The Good NET Guide

Posts Tagged ‘interview’

In the second installment of a series of open interviews with government leaders, YouTube is going to field questions to Federal Communications Commission Chairman Julius Genachowski, following the launch of the National Broadband Plan next Tuesday (The FCC is the federal agency that oversees all elements of the U.S. communications sector). The plan aims to connect all Americans to fast, affordable high-speed Internet.

Similar to the question and answer session with President Obama following the State of The Union speech, users can submit video or text questions on CitizenTube via Google Moderator You can then vote on your favorite questions submitted by the community. YouTube will present the top-voted questions to Chairman Genachowski in the interview next Tuesday. The deadline for submission is Sunday, March 14 at 11:59 p.m. PT.

Google and the Obama administration have been working to incorporate the social video sharing site into government events. YouTube also aired the debate between President Obama and lawmakers over the President’s proposed healthcare reform at the Healthcare Summit in February. Speaker of the House Nancy Pelosi, Minority Leader John Boehner, and Senate Majority Leader Harry Reid answered select questions submitted via Google Moderator at the end of the summit.

Up next in our series of tech interviews at the World Economic Forum in Davos, Switzerland last week: Gina Bianchini, the CEO of social networking service Ning.

Ning has never had the press attention of Facebook and Twitter. But there are 41 million registered users on Ning, and Gina says that 92 million people a month worldwide visit Ning sites.

We spoke at length in the interview about how the world sees Ning, and how Ning defines itself. Anyone can easily create a Ning social network, cobranded or white labelled. 2.5 million of them have been created so far.

In some ways Ning networks are competitive to Facebook Pages (here’s the TechCrunch Facebook page). Both allow for a presence inside of a social network. And when faced with a choice, most may choose Facebook simply because it has so many hundreds of millions of users to help word spread virally.

Gina doesn’t see it this way. She notes that Facebook pages have limited features and are locked within Facebook itself. Ning allows for deep social experiences around brands and things. Instead of the product competing with Facebook (and Twitter, etc.), she sees Ning as the center of an ecosystem that includes all of these products. A fascinating excerpt from the interview:

MA: One place I personally think you do compete with Facebook is company pages. Companies set up a profile to get fans, and it’s not just their friends but they promote it, they put it on their advertisements. They also might do that with Ning whether it’s the Ning network or the domain mount and make it look all their own. They might do both but it seems like there’s a clear direct competition between Ning networks and Facebook pages. Agree, disagree, how do you see that?

GB: Absolutely disagree. I love the fact that there should be this perceived horserace, where one person wins and one person loses, and that’s just not how it’s working today. And what’s really cool is the fact…

MA: Do you see people doing both?

GB: Yeah, absolutely.

MA: That’s why you don’t think there’s competition?

GB: That’s why we can actually integrate with Twitter and use Twitter as a distribution channel. And basically send people very fluidly to Ning and then people are publishing from Ning into Twitter really effectively. And so what I think actually is happening , and we’re seeing this especially among people who are artists, and people who started in 2005 and 2006 with a myspace page, which is they basically look at it and they say, “ok, Facebook, myspace, Twitter, phenomenal for distribution. That is the place where I can put up a fan page and within a few hours I can have a million followers.” The same thing is true for twitter. So if you basically look at the people who have over a million followers, they are getting increasingly sophisticated in terms of understanding that those are phenomenal, but very lightweight distribution channels.

What they’re realizing and I think where the market is going is the sophistication around, where you’re sending people and where the destination is, whether that was originally a blog, or whether that was originally a website is actually becoming a rich immersive social experience.

MA: And now you’re talking about Ning?

GB: And now I’m talking about Ning.

MA: And a Facebook page isn’t as rich and immersive social experience.

GB: That’s not what they’re trying to do. They’re trying to give people away within Facebook to say, “I’m a fan of Pete Wentz and Fall Out Boy” or “I love Adidas.” I think that’s fantastic, but it’s very lightweight. It’s good that it’s lightweight because it means that people have a way to thread all of these ways that they want to interact with brands, with celebrities, with artists, with things that they truly care about. But I think where the market is going and where you’ll see more and more people do interesting things, is where is the hub, where are they sending people. And that is Ning.

For example, Soleil Moon Frye has 1.4 million Twitter followers and just launched a Ning network two days ago. And her excitement about it is that she can allow and enable the people following her on Twitter, primarily moms and young moms who have the same messy wonderful life as a mother that she does. That she gives them an opportunity to really dive deeper into what she cares about and what she’s passionate about, and really building that out as a small but very powerful lifestyle brand for moms.

And in fact Gina doesn’t think any of these companies – Facebook, Ning, Twitter, LinkedIn – really compete with each other. “Each one of them has gotten really comfortable and more narrowly focused on the thing they do better than anybody else,” she says later in the interview:

MA: (drawing diagram off camera) What you’re saying is that Ning is sort of the center. And you’ve got Facebook and Twitter and myspace. So that’s a good way of thinking about it. Do you think that Facebook, Twitter and myspace think about it that way?

GB: I don’t think they see us as a competitor. Here’s what I think is happening in the market. And this is not rainbows and sunshine saying this – what’s really interesting is that all of these companies were basically founded in 2005, 2006, 2007, and what’s actually happened is that each one of them has gotten really comfortable and more narrowly focused on the thing they do better than anybody else. Facebook with Facebook light is actually going more in the direction of connecting you with the people you have strong relationships with your real identity, with status messages, and with photo sharing. And they do that better than anybody else.

Twitter – and they had that year where, is Twitter a competitor or are they not – you can see in the past 6 months is that while there’s some overlap, it’s not a horserace, they’re not actually competing head to head where Facebook wins and Twitter loses. So Twitter’s about news and real time events.

You’ve seen the same thing with LinkedIn, where they’ve gotten really strong and have tremendous momentum by basically saying, “we own professional identity.” Professional identity has different characteristics than what you want to do with your friends on Facebook and that’s actually great. And then for us, interests and passions. If you look across the market, the thing that’s interesting is that none of these companies actually have a number two. And what gets confusing about it is, Facebook doesn’t have a number two. Twitter doesn’t have a number two. Linked In – you lived through that – all of the competitors are gone, and they are the dominant player. And in our case, we don’t really have anyone else who is creating unique social experiences as an online platform, and specifically an online social platform.

What’s confusing to a user of the market that wants to see the head to head horserace, zero sum game, Microsoft/Netscape situation, it’s not actually happening. It’s really actually a race for each one of these companies and services to get as much traction and deliver as much value to an individual with the thing that they do better than anybody else.

The full transcript is below.

Interview with Ning CEO Gina Bianchini

Michael Arrington: I’m here with Ning CEO Gina Bianchini, hello Gina.

Gina Bianchini: Hi, how are you?

MA: Good. Thanks for joining the World Economic Forum in Davos to sit down and talk about Ning for a little bit. How do you like the hotel?

GB: I describe it as Swedish dorm room chic, and it’s pretty great actually.

MA: Even though there’s no internet access in all the internet executives’ rooms?

GB: It’s a little ironic.

MA: So everyone’s down here in the lobby working.

GB: I almost feel like that’s our purpose here in a way.

MA: It’s good for me because if I want to talk to you, I just go to the lobby and you’re on your computer and you can’t really hide when you only have internet access in one place.

GB: Absolutely.

MA: Is this your first World Economic forum?

GB: It is.

MA: And what do you think of the conference itself?

GB: It’s pretty amazing. It’s a little overwhelming actually because there are so many people from different walks of life doing so many interesting things, and it’s all packed within a small Swiss ski town, that’s it’s kind of hard to get your bearings. But it’s been wonderful. I really enjoyed our panel the first day.

MA: Yeah, you were on a panel with Evan Williams, Randi Zuckerberg, Owen VanNatta, and Reid Hoffman was there. I was there reporting on it; you guys talked about social networks. Do you feel like there’s a good amount of attention here to technology? It seems like there is.

GB: There absolutely is. It’s rare that you go to conferences that have a broad policy and political base, as well as being something that’s just technology focused, and I’ve had more people come up to me, trying to explore how to use social technologies to change the world, and I think that that is always a great conversation to have.

MA: Do you find that most people here are very familiar with Ning? New for some people? Is Ning part of the established set of technology companies that people here know about?

GB: I don’t think so. I think the thing that has actually been really surprising to me is how many people touch a Ning network from all walks of life. I had someone from a pretty large advertising agency say to me that their team in Brazil has been using Ning for basically three years.

MA: The advertising agency has a Ning presence.

GB: And even better, they’re using it for their internal team to coordinate. So I think the thing that’s been the most fun from my perspective is that we made the decision early on that we would share branding, that we weren’t going to be a service that was basically one size fits all, but that what we do, being a social platform for interests and passions, and really being about unique social experiences, that we needed to share the brand. And we needed to basically allow our network creators to put their brand first with Ning being a bit recessive. So we don’t have the same visibility that a Facebook or a Linked In or a Twitter has, but we actually think that for what we do, it’s absolutely critical that we give and we share brand identity, because what people are doing on Ning is creating unique contextual social experiences for the things that really matter to them. And so, that’s actually something that’s been fun for me, is to see all the different ways that people are using Ning today, and in some cases, they absolutely know it’s Ning, and in other cases, they don’t know it’s Ning. That’s not white label.

MA: You allow domain mapping which is very basic Ning – is there some footer that is any Ning branding at all?

GB: Yes, absolutely.

MA: We’ll talk about that in a little bit with your numbers. You’ve raised a lot of money; you’ve raised $119 million dollars now, and your last valuation was $750 million, is that right? (GB nods). And you count among your investors, Reid Hoffman, the founder of Linked In. And Marc Andreesen’s actually cofounder, but he’s also on the board of Facebook. Is it awkward at all, with Marc being on the board of Facebook and Reid being Linked In heavy? Is it at all awkward? Because they are both competitors, right?

GB: Not at all. No, and that’s actually why it’s ok. I think that this is the thing that has really been emerging in the last year, is the fact that different people – or I should say actually, the same people, are using different social technologies for different purposes. And I think at some level, the true story of the last few years has been that everybody’s been trying to figure out where they fit into the world and whether or not different people are competing directly. I thinks it’s an interesting evolution that I did not expect, and I don’t think any of us expected when we started, because there’s always the sense that it is a horse race, it’s not a zero sum game as it relates to social technologies, and in fact what’s happening, is that the same people are using Linked In for their professional identity; they’re using Facebook for connecting to people that they know in the real world, and have gone to school with, that are friends from the neighborhood. What Twitter is about is news and real time events in a way that is different from Facebook. And what we do is basically enable people to dive deeper and create rich social experiences for the topics and things that they truly care about. The aha moment that I had was that’s what actually makes us human beings, and what makes us people, and these different social technologies all work together really well.

For example, two weeks ago we launched Twitter integration, and we’ve seen a huge increase in terms of people sharing content from their Ning network.

MA: That’s both signing in and publishing back to Twitter?

GB: It’s just publishing to Twitter, and then people coming back with a shortened url. And what’s been great about that is that people love to be able to share on Twitter. They love to be able to share and then come back in, and we’re seeing that in the numbers. And I think we’ll shortly launch a similar integration using Facebook because it just makes sense, and it’s what people want. They want to have a very fluid relationship between Linked In, Twitter, Ning and the networks they belong to. And Facebook. And I think that’s something that from the inside, we all realize. Why for example, Reid Hoffman has been a great supporter of Ning, why Marc can sit on the board of Facebook and Ning, and why Marc is an investor in so many of the social technologies that exist, and I think that’s something that’s really fun about it right now.

MA: When you integrate with Facebook, will that be in the sense of signing in to your Ning account through Facebook and publish back to Facebook? Or more like what you’re doing with Twitter, and just publish back to Facebook?

GB: More like what we’re doing with Twitter for v1, and there’s no political strategy that says we should have Facebook connect or we shouldn’t have Facebook connect, it’s just a matter of we’re seeing what’s working and integrating rapidly from here.

MA: How about just from a user perspective and integrating the social graph and having your friends listed in one place? Is that something that you think there may be demand at Ning?

GB: Absolutely. It’s something that we’ll explore in the next few months as we move forward.

MA: One place I personally think you do compete with Facebook is company pages. Companies set up a profile to get fans, and it’s not just their friends but they promote it, they put it on their advertisements. They also might do that with Ning whether it’s the Ning network or the domain mount and make it look all their own. They might do both but it seems like there’s a clear direct competition between Ning networks and Facebook pages. Agree, disagree, how do you see that?

GB: Absolutely disagree. I love the fact that there should be this perceived horserace, where one person wins and one person loses, and that’s just not how it’s working today. And what’s really cool is the fact…

MA: Do you see people doing both?

GB: Yeah, absolutely.

MA: That’s why you don’t think there’s competition?

GB: That’s why we can actually integrate with Twitter and use Twitter as a distribution channel. And basically send people very fluidly to Ning and then people are publishing from Ning into Twitter really effectively. And so what I think actually is happening , and we’re seeing this especially among people who are artists, and people who started in 2005 and 2006 with a myspace page, which is they basically look at it and they say, “ok, Facebook, myspace, Twitter, phenomenal for distribution. That is the place where I can put up a fan page and within a few hours I can have a million followers.” The same thing is true for twitter. So if you basically look at the people who have over a million followers, they are getting increasingly sophisticated in terms of understanding that those are phenomenal, but very lightweight distribution channels.

What they’re realizing and I think where the market is going is the sophistication around, where you’re sending people and where the destination is, whether that was originally a blog, or whether that was originally a website is actually becoming a rich immersive social experience.

MA: And now you’re talking about Ning?

GB: And now I’m talking about Ning.

MA: And a Facebook page isn’t as rich and immersive social experience.

GB: That’s not what they’re trying to do. They’re trying to give people away within Facebook to say, “I’m a fan of Pete Wentz and Fall Out Boy” or “I love Adidas.” I think that’s fantastic, but it’s very lightweight. It’s good that it’s lightweight because it means that people have a way to thread all of these ways that they want to interact with brands, with celebrities, with artists, with things that they truly care about. But I think where the market is going and where you’ll see more and more people do interesting things, is where is the hub, where are they sending people. And that is Ning.

For example, Soleil Moon Frye has 1.4 million Twitter followers and just launched a Ning network two days ago. And her excitement about it is that she can allow and enable the people following her on Twitter, primarily moms and young moms who have the same messy wonderful life as a mother that she does. That she gives them an opportunity to really dive deeper into what she cares about and what she’s passionate about, and really building that out as a small but very powerful lifestyle brand for moms.

MA: How many international uniques are you tracking?

GB: On a global basis, by IP address that excludes bots, we have 92 million monthly uniques. And four months ago we had 70 million global uniques.

MA: Does that include the Ning networks that are domain mapping?

GB: Yes it does.

MA: So that’s a fourth of Facebook, something like that? But you don’t have the compressed footprint that Facebook has, or even Twitter, which is smaller than you. Why is that?

GB: Very simple reason: one size fits all social platforms are easier to get your head around because they have the overarching brand identity. When you’re on Facebook, you are on Facebook, and it is blue and white. And when you’re on Twitter, you are on Twitter. In our case, we took a different approach and we have a different strategy, which is for us to enable unique, immersive, very rich different social experiences around the things that people care about and really allow them to dive deeper, as I mentioned as that hub.

MA: So the things people care about get the press attention as opposed to Ning sometimes.

GB: Absolutely. For example, Linkin Park just launched their official website which is now a social experience on Ning. And that was 3 or 4 days ago. Because they realized that what their fans want is this social opportunity to say, “I love you on myspace, I love you on Twitter, I want to know what’s going on and what I should be paying attention to. But then I want a way to dive deeper into the Linkin Park experience.”

MA: (drawing diagram off camera) What you’re saying is that Ning is sort of the center. And you’ve got Facebook and Twitter and myspace. So that’s a good way of thinking about it. Do you think that Facebook, Twitter and myspace think about it that way?

GB: I don’t think they see us as a competitor. Here’s what I think is happening in the market. And this is not rainbows and sunshine saying this – what’s really interesting is that all of these companies were basically founded in 2005, 2006, 2007, and what’s actually happened is that each one of them has gotten really comfortable and more narrowly focused on the thing they do better than anybody else. Facebook with Facebook light is actually going more in the direction of connecting you with the people you have strong relationships with your real identity, with status messages, and with photo sharing. And they do that better than anybody else.

Twitter – and they had that year where, is Twitter a competitor or are they not – you can see in the past 6 months is that while there’s some overlap, it’s not a horserace, they’re not actually competing head to head where Facebook wins and Twitter loses. So Twitter’s about news and real time events.

You’ve seen the same thing with Linked In, where they’ve gotten really strong and have tremendous momentum by basically saying, “we own professional identity.” Professional identity has different characteristics than what you want to do with your friends on Facebook and that’s actually great. And then for us, interests and passions. If you look across the market, the thing that’s interesting is that none of these companies actually have a number two. And what gets confusing about it is, Facebook doesn’t have a number two. Twitter doesn’t have a number two. Linked In – you lived through that – all of the competitors are gone, and they are the dominant player. And in our case, we don’t really have anyone else who is creating unique social experiences as an online platform, and specifically an online social platform.

What’s confusing to a user of the market that wants to see the head to head horserace, zero sum game, Microsoft/Netscape situation, it’s not actually happening. It’s really actually a race for each one of these companies and services to get as much traction and deliver as much value to an individual with the thing that they do better than anybody else.

MA: Ok. Are you happy with your revenue model and how that’s going?

GB: Absolutely.

MA: How happy, like 9 out of 10?

GB: (laughs) We don’t talk about revenue. I’m happy to talk about the revenue streams that we have.

MA: It’s ads, it’s upsells right?

GB: It’s ads, it’s upsells, and premium features like virtual gifts which we launched in October that allow our network creators to make money from their networks. So when a member of the Lost Zombies Ning network which is 10,000 people who dress up as zombies and take pictures and videos and connect with each other in building this collaborative documentary . It’s lost zomies.com, check it out, it’s awesome. And what they’re doing with virtual gifts, is their members are giving them bloody chain saws, and when that transaction happens, we split the revenue 50/50 with the network creators. We think there are tremendous opportunities there.

MA: How many bloody chainsaws have been given?

GB: I don’t actually know specifically.

MA: Are the member of the group?

GB: I’m a member of Lost Zombies, I am.

MA: You should be like Tom from myspace, a member of every network.

GB: That’s a good idea, I like that.

MA: With a really ridiculous pose in some picture. So what is revenue? Are you profitable yet? Are you approaching profitability yet? Are you approaching the point where you could be profitable? Do you want to slow down growth?

GB: We’re really happy and so are our investors. It’s the benefit of being a private company, but it doesn’t make your job any easier.

MA: How many employees do you have?

GB: We have 166 employees.

MA: And you said you’re not going to talk about profitability.

GB: We’re not going to talk about revenue, profitability.

MA: Facebook does, they’re private.

GB: I know.

MA: Twitter doesn’t. Myspace doesn’t. Hint? Million a month? 10 million a month?

GB: We’re really happy with where we’re at and where we’re going.

MA: When you approach profitability will you announce that?

GB: Stay tuned.

MA: That’s at least something. I can drop that now. It think that’s it. How many registered users?

GB: We have 41 million registered users and we’re adding about a million registered users ever 12-13 days.

MA: And you’re not spending anything on marketing or you are? I’ve never seen anything.

GB: No, it’s primarily email. As we launched Twitter, and soon we’ll launch Facebook, those are actually great sources of new members coming in to and across the Ning networks. The good news/bad news of our model is that it’s incredibly productive and effective in terms of growth and exponential growth, but certainly we’ve made a different decision than other services in terms of really sharing that brand placement. And then allowing people to create really incredibly rich unique social experiences on Ning.

MA: Who goes public first? Zynga, Facebook, or Linked In? Personal opinion.

GB: I am not great at predicting timing but I think all of them are incredibly good businesses that are real. And the reality is that two or three years ago Zynga wasn’t in existence, but everybody was wondering, how are social technologies going to make money. I think the story of 2009 was that one size fits all…

MA: Bloody chainsaws, is how they’re going to make money.

GB…social platforms went mainstream. And I think the story of 2010, 2011, 2012 is social platforms become real businesses.

MA: You going to be going public you think? Is that your aim? Or have Andreeson get Facebook to buy you, some large competitor?

GB: We are very confident that we can be a large independent company.

MA: Thanks very much, enjoy the rest of the conference. I really appreciate it.

GB: Thank you so much.

We recently wrote about the traction that how-to video site and producer Howcast is seeing online. But there’s another information and how-to video startup that is dominating the space: 5min. The company is a syndication platform for instructional, knowledge and lifestyle videos, both professionally produced and user-generated. The service’s video library boasts 150,000 of videos across a variety of categories (e.g. food, health, home and garden ), submitted by media companies and independent producers from around the world.

December’s comScore data shows that 5min saw 30.5 million unique viewers, ranking just below Turner Networks (30.6 million unique viewers) and just above AOL (30 million unique viewers). Google saw 136 million unique viewers and Hulu saw 44.2 million unique viewers. 5min ranks as number 14 out of 100 properties in ComScore’s video metrix, according to unique viewers. In terms of videos streamed, 5min saw 75.4 million streams which pales in comparison to Hulu’s 1 billion video streams and Google’s 13.2 billion video streams for the month of December. If 5min was ranked by streams, it would most likely rank lower on the list, as AOL and other video properties had more streams than the startup (AOL saw 210 million streams).

Regardless, the data indicates that 5min, which has raised $12.8 million since its launch in 2006, is growing into the Hulu for niche content. The company has forged partnerships for branded content with Scripps, Hearst and other media companies. 5min monetizes each video with pre-roll ads, overlays, and companion banners and has a rev share with the content providers. Both publishers and advertisers who use the company’s self-serve VideoSeed product, which uses semantic technology to automatically match videos to their respective audiences. The site sees its biggest competitor as the leader in niche content, Demand Media. While most of the startup’s traffic is from the U.S., 5min hope to expand its international presence through partnerships. And 5min expects to be cash-flow positive this year.

Yahoo has ben trying to unload HotJobs for a while, and it finally came to a deal with Monster, which will take the site off of Yahoo’s hands for $225 million in cash. As part of the deal, Monster will continue to power Yahoo’s job listings for three years.

Both Hotjobs and Monster have been lagging newer job search sites such as Indeed, which searches the entire Web for job listings. According to comScore, Indeed’s jog search reached 8.4 million individuals in the U.S. in December, 2009, compared to only 5.4 million for HotJobs and 6.1 million for Monster. Maybe with the acquisition, Monster can take the top spot again, although there is a lot of overlap in those numbers.

For Yahoo, it gets rid of a declining property, boosts to its cash position, and can focus on growth areas. Yahoo has been selling off or shutting dow non-core assets, including recently selling Zimbra to VMWare for $350 million, shutting down its Shopping API, and of course the long-awaited deal with Microsoft to hand over its search to Bing.

Monster recently launched its 6Sense semantic search technology across different products including resume and candidate search. 6Sense is aimed at bringing up more relevant results even when there is no exact keyword match by using semantic analysis and understanding the different ays that the same job or job requirements can be described. Monster needs all the help it can get. Today it announced fourth quarter revenues of $213 million, down 27 percent, and a net loss of $2.1 million. For the year, revenues were down 32 percent to $905 million. Full year net income was $19 million, compared to $125 million in 2008.

Earlier today, we noted that Loopt has launched a check-in for charity campaign to raise money for Haiti. Rival Gowalla is doing something similar as well.

Called “Hearts for Haiti,” Gowalla’s campaign will take place on Monday, February 8 in the San Francisco Bay Area. When someone uses the service to check-in at one of three selected locations during a specific time, Gowalla will donate $50 in that person’s name to the American Red Cross for each check-in. So basically, all you have to do is show up at one of these places, check-in, and you’re donating to charity. The goal is to raise $20,000, the company notes. The selected venues include two different Peet’s coffee shops and a Barenaked Ladies concert in San Francisco on that day.

Here’s the details of the February 8 activities:

11:30 a.m. – 1:30 p.m. Peet’s Coffee & Tea in Emeryville at 5959 Shellmound Street, Suite 85
2:30 p.m. – 4:30 p.m. Peet’s Coffee & Tea in Mill Valley at 88 Throckmorton Avenue
5:00 p.m. – 7:00 p.m. Barenaked Ladies concert at Infusion Lounge

Joining Gowalla and Peet’s in the effort are Alice Radio, a popular Bay Area radio station, and The Counter, a burger joint. Two morning show hosts from Alice Radio will appear alongside Gowalla co-founder Josh Williams and community manager Jonathan Carroll at the check-in destinations throughout the day.

Alongside Gowalla’s $50-per-check-in pledge, Peet’s will be donating 10% of all sales made at the Emeryville and Mill Valley locations during the effort.

We recently wrote about location-based mobile social network Loopt’s push to launch deals for check-ins, and today, the startup is putting use check-ins to philanthropic use. For every check-in at Chipotle, Panera Bread, or Whole Foods around the country, Loopt will donate $1 towards the Haiti earthquake relief. Half of the proceeds from the check-ins will be given to the American Red Cross and the other half will be donated to Doctors Without Borders.

Loopt founder and CEO Sam Altman said the spots were chosen primarily because they are seeing many check-ins at these vendors. It’s truly a generous and worthy initiative and it also provides a noble inventive for users to enable Loopt’s check-in technology, which the startup recently launched.

Text messaging has also played a significant part in fundraising for Haiti earthquake relief; with mobile donations reaching $35 million.

Continuing his series of Davos interviews, Michael talks to Slide CEO and founder Max Levchin in the video above. Levchin discusses the ” shift from advertising to virtual goods” and reveals that most of Slide’s revenues now come from sales of virtual goods, whereas it was the reverse a year ago. Slide makes some of the most popular apps on Facebook and other social networks, and the fact that it is no longer focussed on advertising says a lot about the prospects for social ads. Last year was a huge transition for Slide, made possible by the fact the company has raised a total of $78 million.

Levchin is now steeped in the dynamics of virtual goods and how to get people to pay for them, which he discusses at length in the interview. He makes a distinction between buying virtual goods as a “consumption decision” (because you want to level up in a game immediately, for instance) and an “investment decision” where you spend to improve your standing in a community. He believes there are “less diminishing returns” in getting consumers to make see spending on virtual goods as an investment rather than just consumption.

Levchin also says that Slide is working on the ability to allow consumers to create (and sell) their own virtual goods. You can also watch Mike’s other Davos interviews with Brightcove CEO Jeremy Allaire, Facebook COO Sheryl Sandberg, MySpace CEO Owen van Natta, Salesforce CEO Marc Benioff, Russian DST investor Yuri Milner, and a run-in with Michael Dell.

Transcript courtesy of PhoneTag:

Mr. MIKE ARRINGTON: Mike Arrington here, I’m here with a very tired Max Levchin, CEO and founder of Slide. How are you?

Mr. MAX LEVCHIN (CEO, Founder of Slide): Good.

Mr. ARRINGTON: You’re wearing a suit today. You never wear suits.

Mr. LEVCHIN: I never wear suits.

Mr. ARRINGTON: Kind of a world economic forum thing.

Mr. LEVCHIN: It is.

Mr. ARRINGTON: No sleep at all? You’ve been up late working?

Mr. LEVCHIN: Up late working but some sleep. Just the sleep depriviation several days that’s what gets to you.

Mr. ARRINGTON: It adds up.

Mr. LEVCHIN: Yeah.

Mr. ARRINGTON: So, tell me, I haven’t talked to you in a while, tell me about Slide, how things are going and where it is going.

Mr. LEVCHIN: We’re doing well. We’ve evolved as a business in a pretty cool way. I think a year and a half ago we made, all the money that we made is from advertising. At this point, we make almost all the money that we make through sales of contents to consumers which is a pretty huge transformation for a business at our scale and is a relative success. We have expanded our product line. We’ve realized that some products weren’t going to last so we changed them. But, the most interesting is really the shift from advertising to virtual goods. We’re going to do that more. Probably the most interesting wrinkle in virtual goods that we have is, we also think once we enable our users to create the goods as opposed to us which we believe in a scalable model and we’re going down that road pretty well.

Mr. ARRINGTON: You always sell toward cash. You don’t do much in a way of offers other than some stuff with flowers or something like that, right?

Mr. LEVCHIN: We’ve done exactly one offer.

Mr. ARRINGTON: The one with flowers?

Mr. LEVCHIN: Yeah. Actually it was pretty cool. It was a… strange people…

Mr. ARRINGTON: You know that guy whispered “thank you” in my ear because he was filming us, he was filming me filming you. I wonder who it was.

Mr. LEVCHIN: That’s very meta.

Mr. ARRINGTON: He was behind me. Is that what he’s doing, he’s filming me filming you?

Mr. LEVCHIN: He’s doing more than that, probably more than that. Anyway, yes we’ve done exactly one offer type of thing which was really demand discovery as opposed to demand generation. Demand generation is very tricky. It’s really easy to create from demand generation to lead generation which is an easy thing to drive towards pretty unethical behavior is a slippery slope. Demand and discovery is a lot easier to deal with but it’s also a lot harder to execute. And so, we’ve done one experiment (unintelligible).

Mr. ARRINGTON: If you buy flowers for somebody…

Mr. LEVCHIN: Yeah, if you’re getting something already.

Mr. ARRINGTON: But you didn’t like it, you didn’t like the financial results. You felt it was a slippery slope or…

Mr. LEVCHIN: No, no, from the moral compass perspective, it was pretty -

Mr. ARRINGTON: It’s clearly okay?

Mr. LEVCHIN: Yeah, absolutely. In fact I would recommend it to others. This is neither something I’m ashamed of nor do I think it’s a bad business; it’s just hard to do well. If you’re looking for scalable direct to consumer sales behavior where you’re making things or somebody’s making things and they’re selling through the users and it’s a smooth process creating a really nice smooth demand discovery is hard because then you say, alright, well, it’s Mother’s Day, so we should do flowers. It’s pretty manual labor. It ultimately winds up being about as lucrative as just direct sales merchandising. So, ultimately it’s neither cannibalistic nor massively mass improvement over just direct sales which offers certainly is massive improvement because all sorts of people had said, I will never spend money, pretend spend, through that, which is how you wind up on a slippery slope.

Mr. ARRINGTON: What percentage of customers can you convert to giving you money – single digit, couple percent, five percent?

Mr. LEVCHIN: I think we are well within the industry average. So, it’s – between one and three percent. I think 3 percent in the Western markets is fantastic and I always certainly say it’s fantastic for us. Below half percent is what most people I think can get to and we tend to float substantially better than the lowest and well within the best.

Mr. ARRINGTON: What happens to the other 97 or whatever percent? Are they there to get other users and to have some ads reserved? Is that basically their use?

Mr. LEVCHIN: We don’t do much ads or in fact, we’ve really cut down our advertising efforts by quite a significant margin. Not that we don’t think advertising is a bad business. We do think that commodity advertising is a bad business. So, if you’re in a world of just click on this banner and just get more, it’s hard to get privacy well accounted for. So, a large scale pure reach, just give me anyone or even some modest marketing, low price CPM advertising I think is a declining business in general, but certainly within the world of social networks. Because, in that case, the only differentiating feature is reach and reach is firmly in the hands of Facebook and MySpace. So, at any one time, the only way you can compete if you’re a social advertising network or platform or whatever, is on price. And that is just – that’s another slippery slope I’d like to not be on.

Now, slipping around to a high-end or brand advertising where the audience is uniquely predisposed towards the brand or towards the transaction being promoted, that’s an excellent business model. You look at, before the current, our times, the mortgage refinancing ads, I think, went for like $60 CPM and still probably go for similar amounts of money on sites that have to do with personal finance. Same exact ads on the front page of some random gaming portal will probably go for very little because they’re just pure (unintelligible). So, having the extremely targeted advertising is still a lucrative business even on social networks. An even better version of this and which is what we’re interested in is what is essentially product placement. If you can work a brand successfully into the narrative of your product, then it’s really cool. Then people actually take the brand up and say, my positive experience in your product is directly connected and influenced by this brand and that worked great.

Mr. ARRINGTON: So, in a virtual world, having a can of Coca-Cola should have been an ad sitting and having fun.

Mr. LEVCHIN: If Coca-Cola is listening, I’d love to have their cans in my virtual world.

Mr. ARRINGTON: Do you find, this is a little off topic, back to the old topic. Do you find that users that pay, their friends are more likely to pay? Or that statistically they’re only three percent likely to pay? How do you find those ones that actually pull their wallet out?

Mr. LEVCHIN: I think the best predictor is their commitment to the product. You can predict whether they will or will not pay both to backing up for a second, there are two ways we think of virtual goods and this is possibly leading to us but I think it’s one good way to split up.

One is the consumption decision, one is an investment decision. The consumption decision is if you’re playing a game and you’ve got to level up and you just can’t wait another 24 hours for your crops to mature, for your fish to be sold or whatever, and so you pull out a dollar and say, oh look, I used to be level 15, now I’m level 16 which is great. It works and it is a true consumption decision. It is like watching a movie, you don’t really expect anything in return but you had a lot of fun.

Investment decision is where you are involved in a proto community or perhaps a real community and their conversations, they’re not necessarily on the game topic or a topic of whatever the community was originally formed around, where your standing in the community matters, where you have a voice where people care for who you are and how you differ from others and most of all, you care. If you’re really committed, you start caring a lot. In fact, you’re willing to invest in your standing and personality within that community which is the other way in a virtual-based goods become relevant where your avatar or persona or whatever term is somebody actually are willing to actually invest in cash. The ones I’m most interested in are the latter because they are ultimately a more scalable model in a sense that people are less likely to say diminishing returns. I graduate from level 15 to 16 for a dollar, grow to 500 to 501 for a dollar. Why would I possibly give out in two to 503? And some people are very happy to keep going but on average, I believe, there’s diminishing returns which just has to be. Most people don’t level up to over 500 on anything.

On the other hand, in a real world, as people gain standing and status in their community, they actually do invest more in it. You can join in a parent teacher’s association, next thing you know, you’re donating money to it and helping with the after-school activities. And that’s very possible. So, the investment type, virtual goods I think are probably somewhat more sustainable although they do have their shelf life and their lifespan. The predictor of that behavior is commitment. Will you join the PTA? Are you going to go post on the feedback forum or are you going to help others get better at this game? So, that’s what we found to be the best way to predict that. The thing that you first referred to, my friend is spending money, maybe I should spend money follows naturally from that second type of behavior. It also does sort of follow from the first type of behavior but that’s competitive. You’re level 15, I’m still level 14, if I got to beat you, I got to beat you. I think most people in social gaming or social entertainment in general are on average not as competition driven as they are driven by other means. And community is one of them but also escapism, the desire to have complete control over the process to understand in real life but don’t have full control in their own world, e.g. people play – there’s farming games I think in a big way because it’s something I understand, is very complex and they could never accomplish in the real world, but having a farm that sits there and just produces revenue even if it’s completely virtual is pretty awesome, you can control it.

Mr. ARRINGTON: How long does it last, those types of games? How long does the user last, a month on average, less?

Mr. LEVCHIN: I think it really depends on the game. But there are several different retaining factors. One is content. If the game designer produces more content than he can consume per month, some fraction of the people will say more quests, more tests, more challenges, more whatever and they will be compelled by it. There are diminishing returns there as well. At a certain point he will say – well, this challenge is kind of like the one from last month and I already solved that one. The other retention factor obviously is the community. If you play with your friends and they’re still playing, you’ll probably have higher odds of playing. There are lots of other things and they all add up to some sort of retention curve. That retention curve, it drops down to zero within 30 days then you have a – 30 days of their attention. I think it really – I will only go as far as claiming that from most products their retention curves are not too similar. I mean there are products that have incredibly high retention, and incredibly low retention.

Mr. ARRINGTON: So what about this year for you? What’s going to happen to Slide this year? Any new big product launches that you’re excited about, you want to talk about now? Raising good money that you want to talk about? This is the one like (unintelligible) easy questions.

Mr. LEVCHIN: Right. There are some product launches that I’m excited about, that I’m not willing to talk about.

Mr. ARRINGTON: New games and applications.

Mr. LEVCHIN: Yes.

Mr. ARRINGTON: And this is all still Facebook, MySpace focused? Looking at mobile at all?

Mr. LEVCHIN: On mobile, there are several questions in there so I’ll choose which one I want to answer. The mobile view that we have is as follows. It’s a fantastic extension of a committed community or committed group that exists on the web, and whether it is from the Facebook or MySpace or on any destination site or – it doesn’t really matter that much. But given the distribution cost and dynamics on the web versus the same on mobile, makes a great deal of sense to tell someone to take your favorite game with you versus discover your favorite game on mobile even if mobile is in some cases certainly is more compelling or more lucrative or whatever, just the footprints that it needs to get to, to become financially interesting is much easier achieved as a buyer instead of the people from a Facebook game extending it to their iPhone than a hundred percent of people discovering it through the App Store, for us. I think there are many companies that have mastered the App Store distribution to the point where they can get to a similar financial footprint, but I don’t think that’s a core competence for Slide. Probably it isn’t likey to change this year although hoping to do that one if I can figure out how to do it, I’ll definitely try.

Mr. ARRINGTON: Anything else?

Mr. LEVCHIN: Pretty exciting here for us. I think so. A lot of really interesting maturation that will happen in the overall industry. I think many different assumptions will be challenged.

Mr. ARRINGTON: You want to expand on that a little bit, like which assumptions?

Mr. LEVCHIN: Assumptions of – assumptions of what it means to have a successful social app and possibly the assumption of what categories are going to be successful in social apps. I think this may be the year where things start becoming more blurred about what’s a game, what’s not a game.

Mr. ARRINGTON: Interesting.

Mr. LEVCHIN: How do I delete that part? It’s way too vague, even I think it’s vague.

Mr. ARRINGTON: It’s vague but it sounds like it’s begging to be unpacked a little more. For instance, are you talking about taking Slide social tools and extending them over to platform to other things? By things I mean other apps for other people, other sites, other…

Mr. LEVCHIN: I think what we’re trying to get to is in effect a platform where some of the content is created by the users and…

Mr. ARRINGTON: Yeah, they create a shirt and then other people sell it or something.

Mr. LEVCHIN: Or they create a shirt and then they sell it.

Mr. ARRINGTON: Right. But even other people could theoretically.

Mr. LEVCHIN: Sure.

Mr. ARRINGTON: I mean, you know, I’d love to have, you know, there’s virtual gifts on Facebook, occasionally I give one. I’d love to be able to create my own gift and give it. It would be really cool if it was so popular other people will give it. That’s the kind of thing you’re talking about?

Mr. LEVCHIN: That’s certainly a big part of what we think we’re going to do. And if you look at the historic expertise of our company, it is in the tool-making skill of enabling consumers making something out of practically nothing. And I don’t mean to disrespect the occasionally fabulous but mostly just nice and sentimental pictures that people have but combined with our now five-year-old slideshow product…

Mr. ARRINGTON: Has it been that long?

Mr. LEVCHIN: Maybe it’s been four-and-a-half years, four years, but it’s been around and it’s helped at this point millions of people who go from regular expected to pretty awesome and I think in some cases that pretty awesome becomes financial lucrative. So, we try to think of ourselves as enablers of that.

Mr. ARRINGTON: Right. That sounds like that’s all you’re going to give me right now. You’ve been generous with your time. I’d love to hear more about these when you guys are ready though.

Mr. LEVCHIN: Sure.

Mr. ARRINGTON: Thanks, Max.

Last year we interviewed Facebook COO Sheryl Sandberg at the World Economic Forum in Davos, Switzerland. This year we interviewed her again. Notably, this time I brought a tripod with me and didn’t cut off Sheryl’s forehead.

A year ago Facebook had 150 million users, and more than 200 million people visited the site monthly. I noted “You realize it’s like 1 in 5 people in the world that are on the internet visit Facebook.” Sandberg replied, joking “So we have 4 in 5 more to go.”

The thing is, they’re well on their way to getting those other 4. Facebook has more than doubled in size to 350 million registered users in the last year. By this summer well over half of all Internet users will likely visit Facebook each month.

What’s more dramatic – Half of all registered users still log in to Facebook every day, says Sandberg in the interview. That’s 175 million people. And that doesn’t include Facebook Connect logins, only those people that visit the Facebook website.

Facebook continues to limit the number of friends any individual can have to 5,000. Last year Sandberg said that users would eventually be able to have any number of connections on Facebook. She said “I’m not going to give you a specific date, but I will reinforce the message that this is coming..we’re not providing that functionality and we think that’s important so we are working on this and we’re working on it currently. We look forward to your having 80,000 friends… 100,000 friends.”

This year, when I noted that users are still limited to 5,000 friends, she admitted “I failed you miserably,” and wouldn’t say if or when the limit might be eliminated. She did note that pages have no limit on fans, though.

I also asked Sandberg about her views on how the tech community should respond to allegations of Chinese government sponsored hacking and censorship. Facebook doesn’t currently operate behind the Chinese firewall, although the site is available in Chinese. Sandberg’s response:

It’s a hard question and everyone knows it’s a hard question. China is an important market, it’s a growing market and there are a lot of people that live there. And so when you provide a service, you provide a great service, you want the rest(ph) of the world to use it. And when you think about our mission, we want to connect everyone in the world. Connecting everyone in the world without China is not connecting everyone in the world. And I think that when you do go into China, you have to figure out how to work with the government, that’s very clear. When you go anywhere in the world, you have to work with the government and that’s poses different issues for different models. For us right now, we launched in Chinese. We are not easily accessible if you’re in China, very hard to access us and we haven’t figure out what our plans would be at. So, we’re still thinking here all the issues. It’s complicated.

I was unable to get Sandberg to give me a direct answer on who she thinks competes with Facebook. But she did say that she hopes to integrate with her competitors broadly via Facebook Connect. They’ve certainly made progress there.

At the end I asked Sandberg what her biggest regret was over her last two years with the company. Her response – “I would still like to see us move faster.”

Facebook’s competitors, ranging from Google to Twitter and just about everyone in between, would probably like to see Sandberg do exactly the opposite of moving faster.

The full transcript is below, courtesy of PhoneTag.

Mr. MICHAEL ARRINGTON (Founder and Co-Editor, TechCrunch): I’m here with Sheryl Sandberg, the COO of Facebook. Hello, Sheryl.

Ms. SHERYL SANDBERG (COO, Facebook?): In our annual-

Mr. ARRINGTON: Or traditional.

Ms. SANDBERG: Traditional and annual.

Mr. ARRINGTON: Yeah, second annual.

Ms. SANDBERG: Second annual at Davos.

Mr. ARRINGTON: Davos interview.

Ms. SANDBERG: Interview.

Mr. ARRINGTON: Yeah.

Ms. SANDBERG: With a flip(ph) phone. It’s a TechCrunch flip phone, I noticed it’s branded.

Mr. ARRINGTON: This year, your forehead is not cut off. And I have a tripod.

Ms. SANDBERG: It’s very, very exciting.

Mr. ARRINGTON: And so the production value of the TechCrunch is going up significantly.

Ms. SANDBERG: Very exciting.

Mr. ARRINGTON: So, we just have a few minutes of your time and I appreciate it. I know you’re running between meetings. Few questions. First of all, Davos is here. What do you think compared to last year? Last year, you said it was a bit somber, economy was down. What do you think this year?

Ms. SANDBERG: I think in terms of overall economic perspective, it’s more unknown. Unknown. You see, so start to (unintelligible). You see that some people are saying, there’s a real recovery happening and looking forward to growth. Actually, particular focus I think on growth, China, India, Brazil emerging markets and others are saying, we’re not sure. The recession isn’t over. Job loss is a very, very serious issue. A lot of, you know, anger being expressed due to the lack of financial reform that still hasn’t happened. So, I would say, I’ve been here when I thought years were very, you know, sobering(ph).

Mr. ARRINGTON: You’ve been here 10 years now, right?

Ms. SANDBERG: I’ve been here a lot of years. I’ve been here years. Yeah. Where, you know, the world is on fire and, you know, everything is giving up and last year, I would say, the world is about to fall apart. And this year, it’s more moderated. It depends on who you are, where you are, and what you’re specifically talking about.

Mr. ARRINGTON: Did you participate in the panels this year? What were your favorite sessions? What do you think?

Ms. SANDBERG: I did. I participated in a bunch of panelists. This morning, I did a thing on CNBC on how we get corporations to do gender equality and to care about gender equality. And that was actually pretty interesting. I was really impressed with Muhtar, the CEO of Coca-Cola. He said a couple of things that I really do not heard a lot of CEO say. He said that they’re really thinking about how they do. How they catch up real kind of more gender equality and took his corporate ranks. He got an example where there’s a woman he wanted to be (unintelligible) Europe and she (unintelligible) and couldn’t move and he said, traditionally, the career path of Coke is you have to move. And he said, this is going to work. So, we’re going to have, you know, exact, this is going to work. So, she had to stay, I think, it was France. We let her stay. Her team is not there but she is running Coca Cola Europe, obviously a huge (unintelligible). We need to make this work for her. And I thought, I’ve not heard a CEO say that. That was pretty incredible.

Mr. ARRINGTON: Are you joining the board of Coca Cola? You’re on Disney and on Starbucks Board?

Ms. SANDBERG: I’m not joining the board of Coca Cola.

Mr. ARRINGTON: That’ll be a kind of a cool third one

Ms. SANDBERG: I am. I am (unintelligible) sports joining up the Disney work soon.

Mr. ARRINGTON: Last year, Facebook did a bunch of in panel Facebook surveys and you have hundred of thousands of participants. Do Facebook do anything special this year in the event?

Ms. SANDBERG: Yeah. I would say last year, we were more experimenting and we didn’t. This year, we really did this. This year, we did polls at the last discussions(ph) and I think we had over 400,000 users participated in the poll. For me, you know…

Mr. ARRINGTON: 400,000?

Ms. SANDBERG: 400, 000. You know, Davos is a great event and I think an important event for getting world leaders together and corporations and you know, living(ph) in a very global world so keeping everyone together, you know. But, real people, they’re not really invited to Davos. I mean, they try and they reach out and they do a lot of reach out but they’re not here. And so for us being able to bring real people and real users into the Davos experience is incredible. We saw example after example of, you know, panel where experts are sitting there talking about something and they’ll say, what do people think? And we could do that in like 5 minutes and get, you know, 13,000 responses to whatever the question was. It was pretty interesting.

Mr. ARRINGTON: Last year, you had a 150 million users of Facebook when we sat down exactly a year ago. Today, you have- is the last number you announced is 350 million?

Ms. SANDBERG: 350 million.

Mr. ARRINGTON: What’s the office poll(ph) when you hit half a billion? It’s summer, right? Early summer?

Ms. SANDBERG: I don’t know what the office poll is but – and we’re not taking bets but we are really excited that even at such big numbers, our growth is continuing and so continuing to be so strong. As you get big, it sometimes easier to not grow at the same percentages and we are seeing incredible growth. I think, as importantly as a growth, is the continued engagement of our users. When I joined the company, we’re about 70 million and-

Mr. ARRINGTON: Which is two years ago?

Ms. SANDBERG: About two years ago, yeah. Almost two years. And we kept saying, probably 50% of our users come back every day. And you know, I keep telling people, God, stop saying that. Because every Windows(ph) or later adapters(ph) are not as, you know, engage. So, our later adapters are not going to come back everyday or 50% won’t – stop saying that. But, this is Facebook and people do what they believe in, no matter what I think and people kept saying 50% and-

Mr. ARRINGTON: You’ve almost stuck to that, haven’t you?

Ms. SANDBERG: We’re actually still at 50%.

Mr. ARRINGTON: Forrester(ph) said a 130 million people a day sign in to Facebook. So, that’s even higher than that?

Ms. SANDBERG: So the numbers are in the range(ph) of 50 million plus users and 50% comeback everyday, our numbers. 50% come back everyday. And I’ve never seen that and no one I know have seen that-

Mr. ARRINGTON: Does that include your Facebook Connect, by the way?

Ms. SANDBERG: No, that’s Facebook only.

Mr. ARRINGTON: That’s completely separate. Yeah. How many people use Facebook Connect everyday?

Ms. SANDBERG: I don’t know-

Mr. ARRINGTON: That’s on your website actually. It’s like 30 million (unintelligible).

Ms. SANDBERG: Yeah.

Mr. ARRINGTON: Last year, you made me a promise. There has to be at least a couple of hard questions. That soon Facebook users, not fan pages, Facebook users would have the ability to have more than 5000 friends. And that hasn’t happened yet. So-

Ms. SANDBERG: I failed you miserably. I’m here to apologize publicly for our loss. So, what we’ve done already here is we know there’s an issue for people like you who have a lot of followers and more than 5000 people want to see what you have to say. We have made progress on(ph) year is opening up fan pages and giving them a lot more functionality. So one of the reasons when we talked about last year, you didn’t want to switch from having a personal page to a fan pages, you couldn’t, you know, post two users, you cannot reach out two users-

Mr. ARRINGTON: You can have sort of one-on-one communication with-

Ms. SANDBERG: That’s- you could(ph). You couldn’t do any outreach from fan pages last year.

Mr. ARRINGTON: So, now you can.

Ms. SANDBERG: Now, you can. So, now, while we still haven’t got you more than 5000 people on your front page, we’ve opened up fan pages and so that if you- people want to follow you and you want to respond to people and push information to them, you’re able to do that from your front page. So we have that developed.

Mr. ARRINGTON: OK, great. So we’ll have normal user pages more than 5000 friends?

Ms. SANDBERG: I don’t know but they will add more functionality to the fan pages or we’ll do that. Either way, I think the goal is, you know, you want to be able to communicate with people. They want to hear from you. They fanned you. They friended you. We want to enable that in the best way possible. So it’s clearly (unintelligible).

Mr. ARRINGTON: One of the big things here this year is China. And obviously, the Google situation is still playing out. Facebook is still banned in China, is that right? And think of it you’re not behind the firewall.

Ms. SANDBERG: Yeah.

Mr. ARRINGTON: Yeah. I’m not asking any specific question on what Facebook plans are in China. It seems they haven’t changed. But as a sort of a leader in the tech community, what do you think should be our community’s response to China? Should we work with the government as Google tried it and others tried to do? Should we pulled out and wait? What’s the right thing to do as human beings and as businesses?

Ms. SANDBERG: You know-

Mr. ARRINGTON: It’s a hard question.

Ms. SANDBERG: It’s a hard question and everyone knows it’s a hard question. China is an important market, it’s a growing market and there are a lot of people that live there. And so when you provide a service, you provide a great service, you want the rest(ph) of the world to use it. And when you think about our mission, we want to connect everyone in the world. Connecting everyone in the world without China is not connecting everyone in the world. And I think that when you do go into China, you have to figure out how to work with the government, that’s very clear. When you go anywhere in the world, you have to work with the government and that’s poses different issues for different models. For us right now, we launched in Chinese. We are not easily accessible if you’re in China, very hard to access us and we haven’t figure out what our plans would be at. So, we’re still thinking here all the issues. It’s complicated.

Mr. ARRINGTON: Just a couple more questions. I’ve and others have stated that Facebook is clearly on a tear(ph). I mean, you probably don’t have all of the internet users at some point. Last year, you had 1/5. Now, you have 2/5 or more. But one thing is- it’s not clear to me that you’ve monetized well your profit in the business. But if you found what I called the Google moment when Google paired excellent search with amazing, an amazing monetization model to become one of the largest companies in the world. For Facebook to do the same, it seems to me you have to have this some monetization magic. Have you found that yet? Is it a process of tweaking what you have now or you’re still experimenting? How do you bring in the billions or 20 billion in revenue?

Ms. SANDBERG: Yeah. So, I think this was the year that we changed from being experimental ad platform to really being able to go big and we are going big in lots of ways. What Facebook does and I think we do uniquely well which is part of why I’m so excited about the Facebook opportunity when I was offered it two years ago is we’re a place where users express themselves and we’re a place where people share. And when you think about building brands(ph), not just giving someone something they search but before they search. When they’re talking about who they are and affiliating and, you know, finding things typical demand generation, which is still 90% of global ad spenders(ph). I think we’re best property anywhere, with any media to do that because friends want you to affiliate. They want you to say, you know, I am, you know, a Starbucks drinker. I like Starbucks latte and they want you to tell your friends about it.

Mr. ARRINGTON: You still don’t get free Starbucks as a board member?

Ms. SANDBERG: I get no free Starbucks.

Mr. ARRINGTON: Ridiculous.

Ms. SANDBERG: No.

Mr. ARRINGTON: Sorry, but go ahead.

Ms. SANDBERG: But if I wanted to tell everyone I love Starbucks as a board member or not, I will do it on Facebook. And even if I wasn’t trying to do that, if I was just expressing who I am, that’s part of it. And Facebook is a discovery place. You watch your news feed, you’re not going around to look for things even though sometimes you are but your news feed is coming to you. You said, these are the people I want to connect with and they are sharing with me. And that’s a really unique opportunity for brands. You know, the meetings I had at Davos last year were very much- we’re interested, we see, you know, 150 million users we’d like to experiment. The meetings I’m having this year at Davos are very different. They’re saying, we’ve experimented with you, we’ve done some great (unintelligible) in the last year. We’re ready to go big because we really want that kind of very authentic two-way dialogue with our users and we’re excited to help brands do that and help people interact to them in ways that they’re excited about.

Mr. ARRINGTON: So, you like your model? You like your revenue model and now it’s a process of scaling it and convincing one more and more brands to jump on towards (unintelligible).

Ms. SANDBERG: (unintelligible). Because I think that advertising is a great business when done the right way. Advertising that’s interrupted, advertising that’s pushed at you, that’s annoying is not a great model. Advertising which lets you express who you are and then engage in an authentic way is so important. I was just meeting with someone who runs a very important agency and he said what he will use is that right brands of the future are going to be shaped by consumers. What he’s telling his clients is you don’t get to control your brand anymore. You’ve got to work with consumers because they’re going to build your brands. If we are- wait a minute for the noise.

Mr. ARRINGTON: Yeah, yeah. Keep (unintelligible).

Ms. SANDBERG: As I scream, you know, all at Davos. If we are working, if we are going to change the world to take real people and put them into Davos so their voice can be heard. And if we’re going to change the world so that brands have to help and work with people to build their companies and their brands, we think that’s a much better place. And now, we’re starting to do it at scale and I think it’s going to make for better companies, I think it’s going to make for people having better consumer experiences, and I think it makes for great experiences online. So I’m really excited about it.

Mr. ARRINGTON: Who are your competitors?

Ms. SANDBERG: Who are our competitors? A competitive question is always an important one. It’s important for companies to get, right? I think if you draw your focus too narrowly(ph) our competitors, you can get very much blind-sighted by something wrong in company or others are doing. I think you want to think about your competitive case broadly. Well, understanding that you’re working with others to have partnerships. So I think we are competing for how you communicate. We want – when you want to communicate, for Facebook to be the easiest, the most efficient, the most ubiquitous way for you to communicate. I guess that’s a pretty broad communication. Yeah, broad set of competitors, but we’d like to integrate with a lot of this to really make sure that we make it easy to communicate.

Mr. ARRINGTON: So you’re not going to answer that question at all?

Ms. SANDBERG: It’s not an answer?

Mr. ARRINGTON: No.

Ms. SANDBERG: But I talked for a while.

Mr. ARRINGTON: It is an awesome answer, yeah.

Ms. SANDBERG: If I didn’t say anything, is that good? Yeah. No, I’m not going to answer that question. But no one ever answers that question. I’ve seen everyone interviewed here. I’ve never seen anyone answer that question.

Mr. ARRINGTON: No. I thought – you know, I thought maybe you would. But…

Ms. SANDBERG: Try next year. Our traditional annual Davos conversation, you can ask me again who our competitors are.

Mr. ARRINGTON: Two more questions.

Ms. SANDBERG: We will say TechCrunch. TechCrunch will be so big…

Mr. ARRINGTON: That’s right.

Ms. SANDBERG: So they are our competitor.

Mr. ARRINGTON: The TechCrunch threat.

Ms. SANDBERG: The TechCrunch threat to Facebook.

Mr. ARRINGTON: But we’ve already integrated Facebook Connect, so we’ve been board by you, right? So we’re a part of…

Ms. SANDBERG: So it’s become a partnership.

Mr. ARRINGTON: What is your biggest regret in the last two years? What would you go back and do differently as an executive?

Ms. SANDBERG: It’s a good question.

Mr. ARRINGTON: That’s a tough question I throw you without warning, but…

Ms. SANDBERG: No. It’s a good question. It’s a fair question.

Mr. ARRINGTON: Yeah, anything you would have done differently.

Ms. SANDBERG: I think I would still like to see us move faster. I think we move fast.

Mr. ARRINGTON: You mean, in terms of product generation?

Ms. SANDBERG: Yeah, in terms of product generation. I mean, Mark says this all the time, right? The risk of any spaces that we don’t move as that they move too slowly, not too quickly. I think we are moving quickly and I think we’re quicker than anyone. I think we still like to be faster. I would have love to have gotten last year from the experimental part of our brand business to where we are now, which is scaling. I’m excited we’re here now, but would have loved to accomplish that more quickly.

Mr. ARRINGTON: What are you most proud of?

Ms. SANDBERG: I’m most proud…

Mr. ARRINGTON: What have you done in the last two years, when you look back and go, that was awesome?

Ms. SANDBERG: I’m most proud of how Facebook changes lives. I’m most proud of the following example, which hit me because it’s a friend of mine. Her friends, they wanted to adopt a baby and they had a birth mother…

Mr. ARRINGTON: Can you adopt babies on Facebook now?

Ms. SANDBERG: Let me, let me.

Mr. ARRINGTON: I’m sorry.

Ms. SANDBERG: Wait, wait, wait. And they had arranged through an agency with the birth mother and at the last minute, the birth mother changed her mind and wants to keep the baby, which is of course, prerogative in the choice. But for this couple, it was very sad. And they actually wrote on Facebook, they created a page where they really were expressing themselves like, this is so disappointing. We had a nursery, we really want to be parents. We just hope someone else just ask for adoption. And separately, there’s a woman who was looking for a place to give a family to adopt her baby, and she went to the usual process and found it too formal, didn’t find anyone she liked. Found this page, she saw this couple’s desire to have a children and more importantly, saw the community around this couple, saw the friends and the family who are saying we know it’s going to happen for you, we know you’re going to be able to be happy parents and we’re going to be there for you through the experience. And she said that’s where I want my child. I want my child…

Mr. ARRINGTON: And they actually…

Ms. SANDBERG: It’s gone through. The couple has a baby. And what that says to me is that we create community where there wasn’t any, we show people in this very important way the power of what human connection is. We have this page I’m very proud of. I think it’s peace.facebook.com, which you should look at. We’re choosing real-time. Every 24 hours, if personal connections are made between historically conflict groups, so it does Palestinian area and Israel, it does Pakistan and India, it does Muslim and Christian, for example. And you get on there and you know, it’ll say in the last 24 hours, 13,000 connections have been made from Israel to Palestine, 13,000. 13,000 individual people who have connected. You know, if someone else said here it’s really hard to shoot at people you know, it’s just easier to shoot at people you don’t know. And so I don’t claim for a second that we’re going to like create (unintelligible). I’m not that naïve or silly. I think making things more personal makes a huge difference. It’s why, you know, my friend’s friend now has a baby, because they wanted that community. It’s why people are directly connecting in areas of the world where they weren’t before and I’m really proud of that, really proud to just be one of the many people working at this company that’s making that possible. It’s an honor.

Mr. ARRINGTON: All right, we’ll end with that. Thanks very much. I appreciate your time.

Ms. SANDBERG: Thank you. I’ll see you next year.

Nokia and education company Pearson have formed a joint venture in China dubbed Beijing Mobiledu Technologies to grow MobilEdu, the wireless education service that the Finnish mobile giant launched in China back in 2007.

Mobiledu is a mobile service that essentially provides English-language learning materials and other educational content, from a variety of content providers, directly to mobile phones.

Customers can access the content through an application preloaded on new Nokia handsets, or by visiting the service’s mobile website and most other WAP portals in China.

According to Nokia, Mobiledu has attracted 20 million subscribers in China so far, with 1.5 million people actively using the service each month. According to the press release and by mouth of John Fallon, Chief Executive of Pearson’s International Education business, China is the world’s largest mobile phone market and the country with the largest number of people learning English.

UK-based Pearson owns the world’s largest education publishing business as well as the Financial Times and Penguin books. In april 2009, it acquired Wall Street English for $145 million in cash, giving it a leading position in China’s English-language teaching market.

The new joint venture company aims to deliver a wide range of services to meet the demand for digital education in China. It will begin operations immediately and will be managed by Angela Long, formerly head of Mobiledu at Nokia.

I sat down with MySpace CEO Owen Van Natta at the World Economic Forum in Davos, Switzerland earlier this week to talk about his first eight months on the job. This is one of Owen’s first video interviews since taking the job last April.

We talk about Van Natta’s vision for the once-mighty MySpace. The site was at one time the worlds largest social network and had more page views than any other U.S. website. But in the last couple of years it has been eclipsed by Facebook’s stunning growth.

Still, Van Natta and team have a plan. The MySpace of the future will be all about the social experience around content, and the company’s strong offerings in music and music videos through MySpace Music will be the cornerstone of that effort. From the interview:

I think we have a unique value proposition for consumers that is about being the place where people socialize around content, and by socialize, I mean the tag line of, you know, discover and share and showcase content. It’s where you learn about content both through your friends and, you know, sometimes it’s more important that the people that you don’t have any connections to in the real world. And one of the big differentiators for MySpace is the fact that we have an open social graph. People expect to connect to people they don’t have connection to in the real world but has similar interests with. And so, it’s a great way to do discovery. It’s a lot of the way discovery happens in the real world. And now the social web is just simply enabling that to happen more increasingly online.

Van Natta has made two acquisitions since joining, iLike and iMeem, both in the music space. And that iLike deal got MySpace Music onto Google search, driving a lot of traffic and attention to the service.

We discuss both acquisitions in the interview.

Van Natta also talks about MySpace revenue, particularly the soon to terminate Google search deal.

The full transcript is below (thanks to PhoneTag for the transcription). You can also watch Van Natta’s presentation at the event here.

Michael Arrington: I’m here with Owen Van Natta, the CEO of MySpace. Owen, you’ve been CEO for eight months now?.

Mr. OWEN VAN NATTA (CEO, MySpace): Eight months. About eight months now.

Michael Arrington: We’re sitting down at the luxurious Club Hotel in Davos, Switzerland. You’re at the World Economic Forum. This has become a bit of a tradition for me to interview CEOs here. This is the internet ghetto. This is where they put all the internet CEOs. It’s not like the best hotel in the world. As you found out, there’s no shampoo.

Mr. VAN NATTA: (laughs) No shampoo. And they’ve got beds in the closets.

Michael Arrington: Murphy beds. Yes.

Mr. VAN NATTA: But they also have a great sound track here, so you could hear it matches the decor. It’s very ’70s, very (unintelligible).

Michael Arrington: So, I have a few minutes with you. What I want to start with is, tell me what MySpace is today.

Mr. VAN NATTA: MySpace is a place to share and it’s a place to discover, share and showcase content. That’s what people are doing on MySpace today and that’s what we’re focused on, continuing to provide to people.

Michael Arrington: So, over the last eight months, what have you fixed, what have you pushed forward on, what have you cut? What is your job there?

Mr. VAN NATTA: Well, we’ve – I’m very focused on being a user center’s company. And that means starting with the product, making sure that we have a product plan that matches the mission statement of discover, share and showcase content. We’re focused on the music category. We’re focused on film and television. We’re focused on games. That’s what people are engaged with today on the site. Once we – you start a product strategy, you need to make sure you have the right team. We’ve built a entirely new management team of MySpace. I’m really excited about some of the talent that we’ve brought on board. Now, it’s all starting to be built throughout the entire company, and obviously, you have to have a great technical platform in order to be able to compete in the internet space. And we’ve been doing a lot of work to position ourselves to deliver on the promise of our type of platform. You know, we’re doing a lot of things to improve the experience like decrease page download times and we’re starting to realize some of those games already. I’m excited about our progress so far.

Michael Arrington: Your engineers are mostly in L.A. and San Francisco, right? Or entirely in L.A. and San Francisco?

Mr. VAN NATTA: We actually have a large engineering group in – well, reasonably large engineering group in Seattle.

Michael Arrington: OK. And have you hired a lot of engineers since you’ve come on board? Or has it been mostly keeping the ones that you like or how – what has that been like?

Mr. VAN NATTA: No, we’re constantly bringing new engineering talent at all levels of the organization. We have a new CTO, got an Alex Maghen who has a great background dealing with large scale systems. And I think we have a lot of great news to come in terms of tech (unintelligible) coming in. It’s a big area of focus for us.

Michael Arrington: Before you came on board – in fact, I talked to DeWolfe, your predecessor, here a year ago, and there was a lot of focus on the past before you and your team joined about competition, and particularly Facebook, and how you stacked up against Facebook at different times. I haven’t heard a lot of that from the team, not a lot of focus on the competition, more about what you are and what you’re doing to push forward. In fact, you’ve integrated with, I think, Twitter in some ways, right?

Mr. VAN NATTA: Yes.

Michael Arrington: You’ve done a small integration with Facebook Connect. Are we going to see more of that? How can you use some of the companies out there to make your product better?

Mr. VAN NATTA: Well, a big part of our strategy is to be – is to really embrace openness and let people engage with content where it is that they want to engage with it. So, you know, one of the things that we did early on was we acquired a company called I Like That. I know you’re aware of. It has a…

Michael Arrington: Yeah, just a month before they were integrated with Google Search.

Mr. VAN NATTA: That’s right.

Michael Arrington: Did you know about that when you bought them? Did you know that that deal is going to happen?

Mr. VAN NATTA: You know, those things are always in the works but it wasn’t a done deal. But you know…

Michael Arrington: The timing sort of worked out well, looked like you got a really good deal on that company as well.

Mr. VAN NATTA: Well, I think, you know, the timing of the Google partnership is one that we’re excited about. You know, we’ve even extended, so since then, we announced that we’re going to be part of their real time search initiative and, you know, we’re excited to see what type of collaboration that brings as well.

Michael Arrington: Well, since we’re on the topic of Google, I’ll jump ahead. You have a search deal with them that signed a couple of years ago before you joined, and in, I think, June of next year – middle of next year, the end of your fiscal year next year, it ends, at least the last for a public statement on that. Are you renegotiating that or you think you’re working with another partner? It’s nearly $900 million deal over three years. It’s a substantial amount of revenue. Where do you stand with that?
Mr. VAN NATTA: All those types of partnerships always need to evolve. You know, we’ve continued to evolve the business and building that in a way where we just – we don’t have any dependency on – we don’t have dependency on any one revenue stream. We’re always open to new partnership. We’ll continue to extend our partnership with Google in the areas of music search as well as real time search(ph). So, you know, that continues to be a great relationship that we’re excited about. And we’re going to be looking at lots of different options as we go forward. We’re really pushing on innovation. You know, we’re really in the midst of remaking MySpace into the place where you discover, share and showcase content and partnerships are going to be a big part of that.

Michael Arrington: If you talk about content, and this has been something you and your team is – have talked about almost since day one. Obviously, you have the music property with is great. It’s been around since over a year now. You guys do a lot with trailers. I see trailers all the time. You have lots of video content on the site. Is that what we should be thinking of? Or you’re thinking of more of like a Hulu type of thing or are you actually pulling an actual TV content, like what do you mean by content? And there are games as well. Are these games that you’ll publish? Will you acquire companies? Will you pull in more third party Flash games? Is there a way we should – as a press, should be thinking about what you mean by content?

Mr. VAN NATTA: On the Music Space, having the relationships that we do and the joint venture we do with the major record labels, the publisher, all the independent record labels, give us the ability to have a music experience that really is unparalleled.

Michael Arrington: Music videos, music streaming…

Mr. VAN NATTA: All of it in one location and very, very social which we think is really the foundation for discovering (unintelligible).

Michael Arrington: What about mobile? We see a mobile music initiative at some point?

Mr. VAN NATTA: We continue to look at mobile. It’s a big part of the way that people are interacting with the site today. We got a tonic(ph) growth in mobile, and it’s a big area of focus for us, and I’m really hopeful that we’re going to continue to evolve and innovate and that’s (unintelligible)…

Michael Arrington: And maybe see streaming music and that kind of thing in the future.

Mr. VAN NATTA: I think all those things are the things that users are increasingly wanting and we want to serve those user needs, especially as it relates to discovery around music because that’s one of the underserved areas in the market that we’re uniquely positioned to deliver for consumers.

Michael Arrington: What about TV and films? I mean, actual films and things like that. Is that something that you think YouTube and Hulu will dominate or is that a place that you’ll play or do you know yet?

Mr. VAN NATTA: We consider YouTube and Hulu to be partners today and we have their content integrated all throughout the site. We have over 400 partnerships with different content producers and content creators. That’s going to continue to be an area of focus for us. We host our own music videos, that was something we launched, as you know, last year. So, those models will continue to evolve but it’s really going to be about partnership. We’re building a platform where we want users to come and engage with that content in a highly social environment and that’s going to continue to be our focus in terms of providing great user experience.

Michael Arrington: OK. Do you think – and I know this is a question you’ve been asked many times. But, do you think we’ll see a for Facebook Connect integration? Is it something you’re still considering, something you’re deciding on?

Mr. VAN NATTA: We did a very small Facebook Connect…

Michael Arrington: The European site.

Mr. VAN NATTA: Out of our UK office. Again, I think embracing openness means looking at it everywhere. And, you know, we’re certainly looking at different ways that users want to be able to engage with the content and we’re pretty much open to figuring out the right way to make that available for users, where it is that they want it. 7.45

Michael Arrington: OK. MySpace has always been a bit behind maybe on design and technology. And not your team’s fault, but what are your plans to remedy that? Or do you disagree with this statement?

Mr. VAN NATTA: You know, I think usability and user experience and design are critical areas if you’re going to be a player in the consumer web. One of the first hires that we made was someone that had a user experience for (unintelligible) extensive experience, building great user experiences from some of the top sites out there. It’s something that…

Michael Arrington: Who was that?

Mr. VAN NATTA: That really focused on – she’s a woman named Katie Geminder.

Michael Arrington: OK.

Mr. VAN NATTA: She’s got experience at Amazon and Apple and Facebook.

Michael Arrington: Does she report to Jason?

Mr. VAN NATTA: She does.

Michael Arrington: OK.

Mr. VAN NATTA: She – and so, it’s an area – it’s a big area focused for us. It’s something that we’ve actually been staffing up quite a bit. We’re starting to build a really solid team there. We need to have a technical platform that really enables us to have a great user experience and we’re focused on building that out too.

Michael Arrington: How far away are you from that do you think?

Mr. VAN NATTA: You know, it’s an interactive(ph) process. It’s not something that you can do a big atomic launch around. We have a very large site with a large number of users and we really want to bring them along and have them show us through exactly how it is that they’re responding, give us a feedback exactly what the best user experience is. So, you’re going to see that continue to evolve. We’ve done a number of things in that space already where we (unintelligible) set a number of categories and number of areas on the site that we just didn’t think we’re adding value for users, that usually we’re showing through their actions weren’t the things that they were coming to MySpace to do, things like weather and jobs and classifieds, horoscopes. I know you found out that horoscopes are gone.

Michael Arrington: I was – that was a sad day.

Mr. VAN NATTA: But, you know, that’s something that we’re continuing to focus on and we want to be excellent in usability and design. We were building a really strong competence(ph) there.

Michael Arrington: You know, Facebook talks a lot about how they’re the pipes around social. You guys talk a lot about you’re the content. It seems to be that the one word you use a lot is content and social experience around content. Is that the right way to think about MySpace?

Mr. VAN NATTA: I think we have a unique value proposition for consumers that is about being the place where people socialize around content, and by socialize, I mean the tag line of, you know, discover and share and showcase content. It’s where you learn about content both through your friends and, you know, sometimes it’s more important that the people that you don’t have any connections to in the real world. And one of the big differentiators for MySpace is the fact that we have an open social graph. People expect to connect to people they don’t have connection to in the real world but has similar interests with. And so, it’s a great way to do discovery. It’s a lot of the way discovery happens in the real world. And now the social web is just simply enabling that to happen more increasingly online.

Michael Arrington: So, you were always a startup guy. I mean, even in Amazon, you broke out and started a line for them. You were with Facebook when they were a very small playlist. You’re now at a big company within a big company. Looking back over the last eight months, is the job what you thought it would be when you took it? Was it different than you thought it would be?

Mr. VAN NATTA: I think this is a unique situation. I certainly came in expecting that this is going to be a lot of work but what I am excited about everyday and what gets me fired up and my team fired up everyday is that we have an incredible asset base and we have a really strong user value proposition. It’s something that users are telling us every single day with their time that they really value highly. And as we continue to make improvements, we’re seeing increased engagement around the areas that we are focused on, the content areas that we just talked about. So, you know, look, building these companies is a huge challenge, but I love building teams, I love being part of a team, and I’m really excited about what we have in front of us and really also pleased with the progress we’ve made so far.

Michael Arrington: All right. Thanks very much. Oh, one other thing. You just hired a new chief revenue officer.

Mr. VAN NATTA: We did. Nada Stirratt.

Michael Arrington: Any shifts on your revenue strategy now based on that?

Mr. VAN NATTA: Well, one of the things that we’re seeing in terms of the market is, you know, the economic downturn, as I’ve talked with a lot of CEOs and marketers, you know, brand managers, I think the economic downturn caused a lot of these companies to really reevaluate their advertising strategy and what you increasingly see is more people’s time spent online but fewer brand always being able to be spent online. And one of the areas where I think we’ve been super innovative and where I think we have a strong competency is in the integrated marketing area, some of the things that we do with movie studios or on movie launches or record releases. You know, we released over 200 records in the last 12 months for bands, and really to promote those heavily to millions and millions of people in a very integrated way is super unique. When we talk to users about it, we look at users’ behavior, what we’re finding is they really view that content as valuable as they would view professionally produced content or content that isn’t necessarily advertising content. And, you know, that is what we think is the big opportunity that could bring a lot more brand always on to the web and that’s what we’re working on with our advertising partners on today. So, I’m excited about that. I think it is new in that as more brand always go online, people are going to want those types of experiences and I think we’re really continuing to lead the market in terms of that type of integrated marketing.

Michael Arrington: OK. Thanks very much for your time.

Mr. VAN NATTA: Yeah. Thanks a lot.