Bambi Francisco writes about "the search engine that would outdo Google."

Powerset...is a natural-language search engine. Simply put, the technology analyzes the meaning and relationships of words in context so that it can accommodate questions asked in natural language, such as "How're the Giants doing," rather than questions asked in sketchy "keywordese" inputs, like "scores, Giants."
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Here's why a search engine with a new paradigm can work today. In the years since Google was born, technology costs have dropped sharply, making the indexing for natural language search far more cost effective.

Indexing in natural language requires about 100 times more computational power than indexing keywords, which is what the popular search engines do today. The cost of central-processing unit cycles was eight times more expensive six years ago (in other words, three iterations of Moore's Law).

Xen Mendelsohn has an interview with Nick Wright:

The relationship between youth and their mobiles is not necessarily based on being “fun, cool, or entertaining”. It’s a key social tool employed in the dynamics of the peer group. Youth consume mobile products - as they do others - to make statements about themselves and their relationship with their peers.

Self-expression is such a key aspect of young people’s lives that they would rarely choose a non-branded alternative over an identifiable brand. 98% of teens for example would choose a brand/logo designed T-shirt over a plain one.

Mobile is most importantly a symbol of belonging to a group, both as a physical product (you must own a phone to be part of our group) and its communicative possibilities: texting is essential to youth not because of the content (very limited) of the texts themselves but because each text is a reaffirmation and a reminder that “I’m with you”.

SF Gate writes about 10 lies. Among them:

1. We learned our lesson last time. And we're going to cash out before this bubble pops.

2. This is not a bubble. Hot parties, overheated PR pitches, and five or six dozen social networking sites are just healthy indicators of a new boom.

3. It's all about community and sharing. But we told our venture capitalists that our exit strategy will make them rich. (Corollary: But you have to know someone to get into our conference/party.)

4. Online advertising will pay for everything. As if click fraud is any kind of a threat.

5. These sites are so easy, my mother could use them. And they're so geeky, she has no interest in even trying.

The New York Times writes:

Turning MySpace into a global power could be far more complicated than marketing a movie overseas. While the company has 100 million registered users, most are in the United States. People outside the United States already have different habits about socializing online.

And many do so by using cellphones rather than computers.

“In the U.S., teen and 20-something culture is more about I.M.,” instant messaging, said Danah Boyd, a fellow at the Annenberg Center for Communication at the University of Southern California, who studies popular culture and technology. In other countries, “the primary way of talking to your friends is SMS,” text messages on mobile phones.

O'Reilly Radar writes about Microsoft's new 3-D services as part of Virtual Earth:

Microsoft released an amazing, computer-generated 3-D mapping site via the Virtual Earth team. Spaceland, as it's called, is quite beautiful and available in 15 cities. It can be used for driving directions, searching, and real-time traffic monitoring.
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Spaceland utilizes technology from the GeoTango and Vexcel acquisitions. Vexcel is a GIS data collection asset for MS. They use their advanced UltraCam to gather the data used in the models. This was the data collection part of the equation. That's right, MS is now gathering their own GIS data.
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As has been widely reported, Microsoft is experimenting with ads in its new 3-D GIS playground. These are supplied by Massive, a company that was originally serving ads in games and from Microsoft's homegrown ad platform.

The HBR article authors categorise the two sides as a “subsidy side” and a “money side” who interact with each other via a platform. Thus, for example, Google is a platform which connects users interested in search or content (subsidy side) with advertisers (money side). Online recruitment sites connect job seekers (subsidy side) with employers (money side).

One of the most important issues in two-sided markets is that of pricing. In an interview with HBS Working Knowledge, Andrei Hagiu explained the pricing challenge further: “Two-sided platforms must solve a chicken-and-egg problem. For example, without sufficient applications developed for it, an operating system has no value for, and therefore cannot attract, users. Without a solid user base, no application developer will be interested in supporting that operating system. If the platform vendor decides to charge positive prices on both sides, it might end up attracting neither. The same goes for dating clubs, game consoles, and so on. So the idea is to subsidize one side in order to attract it more or less irrespectively of the other side and then turn to the second side and charge it positive prices.”

Wikipedia adds: “In two-sided networks, users on each side typically require very different functionality from their common platform. In credit card networks, for example, consumers require a unique account, a plastic card, access to phone-based customer service, a monthly bill, etc. Merchants require terminals for authorizing transactions, procedures for submitting charges and receiving payment, ‘signage’ (decals that show the card is accepted), etc. Given these different requirements, platform providers may specialize in serving users on just one side of a two-sided network. A key feature of two-sided markets is the novel pricing strategies and business models they employ. In order to attract one group of users, the network sponsor may subsidize the other group of users. Historically, for example, Adobe’s portable document format (PDF) did not succeed until Adobe priced the PDF reader at zero, substantially increasing sales of PDF writers. Relative to Apple computer’s initial pricing, Microsoft also steeply discounted systems developer toolkits (SDKs) leading to more rapid development of applications for MS Windows.”

The HBR article authors discuss pricing in more detail:

Because the number of subsidy-side users is crucial to developing strong network effects, the platform provider sets prices for that side below the level it would charge if it viewed the subsidy side as an independent market. Conversely, the money side pays more than it would if it were viewed as an independent market. The goal is to generate “cross-side” network effects: If the platform provider can attract enough subsidy-side users, money-side users will pay handsomely to reach them. Cross-side network effects also work in the reverse direction. The presence of money-side users makes the platform more attractive to subsidy-side users, so they will sign up in greater numbers. The challenge for the platform provider with pricing power on both sides is to determine the degree to which one group should be encouraged to swell through subsidization and how much of a premium the other side will pay for the privilege of gaining access to it.

Pricing is further complicated by “same-side” network effects, which are created when drawing users to one side helps attract even more users to that side. For example, as more people buy PlayStation consoles, new users will find it easier to trade games with friends or find partners for online play. Economists call this snowballing pattern a positive same-side network effect.

It is not always obvious which side—if either—the platform should subsidize and which it should charge.

Tomorrow: Examples