Insider Chatter by Donna Bogatin

LinkedIn advises of a “big” status update, about “status” at LinkedIn! Elliot Shmukler assures he is NOT talking about his typical talkiing about “incremental changes.” NO, he proudly beams, on behalf of LinkedIn, “I’m really glad to announce the complete redesign of the LinkedIn homepage.”

The number one component cited by LinkedIn as representative of its “complete redesign”?: “We’ve gradually transitioned away from a system of tabs to one of drop-down menus.”

WOW? LinkedIn usability tweaks aimed at driving more usage of LinkedIn’s existing product offerings are NOT the stuff that IPO dreams are made of! Founder Reid Hoffman’s desire to fuel monied corporate desire for his home-grown database of millions and millions of personal resumes IS though, as I analyse in LinkedIn Preps Spy Network: Is YOUR Company Safe?

Hoffman has an even BIGGER to-do item on his agenda as well: STAMP OUT BUSINESS CARDS! 

Brandon Duncan, a Shmukler LinkedIn colleague, recently took to the company’s blog to hail LinkedIn Mobile, which, he uderscored, ”includes an iPhone version.” Duncan’s product goal is to make sure all of the LinkedIn “goodness” is WAP enabled.

While itemizing all the niftty LinkedIn things one can now do on the small screen, Duncan advised the world about conference going LinkedIn style:

Exchanging business cards is just not cool anymore!

REALLY? No need for proprietary, real world, hard-copy personal backup of personal contacts made in the real world?

Reid Hoffman would be tickled if he was able to displace the business card printing industry: Goodbye rolodex, goodbye desktop business card scanning, goodbye personal databases? HELLO OUTSOURCING TO A LINKEDIN OWNED AND OPERATED VIRTUAL BUSINESS CARD REPOSITORY!

It is not surprising that LinkedIn believes it can obtain, control and profit from the world’s proprietary resumes. After all, Google believes it is on track to usurp the world’s proprietary enterprise data for its unique corporate advantgage. SEE: Why Google Sites Is BAD Business: ‘Til Death Do Us Part’?  

MORE: AP On LinkedIn: Social Networking Gold Mine at $5 per User? and
Reid Hoffman: LinkedIn About Face (book) and
Deal Maker on LinkedIn: ‘What Do I Do With It?’
Does LinkedIn Have a Connections Fraud Problem?

PLUS: PR Agencies: The Next Digital Casualty?

CONTACT DONNA BOGATIN 

Beware data greedy Facebook? LinkedIn is flexing ITS user data muscle.  

What can the online professional network seeking a hefty IPO pay day do to prop up its perceived value? How about trying to milk its vast user base for valuable, non-public information on their employers?

Reid Hoffman believes he is sitting on a LinkedIn gold mine and aims to mine for the gold. LinkedIn boasts an 18 million strong data base of high-level, professional CVs and continues to garner thousands of resumes on a daily basis. In LinkedIn To Mine User Data For Corporate Espionage I analyze how the impending “LinkedIn Research Network” is a new fangled attempt at waging an age-old battle: Industrial spying.

LinkedIn’s Mike Gamson unveiled the new “primary research services” initiative at an event in New York City last week produced by O’Reilly Media.

Tim O’Reilly helped spur along his conference presenter’s promotional case with a personal post at “O’Reilly Radar,” positioning the new LinkedIn service as a new fangled verison of the “Gerson Lehrman Group (GLG),” which O’Reilly assures has “made a splash” and “charges hefty subscription fees.”

O’Reilly undoubetdly is alluding to GLG’s recent venture funding, perhaps unaware (or uninterested) that GLG’s turn in the limelight has also included investigation by the New York attorney general regarding potentialy improper public company insider information transfers from its “experts” to hedge funds.  

Gerson Lehrman was coincidentally a “Platinum” sponsor of O’Reilly’s conference! 

O’Reilly full steam ahead on the “competitive advantage” he deems O’Reilly presenter LinkedIn will have over sponsor GLG, with hedge funds: 

The big difference is that GLG has crafted a stable of hand-picked experts, while LinkedIn will be data mining its database of millions of users to find potential experts. This is significant because hedge funds and other financial firms get little advantage if they are all taking to the same people, even if those people are the top experts in the field. Competitive advantage, referred to in financial markets as alpha, only comes when you have information that others do not.

O’Reilly ought to know? After all, he claims an “uncanny predictive sense,” which he cannily bolsters by “making noise” on behalf of favored companies. SEE: Web 2.0 Startups: Will Geek Chumby ‘Fade Away’ in 2008? 

O’Reilly hails the interest of interested financial parties in obtaining “information that others do not” have, thanks to LinkedIn and its data mined “insiders,” soon.

Insider knowledge, insider trading…?

LinkedIn’s Mike Gamson (as per eWeek):

The service will help hedge fund managers and investment banks find people who used to work at a company they’re interested in, or even who is working for a customer of a company they are interested in. ”Let’s say I’m thinking about making an investment in a producer of product X. I might want to speak to people that sell that product, people that buy that product, or that used to work at that company as part of my research process to have a better understanding of how valuable that product is.”

BUT, “let’s say” the “producer of product X” does NOT want current or past employees talking to hedge funds and investment banks about its proprietary, confidential, insider goings on.

Corporations have instituted policies to safeguard against their employees serving as Gerson Lehrman “experts.” 

BEWARE LINKEDIN? Reid Hoffman’s user data mine poses greater net potential risks to society than Mark Zuckerberg’s does. IS YOUR COMPANY SAFE, FROM LINKEDIN?

MORE: AP On LinkedIn: Social Networking Gold Mine at $5 per User? and Reid Hoffman: LinkedIn About Face (book) 

ALSO:The REAL Google (and Facebook) Nightmares: Eternal Data Traps and How Web 2.0 Meetups Displaced the New York Software Industry and MySpace to Facebook: Where is Your ‘Reach, Relevancy, Results’? OMMA Report and Henry Blodget Tech Ticker Puts Yahoo Finance at SEC Risk

CONTACT DONNA BOGATIN 

Think Mark Zuckerberg’s Beacon is scary? Reid Hoffman has some user “tracking” of his own in store.

In November, The Washingotn Post reported the sad tale of how Facebook “ruined” Facebooker Sean Lane’s Christmas when Mark Zuckerberg conspired with Overstock to alert his “friends,” including his wife, of his happy (supposedly surprise) purchase of a diamond ring, for his wife.

Reid Hoffman may soon have some (serious) unwelcome surprises of his own, for the thousands of companies represented within the “rich profile data” of “17 million professionals” hailed by LinkedIn as the “largest group of business decision makers on the Web.”   

LinkedIn’s Mike Gamson is touting an impending fee-based “Research Network” aimed at capitalizing on the reams of data LinkedIn houses on those millions of people:

The service will help hedge fund managers and investment banks find people who used to work at a company they’re interested in, or even who is working for a customer of a company they are interested in. (as cited by eWeek)

In other words, insider corporate intelligence, or espionage:

Let’s say I’m thinking about making an investment in a producer of product X. I might want to speak to people that sell that product, people that buy that product, or that used to work at that company as part of my research process to have a better understanding of how valuable that product is.

BUT, “let’s say” the “producer of product X” does NOT want current or past employees talking to hedge funds and investment banks about its proprietary, confidential, insider goings on. LinkedIn’s financial incentives to its “17 million professionals” may nevertheless be hard to resist. Gamson boasts, “If we can begin to help our members make money and help our clients find the right people, that’s when you create value on both sides and we like those situations.”

Corporations about which LinkedIn users divulge insider information to hedge funds and investment banks, however, will undoubtedly NOT “like those situations.”

Barron’s Business Dictionary on corporate espionage: 

Act of spying. An example is spying on the activities of another company by improperly gathering information about the competing company’s new products or practices. Usually the spy is paid a fee for the information obtained.

The danger of corporate espionage, according to The SANS Institute: 

Corporate espionage is a threat to any business whose livelihood depends on information. The information sought after could be client lists, supplier agreements, personnel records, research documents, prototype plans for a new product or service. Any of this information could be of great financial benefit to a scrupulous individual or competitor, while having a devastating financial effect on a company. Just about any information gathered from a company could be used to commit scams, credit card fraud, blackmail, extortion or just plain malice against the company or the people who work there.

In Web-based social networking, six figure Fortune 500 execs seek the discretion and confidentiality that LinkedIn uniquely offers, Reid Hoffman has indicated to me. The “LinkedIn Research Network” appears to thwart such desired privacy, however.

The “LinkedIn Research Network” also appears to contradict the spirit of LinkedIn’s Privacy Policy which asserts “We will never sell, rent, or otherwise provide your personally identifiable information to any third parties for marketing purposes.” How then will LinkedIn market its “Research Network” company-specific “expertise”?

What’s more, LinkedIn’s “primary research service” risks impacting non-disclosure and confidentiality agreements and insider trading restrictions.

Linkedin claims a “simple philosophy”: relationships matter. YES, but the way relationships are monetized matters as well.    

MORE: AP On LinkedIn: Social Networking Gold Mine at $5 per User? and Reid Hoffman: LinkedIn About Face (book) and Beacon Privacy Solution: STOP USING FACEBOOK! and Multiply.com CEO to Facebook, MySpace: STOP Claiming to be Real-Life Social Networks, INTERVIEW

PLUS: Google Apps Meets Les Miserables: Enterprise IT Team DREAMS Big and Why Silicon Alley VCs Should Do Blogging Due Diligence, Too

CONTACT DONNA BOGATIN

Associated Press staff reporter Michael Liedtke declares unequivocally, and headlines, that Reid Hoffman has “the golden touch.” Lest a reader NOT get the AP’s message, Liedtke’s Hoffman puff piece underscores in its subhead: “LinkedIn founder’s road to riches paved with golden connections.”

Nowhere in the AP story does Liedtke provide any quantifiable confirmation that Reid Hoffman has indeed achieved “riches,” though. Liedtke asserts under the AP banner that Hoffman has “raked in one Internet jackpot after another,” but offers NO numerical illustration of a single Hoffman Internet jackpot. On the contrary, the size of Hoffman’s Internet returns are NOT deemed to be oversized:

“Three of his startup investments have been sold since 2005 for more than $1.1 billion combined, although Hoffman got only a sliver of that.”

Liedtke asserts one Hoffman “windfall,” but does not offfer any hard returns data to back up the characterization:

“A college friendship led Hoffman to PayPal and his first windfall when eBay Inc. bought the online payment service for $1.5 billion in 2002. Since then, he has become even wealthier by investing in other Internet startups he discovered through friends and former colleagues.”

How can the AP’s Liedtke be so certain of Hoffman’s wealth? It is unlikely that he is privy to Hoffman’s private financial records regarding the entrepreneur’s private angel investments in privately held startup companies. If Liedtke is basing his conclusions about Hoffman’s wealth on third party information, he ought to cite his sources, as the AP’s “Values and Principles” demand.

What’s more, the hard data that Liedtke does include about Hoffman’s signature Internet venture–LinkedIn–does NOT support a social networking gold mine hypothesis. While the AP story perpetuates the yet to be open-market tested multi billion dollar “valuation” of Facebook, a Hoffman passive investment, and cites Hoffman on aspiring towards a noteworthy IPO for his active LinkedIn investment, the actual operating worth of LinkedIn is not questioned in the AP piece.

Hoffman on his five year old LinkedIn, of which he is the founder and largest shareholder:

“I know we are going to be much more valuable in a year or two. We have had (buyout) conversations with all the usual suspects, but I think an IPO is by far and away the most likely outcome.”

Apparently his “conversations” with suitors are NOT yielding Internet gold for LinkedIn’s Hoffman!

What about an IPO? What about LinkedIn’s $5 per user monetization record! According to the disparate LinkedIn performance metrics in the AP piece, LinkedIn has a base of 18 million user profiles and 2008 estimated revenues of $75 million to $100 million. Is $5 per user really the stuff that golden IPO dreams are made of, though?

The AP story discusses Hoffman’s LinkedIn Facebook “copycat” moves, a story I broke last month. SEE: Reid Hoffman: LinkedIn About Face (book)

LinkedIn is NOT a social/business networking slam dunk. How many of the 18 million users are active? What does the typical user actually get out of ”being on LinkedIn”? Target LinkedIn “customers” want to know. SEE: Deal Maker on LinkedIn: ‘What Do I Do With It?’

Power users themselves are having second thoughts about LinkedIn. SEE: Does LinkedIn Have a Connections Fraud Problem?

“Everybody in Silicon Valley is no more than two degrees away from being connected to Reid” says Hoffman friend and co-investor Peter Thiel.

REALLY? Hoffman seems many more degrees away from connecting with his own typical LinkedIn users: He disclaims attempts at connecting with him via his own LinkedIn profile! The Reid Hoffman LinkedIn “Contact Settings” warns:

“Unfortunately, I’m extremely busy…Good Luck!’

Good luck indeed, to Hoffman’s LinkedIn! 

PLUS: MySpace, Facebook Rule: Does Multiply.com Want To ‘Sell Out’? and Why Zynga, NOT Scrabulous, Has a Lucky Facebook Charm

ALSO: Salesconx Will Monetize Your Rolodex: LinkedIn Beware? INTERVIEW and Scrabulous At Risk? Zynga $10 million VC Game: Facebook Roulette and Facebook Davos PR Blitz: Beware Scoble Hype, Users Still at BIG Risk

CONTACT DONNA BOGATIN

Contrary to the tagline of the Australian Web 2.0 firm Faraday Media sponsored “Data Portability.org,” online sharing is NOT ALWAYS caring: Just ask the Scobleizer’s 5000 “friends.” What’s more, despite the Riley-Kirkpatrick tag team blogosphere boosting of Faraday Media CEO Chris Saad, the social networking BOMBSHELL that Saad’s “Data Portability Working Group,” is purported to be is but more feel good sound and fury, that could very well signify nothing.

In fact, at the end of the so-called Data Portability day, users may actually be more harmed than helped, (not) thanks to the non-transparent lobbying of interested party Faraday Media in its seemingly benevolent “DataPortability.org,” as I analyze in Data Portability Games: Australian Faraday Media Pushes Web Agenda in U.S.

For a company that positions itself, its products and the industry consortium it seeks to spur, on a vaunted notion of transparency, Faraday Media’s “DataPortability.org” is non-transparent to the users it claims to be helping. Faraday Media is nevertheless crystal clear on its own corporate agenda: To be the definitive “epicenter of the attention ecosystem.” BUT, how does Faraday Media’s creation and evangelizing of the “Data Portability Workgroup,” support its own product roadmap and corporate agenda?

AND, how does a corporate sponsored entity, pooling corporate interests, commercial Web properties and industry consultants, demonstrate that “DataPortability.org” will work in the best interests of users? While the TechCrunch-ReadWrite Web Chris Saad cheerleading team gushes over the “heavy hitters” Faraday Media has managed to snag for its efforts in making sure that it operates as the “epicenter of the Attention Ecosystem,” the confluence of power players may serve to solidify commercial influence over users’ data.

NEWS FLASH: Contrary to conventional blogosphere wisdom, the typical online social networker is NOT clamoring for data portability and many actually fear it, as the Scobleizer-Plaxo stunt reconfirms. SEE: Plaxo, Marc Canter Ignore Rights of Stubborn Social Web Silent Majority and Zuckerberg Message: Facebook Resistance Futile, Billions of Stubborn Email Accounts Targeted and NewsFriends? Facebook Anti Social Utility: Real Friends DON’T Share

ALSO: Does LinkedIn Have a Connections Fraud Problem? and Reid Hoffman: LinkedIn About Face (book) and Deal Maker on LinkedIn: ‘What Do I Do With It?’ and 2008 Social Media Warning: Beware Google AND Facebook and Henry Blodget Braces For ‘Harder Times’: Silicon Alley Insider ‘Screwed’?

CONTACT DONNA BOGATIN

LinkedIn is NO Facebook: CEO Dan Nye has promised he will not tolerate virtual food fights and a Robert Scoble show is conspicuously missing. Nevertheless, LinkedIn is NOT immune to Facebook style user unrest over how the networking service serves its members.

At this very moment, power LinkedIn users are weighing other professional networking options online out of frustration with a perceived “LinkedIn police.” The white collar LinkedIn bad behavior alleged represents a new breed of online social networking infraction: WELCOME TO THE WORLD OF CONNECTIONS FRAUD AND FRIENDING FRAUD!

While Robert DeNiro famously asked “Are you talking to me?,” LinkedIners wonder “Do I know you?” When a LinkedIn member answers “NO” to a fellow member’s connection invitation, that is when the LinkedIn “police” take notice.

LinkedIn is on the lookout for “abuses” of its 16 million strong pool of prime professional networking targets: “What If I Get Invitations That I Don’t Want?,” LinkedIn asks, and answers: 

If you receive invitations from people you don’t know, we recommend that you not accept those invitations to help you ensure that your personal network contains only people you know and trust. If you receive an invitation from someone you don’t know that you find annoying, intrusive, or abusive, you have the option of reporting that invitation as inappropriate. We use such reports to help detect possible misuse of LinkedIn invitations.

LinkedIn members are provided three response options when they receive “invitations to connect”: 1) Accept invitation, 2) “I don’t know this person,” and 3) Decide later (archive it).

Victims of the LinkedIn “police” warn of a “fatal” I don’t know button!:

It happens all the time. One guy who I know quite well was on his computer at 3am when he looked at my invitation and he pressed the fatal ‘I dont know’ button. I was horrified so I emailed him and asked him to have it removed by LinkedIn - no chance - its still on my record.

I realize that a personal message is one of the ways this may be avoided - but there’s always a chance someone can spoil your day. Personally I put some duct tape over my “I don’t know” button!

LinkedIn is aware of member discontent with what is perceived as LinkedIn treating casual network connecting as deliberate spam-like malfeaseance. BUT, WILL LINKEDIN CHANGE ITS “I don’t know you” ways?

I recently pointed out LinkedIn’s sexist, glass-ceiling reinforcing all male “icon” strategy. SEE: Sexist LinkedIn: Hillary Clinton and Gender Politics and Facebook vs. LinkedIn: Who has the Women?

Linkedin subsequently informed me they “noticed my blog mention about the executive male mascots on LinkedIn and are trying to work with design teams to change that to unisex, if feasible.” LinkedIn did change its icons (on the down low) but the new profile “Summary” icon still appears to contain an image of a male executive.

LinkedIn also appears to proceed on the down low with the wealth of user product feedback it garners from its own “Answers” feature. LinkedIn prides itself on the direct communication it enables between members but itself prefers cheery corporate blog posts and PR media for its member communicatons.

MORE: Reid Hoffman: LinkedIn About Face (book) and Deal Maker on LinkedIn: ‘What Do I Do With It?’ and 2008 Social Media Warning: Beware Google AND Facebook and Salesconx Will Monetize Your Rolodex: LinkedIn Beware? INTERVIEW

ALSO: How Google AdSense FAILS Better Business Bureau and Facebook vs. Google: The Real Tech President Political Power Plays and Google Joins Blogosphere in Mocking Wikia Search: Jimmy Wales Defiant

CONTACT DONNA BOGATIN