Rustic Canyon

By Jenna Busch

Heroes of Telara is an upcoming fantasy-style MMORPG from Trion World Networks, but that's not what the developers are calling it: Company spokesman Dave Geffon told SCI FI Wire at the Electronic Entertainment Expo in Los Angeles Thursday that the game is a "massively social, fully dynamic server-based game." Quite a mouthful, but it really is different.

Server-based gaming takes a large percentage of a massively multiplayer online game and puts it onto the server instead of the client. What that means is that Trion can publish far more content much more easily than they could on a traditional client patch system.

If you play World of Warcraft or anything similar (and this game has the same feel), you have experienced a patch. You sign on to the game, and whatever updates or fixes are available take time to load onto your computer. And you have nothing to do but, I don't know, actually leave the house. And I say that with affection, since I'm a player.

Geffon explained that the new system means that every time you log onto the game, you'll see something new. New monsters, new quests, new items, etc. And in different places all the time.

"All this can be done because of the flexibility of server-based gaming," Geffon told us. It also allows Trion to create "hundreds and hundreds of dynamic events." They can be random or scheduled or triggered by in-game actions.

As an example, we were told, imagine you're out questing or gathering items or crafting (the game has all the traditional features of an MMO). You hear a call to arms because the city is being attacked. "There is an army marching from a nearby city," Geffon said. "You mount up. You charge back to town to see how you can help. What you'll find is tons and tons of other like-minded players coming together who want to be a hero. Who want to save the city. ... So you band together and save the city from certain destruction. This won't happen every night. There are some nights where you just want a quest ... or maybe you want to sit on the wall and watch the city burn, because sometimes watching buildings fall over in a fire is mildly entertaining."

If you're worried that it will be a mess if tons of other characters are doing the same thing as you, Geffon says not to worry. "If you're playing a traditional MMO, you're absolutely right," he said. "In a traditional MMO, the servers distribute their processing power by in-game geographical environments. ... With the Trion platform, instead of distributing our server's processing power by in-game geographical environments, we do it based on in-game systems such as A.I. or gameplay in the world. If we know we're going to have a huge event with tons of players coming together, we can actually scale all the appropriate systems to ensure that they have a great gaming experience."

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E3: Could Heroes of Telara's new social gaming replace Warcraft?

Heroes of Telara is an upcoming fantasy-style MMORPG from Trion World Networks, but that's not what the developers are calling it: Company spokesman Dave Geffon told SCI FI Wire at the Electronic Entertainment Expo in Los Angeles Thursday that the game is a "massively social, fully dynamic server-based game." Quite a mouthful, but it really is different.

Server-based gaming takes a large percentage of a massively multiplayer online game and puts it onto the server instead of the client. What that means is that Trion can publish far more content much more easily than they could on a traditional client patch system.

If you play World of Warcraft or anything similar (and this game has the same feel), you have experienced a patch. You sign on to the game, and whatever updates or fixes are available take time to load onto your computer. And you have nothing to do but, I don't know, actually leave the house. And I say that with affection, since I'm a player.

Geffon explained that the new system means that every time you log onto the game, you'll see something new. New monsters, new quests, new items, etc. And in different places all the time.

"All this can be done because of the flexibility of server-based gaming," Geffon told us. It also allows Trion to create "hundreds and hundreds of dynamic events." They can be random or scheduled or triggered by in-game actions.

As an example, we were told, imagine you're out questing or gathering items or crafting (the game has all the traditional features of an MMO). You hear a call to arms because the city is being attacked. "There is an army marching from a nearby city," Geffon said. "You mount up. You charge back to town to see how you can help. What you'll find is tons and tons of other like-minded players coming together who want to be a hero. Who want to save the city. ... So you band together and save the city from certain destruction. This won't happen every night. There are some nights where you just want a quest ... or maybe you want to sit on the wall and watch the city burn, because sometimes watching buildings fall over in a fire is mildly entertaining."

If you're worried that it will be a mess if tons of other characters are doing the same thing as you, Geffon says not to worry. "If you're playing a traditional MMO, you're absolutely right," he said. "In a traditional MMO, the servers distribute their processing power by in-game geographical environments. ... With the Trion platform, instead of distributing our server's processing power by in-game geographical environments, we do it based on in-game systems such as A.I. or gameplay in the world. If we know we're going to have a huge event with tons of players coming together, we can actually scale all the appropriate systems to ensure that they have a great gaming experience."

We were shown a trailer that we were told is 100 percent in-game footage and some live gameplay. I'm using World of Warcraft as a reference here, but the game looks beautiful. The graphics are quite a few steps up from WoW, and everything is crystal-clear and incredibly detailed, from the armor to the texture of the buildings and the skin of the monsters.

One major issue, though. The character we saw walking through the game—how to put this nicely?—looked like she had a rash on her inner thighs or had just come back from the "Ministry of Silly Walks." It was the strangest loping gait, and it was pretty distracting. I'm hoping that will be fixed before launch. But the mount we saw her ride was really cool. You summon those just as you do in WoW.

We started in what looked like a medieval town, with a castle on the hill behind us. The NPCs in the town all had incredibly distinct faces. More so than I've ever seen in an MMO. We watched as the character joined a fight against skeleton creatures and a mini-boss outside of town. We saw her help out during a demon attack on the town.

She passed other characters from the world engaging in battle with monsters and ran to help. And she changed classes. No, I'm not kidding. In Heroes of Telara, you can change from a fighter to a mage or any of the four character classes you wish, depending on the situation, with a whole separate set of armor or robes, different items and different skills that are reflected on your action bar. Your face stays the same.

If you are a level 5 mage, and the friend that you're playing with that night happens to be a mage as well, one of you can be something different. When you change to a new class, however, you have to start back at level one and build it up separately. In addition, you have subclass "cards" that allow you to specialize with separate actions and abilities. You can switch these at any time and even loot them off enemies and take some of their power.

Geffon told us that many features were still under wraps, and I'm looking forward to future announcements. After seeing Heroes of Telara, I'm starting to think it might be possible to distract me from WoW.

Trion is also developing a science fiction MMORPG with the SCI FI Channel. It's top-secret right now, but stay tuned! Heroes of Telara's release date has not been announced.

We’ve seen much speculation in the past month about Facebook’s impending virtual currency tests. Its initial forays will be, by all accounts, relatively simple and small. But it’s the potential of “what Facebook could do” that has everyone talking. Yes, it’s cool that in the short-term, application developers will be able to use its “credits” currency to make money, and it’s nice to see Facebook making a smart business decision, but there’s a larger and more serious question:

Can Facebook introduce a universal virtual currency that makes it easier and cheaper to buy/sell virtual and real goods?

The short answer is yes.

But they’re not the only ones eyeing the market. From startups like Jambool and SpareChange to behemoths like Apple and PayPal, companies of all sizes are preparing to chase the modern alchemist’s dream of turning virtual coal into real dollars.

Virtual Currencies

For those of you reading this who aren’t sure what a virtual currency is (love you, Mom), let’s do a quick primer. In the real world, we’re used to sovereign/fiat currencies, which serve as a standard unit of account and representation of value within a given economy, facilitating all types of trade. Virtual currencies do the same thing, except that the economy is online, and they are backed by private companies (here’s a more in-depth discussion of how we define virtual currencies).

Virtual currencies have gained popularity because they reduce two major points of friction - consumer inconvenience and merchant cost. A user enjoying a social or gaming experience doesn’t want to be pulled away to enter payment info, and the seller doesn’t want to pay transaction processing fees that were scaled for more expensive purchases. As transactions have gotten smaller and more frequent, reducing friction has become a key driver for increasing overall revenue.

Enter virtual currencies, which allow customers to buy a chunk of virtual money with real world money. It’s one processing fee, and then the consumer can spend the virtual currency over time for no additional fees (essentially lowering effective transaction costs) and without leaving the application.

A universal virtual currency extends across a host of applications. Instead of each application having its own micro-economy, they puddle up onto a shared currency system. Vertical examples include Microsoft Points, SparkCash, and Hi5 Coins.

Why You Can’t Buy Lisa Dollars from Twofish

I have a pretty unique view on the space, simply because my company, Twofish, markets a virtual economy data platform that was actually built to manage and optimize exactly these types of universal currencies. Sitting here with a world-class infrastructure and watching the market evolve relatively slowly, we’ve stopped several times to (re)assess whether or not we should launch our own Twofish-branded currency.

I’m not going to lie, I really love the idea of having everyone spending Lisa Dollars all over the internet, but at the end of the day, we’ve chosen to white label for brand partners and not launch a Twofish currency for a fundamental reason: We’re a startup, and a universal currency should come from a trusted consumer brand that has the resources to promise—and provide—customer support, stability, and security, as well as the scale to attract an appropriately diverse set of economic partners.

No matter how great your technology or how much you want to be the central bank for all of the virtual coins of the world, it’s just unrealistic to think that mass consumers will be willing to entrust a significant portion of their income to a startup tech company (note that I do not consider the people who invested in Second Life’s Ginko Financial to be representatives of the mass market).

Importance of Brand and Scale

When virtual currencies were just a fanciful piece of game play, the need for that brand promise was low. But now that we’ve started thinking about universal virtual currencies that carry real world value across the Internet…well, they’ve become tangibly important, and a new level of care is expected. The brand needs to be trusted and recognized.

A large brand can also attract a more diverse and plentiful set of partners, which is important from an economic theory perspective. At the risk of glazing over some eyes, consider what’s called the Optimum Currency Area (OCA), the optimal geographic domain of either a single currency or several that are permanently pegged together. An optimal area has labor mobility, price and wage flexibility, open trade, diversification in resources/production and consumption, and fiscal integration, so that when the global economy shifts, the region has the flexibility to optimize its monetary power through different resources.

Following OCA theory, a small, land-locked country, like Luxembourg, or even Austria, doesn’t have enough flexibility to optimally support its own currency. But if you put it together with the surrounding 26 nations, take away trade barriers, and build a great rail system… well, now you understand the EU.

My point is that the same principle applies to online economies—let’s call it the Optimal Virtual Currency Area (OVCA). For a shared virtual currency to take hold and maintain its long-term stability, it needs to be accepted across multiple verticals (i.e., not just games or SNS apps), it should have open trade and dynamic pricing (so that users can buy or earn a currency in one app or platform and sell in another), and it needs to have some loose infrastructure or clearinghouse to step in and balance when needed.

So who can succeed?

Remember, were not talking about a small gaming currency here. We’re talking about the potential to create a global virtual wallet system that extends and simplifies all types of commerce.

It’s just not going to come from a startup. But there are several companies that I think could make a massive and transformational shift, though they each have very different motivations:

I don’t think Facebook sits around thinking about virtual currency domination. Rather, the mantle has been thrust on them by demand and the evolving nature of their application developers. Time will tell if they decide to embrace and run with it, but if they do, they can continue to diversify their business outside of the core social network and start leveraging the power of the transactional graph.

PayPal’s motivation should be much different. They need to think about blocking someone else from coming into their space and replacing their “e-wallet” with a “v-wallet,” which would be designed to essentially circumvent existing fee structures. PayPal used to be at the forefront of lower-friction commerce, but now they’re risking becoming one of the old boy network if they don’t innovate. If I were them, I’d start here.

Apple has the best interface (iTunes) and the most goodwill, and they’ve expertly managed expectations around their mobile micro-transactions, so that people love them even when they’re late to the game. What’s interesting about Apple is that an iPhone-friendly virtual currency can wreck the carriers, who are still charging exorbitant fees for mobile payments.

I also think that Amazon is well-positioned to outflank PayPal and start consolidating v-commerce into their existing e-commerce model. It’s also a great fit for some of their long-term ideas for the Kindle.
Then there’s that most ubiquitous web company of all… Google. Why wouldn’t they move to beat PayPal in the v-wallet space? Particularly since they are so focused on analytics and understanding massive amounts of information.

The War is Coming

All of this is not to say that there will be only one currency. There will always be places for specialized currencies, as well as tools to clear/exchange different virtual currencies.

But the domination that would come from a consumer-embraced universal virtual currency is just a massive opportunity. And while right now it’s just startups, game-centric portals, and minor social networks who are playing with shared currencies, Facebook’s impending tests are going to escalate the current skirmishes to-all out battle.

The universal currency wars are coming. It’s going to be interesting to watch.

Lisa Rutherford is President at Twofish, based in Palo Alto, California.

By Charles C. Mann

The offices of Transonic Combustion are not going to win any design prizes. Located in Camarillo, California, the company occupies a line of anonymous rooms and padlocked garage workshops at the edge of town, where land is cheap and prying eyes are scarce. Alloy-frame bicycles lean against the walls of the computer-stuffed workspaces; wastebaskets overflow with empty Mountain Dew cans. So many nondisclosure agreements have spewed from the printers on the tables that they must be capable of producing them without human intervention.

It looks, in other words, like any other high tech startup trying to make its mark in software, electronics, biotech, or energy. But Transonic isn't working in any of those fields. Instead, it is part of a surprising wavelet of innovation in an industry largely dismissed by venture capital: automobiles. The company makes a special breed of fuel injectors, which use advanced technology to force precisely timed, high-pressure bursts of gas-air mixture into engines to increase their power and efficiency. Tests are not complete yet, but Transonic believes that its products could help drivers get as much as 100 miles per gallon out of otherwise standard internal combustion engines. "If you double gas mileage, that ultimately cuts consumption by about half," Transonic president Brian Ahlborn says. "We're in business to make money, but we're aware of what that kind of dramatic drop could imply." He hopes that in the next few years Transonic fuel injectors will be in millions of vehicles, saving millions of gallons of gas a year.

Not long ago, Ahlborn's dream would have seemed quixotic. Detroit's Big Three automakers have for decades been notoriously hostile to outside innovation; Flash of Genius and Tucker, films that decry the industry's insularity, are both based on true stories. No small US company has grown into a big carmaker in the past 50 years—one of the reasons that the automobile itself hasn't changed more fundamentally during that time. "It's as if the computer industry were still dominated by Wang and Data General and DEC, and they were still selling minicomputers," says Henry Chesbrough, executive director at UC Berkeley's Center for Open Innovation.

Nonetheless, the automotive startup world is sputtering to life. Venture capitalists invested roughly $300 million in young car-related companies last year, up from $8 million in 2003. Dozens of startups are dipping a toe in the water, many in the high tech corridors near Boston and in Southern California (see this story's "Next Year's Module" sidebar). Some, like Transonic, focus on nitty-gritty hacks of machines that exist today. Others are assembling fanciful all-electric sports cars that may cost as much as a small house. But all of them are trying to jump-start the industry with new ideas, vigor, and technology.

Detroit desperately needs them. US automakers' share of the domestic market has plummeted nearly 30 percentage points since the early 1980s. The federal government has unceremoniously ousted the head of General Motors. By the time you read this, two of the Big Three may be in bankruptcy, a bleak capstone to years of collapsing stock prices, shrinking margins, and cascading layoffs. Some analysts believe not one of the major US carmakers will exist a decade from now. And while there are plenty of historical explanations for Detroit's sorry state—vicious labor relations, uncontrolled health care costs, neglected quality control—the most fundamental problem is also the hardest to overcome: The most innovative cars are no longer made in America.

If a domestic auto industry is to survive, it will have to incorporate and encourage breakthroughs from outsiders like Transonic. Automakers will need to transition from a vertical, proprietary, hierarchical model to an open, modular, collaborative one, becoming central nodes in an entrepreneurial ecosystem. In other words, the industry will need to undergo much the same wrenching transformation that the US computer business did some three decades ago, when the minicomputer gave way to the personal computer. Whereas minicomputers were restricted to using mainly software and hardware from their makers, PCs used interchangeable elements that could be designed, manufactured, and installed by third parties. Opening the gates to outsiders unleashed a flood of innovation that gave rise to firms like Microsoft, Dell, and Oracle. It destroyed many of the old computer giants—but guaranteed a generation of American leadership in a critical sector of the world economy. It is late in the day, but the same could still happen in the car industry; it just has to harness our national entrepreneurial spirit to develop the next wave of auto breakthroughs.

Transforming US auto manufacturing would be an enormous task. It would require the cooperation of the federal government to help create the conditions under which innovators can thrive—primarily by removing the energy and health care obstacles that now stand in their way. But now is the time to do it. The specter of global economic collapse has forced politicians, labor, and industry to abandon some of their most entrenched and dysfunctional ideas. Eventually, a reconfigured car industry could leapfrog Europe and Japan the way Toyota began to outpace Detroit 30 years ago. Indeed, such a radical reconfiguration may be the only way this vital industry can survive on these shores. "They're going to have to swing for the fences," says Steven Klepper, an economist at Carnegie Mellon University who studies industry innovation. "The only way I can see for them to win the game is to change it entirely."

I should declare a personal interest here. My father worked as a Big Three executive for much of my childhood, most of that time at Ford. He left to run his own marina, but he always remained loyal to Detroit. He never bought a foreign car. I didn't buy one until after his death, and even then I felt like I was thumbing my nose at his memory. I would like to return to a US product. More than that, I would like millions of Americans—people who don't share my sentimental ties—to come back to vehicles from US companies.

By Charles C. Mann 

Because gasoline has historically been inexpensive, U.S. consumers have had little reason to buy fuel-efficient automobiles, giving manufacturers little reason to make them. As a result, today’s cars are amazingly wasteful. Less than 20 percent of the energy in the gas consumed by typical passenger vehicles is used to power the wheels. Most of the rest is lost as heat or sent into the air as pollutants.

To San Diego inventor and entrepreneur Mike Cheiky, the conclusion was obvious: To make cars more fuel-efficient, figure out how to increase that percentage. If Cheiky could create an internal combustion engine that used just 40 percent of gasoline’s potential energy, he would effectively double gas mileage. The goal didn’t sound impossible. After all, many electric engines operate at more than 80 percent efficiency.


Cheiky founded Transonic Combustion in 2006 to tackle the problem. His solution: Manufacture a new kind of fuel injector.

Hypothetically, automobile engines would function most efficiently if all the fuel in the cylinder exploded instantly, just as the piston reaches its highest point. In the real world, of course, that doesn’t happen. Not all the gas gets burned, for one thing. And the explosion is stretched over time, so that some of it continues as the piston is moving down the cylinder — the expanding gasses end up chasing the retreating piston, instead of striking it solidly. Ordinary fuel-injection systems like the one pictured improve efficiency by squirting a carefully calibrated mix of fuel and air into the cylinder just as the piston rises to meet it.

Transonic’s fuel injection system goes another step: It shoots the fuel-air mixture into the engine in what is called a “supercritical” state. Usually liquids heated above a certain critical temperature become gases; gases compressed above a certain critical pressure become liquids. Substances that are simultaneously heated above the critical temperature and compressed above the critical pressure go into a supercritical state—neither liquid nor gaseous. Transonic’s system heats and compresses the fuel-air mixture until it is supercritical, then injects it into the cylinder.

Supercritical substances have unusual physical properties. According to Transonic, gasoline becomes much more explosive. Typical fuel injectors blast about 15 times as much air as fuel into the cylinder. Transonic injectors have been able to function at ratios of 100:1 or even 200:1, a huge potential improvement that would require much less gas. And because supercritical combustion is more complete, Transonic president Brian Ahlborn notes, there will be fewer leftover pollutants released into the air.

Transonic is still learning how to commercialize its technology, which works with gasoline, diesel fuel and ethanol and ultimately could be added onto existing car engines without extensive modification. Ahlborn stresses that the company, which has backing from Khosla Ventures, Rustic Canyon and Venrock, still has much work to do.

“But we’re pretty excited about what we’re seeing,” he says. “There’s a lot of room to make standard internal-combustion engines a whole lot better.

You can read Charles C. Mann’s piece, “Beyond Detroit: On the Road to Recovery, Let the Little Guys Drive,” here.

As companies implement virtual goods on applications in Facebook and other social networks, they need better tools for analyzing how people are buying and selling these goods and how to make more money.

Today, Twofish is offering these companies a set of e-commerce analytics services, called EasyElements, that can be integrated into Google Analytics or into its more comprehensive Elements analytics program. It may help them make more money from their users.

Virtual economies are complicated and easy to mess up (sort of like real-life economies). But tuned right, incentives in a game will get users to spend money, and in turn make money for the developer.

The first component of EasyElements is called CurrencyStarter. It’s a software add-on for Google Analytics that helps smaller developers quickly implement a virtual currency into an application and track basic e-commerce data. Features include a customizable interface, foreign exchange rates and offers for doing international business, support for multiple currencies, and a variety of payment options. Competitors in the area of currency creation include Jambool and Spare Change, but neither currently offer the same sophisticated e-commerce analytics that Twofish is focusing on.

The second part of what Twofish is launching today is CurrencyStarter for Elements, more of a full-fledged accounting system combined with user data. This software service is also getting CurrencyStarter, and paired with the deeper data modeling it allows, it could prove to be the more attractive option for established developers. It lets you get currency and account reports, analyze user engagement, and see what types of users are doing what activities. Companies can do macroeconomic analysis of how money is flowing through a game, or microeconomic analysis of how specific types of transactions are occuring.

The clarity of all this data is the sort of stuff economists dream about, as Twofish chief technology officer William Grosso discusses in the embedded slideshow below. For people interested in the concept of virtual goods, it’s worth a view.

As we continue our look at the Facebook Platform payments ecosystem, today we turn our attention to virtual economy payment and analytics platform Twofish. In fact, just this morning Twofish announced the launch of a new product called Twofish EasyElements, an easy to integrate toolkit for managing virtual currencies in social networks and online games.

We spoke with Twofish President Lisa Rutherford about the opportunities she sees and the approach Twofish is bringing to market.

Inside Facebook: When did you see the potential in the virtual goods economy?

Lisa Rutherford: I was skeptical. I had been in venture capital and saw the rise of virtual goods in Asia. Many people said it would translate to the US. That model took off in Asia because Asia needed a new business model. The free to play model works in Asia because Asia needed to find a viable way to address piracy problems. The problem is that the US has business models that are working, for example subscriptions. I had a similar reaction to consumers’, which was: free to play is just another way to extract money from users. Then I realized that if you decouple the economy from monetization, a virtual economy can be a game play feature that enhances the game play experience.

Interesting. How does Twofish decouple the economy from monetization?

Twofish runs a virtual economy for you. We’re a virtual economy data platform. We capture enormous data that no one else does on currency, users, inventory management, etc. in an analytics framework. Using robust, simple tools, you can analyze price, items, macroeconomic flow, what types of users are buying certain items, and other variables enabling you to optimize revenue and the user experience. We’ve never had bad press from the consumer side of things. We didn’t say we could take money out of everything. Our goal is to enable more meaningful types of interactions.

What products do Twofish offer? (Note: This morning, Twofish announced the launch of  a new product called EasyElements.)


One component of Twofish’s core platform is a banking layer, which records the full credit and debit history for every single transaction that happens in a game. We keep history on individuals, as well as items. If you buy a gun in an elements-backed game, the gun has its own item account, which details who owned it, what they payed for it, etc.

The Twofish Elements Analytics tool gives you unparalleled access to currency, user, and catalogue data with the flexibility of dating mining and visualization. This robust tool captures data relevant to currency, sales, and user reports, macro flows, market activity, payment types, unit sales, revenue, etc.

Now we’re launching Twofish EasyElements for casual social games that have a need for more lightweight tools. It’s easy to set up EasyElements in a couple hours. The first starter kit is CurrencyStarter. Like Jambool, it helps you get money into the system and your currency set up, but it’s different because you can brand your own currency across platforms, have separate exchange rates in different countries, etc.

What challenges might Facebook face in launching its own a virtual currency system?

It’s smart of Facebook to begin testing out its own virtual currency because it was leaving money on the table. The company is secure and well-run, and we’re very much looking forward to plugging in. The challenge is that Facebook has to give something (data) back to developers. And since Facebook opened its Platform to application developers before rolling out its virtual currency system, there may be some ill will. By contrast, Apple has been more strategic with its store in not yet involving third-party developers. When Apple introduces its platform, it will be all fanfare and glory.

What are a couple characteristics of compelling virtual goods?


Branded virtual goods that signify individual knowledge of the giftee are successful. Giving a woman a bottle of perfume doesn’t seem that thoughtful, but if you know she wears Chanel No. 5, that signals a stronger level of communication and intent. It’s a way of saying I was thinking about you in a very personal manner. Another trend is around care-taking and making items consumable. Making dog food disappear, a rose wither, or a litter box fill up with poop has the added effect of making people come back.

In this economy, most start-up companies are hurting. What have you noticed in your own company?


Personally, Twofish hasn’t felt the impact. The economy has accelerated a lot of people toward new business models. A lot of start-up companies need to get revenue fast because there’s no venture capital support or large advertising budgets, so bootstrapping is common.

Earlier you mentioned that the free to play model in Asia and the extent to which it could be applied in the US. In the next wave of innovation, what direction will virtual economies take at a global level?

The free to play model from Asia won’t be exported around the world, but similar concepts will be used. In the Middle East and South Africa, there are places that have large diaspora populations and don’t have solid sovereign economies. This is an opportunity to have an online economy transact value and to build a digital economy far beyond gaming and social networks. From a purely classics standpoint, gaming and social networking are on the cusps of extreme innovation.

We’ll see a true digital economy evolve beyond virtual goods and currencies, and beyond games and social networks - a digital economy that’s localized just by being digital. In 1994, globalization was here and now, and today the world is globalizing more and more. The Web enables globalization, monetization, free trade, and the spread of information and ideas – why shouldn’t economies too?

By CAMILLE RICKETTS, VentureBeat
Published: May 14, 2009

DocStoc , the site that lets you post, share and embed PDFs, documents and other files — much like its prime competitor Scribd — has emerged from beta with a new look and a new business model . While the site is growing rapidly — now with 1.6 million unique monthly visitors — it’s still running to catch up.

Changing the way it brings in revenue, the company has introduced DocCash, a program that will split Google AdSense revenues with users who opt into online advertising next to the documents they’ve uploaded. The homepage has also been redesigned to attract viewers, highlighting documents that are somehow relevant to current events. It is now easier to navigate for users and viewers, as well — making up for the polish it has been lacking since its inception.



Another boon for DocStoc’s users: The site has opened up its API so that other web sites can use the same posting and embedding technology themselves. Visitors to these sites can now search for and preview documents as well.


But DocStoc isn’t the only service of its kind that has continued to innovate. Not only does Scribd continue to grow, pulling in 50 million readers every month, but smaller rival Issuu is also adding features to give document storage more of a social, community feel. That company has also done a good job of attracting enterprise customers with offerings such as subscriber management tools.


DocStoc has raised $4 million to date from Rustic Canyon Partners , Crosscut Ventures and several individual investors.

The document sharing site Docstoc, now out of beta, is announcing that it will start splitting advertising revenue with users who upload content to the service, in a new program called DocCash.

Using the Google AdSense API, Docstoc will crawl through uploaded documents, put related ads alongside them, and send the person who uploaded a document half the Google revenue when users click through to ads that run next to it.

This change to Docstoc is part of the company's new plan to help users monetize content, but CEO Jason Nazar harbors no illusion that it will make his users rich. Although he thinks a lot of people could make "$50 a month without too much effort, maybe more if they promote their docs on Twitter and Facebook."

Future changes may increase user revenue more. Today's new ads only show up on the Docstoc site itself, for example. An upcoming revision will let ads show up on embedded documents (embedding is a key feature for the service). Actually allowing users to sell access to documents is also coming. "It's the direction we're headed in. It's a two-phase process," Nazar says.

Few services built on user-generated content actually give users a share of revenue, and Docstoc's new direction may indicate an interesting trend, even if most people won't make much money from shared ad revenue. Worse, attaching dollars to user-generated content will likely cause a surge in the uploading of plagiarized or copyrighted material, which Docstoc staffers will have to work hard to stay ahead of.

However, it's a milepost on the road to giving users something tangible in return for their uploads. And it's a smart move for Docstoc, since it does give the company a financial leg up on competitors Slideshare and Scribd.

Nazar says he expects his company to become profitable this year. Docstoc first raised venture funds a year ago, and has taken in $4 million so far. The site gets about 4.8 million unique users a month. Nazar has produced a video walk-through of DocCash.

Camarillo-based Transonic Combustion, the maker of new fuel injection technology it says could push gasoline engines to 100 mpg, has landed another round of funding.

The firm didn’t say how much it raised in the third-series round and hasn’t disclosed how much it previously raised. However, it noted that existing investors Venrock, Khosla Ventures, Rustic Canyon Partners and Saints Capital “depended on their support.”

By JOSEPH SZCZESNY
Of The Oakland Press

Transonic Combustion Inc. of Camalito, Calif., which develops new technology that will make auto engines cleaner and more efficient, is setting up offices in Oakland County.

“Our team is developing a fundamental, cost-effective improvement in internal combustion efficiency,” said Brian Ahlborn, Transonic’s chief executive officer, who said the company’s ability to attract venture capital is making expansion possible.

In addition to investor backing, Transonic has secured support from the Michigan Economic Development Corporation and plans to expand its presence in the Detroit area by opening a sales and technology office in Oakland County.

The California-based firm plans to invest $247,000 in the office, which will support the development and commercialization of Transonic’s ultra-high efficiency fuel injection system for internal combustion engines.

The new office will be staffed by about 25 employees and is being supported by a state tax credit valued at $648,313 over six years.

The credit helped win the company’s investment as the first new expansion site outside its California headquarters.

Several California-based venture capital firms, among them Venrock, Khosla Ventures, Rustic Canyon Partners and Saints Capital, have increased their support of Transonic, which already has earned a spot on the “Clean-Tech 100.”

“Transonic has developed a revolutionary approach to improving internal combustion engine efficiency that could change the automobile industry forever,” said Ray Rothrock, a partner in Venrock.

“We’re at a pivotal time of increased regulations and consumer demand for efficient, affordable cars,” added Vinod Khosla, founding partner of Khosla Ventures.

“Transonic’s technology offers a high-impact, near-term clean technology solution to promote energy independence and climate change mitigation.”

“Transonic’s innovative technology, unique market position, and enormous commercial promise hold broad economic, environmental and social impact,” said Lee Bailey, advisory partner with Rustic Canyon Partners.

Transonic’s fuel injection system has demonstrated it can boost fuel economy substantially and reduce emissions in gasoline or diesel engines, the company says.