Sony to launch online store – Sony executive Kaz Hirai says that the Japanese electronics giant will launch its own online store modeled after its successful PlayStation Network store. The store will include connections between Sony’s consumer electronics devices and its digital content.

NY Times columnist slams Bing over China — Nicholas Kristof, a columnist for the Gray Lady, called for a boycott of Microsoft’s Bing search engine today for failing to stand up to Chinese government censors. If you type Tiananmen and other controversial search subjects in simple Chinese characters in a Bing search, you get government propaganda instead of real search results. Google handles the problem in a different way, but Kristof says he isn’t buying Microsoft’s response.

Behind the FAA’s flight plan glitch — eWeek has a lengthy article describing the router failure that brought down the nation’s air traffic control system.

Oracle’s acquisition of Sun looking dim — Bloomberg reports that the European Union is likely to block Oracle’s $7.4 billion acquisition of Suny Microsystems. The hangup seems to be Sun’s ownership of the MySQL database software, which competes with Oracle.

McAfee warns of 12 scams of Christmas — Beware of everything from fake electronic greeting cards to charity scams that steal your identity and credit card data. McAfee offers the warnings in a podcast.

AOL to cut 2,500 jobs — AOL is asking a third of its work force to volunteer to end their jobs. If it can’t get the volunteers, it will resort to layoffs.

EA shuts down Pandemic – Electronic Arts has shut down its Pandemic game studio amid much criticism. EA bought BioWare/Pandemic from Elevation Partners for $800 million in 2007. John Riccitiello, who left Elevation to become CEO of EA, recused himself from that purchase decision because he stood to benefit from it. Now, faced with declining demand for its games, EA is making drastic cutbacks of 1,500 jobs — including 200 at Pandemic, which was about half of the original acquisition. The decision is understandable, since Pandemic had a string of weak games, including the Lord of the Rings Conquest game we panned. But the Riccitiello critics don’t seem to care about that.

Microsoft’s Ray Ozzie: Apps don’t make your phone special — “It’s not the applications available on the various platforms that will be the differentiators, Ozzie said, even though that’s what many companies and writers seem to focus on.”

Microsoft’s Xbox Live chief on banning modders and browsing Facebook photos on TV — “It’s a cat and mouse game. These were people that were pirating software.”

Modern Warfare 2 continues to blow away entertainment records — “Call of Duty: Modern Warfare 2 has set the all-time entertainment industry record, generating $550 million in sales in its first five days on the market.”

Updated: Modern Warfare 2 banned in Russia due to civilian massacre scene — “Activision Blizzard released this statement today: Reports that Call of Duty: Modern Warfare 2 has been banned in Russia are erroneous.”

Former Microsoft evangelist Don Dodge joins Google, discovers Gmail — “Don Dodge, the Microsoft startup evangelist whose layoff earlier this month was much-bemoaned in the tech community, has landed on his feet, and then some.”

And here are five more stories we thought were important, thought-provoking, or fun, including coverage of our Smart Grid conference GreenBeat 2009:

GreenBeat: Live-blogging Nobel Prize winner Al Gore — “The single largest solution is efficiency and the Super Grid, or the Smart Grid, plays a crucial role in several aspects of a comprehensive plan to solve the crisis.” (You can also check out our summary of Gore’s remarks.)

Politics and policy needed for the smart grid. Soon. — “At GreenBeat 2009’s Politics and Policy session, the prevalent theme was the need for a simple, efficient legislation and regulation package for the U.S. power system.”

Twitter COO Dick Costolo: Revenue is on and advertising is coming soon — “The big takeaways are that Twitter is making more than $4 million a year, but won’t specify how much, and that’s through the recent data-sharing deals with Microsoft and Google.”

Google aims to release Chrome OS netbooks by holiday season 2010 — “Although there’s been some hope that Google might launch the operating system in early 2010, Vice President of Product Marketing Sundar Pichai said Google plans to work with manufacturers to bring Chrome OS netbooks to market in time for next year’s holiday season.”

Offerpal Media sets standards to lock out scam offers — “Burned by a scandal in its offer business over inappropriate promos, Offerpal Media is moving to set standards that forbid offers that are misleading, deceptive or otherwise objectionable.”

5 ways VC firms can stop shooting themselves in the foot – Venture Capital firms drill the need to create basic credibility into the companies they invest in – but often fail to take their own advice. Laura Grimmer, CEO of Articulate Communications (which works with VC firms), lists five things they could do to build a better pipeline of prospective portfolio companies.

After VC cash? Show ‘em what you’ve learned – When the time came for Cafepress to seek its second round of funding, the company went about it in a slightly different way. Serial entrepreneur Steve Blank, a longtime board member of the company, offers a look at how they did it – and what the reaction was from investors.

Boston Millennia’s Callow on the state of the VC industry – Dana Callow has been watching the Venture Capital business morph and change for years. In this Q&A, the managing partner of Boston Millennia Partners discusses the VC shakeout, fields that have him excited and what entrepreneurs seeking capital should be doing.

Finding a buyer for your start-up – It’s hard enough to walk away from the business you built from scratch. It’s even harder to find an ideal buyer. John Ovrom founder and CEO of Exit and Answers, examines the two most common ways people begin the process when they decide to sell.

Tech mishaps and the human problem – Engineers might cringe when they hear it, but every tech problem is tied to a human problem. Serial entrepreneur Eric Ries, in this lecture given at Stanford University, demonstrates how to narrow things down and learn the root cause.

The application was created by San Francisco-based Thing Labs, and includes features like expanding links and photos, the ability to “mute” people who you want to stop seeing updates from temporarily, and recently-added support for Twitter Lists.

In addition to opening the beta, Brizzly also added a new feature today, the ability to translate tweets with a single click using Google Translate.

Thing Labs also announced a new hire — Ben Darnell, an early Google employee who worked on Reader with Thing Labs chief executive Jason Shellen. He left for FriendFeed, all of two weeks before it was sold to Facebook. Thing Labs is backed by Polaris Venture Partners and Ron Conway.

And one last easter egg, if you tweet ‘#jacob’ or ‘#edward’ into Brizzly, it will change to a Twilight theme.

The startup, which creates those green ‘Retweet’ buttons you see everywhere (including on this site), is rolling out the same feature for ads. They’re partnering with Federated Media to insert retweet buttons into their advertising two weeks from now, enabling people to share compelling ads with others.

Advertising in social streams has historically been a touchy issue (see: Facebook Beacon in 2007). Users logged into Twitter and Facebook want to see what their friends are up to, and they don’t want those personal messages to be conflated with advertising. There have also been other advertising efforts launched around Twitter, like Sponsored Tweets, which pays people to send out commercial messages. But those haven’t gained widespread traction for the very simple reason that if you pollute your stream with too many boring messages, you risk losing followers.

But Tweetmeme’s product is interesting because it returns advertising to its roots in some ways. Great advertising has always been about connecting with people — remember Apple’s “Think Different” campaign or the never-ending “Got Milk” print and TV ads. They’ve become cultural touchstones in some ways. This could incentivize online advertisers to create material that’s more engaging or social.

It’s also the direction in which advertising is headed on other social networking platforms. Facebook, for example, sends detailed metrics back to its advertisers on how many shares, likes and comments their campaigns receive. They also send how many “Hides” an advertiser’s content gets if users find it uninteresting.

We were thrilled with the turnout, and couldn’t be more grateful for all the support we received from attendees, speakers, sponsors and the press. It’s clear that the Smart Grid has gained the momentum it needs for serious work to be done, and we are excited to play a big role in this conversation going forward.

With Al Gore, and several of the biggest utilities and brightest entrepreneurs leading the charge, 2010 should be a big year for smart metering initiatives, regulatory reform and consumer conservation education. Whether or not these efforts will result in a cleaner, more efficient grid, or a population more committed to saving power (even if it’s only to trim their bills) still hinges on policy and money.

Stationed in the most progressive state for environmental legislation, and at the heart of the venture capital community, VentureBeat is ideally situated to report on how this unfolds. We’re already looking forward to future events on the power grid that will pick up where GreenBeat 2009 left off.

Once again, we’d like to thank all of our event sponsors and strategic partners for making this week’s event possible: Accenture, Southern California Edison, Accel Partners, Mayfield Fund, Oracle Utilities, Schwartz Communications, Cisco Systems, CPower, CSC, S&C Electric Company, KPMG, Vantage Communications, DEMO, Matter Network and Fora.TV.

We were also honored to have so many of our colleagues from the press in attendance during the event. To thank them for their coverage, and give our readers a more holistic sense of the Smart Grid dialogue sparked by GreenBeat, here’s a roundup of articles from the last several days:

GreenBeat in the New York Times:

Google says it doesn’t want to be a utility
In Pursuit of a Smarter Grid

On Al Gore:

Al Gore: Super grid is critical to combating the climate crisis, Cleantech Group
Gore: White House shooting for climate bill by spring, Greentech Media
Al Gore: The Smart Grid is Key, Earth2Tech
Al Gore: Our next power grid will be like the Net, CNet

On Innovation Competition and winners Locust and CPower:

Data storage startup, energy manager, win GreenBeat Innovation Contest, TriplePundit
3 Next-Gen Applications for Smart Grid 2.0, Earth2Tech
Data centers that feed power to the grid?, Greentech Media
Xtreme Power named a Smart Grid innovator in VentureBeat’s Innovation Competition

Related news:
Google PowerMeter: It’s our gift to humanity, really, Greentech Media
Cisco seeks smart grid CTO, EE Times
Viridity Energy poised to make next generation of Smart Grid a reality, TMCNet
Current CEO Casey talks about SGIG, GreenBeat 2009 Award, Smart Grid Today

Here are some photos from the event — look for more media, including an image and video gallery, in the next few days.

[Photo credits: Alexa Lee, David Lin and Cheng Saechao]

Perhaps the most significant point: That energy efficiency is “the single largest solution to the climate crisis,” and the Smart Grid will “play a crucial role” in achieving that efficiency.

The Smart Grid will have a number of advantages, Gore said. It will reduce the carbon emissions that accelerate global warming.  It will give us more access to alternative energy sources like solar and wind, and will equip us to cope with the inconsistency of those sources. It will create jobs. And it will be cost-effective, eventually paying for itself by preventing grid failures and blackouts.

“The analogy to the internet is close to exact and very relevant,” Gore added. Like the internet, the Smart Grid is moving from a centralized to a distributed model, and it will spur the creation of new devices and applications.

Gore also talked about the obstacles facing the Smart Grid and other efforts to fight global warming. Those obstacles involve politics, economics, and short-term thinking. But those challenges must be overcome — because he said members of the next generation will ask one of two questions.

If the climate crisis has come to a devastating head, they’ll ask, “‘What were you thinking? Were you watching Dancing with the Stars? Didn’t you hear the scientists? Didn’t you care?’” Or they may see that we’ve taken the political, economic, and technological steps necessary to create “a new renewable energy platform and sustainable environment,” and they’ll ask, “‘How did you find the moral courage to rise and solve a crisis that so many people said was impossible to solve?’”

[photo:David Lin]

One of our newest speakers is Randy Breen, chief operating officer at Social Gaming Network, where he oversees game development, business development, strategy and executive management. He has worked in the game industry since 1986 at companies such as Electronic Arts, LucasArts and Emotiv Systems.

Today is the last chance to get DiscoveryBeat tickets at the early-bird rate of $114. That’s a 25 percent savings from the regular ticket price per attendee of $149.

As a reminder, DiscoveryBeat is all about getting your apps noticed. The event is targeted at the intersection of social, mobile and gaming trends. The event takes place in the afternoon of Dec. 8 at the Automattic Lounge on Pier 38 in San Francisco. Check out the DiscoveryBeat site for the full agenda and speakers. We’ve got a good batch of sponsors signing up for the event. A partial list of sponsors includes apps PR firm AppLaunch PR/VSC Consulting, Peter Relan’s startup incubator YouWeb, app store operator GetJar and social gaming firm SGN.

We’ll discuss the “secret recipe” for getting discovered in an age when getting discovered can mean huge viral growth and the difference between profound success or prompt failure. We think there are five main ingredients to the secret recipe for viral growth: 1) Social networking and marketing, 2) advertising, 3) web design, 4) partnering and 5) measurement.

Our previously announced speakers include John Pleasants, chief executive of social game firm Playdom, Ge Wang, co-founder and chief technology officer at music app maker Smule; Jon Vlassopulos, CEO of Zippo virtual lighter app maker Moderati; Roy Sehgal, executive producer of the Cafe World social game at Zynga; Julian Farrior, CEO and founder of iPhone hit game maker Backflip Studios; and Sebastien DeHalleux, president of social gaming firm Playfish, which was recently acquired by Electronic Arts for as much as $400 million.

Tickets are available here.

There have been other reverse karaoke products, most notably Microsoft Songsmith, a Windows application that lets you record your singing, then automatically generates musical accompaniment. Songsmith even prompted a series of YouTube videos highlighting the hilarious badness of many of the resulting songs.

Khu.sh’s iPhone app, LaDiDa, lets you do something similar on your iPhone. You choose a style (such as E Piano Pop or Dub Tone) and tempo, sing into the iPhone, and LaDiDa adds the music. You can also share the recordings on Facebook or Twitter. A $0.99-version of LaDiDa was first released last month, and Khu.sh added a free version (with fewer musical styles) called LaDiDa Lite (iTunes link) this week. You can check out the results in the video below.

This may seem like little more than a novelty, but if musical iPhone app developer Smule can have a hit with something like I am T-Pain (which overlays your singing with Auto Tune technology), I could see plenty of iPhone owners embracing this, too — though it’s a little more challenging without the help of a hip hop star like T-Pain.

Khu.sh is based in Atlanta and has raised $120,000 in seed funding, including $20,000 from incubator Shotput Ventures.

The company said it is cutting back investment in making games and other apps for Android-based cell phones, even though Android has won a lot of attention lately with new models from Motorola and Sony Ericsson, according to Reuters.

“We have significantly cut our investment in Android platform, just like … many others,” Gameloft finance director Alexandre de Rochefort said at an investor conference. “It is not as neatly done as on the iPhone. Google has not been very good to entice customers to actually buy products. On Android nobody is making significant revenue.”

By contrast, iPhone games are generating 13 percent of Gameloft’s revenue in its most recent quarter. Rochefort said that Gameloft is selling 400 times more games on iPhone than Android.

Not every developer is so disappointed with Android. Stewart Putney, chief executive of mobile games publisher and platform company Moblyng, said that he is very bullish on Android. His company has eight titles on Android and it deploys its games first on Android. One of his games recently hit No. 1 in the Android app store. (Moblyng makes a platform that allows it to publish games quickly on a bunch of different smartphones at the same time).

“Every app store is different,” Putney said.  “We have learned how to manage our Android app catalog presence and monetize our apps.  Android app monetization can be as good, or better, than iPhone- but it does require a different, more technology-driven, approach.  As app stores proliferate, older and bigger developers can’t just rely on being featured by Apple.”

Electronic Arts, the biggest mobile game company, also has faith in Android. Adam Sussman, vice president of worldwide publishing for EA Mobile, said, “We look for Google’s Android platform to become an important channel for EA Mobile and we have already launched some of EA Mobile’s most popular franchises on Android including Bejeweled and The Sims 3 with more to come, including Surviving High School, Spore Origins and many others.”

Brooklyn-based Hot Potato launched a site and iPhone app today that lets groups of people share and create streams of content around events.

You can create an event like a concert or a football watching session and let other people check in to it. Everyone “checked in” at an event can post their thoughts, photos and videos about what’s going on, creating a stream of activity for others to see.

All the content is curated by “likes” and “comments”, so Hot Potato can surface the most engaging posts. You can also specify that you’re “attending”, “watching” or “following” an event someone else has created like a concert.

You can look at people’s profiles and scroll through their stream of activity. Hot Potato uses Facebook Connect for log-ins, so you can pull in your existing friends. The company is backed by Vimeo co-founder Zach Klein and launched at the Real-Time Crunchup in San Francisco today.

To date, 40 developers have launched official communities at Playhaven in its first month. Fans can join the online communities for free, and developers can claim the communities for free. Developers simply “click to claim” the communities, which means it’s minimal work for game creators.

The idea is to spark word-of-mouth buzz around games, which is extremely important on the iPhone because its easy to get lost among the 22,784 games among the 118,568 published iPhone apps (Mobclix numbers).

Fan reviews and ratings are especially important ways to get noticed on the iPhone, said Raymond Lau, chief executive of San Mateo, Calif.-based Playhaven, in an interview. These are the sorts of issues we’re going to discuss at our DiscoveryBeat conference on Dec. 8 in San Francisco.

“Right now, the developers fly blind because they don’t know who their fans are,” Lau said. “We want to empower the developers by establishing a community.”

Developers can add the links to the fan community into their apps for free. Lau said the company may add premium features that developers can pay for at some point in the future.

Playhaven uses the description and art work that companies submit to the AppStore when they launch, so it can easily start a new fan community for every new game. So far, the company has created more than 15,000 fan communities where fans can post game guides, tips, reviews and other content. They can also communicate with developers on the official sites. Develoeprs can create blog posts.

Some of the popular games with official forums are Aqua Globs, Radio Flare, Fare City: First Shift, Wheeler’s Treasure, Medieval and The Quest – Hero of Lukomorye I. Bryan Mitchell, the developer of Geared, found that a third of his game’s players are entering the community site every day, partly to see the fan-created guide to all 80 levels of the game. An AdMob survey found that 46 percent of iPhone users choose apps based on word-of-mouth recommendations.

Playhaven was founded in 2008 by Lau, Erik Yao, and Kurtiss Hare. Lau and Yao had previously started MyGameMug, a social networking site for gamers. It didn’t do particularly well, but it has become useful to World of Warcraft guilds that are recruiting new members. So the site is still in operation. The company has fewer than 10 employees.

Competitors who do similar things include Scoreloop, Aurora Feint’s Open Feint platform, and Ngmoco’s Plus+ platform. But Playhaven doesn’t require that its communities be integrated into a game via a software development kit. Investors include Tandem Entrepreneurs and LaunchBox Digital. The company raised an undisclosed amount for its seed round.

[The excitement in this industry is one of the reasons why we're holding an executive event called DiscoveryBeat on Dec. 8 in San Francisco. The event will explore the secret recipe for getting your social game or mobile phone application "discovered" in an age of increasing noise. Get your early bird ticket by today to get 25 percent off].

Google hasn’t traditionally engaged in large-scale advertising campaigns. Instead, it has relied mainly on word of mouth to become the $180 billion company it is today. However in the last year, the company has rolled out bigger and bigger paid advertising efforts (as many mature brands start to do). That includes the Go Google campaign back in August, promoting Google apps as a reliable alternative to Microsoft Office for businesses.

Yesterday, Google rolled out a series of videos with the slogan “Search On” promoting Googling! They include an adorable one about falling in love in Paris, another video on how to use Google to become Batman, and one retracing Jack Kerouac’s route in “On the Road.”

Parisian Love:

Batman:

Kerouac:

There is a lot of chatter over the impending arrival of Microsoft’s Office 2010. Delayed as it may be, it has prompted an enormous amount of discussion over the potential value of Office-type applications moving online. Some say it is a game changer and bound to happen, and some claim that most users are too entrenched in current computing behaviors to make significant and habitual change. No matter where you fall in the debate, there seems to be a baseline level of agreement that, at the very least, online access to your documents is a good thing.

The big question remains: Are you better off moving your entire business and document life online? Large companies like Google bet yes, and I not only agree with them, but believe there is much, much more to the online story than what Microsoft (or Google, for that matter) has to offer.

I spent the previous nine years at salesforce.com, and have seen first-hand how software-as-a-service and web-based applications can completely change an industry and displace the entrenched companies whose revenues rely on client based software.

Is Microsoft one of the “old” and in for a similar fate? Based on the current trajectory of innovation from new technologies, many signs point to yes.

Case in point

Let’s look at Microsoft’s Office 2010 due out later this year. Judging from the technical preview, Office 2010 will include Web-based versions of its popular desktop suite, including PowerPoint. Since a web-based PowerPoint is of particular importance to me, allow me to indulge in a bit of a deep-dive on this one.

This is the biggest thing to happen to PowerPoint in a long time. After all, the technology is more than 25-years-old — it is an application that allows for the creation of presentations. But, if you try to go beyond authoring and embrace the entire lifecycle of a presentation from creation to management, collaboration, delivery and measurement, PowerPoint fails.

Will Microsoft’s plans for the semi-web version of PowerPoint change this dramatically? It does not appear so. Essentially, what the feature does is create an FTP server in the cloud where users can upload and download PPT files. Granted, this is a step forward in what PowerPoint presentations can do, but there are so many more possibilities when you allow a presentation to become truly online content — a living, breathing document that allows a presenter and viewer to interact with and learn from each other.

Think about all the online tools that sales and marketing teams take for granted and can’t live without, such as collaboration, asset management, analytics and more. Match that up against the reality that presentations are second only to email in their importance to sales — they are the conversation opener and hopefully the deal closer, and 30 million of them are delivered each and every day — and it is easy to see Microsoft shortcomings.

Online documents and presentations need to be living, dynamic web content. This is the game changer. By simply posting files to the cloud like 2010 plans to do, Microsoft is again missing the boat by not embracing online architecture in its entirety.

So why is Microsoft only taking a small step toward a cloud-based presentation application? The crux of Microsoft’s problem is old habits. It is a problem of addiction to an out-of-date technology foundation. Beyond this, and perhaps most importantly, it’s a problem of Microsoft’s business model — the company continues to find it difficult to let go of up-front software sales and revenue and truly commit to the cloud based revenue stream. Customers expect web apps to be straightforward, but Office 2010 is not as simple as “log-in and get to work.” At the very least, it seems business users will need SharePoint for content management, likely Groove for collaboration, and even more Microsoft applications will be required for more advanced work flows.

It’s a long way from SaaS to $aa$

Microsoft’s revenue question is a big one — going from licenses to software-as-a-service has it’s complications and growing pains, especially for a well-established, license-based, public company. It isn’t just a short-term hit either. This has massive long-term ramifications that will require Microsoft to either make a giant leap all at once and feel a lot of pain, or take baby steps that make room for innovative and faster moving companies to overtake them.

SaaS is an all or nothing deal. You architect from the ground up for SaaS or you try unnatural acts to get client server software to look and feel like SaaS … and it fails.

This is definitely a fascinating space to be in at this moment in time, and I for one look forward to helping people find a new path to business success.

[top image:flickr/meddygarnet]

The big takeaways are that Twitter is making more than $4 million a year, but won’t specify how much and that’s through the recent data-sharing deals with Microsoft and Google.

Next, Twitter is going to roll out advertising soon. Costolo says, “You’ll see an advertising strategy from us in the near future. It will be fascinating and completely non-traditional, and people will love it.”

Twitter is also on track to roll out paid commercial accounts by year-end.

Here are my notes:

[Costolo talks about why Twitter changed the question from "What are you doing?" to "What's happening?"]

Costolo: In user research, people would sign up for Twitter and they’d see this big white box that said “What are you doing?” And they would say, “What am I doing? God, I’m not doing anything.

By the way, this is what we’re spending the venture round we just raised on.

Anyway, we have this on-boarding challenge [challenge of attracting and keeping users]. And we’re doing a lot of simple things — two include replacing the suggested user list with more elegant suggestions for people to follow.

[Arrington asks when's that going to happen.]

Costolo: No firm date for that. I hope it’s gone by the end of the year.

[Arrington asks about Costolo's history at Feedburner, which was sold to Google. Does he think RSS is dead]

Costolo: RSS is not dead, It got pushed down the stack. It’s like HTTP, no one thinks about it anymore. You just use web sites. It got pushed down the stack, which is what happens to protocols as they mature.

[Arrington asks about Twitter's internal documents, which were released earlier this year. They projected $4 million in revenue by year-end. Arrington asks how they're doing compared to those projections.]

Costolo: We’re well above all those numbers.

[Arrington asks about user count.]

Costolo: These services measure count in traditional ways. They measure traffic to the site, but it’s no secret there are tens of thousands of different applications. I’m instead going to say those numbers shortcount Twitter significantly.

Arrington: So 58 million shortcounts Twitter?

Costolo: Yes.

The other thing I would say about user growth is that it’s diminished significantly for us in the U.S. Hopefully the suggested user list goes away soon. Those are super small things. There are a lot more sophisticated things we can do to on-board users.

Arrington: How much have you raised?

Costolo: $155 million.

Arrington: How much is left?

Costolo: Plenty. Our run-rate and burn-rate. We’re not going to be needing to do anything anytime soon.

Arrington: So you have those new Bebo offices? That’s not cheap.

Costolo: There are cheap ways to do things and expensive ways to do things. One of things that anybody with an investment would do is measure burn or EBITDA rate and that’s one of the last things I’m worried about.

[Arrington asks about revenue. How will they turn it on without impacting user experience?]

Costolo: It’s on.

[Is that the search deal or advertising?]

Costolo: We’re obviously not going to talk about the details about those relationships, but they’re financial. And that’s been said as much by all parties involved. They’re compelling. They point to how we’re going to market. We’re an open ecosystem, allowing partners to have access to the tweets. I think and hope it’s sophisticated enough to pre-thought about the implications of displaying tweets on other sites. We shouldn’t care about whether people are coming to Bing or Google for search results, instead of Twitter.com. We’ll provide all these companies with a mechanism for leveraging the APIs that will make them a lot of money.

[Arrington asks what Costolo uses to access Twitter.]

Costolo: I’m old-school. I use Twitter.com

[Arrington asks about geo-location API.]

Costolo: It’s huge. If you look at Foursquare, the check-in is an explicit way of opting into sharing your location. The big challenge with geo, is you’ll turn it on and forget to turn it off. The cool thing about what Dennis Crowley has done at Foursquare is he’s made location sharing explicit for a short-time with the gesture of checking in.

[Costolo starts talking about the business model.]

Costolo: You’ll see an advertising strategy from us in the near future. It will be fascinating and completely non-traditional and people will love it.

[Arrington asks what's new.]

Costolo: The genius of Google was that when they first rolled it out — the ads were what people were looking for. What we want to do is to do something organic, where it’s in the flow and where it matches what people want. It’s going to be really cool.

[Arrington: People will love the ads. They will have never experienced so much joy as when they see these ads.]

Audience questions.

We’re going to offer a way for our partners to make money. The whole idea is we’re going to be open. We’re going to foster ubiquity of the tweets. If you’re a startup and you have this great idea about using tweets, you should be able to do that.

But for companies that want to work with us at a more in-depth level with a service agreements, we’ll provide mechanisms for partners to do that.

Steve Gillmor: Is there going to be a Twitter app store?

Costolo: It’s not top of mind for us. The most important things are on-boarding and discovery. We don’t spend a lot of time thinking about an app store. It’s a debate that rages internally that we don’t feel urgency around right now.

[Arrington asks about new features. Costolo talks about all the new products lately -- lists, Twitter in French, geo-location API.]

Costolo: There’s a pace of execution that’s remarkable given the scaling.

[Audience asks about analytics.]

Costolo: We’ve talked about commercial accounts. One of the pieces will be an analytics dashboard. Other features will allow multiple people to edit an account. We continue to be on the timeframe of rolling it out soon.

[Kevin Marks asks about openness.]

Costolo: I think the question was an accusation question. Kevin and I have known each other for awhile. Why don’t we — when our engineers interview people, one of the questions is, tell me about your contributions to open-source. I’ve never seen people working harder and more passionately. People are just absolutely — the pedal is to the ground. When you see, when we have more engineers in-house, we’ll be more participatory. We use open-source. We hope to be advocates of it.