Michael Toutonghi is headed back to Microsoft after selling his Seattle based social networking site WebFives to the software giant…
Software giant Microsoft has revealed that they are acquiring a Seattle-based social networking Web site called “WebFives,” which provides a Web-based file-sharing service for Internet and mobile video, photos, audio, and blogs, according to a message posted on the startup’s Web site.
Founder of the company Michael Toutonghi would now join Microsoft. He said about this deal: “I am happy with the outcome.”
WebFives, came about in 2004, previously called Vizrea, and interestingly, was founded by former Microsoft Distinguished Engineer Michael Toutonghi, who helped pioneer the Media Center version of the Windows OS, many of the features of which found their way into Windows Vista.
The company offers social networking with a focus on mobile media, including video, music and photos.
WebFives users are provided with standard social networking profile pages complete with blogging features. They also have the option of accessing their sites via a computer or on a mobile via a WAP-specific page.
On the WebFives Web site, a message attributed to Toutonghi said Microsoft agreed to purchase the company in November, and WebFives will close and shut down its service on Dec. 31. The service gives users a hosted Web site to which they can automatically upload multimedia content from mobile devices, as well as other features.
This would make the acquisition a technology buy as opposed to a community buy.
Here is the actual letter that was published yesterday to WebFives users:
“While WebFives has pioneered some great technologies, including automatic upload of content from mobile phones and PCs, high-quality video sharing services, and automatic RSS feeds for everyone, our next challenge will be to help Microsoft incorporate the best of those technologies into its already comprehensive suite of products and services.”
He further said: “I encourage you to look at MSN Spaces and/or Windows Live services as an alternative to WebFives for serving your video, photo, music sharing, and blogging needs on the Internet.”
However, “any content previously uploaded to WebFives user accounts will be deleted from our servers and no longer available online,” according to the post.
WebFives/Vizrea raised about $4 million in funding, with some of the capital provided by former Microsoft executives Brad Chase and Ben Slivka.
Toutonghi described the deal as an asset sale, declining to comment when asked if it was a positive financial result. “It was more the technology value than the user base,” said Toutonghi.
But facing competition in the digital media sharing arena, neither service really caught on.
Microsoft indeed has been looking for ways to boost the value, and thus revenue, of its Online Services Group (OSG), which oversees MSN and Windows Live. Microsoft hopes these properties will help boost its online advertising revenue to compete with Google.
The company also has said its mobile device strategy, the linchpin of which is its Windows Mobile OS, will be a priority for the company as a way to diversify its revenue, which primarily comes from its Windows OS, Office business productivity suite and server software such as the SQL Server database and other enterprise products.
In November 2005, Microsoft re-branded many of the former MSN services Windows Live, and announced its intention to roll out more services to complement its popular e-mail and instant-messaging services.
Microsoft will incorporate WebFives’ services into its own products and services, Toutonghi wrote. WebFives services also include a mobile Web site, widgets and a WebFives media player that can be put on social networking sites such as Facebook and MySpace, as well as other social-networking and messaging services.
Toutonghi, a former distinguished engineer at Microsoft who served as vice president of the eHome division, will return to work for the software giant as a technology fellow working on the company’s advertising platform. The 45-year-old will be based in Prague, where he owns a home.
Microsoft also operates an office in Prague with about 250 people, though it does not have a focus on software development. With Toutonghi’s new role, it could lead to bulking up development efforts there, he said.
Toutonghi said he is glad to be back at Microsoft, saying he learned how difficult it is to scale a startup business.
“I love working on technology platforms … that make a huge difference,” he said.
Given Microsoft’s push into the online advertising arena, Toutonghi will have a lot to work on in the coming months.
However, the financial aspects of this deal are not yet known, neither have they been disclosed by any of the parties.
Microsoft did not comment on the deal.