TechFlash: Seattle's Technology News

Seattle-based SEOMoz is transferring its search engine optimization consulting practice to U.K.-based digital marketing agency Distilled as part of a deal being announced today. Distilled will open an office in Seattle to support the business, with plans to hire five to six people this year.

Meanwhile, SEOMoz plans to focus efforts on its SEO software tools business, a unit which CEO Rand Fishkin said offers "the best long-term bet for our valuation."

It was a huge week in the technology industry. Amazon.com and Microsoft posted strong earnings. Apple released its highly-touted iPad. And, to top things off, there was even a sex scandal involving the co-founder of Bellevue's Intelius. Here's a look at the past week through the eyes of reader comments.

After Apple unveiled the iPad, many dubbed the device a Kindle killer. Reader Darren Erik Vengroff said he probably wouldn't buy an iPad, but he saw trouble ahead for Amazon's electronic reader: "When Amazon ports the Kindle iPhone app to the larger screen size it's over for the DX."

But Madrona Venture Group's Scott Jacobson -- an Apple customer who previously worked at Amazon -- wasn't so sure. He offered five reasons why the Kindle would survive, which prompted Wetpaint CEO Ben Elowitz -- who had previously written a post on TechCrunch citing 10 reasons why it would die -- to note: "Kindle may have a niche - but it's a specialty device for a specialty audience, while Apple is going after changing consumers' behaviors and lives."

Technology executive John Arnold allegedly lied to a grand jury about having sex with dancers at a Seattle strip club, which prompted several readers to refer to the past legal troubles at the Bellevue company he co-founded. Reader Web 3.0 wrote: "Here is a clue, don't lie to a grand Jury or bad things happen." But some readers also noted that the government shouldn't meddle in these types of activities. Nonamesnomas wrote: "Just because he broke the law, doesn't mean he did anything morally wrong. What right does a government in a free society have to ask, even in a court of law, about what a person does privately?"

Our story -- "Old-school Classmates.com forced to face up to Facebook" -- led to comments from people who had abandoned Classmates and others who found the company's mission misguided. Wrote George Anderson: "Classmates has never realized that people resent being forced to pay for information that they themselves entered. Social media must be free because the content is generated by the users, not the companies that control the website."

The appearance of Bill Gates on The Daily Show this past week prompted one reader to suggest that the world's richest man needed a wardrobe overhaul. (Perhaps someone should nominate him for "What not to Wear"). Janet remarked: "I liked how relaxed Mr. Gates appeared to be and totally admire the work his foundation is doing. However, can we take a moment to talk about his clothing? He was wearing a shirt that was at least two sizes too big. I'm all for frugality, but he can surely afford one tailored shirt."

Intelius co-founder John Arnold speaking at the DEMO conference last fall.

Intelius co-founder John Arnold has been placed on paid leave following allegations that came to light yesterday that the technology executive lied to a grand jury about having sex with dancers at a Seattle strip club. An email was sent to Intelius employees at 11:02 a.m. today which read:

"Intelius announced today, January 29, that John Arnold has been placed on a paid leave of absence for an indefinite period of time to resolve his current personal legal issues. We respect John and his family's privacy and our thoughts are with them."

Arnold pleaded not guilty to the charges yesterday in federal court in Seattle. The allegations stem from an investigation into the activities of Frank Colacurcio Sr., who operates the Seattle strip club chain Rick's.

The tech community has been buzzing this week with news of the iPad, Apple's highly-touted touchscreen tablet computer. And while many bloggers and journalists have wondered where the new device will fit in the gadget landscape, we were curious what actual developers had to say about the contraption.

One of the key moves by Apple was making the device compatible with the nearly 140,000 third-party applications already built for the iPhone. So, we reached out to a few Seattle area iPhone app developers to get their take. For the most part, they were left wanting more from Apple's latest release.

The DigiPen Institute of Technology plans to move to larger digs in Redmond this summer, with plans to open a 100,000 square foot campus on Willows Road. The school -- the first to offer a bachelor's degree in video game development -- currently is located near the Nintendo and Microsoft campuses at 5001 150th Ave NE.

DigiPen founder and CEO Claude Comair said that the new facility will put students and faculty from various fields under one roof. Since 2000, more than 700 people have graduated from DigiPen. There are currently about 830 students enrolled, with about 120 full and part-time faculty and staff.

Wallin

Todd

Joe Wallin and Brian Todd: President Obama has proposed eliminating the capital gains tax on qualified small business stock. This has been a theme of the President’s for some time, but perhaps significantly he reiterated it in his State of the Union Speech last night. Again, he doesn’t quit.

As startup company and tax lawyers, we believe that eliminating the capital gains tax on qualified small business stock held for more than five years would create a literal flood of investments into startup companies, which would create jobs and future prosperity.

Why? Because reducing the capital tax rate to zero makes investing in startups tax free, and investors like tax favored investments. And a zero capital gains tax rate is an absolutely screaming deal.

Microsoft was ridiculed last fall for encouraging consumers to host their own Windows 7 parties, mainly because of the incredibly cheesy (and hilarious) marketing video used to tout the concept. But is a Tupperware-style party for consumer tech products really that stupid?

The folks at Picnik -- the fast-growing online photo editing service -- don't think so. The Seattle company plans to encourage its customers throughout the country this winter to host "Picnik Parties" where expert users can show off the service in a comfortable setting along with drinks and snacks.

Redfin is in the business of finding people new homes. But the Seattle online real startup has some new digs of its own. The company is moving from its Pioneer Square headquarters at the Dexter Horton Building to new offices in Belltown, taking over the former Cranium space in the Market Place Tower at 2025 1st Avenue.

"It's a little smaller than our current Dexter Horton space, but it's laid out much better and there are views from nearly everywhere but the bathrooms," notes Rob McGarty, director of real estate operations at Redfin. The new offices have 15,900 square feet, compared to 17,900 at Dexter Horton.

Hackers everywhere could learn a thing or two from Phil Mickelson, the left-handed golfing whiz whose known as one of the best chippers and putters in the game. Now, thanks in part to the efforts of Seattle-based Zumobi, iPhone-touting golfers can get a few tips from the master. Mickelson, along with Zumobi and Jastrow Productions, have released Phil Mickelson: Secrets of the Short Game.

The $4.99 app includes interactive flash cards so golfers can quickly reference the tips while on the course.

Thomas

We've been intrigued by the flow of aQuantive talent out of Microsoft over the past few months -- tracking folks such as Brian McAndrews, Karl Siebrecht, Brent Turner and others as they land new gigs at companies around the Seattle area. Now, tiny Marketfish has hooked a former aQuantive manager who comes to the Seattle startup via Microsoft.

Andrew Thomas, who served as software development director at aQuantive for more than a decade, has joined Marketfish as chief technology officer. Thomas joined Microsoft after it acquired aQuantive in a $6 billion deal more than two years ago, managing the development of reporting applications across the Microsoft ad platform.

King

DocuSign, the Seattle electronic signatures company, today appointed former E-Trade executive Steven King as CEO. It also named Keith Krach, the founder and former CEO of Ariba, has chairman of the board. As a result of the new hires, Matthew Schiltz -- who had held the CEO reins since January 2007 -- will head up strategic business development.

Singh

Concur Technologies Chief Executive Steve Singh has built one of the most valuable technology companies in the Pacific Northwest, and he did so without the help of Seattle venture capitalists. But the 48-year-old entrepreneur -- who founded Concur in 1993 and raised cash from Valley firms such as Redpoint, Mayfield and Institutional Venture Partners -- is giving back to the Seattle venture capital community in another way.

Singh is the latest addition to Voyager Capital's advisory board, giving the Seattle venture capital firm some deep expertise in the software-as-a-service category.

"With its emphasis on building technology companies and strength in the Seattle region, Voyager is a natural fit for me," said Singh in a statement. "I look forward to being a resource for the firm's entrepreneurs."

The comic strip has been entertaining the masses for ages, usually driven by the creativity of an individual artist. Now, a new Seattle startup called Cheese9.com is hoping to create the next incarnation of this powerful storytelling device, relying on the humor of the masses rather than the individual.

Cheese9.com essentially is an open canvas, an online playground of sorts where anybody can add their two cents to a series of images. Think your caption might be funnier than the existing one? The online editing tools allow individuals to tap their inner Seinfeld and quickly add a few lines. Meanwhile, other users can vote on whether the new caption makes the grade, with the most popular panes rising to the top.

Venture capital investments dropped by 40 percent in the state last year. And just one venture-backed company completed an initial public offering. Despite those troubling numbers, venture capitalists in the state are optimistically looking forward to 2010, according to a survey released today by the Washington Technology Industry Association.

Ninety percent of the respondents predicted revenue growth for their portfolio companies in the first quarter of 2010, the survey found. Meanwhile, 27 percent of the VCs said that their portfolio companies would increase hiring during the quarter -- the most optimistic forecast since the third quarter of 2008.

Fisher Communications -- the Seattle-based broadcaster that operates KOMO 1000 radio and KOMO 4 TV -- said that its network of hyperlocal neighborhood blogs has surpassed 100 sites and more than 1,000 advertisers. The sites are being run by Bellevue-based Datasphere, which we profiled earlier this month after it raised $10.8 million in new venture funding.

Inrix, the Kirkland traffic analysis company, has named Don Butler as senior vice president of global marketing and product planning. Butler, 46, is a former vice president at General Motors' OnStar unit.

Applied Technical Systems, a Silverdale company which specializes in data analysis for government agencies, said today that it has won a $13 million contract to develop the Common Digital Sensor Architecture for the U.S. Navy's Above Water Sensors. The task order was awarded as part of the SeaPort-e contract.

The rotten economy is leading to the creation of more entrepreneurial ventures, reports Challenger, Gray & Christmas. The firm found that the percentage of unemployed workers starting their own business rose to an average of 8.6 percent last year. That compares to a rate of 5.1 percent in 2008.

It is now illegal for commercial bus and truck drivers to text from behind the wheel, with violations possibly resulting in civil and criminal penalties of as much as $2,750, reports Bloomberg News. Washington is one of the states that has outlawed texting while driving, though it is a secondary offense which means that a driver needs to be pulled over for another offense first.

Virtual goods revenues are expected to reach $1.6 billion this year, reports VentureBeat, which notes that social gaming platforms such as Zynga and Playdom are driving a good chunk of the numbers.

Seattle-based PopCap Games has lost a legal battle with casual game maker MumboJumbo, with a Dallas jury awarding the company $4.6 million in damages. PopCap plans to appeal, according to Gamezebo.