Google goes head on with Facebook

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If you can’t beat ‘em, join ‘em. And if you can’t join ‘em, get all your friends to band together—and gang up on them!

In a move that some Silicon Valley pundits are deriding as desperate, Google unveiled a plan to fight back against social network Facebook. A dozen companies, including social networks LinkedIn, Ning, hi5 and Google’s own social network Orkut, have aligned together under Google’s “OpenSocial” banner to “make the Web more social,” said Joe Kraus, who’s managing the project. Business software makers Oracle and Salesforce.com also joined the alliance.

The goal is to lure software developers back to the open Web from Facebook and create standards for applications that can run on any social networking site. In June, Facebook opened its site to apps makers, allowing them to launch their own applications on its social network, and make money from them. Some 5,000 applications were launched enabling Facebookers to do everything from play Scrabble to engage in virtual food fights. And that caused the young site to take off, with membership growing at the healthy rate of 3% a week. It now has some 50 million members and is expected to unveil a new advertising platform next week that, many believe, will cleverly target “social ads” at users, mining their connections for useful information. If it works, it could be a huge breakthrough in online advertising.

And that’s what’s got Google taking the offensive. Google’s business model hinges on selling ads targeted against search—a diminishing activity while people are cavorting within the closed-off walls of Facebook. Adding insult to injury, last week, Microsoft (MSFT) beat out Google and bought a minority stake in Facebook—valuing it at $15 billion. That secured Redmond’s role as the social network’s sole partner in international advertising, and potentially much more.

Google’s OpenSocial project aims to do Facebook one better: It’s opening the entire Web to developers and making it even more remunerative for them to create cool applications. How? For starters, Google will be sharing critical APIs—in this case, datastreams that divulge a user’s profile information, who their friends are and what applications they install. (Among other things, that info helps applications spread virally since people see which applications their friends just installed.) While Facebook does the same thing within its closed network, twice as many people are in the Google alliance—100 million—and it’s just getting off the ground. Better yet for the developers, Google isn’t extracting a penny from them. They can keep 100% of the revenues from advertising or referrals. Finally, while developers need to learn a special programming language to write apps for Facebook, they can write widgets in HTML and Javascript—the common language of the Web.

“It’s a little bit of an apples to oranges comparison, but the full application we’ve built on Facebook took us six months to write,” said Ali Partovi of iLike, one of the better-known music applications. “The one that we’re demoing here took us a matter of days to write.” (It also looked very slick.) Partovi said that since OpenSocial uses the common languages of the Web, it will also make it easier, and cheaper, to hire programmers. Developers such as iLike will continue to work with Facebook.

Ning founder Marc Andreessen applauded Google’s move. “This is more like what we always used to do at Netscape — someone does something proprietary, so we create or embrace an open alternative and get lots of people to support it,” he wrote in an e-mail. ” We did that originally with HTML (!!) and Javascript.”

While a hand-full of demonstration projects will be unveiled Thursday, Kraus said the goal of the announcement today was to invite in the developers and get them started on rolling out new apps. He said it would be about a month before consumers started to see the first OpenSocial apps. Ultimately, the widgets could run on virtually any website that elected to participate.

“They were totally desperate,” one Silicon Valley financier observed yesterday. “Google isn’t making a dime from this. It was just a way of keeping people off Facebook.”

Kraus said that Google’s interest was in preserving the open Web. “By making the web a better place to be, Google ultimately benefits because people spend a lot of time on the Web searching,” he said. Asked whether Facebook could join the alliance, Kraus said, “Obviously we would love to have them participate.” He declined to say whether Facebook was ever invited, however.

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Wing Tai doubles Q1 profit to S$61.8m

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Higher contributions from two condominium projects in Singapore have helped Wing Tai to double its first quarter profit.

For the three months to September, the property developer booked earnings of S$61.8 million, despite a 39 percent fall in revenue to S$100 million.

Wing Tai is planning to put several new residential projects in Singapore on the market in the next few months.

It says it will continue to position itself to ride on the positive sentiment in the Singapore property market and expand its business activities overseas.

Towards this goal, it signed a memorandum of understanding to develop a real estate project in Chengdu last month.

This will be the developer's first property project in China.

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Microsoft acquires Thai medical software firm

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Microsoft Corp, seeking to expand in the medical sector, has agreed to acquire the assets of a privately held, Thailand-based health information system company, the software giant announced yesterday.

Global Care Solutions (GCS) specialises in creating software modules for hospitals' clinical and administrative operations, allowing them to run more smoothly. Financial terms were not disclosed.

The Bangkok-based company, whose core product was first marketed in 2000, has implemented its systems in seven client hospitals in the Asia-Pacific region. They are based on already existing Microsoft software products.

'We are really amazed at the quality of care that can be delivered with Global Care Solutions' health information system,' said Peter Neupert, corporate vice-president for the Health Solutions Group at Microsoft, into which GCS employees will be incorporated.

Mr Neupert said that the deal, under which Microsoft will acquire software, intellectual property and other assets of GCS, would allow the technology to be marketed worldwide.

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Oil prices tops $93

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Oil prices hit a new trading high above $93 a barrel Monday before falling back, propelled by news that Mexico’s state oil company was suspending about a fifth of its oil production due to a storm.

The news that Petroleos Mexicanos, or Pemex, was to stop as much as 600,000 barrels of daily crude production came amid political tensions in the Mideast, a weak U.S. dollar and a tight supply outlook that had already pushed crude oil to record prices.

The Pemex shut-in “is the one that has pushed prices above $93,” said Victor Shum, a Singapore-based energy analyst with Purvin & Gertz. “This is on top of what has already been simmering.”

Pemex announced Sunday that it had already suspended 200,000 barrels of daily production in the Gulf of Mexico because of bad weather and was planning to reduce by another 400,000. Pemex produces about 3.2 million barrels of crude oil a day, of which 2.7 million come from the Bay of Campeche in the southern Gulf.

In addition, Vienna’s PVM Oil Associates noted that “more bad weather could hit the region in the form of Tropical Storm Noel.”

Light, sweet crude for December delivery rose as much as $1.34 to $93.20 a barrel, a new intraday record, in early afternoon Asian electronic trading on the New York Mercantile Exchange. By afternoon in Europe, it had slipped back to $92.26 a barrel.

That was still up 40 cents from Friday’s record close of $91.86 a barrel. The previous trading high was $92.22 a barrel, set Friday.

Oil futures have gained almost $8 a barrel, or 9 percent, since the U.S. Department of Energy reported last Wednesday a sharp drop in the country’s crude stocks.

“The strong price is due to supply concerns in general, on top of which we have the geopolitical news,” Shum said.

A rumbling of tensions in the Middle East and elsewhere last week already had traders worried about the disruption of oil exports.

A sharp escalation in fighting between Turkey and Kurdish rebels has brought Turkey to the brink of sending troops south across the border into Iraq, and the United States last week announced harsh penalties against Iran — the world’s fourth largest oil producer — in hopes of raising pressure on the world financial system to cut ties with Tehran.

Also, last Friday, gunmen in speedboats kidnapped six workers from an oil vessel off Nigeria’s coast, the second attack on an oil field there in a week. Nigeria is Africa’s largest oil exporter and the fifth-largest supplier of crude to the United States.

A weak dollar continues to be a factor in driving oil prices as well.

The dollar’s descent against major currencies has drawn investors to crude futures as a hedge against the weakening currency and made dollar-denominated oil futures less expensive to people dealing in other currencies, said David Moore, commodities strategist with the Commonwealth Bank of Australia in Sydney.

Analysts note the price of oil is closing in on the inflation-adjusted highs hit in early 1980. Depending on the how the adjustment is calculated, $38 a barrel then would be worth $96 to $101 or more today.

In London, December Brent crude advanced 39 cents to $89.08 a barrel on the ICE futures exchange.

Heating oil and gasoline futures rose just over a penny to $2.445 a gallon and $2.2850 per gallon.

Natural gas futures gained nearly 11 cents to fetch $7.325 per 1,000 cubic feet.

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UBS Confirms 3Q Loss

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UBS AG said its third-quarter loss will be in line with a profit warning earlier this month, but primed investors for further write-downs due to U.S. mortgage-securities the bank still holds.

The Zurich-based bank said it will Tuesday post a pretax loss of between 600 million and 800 million Swiss francs ($517 million and $690 million), as flagged earlier this month when the bank was forced to disclose massive write-downs and sweeping management changes as a result of the subprime mortgage woes.

UBS said the current quarter has started positively in all its units, including the investment bank, where the recent trouble has centered.

However, the bank cautioned that it may record further write-downs in the future because it remains exposed to the deteriorating market in the U.S. for mortgage-securities.

"As a result, UBS is not assuming that the quarter will continue as positively as it has begun, or that the current difficulties will be resolved in the short term," UBS said in a statement.

The bank's third-quarter report is scheduled for 0600 GMT Tuesday.

Investors had been fearful UBS would post a worse loss than flagged after U.S. rival Merrill Lynch & Co Inc. (MER) surprised the market last week with far larger third-quarter loss than originally indicated. UBS said it made the statement to refute a Swiss weekend media report, which suggested the losses may have spread further.

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