Israel Innovation 2.0

Inside Israeli Technology

Snorkelers of the world-renowned coral reefs in the Red Sea off of Israel have been getting a different view of the sea’s marine life lately. Over the summer, a team of Israeli and Jordanian researchers placed an artificial coral reef made of specially designed concrete near the natural reefs in an attempt to prevent the destruction of the reefs by divers, while still allowing them and others to see the coral life. So far, the reef has already attracted over 20 species of fish.

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The work and research that went into this project represents part of a greater trend of Israelis taking more interest in protecting and preserving the environment. In addition to preserving sea life, finding solutions for the world’s 2 billion-plus population that doesn’t have access to fresh water and using water as an energy source have also become a focus in Israel’s technology community. Showcasing this trend will be the 2007 Water Technologies and Environmental Control (WATEC) Israel conference in Tel Aviv on October 30 – November 1st in which Israel’s solutions and innovations for water-related issues will be discussed and presented to an international audience.

According to the website, “Israel is poised to play a major role in supplying the world with cutting-edge water and environmental solutions.” The site then goes on to list such reasons as Israel having the world’s highest reused wastewater rate, the world’s most developed irrigation methods, and the world’s largest RO desalination plant.

With sponsors and exhibitors such as Netafim, Yissum, Auqatech, Dorot Water Technologies and Ormat Systems, Ltd., and the conference’s goal to bring together the international research and business communities to stimulate debate and discussion, this conference promises to be the cornerstone of innovations in the water-industry over the next few years.

Note: Images are from thediver.co.il.

Doing basic research on major companies in Israel? For a brief overview of Israeli companies with R&D departments in Israel, I have found Matimop.org to be an invaluable resource. Every time I do a search on a company for a blog entry, I make sure that Matimop is one of my first destinations.

According to the website’s homepage, Matimop is the “main technology clearing house in Israel and provides databases – updated daily listing hundreds of projects in diverse advanced technologies plus detailed profiles of Israeli companies looking for foreign hi-tech partners.” It was created by the Israeli Industry Center for R&D.

The VON Israel telecommunications conference was held this past Sunday and Monday in Tel Aviv. Although I was unable to attend it, I have been following it in some blogs and have watched some of the speeches on PulverTV. In his keynote address, Jeff Pulver, the conference’s founder, mentioned that VoIP is the future of communications on the Internet and now is the time for companies to find the right innovations and solutions for VoIP.

In the spirit of what he said, here are examples of how I think social media areas can integrate these technologies:

Facebook– Have a special application that will let friends voice chat or video chat with each other. This would also be good for the marketplace section, especially for job seekers and potential employers, and for sales, similar to eBay having the call buttons.

MySpace– Musicians can hold special “conference calls,” or interviews, with their fans, similar to the idea of how companies have quarterly conference calls with their investors. Also, musicians can create their own TV networks and broadcast fan mail by embedding it on their MySpace page.

Flickr– While looking at pictures, you can chat with the friend or family who posted them using an application on Flickr.

For more on VON Israel, check out Jeff Pulver’s blog and if you want to view some of the speakers from VON Israel, including Pulver’s keynote, check out PulverTV. Also, if you have any ideas of your own on how social media can integrate VoIP technology, feel free to add a comment below.

UPDATE: Skype and MySpace have announced that they will integrate their chat services to add Internet voice chat to MySpace’s instant messenger and allow Skype users to contact MySpace friends through its service.

News
Globes reported last week that there are rumors circulating that Symantec is considering selling Precise Software Solutions, which operates in Israel. The article speculates that interest might be coming from “one of the major enterprise software houses interested in improving its position in the enterprise IT systems performance market.”

Background
Precise Software Solutions was taken over by Shimon Alon, Ron Zuckerman and Aki Ratner in 1997 and within 6 years the company went from making $10 million to $100 million under their management and the help of Gemini Israel funding. The company went public in 2000 and was sold to software storage provider, Veritas, for over $600 million in 2004. In 2005, Veritas was bought by Symantec. Under Veritas and Symantec, Precise has been able to keep its Israel operations independent, though its management has changed (many moving on to enterprise software supplier, Attunity).

What it does
Before being sold, Precise was considered the leader in application performance management, with its Precise i3 being its most successful product. Now known as Symantec i3, the software “helps organizations improve business efficiency and mitigate costs by quickly identifying and resolving potential bottlenecks within an application infrastructure,” by providing “IT managers with a comprehensive set of end-to-end performance management tools that will allow them to pro-actively monitor, analyze, and fine-tune their applications to attain increased application transaction performance and high availability service levels for their organizations.”

Market and Future
The Globes article lists some of the major IT companies that are active in the market that may have fueled the sales speculation. In general, some competitors in the application management solutions industry include IBM, Oracle, Microsoft, Hewlett-Packard (HP), and EMC.

The idea of Symantec selling Precise to any of these companies doesn’t have a clear basis. The industry is still growing and Symantec i3 has been leading the way. Revenue numbers for Symantec’s security and data management sector grew in 2006, with Veritras (including Precise) products contributing $410 million. The fact that the security and application management industry is currently as hot an area as it is and with other big companies looking to get a share by acquiring smaller companies in the field, should provide enough reasons for Symantec to keep Precise off the sales block and out of the hands of its competitors.

Additional Resources
Veritas-Precise merger
2001 Interview

Flash animators who wish to display their short animation videos and make a profit need look no further than Israel-based aniBOOM for a Flash-sharing community. The company that’s been turning heads in the media this past year, is at it again with news that video-delivery site, Joost will be giving aniBOOM its own channel. aniBOOM, which already has channels on Yahoo! Video and Google’s YouTube, will display the best animation videos on the Joost channel with the animator, aniBOOM and Joost splitting advertising revenues from it equally.

Aside from fulfilling part of its phase to cross over into other media with this new channel, this expansion provides a glimpse of the market opportunities still available for aniBOOM and its animators to tap. Below is a sample of a video from the site and check out CNN Money’s article for more on aniBOOM’s potential.

Last week, Globes reported that eBay, Inc. will be increasing its collaboration efforts with Israeli start-up, Shopping.com and opening a development center. The center will be charged with the task of developing “eBay’s sorting and cataloging technologies.”

With increasing threats to eBay’s technology integration methods, perhaps the company can benefit not only from the innovations Shopping.com will come up with, but from its story of survival as well. Originally called Dealtime and founded in Israel, Shopping.com was the first price comparison website. After surviving the dot-com bust and once the Internet began to recover, the company thrived and changed its name to Shopping.com and went public. It was then bought by eBay in 2005.

Although eBay also survived the dot-com crash, and has maintained its monopoly and is a survivor in its own right, its success in beating down any competitors in the past is different from its current competition today — primarily, Google and small VoIP companies. While in the past, threats were directed at eBay’s auction services itself, as the company tries to innovate its auction site and other holdings with multiple services to provide a better user experience, Google and small start-ups are finding vulnerabilities in the additional services and are directly attacking them, either by providing similar services of their own (i.e., Google) or trying to interfere with features that have been integrated onto the auction site (i.e., Jajah).

Despite the constant competition, perhaps eBay’s new activity with Shopping.com, and the collaboration of minds that have overcome different threats in the past, can ensure that eBay will be able to continue to have a leg up in the e-commerce world over Froogle and Google’s own constant cataloging efforts for the near future. Although time will tell, which company do you think will win the battle over cataloging and e-commerce? eBay’s Shopping.com or Google’s Froogle or do you think they can co-exist?

Latest video content server
Media attention on video content platform technology being developed in Israel continued with Arootz getting the latest coverage. Arootz’s platforms “enables network and content providers to offer their customers private label, broadband TV services that drive broadband revenue and brand awareness in a TV quality, personalized and network friendly solution.” They are currently partnering with ISP’s and telcos, among other providers, and have received funding from Gemini Israel Funds and Genesis Partners.


Reaching the Israeli audience

MTV, which has had success with local music stations in other countries, is choosing not to go its traditional route in reaching its Israeli audience. Instead it will be taking advantage of Israel’s high internet usage percentage and offer a local music on its local music website and try to create an online community at the same time, using TVinci‘s platform.

Britain’s ICAP buys Traiana’s currency system
According to Ynet, Traiana Software has been sold for $247 million to the British ICAP Group, the largest interdealer broker in the world. Traiana’s software is considered a benchmark in foreign currency trading systems and the deal “will allow the company to expand its hold in the international market.”

I came across an article last week that mentioned that despite the increasing trend of immigrants to Israel, the country still has more natives leaving than immigrants coming in. I brought this up with two relatives of mine who are native Israelis working in the high-tech industry here and they said that they have noticed its effects on high-tech. Earlier this year, EE Times Europe ran an article on what role Israel’s successful high-tech industry, but small economy and market, plays in fueling this trend.

The article states that “Key knowledge, people and technologies are moving abroad, especially to the United States, and some people question whether startups are offering sustainable value.” It then goes on to mention reasons for this, such as successful Israeli companies are being merged or acquired and Israel lacks a significant amount of entrepreneurs (and those who are, are serial entrepreneurs).

Although, this article raises several good points, based on what I have learned over the past few months, I don’t think Israel’s high-tech sector is in as grave a danger as it makes it out to be. First, though foreign influence in the high-tech sector has taken away several key players, there are still immigrants from other countries with high-tech backgrounds coming in that can help fill part of the void (though not all of it), and who might be entrepreneurs that start up their own companies in Israel that will become successful. Also AT&T’s announcement recently of its plans to build a new R&D center in Israel, shows that there is still interest in Israel and job opportunities here, and that maybe, there’s still an untapped wealth of knowledge in Israel that will continue to renew itself.

What are your thoughts on this? Based on your experience or connection to Israel’s high-tech industry, do you agree, disagree, or have some other ideas on this? Share your thoughts in the comments section below.

The Globes has reported that Tel Aviv-based, RayV has received $8 million dollars in second round funding from Accel Partners to create a 24-hour virtual network that can be viewed on TV or on a PC. According to TechCrunch, RayV’s technology will provide a “P2P live broadcasting offering in which users will be able to create and broadcast video playlists at ‘high video quality.’” With similar sites such as Joost and Veoh, and even several other Israeli companies, the big question is what is the differentiator between RayV and other sites? Another question is, should RayV succeed, will this be the long-awaited-for YouTube killer? For more analysis on RayV’s technology, check out the Venture Capital Cafe.

Earlier this month, AT&T entered the Israeli technology market for the first time with its purchase of Interwise. Less than two weeks later, AT&T has gotten a head start on the quest for the FCC’s prized wireless spectrum– the 700-megahertz frequency — with today’s announcement that it will acquire a chunk of it from the private holding company, Aloha Partners, Ltd.

While the headlines two days ago about AT&T’s purchase of Interwise mainly focused on the telecommunications company’s late entrance into the Israeli market–other companies such as Microsoft, Cisco and Intel have been in Israel for years — what Interwise actually does seems to be a lot more significant now combined with the wireless spectrum purchase.

According to the Interwise website, Interwise Connect delivers “unlimited voice, Web and video conferencing for the enterprise” and is geared towards mid-to large- sized enterprises, giving them the multiple conferencing tools they need, in one. The tools included help with voice conferences, Web meetings, virtual training, Webcasts, broadcasts and recordings. The 700-megahertz frequency will allow data-intensive services such as video and Internet service to be carried over long distances and will easily penetrate building walls.

By combining the benefits that Interwise Connect has with the Web and the power of the 700-megahertz band, it seems that AT&T is not just priming itself for the spectrum auction, but is also furthering its position as a leader in cost-efficient all-in-one communication/data services for businesses while doing so.