company’s stock will continue to decline,” James Covert writes in the New York Post. “Some analysts questioned whether the tweet by Garcia caused the stock move,” writes Reuters’ Brad Dorfman and Doris Frankel, “but could not point to another reason for the jump.” That’s interesting because sources tell the Wall Street Journal’s Dana Mattioli that Penney is about to “make deep price cuts across much of its merchandise, which is “a significant shift in tactics” for CEO Ron Johnson. Starting next month, Mattioli reports, the retailer “will get rid of month-long specials that cut prices of select items by 20% to 29% and instead will permanently mark down a large amount of merchandise in stores by similar amounts.” A Penney spokeswoman confirmed the elimination of month-long pricing. Mattioli points out that it’s not only a recognition that the chain needs deeper price cuts after eliminating sales and coupons but also is “an attempt to clarify for consumers what Penney executives acknowledge has been a confusing pricing strategy.” Plain and simple, here’s what they’ll now get: “Everyday low prices and clearance sales on certain items.” The company also announced a four-year deal yesterday with Loblaw’s Joe Fresh cheap-chic fashion line that will put almost 700 branded boutiques within its stores. The Joe Fresh line itself “has been one of the few engines of growth” for the Canadian “grocery titan,” reports the Toronto Globe and Mail. “Ron is looking for brands –- he’s looking to really differentiate himself in the United States,” Joe Fresh creative director Joe Mimran tells the Globe and Mail’s Marina Strauss. “He’s looking to transform the business and he wants to do it with innovation. I think our brand offers that.” Reports Bloomberg’s Ari Altstedter: “The ‘store-within-a-store’ concept will see Loblaw act as a wholesaler while retaining final say on how Joe Fresh products are displayed and marketed,” Loblaw president Vicente Trius told analysts on a conference call. Other branded shops within Penney featuring merchandise from Levi Strauss, Jeans by Buffalo and Penney's Arizona brand will open in August. There will be six shops in each store -- one each in young men's and juniors. “After six months of talking about it, the first signs of J.C. Penney's physical transformation are beginning to show up,” reports the Dallas Morning News’ Maria Halkias. “Instead of one big traditional department store, think of streets lined with shops and a town square in the middle.” Speaking of tradition, a venerable Penney store in San Fernando, Calif., is in its last throes, with 50%-off sales on remaining merchandise despite a community rally and online petition to keep the doors open. The retailer has had a presence in the city northeast of downtown Los Angeles since 1920. "We've been hearing that they are rebranding and the San Fernando store did not fit with their vision," San Fernando city administrator Al Hernandez tells Susan Abram of the Contra Costa Times. “It's not about nostalgia," says community activist Julian Ruelas, who charges the retailer is not responding to questions about why it is closing and is “not being a good corporate neighbor.” The owner of the 60,000-square-foot building Penney occupies says the company is ignoring him, too. "Their lease isn't up yet. I think the bottom line is, J.C. Penney is in turmoil and we really think they are overlooking their community." As legit as Penney’s business reasons for closing the store may be, it seems to be a bad PR effort, any way you cut it. Maybe it should send in Nina Garcia and her magical smartphone.
NBC4 Southern California is jumping on the two-screen viewing bandwagon, but with a twist. The West Coast flagship of NBC’s local TV stations is rolling out a mobile technology dubbed myCode that lets viewers get special offers and discounts via a smartphone app while watching. But unlike other second-screen apps like Yahoo’s IntoNow, Shazam or Viggle, that require users to point their phones at the screen or otherwise interact with programming, the myCode app is built for true couch potatoes. After downloading the app to their iPhone or Android device, all users have to do is sit back and let the offers come in as they watch TV. Said Steve Carlston, president and general manager of NBC4: “You just have to have myCode on and automatically throughout the day, if within 50 or 75 feet of your TV, you’re going to offers, couponing, sweepstakes opportunities.” The myCode technology, developed by startup WinMore Inc., utilizes an inaudible code embedded in an audio source to send promotional offers through the app, rather than via on-air digital wartermarks or pre-offer notification. The deals don't even have to be tied to TV commercials or network shows. “We’re actually going to have a lot of nontraditional TV advertises come on board,” said Carlston. The focus, though, is on advertising related to the greater Los Angeles area, with 5.7 million television homes and over 17 million people. For the myCode app, which NBC4 is soft-launching today, the station has lined up local advertisers including Powell Electric, the California Science Center, Legoland, Six Flags and SeaWorld. Carlston said the technology is also attracting interest from national brands, such as McDonald’s and Carl’s Jr., for locally targeted campaigns. NBC4 has an ad revenue-sharing agreement with WinMore, which is handling sales efforts for national advertisers, while the TV station focuses on local market ad sales. Advertising via myCode is being sold on a performance basis, but Calrston said things like ad rates haven’t been standardized yet because its second-screen project is just getting underway. The station is boosting awareness of the app through a station host who regularly does promotional spots on-air, its morning show and news staff, and through its Web site. Carlston pointed out that NBC4 plans to extend myCode beyond the TV to other platforms, including the Internet, social media platforms like Facebook and Twitter. Even outdoor locations. Users can redeem myCode offers in a variety of ways, depending on the type of campaign, including email-to-print, a one-time-use mobile barcode, sharing with a friend, or calling a designated number. Through its partnership with WinMore, NBC4 has exclusive rights to the myCode system as a broadcaster for three years in the L.A. area. But WinMore President Dan Morris, who also serves as president of ad testing firm PreTesting Group, of which myCode is an offshoot, said the company is already in talks with other distribution partners to bring myCode to other parts of the country. PreTesting CEO Lee Weinblatt is the nventor of the myCode technology, which is rolling out the service outside the U.S., starting in Israel. Given the privacy concerns raised around apps, Morris emphasized the myCode app requires an opt-in and is only collecting anonymous data via an identification code assigned to each user. Registering requires a user to enter Zip code, year of birth and gender. People can also provide additional demographic information for more targeted offers. As it is, the sign-up page isn’t very clear on what information is optional and what isn’t. For NBC4, what matters is how myCode can help expand its overall audience. “If you can get more people to watch for longer periods, that’s the formula to build ratings,” said Carlston.
As initially reported in OnlineMediaDaily on July 23, California Attorney General Kamala Harris has created a new unit to target companies that violate the state's data privacy laws. The six-person Privacy Enforcement and Protection Unit will enforce a variety of privacy-related laws, including regulations about data collection, financial records and identity theft. Joanne McNabb, formerly of the California Office of Privacy Protection, will serve as director of privacy education and policy. She is best known to industry watchers for pressuring Google to revise its home page in 2008 by adding a link to its privacy policy. Creating the new unit marks the latest in a series of privacy initiatives by Harris. Earlier this year, she convinced six major app platforms -- including Google, Apple and Research in Motion -- to sign an agreement promising they will require developers to offer privacy policies if their apps collect personal data from users. Several weeks ago, she announced that Facebook signed on to that pact. California has some particularly strong ammunition when it comes to privacy. A state law that took effect in 2004 requires Web companies to conspicuously post their privacy policies. California's constitution also specifies that people have the right to privacy. The state's unfair competition law also allows the attorney general to seek fines from companies that engage in unfair or deceptive practices, such as failing to follow their privacy policies. By contrast, the Federal Trade Commission typically is limited to obtaining consent decrees when companies violate their privacy policies, although it can fine companies that subsequently violate that decree. Justin Brookman, director of consumer privacy at the digital rights group Center for Democracy & Technology, says the new unit likely will lead to more privacy cases against Web companies and developers. "With more cops on the beat, there's more chance for enforcement," says Brookman, who previously served as chief of the Internet Bureau of the New York Attorney General's office. Harris isn't the only state attorney general concerned about digital privacy. Last month, Maryland Attorney General Douglas Gansler, who also serves as president of the National Association of Attorneys General, said he intends to focus on Internet privacy. Earlier this year, New Jersey Attorney General Jeffrey Chiesa made headlines by suing 24x7digital for allegedly violating the Children's Online Privacy Protection Act by collecting personal information from young children, including preschoolers. One reason the move drew attention was because state authorities rarely bring cases alleging violations of that law.