Microsoft’s popfly is an easy way to create widgets and mashups using Silverlight. With Popfly Game Creator, it is adding a simple Web-based authoring environment for creating casual arcade-style games.

The tool is built for non-programmers so that anyone can create a game, and is particularly aimed at kids and teenagers. It is entirely browser-based. You create a game using predefined templates that can be modified, and when you are satisfied, you hit play to run the code. The games run in Silverlight and will be hosted at Popfly, but are embeddable anywhere on the Web.

So many people are using the term widgets, though so many times for a different format or in a different context.  What is a widget? Where and how do you use widgets? How many different widget-like apps exist? In what context? Serving what purpose and on what platform/device? So many questions about one single thing.

The widgetized web has arrived and its more than apps on Facebook.

Earlier this week I read the following: “Widgets are dead”.

Widgets are dead

“One goal of the Facebook redesign was to kill pointless widgets that cluttered user-profiles. It’s working. When Facebook launched its platform last year, AllFacebook’s Nick O’Neil created your typical one-trick app: the Bush Countdown Clock. All it did was sit on a user’s profile like a badge, and yet it attracted and maintained over 50,000 users. But with Facebook’s redesign, O’Neill’s widget and other simple badges like it were moved to a “boxes” tab on user profiles. After the redesign went permanent on September 11, traffic to the countdown clock dropped 60 percent almost overnight. Writes O’Neill: “Widgets have not survived the shift over and my guess is that within a matter of weeks we will see most top-performing widget applications practically disappear.” In December 2007, VC Ross Levinsohn said 2008 would be all about “Facebook plus widgets.” Maybe that sort of poor prediction explains why he and partner Jon Miller can’t find their pot of gold?”

Honestly, here we are just talking about applications on Facebook. Saying widgets are dead, only because Facebook is throwing up some barriers that is too much exaggerated. True it affects scaleability, true it creates problems if an app is only running on Facebook. In the end widgets are not dead. Instead, we’re just at the beginning.

Its better to say that within the widget ecosystem there are some niches with more difficuties, though other niches still and will flourish.

The financial crisis will have its impact on early stage companies. Companies with fragile and unproven business models (online advertising), high capital expenditures, relatively young markets (mobile apps) will find it difficult to secure financing from business angels and vc’s. Actually, I think that vc’s will not invest in new companies, they will keep their cash at hand, focus on their existing portfolio companies and support that instead of looking for new companies.

The earlier you are in your development phase, the better. Once your business needs to prove its commercial skills or needs to find an exit, you’re in trouble.

SEED stage: Those companies which still need to close their seed round will have difficulties as they still need to prove their product/service and business. If they have an interesting technology that needs tuning and further development, it might be easier. Eventually, a critical element for investors will be the “entrepreneur” and the “team”. There must be a proven management team behind if it where to convince investors from making a first bet on it. The advantage is that most of these companies are not commercially viable, i.e. they still need to work hard on product development. The current economic recession, is just the right moment to focus on development.

Series A: If you’ve already closed a round, then you’re kind of safe. You might have a fragile business model (online advertising), or are active in a young market (mobile apps), you’ll probably get the support from your investors. As your investors won’t take, or will be careful in taking on more investments. They’ll probably focus on your company and see how you can manage getting through this rough period. Bootstrapping will of course be elementary.

Series B, C, D: There is no market for exits, because an exit is going IPO (who wants to do that now?) or via a trade sale that requires transactions with leverage from banks and or exchanges of shares which are worth less every day. Thus later stage companies will have to focus on “bootstrapping”, no more hiring, no free services and trying to get through the recession period.

Less than 7 months ago they received $9,5M in series B funding. So far they raised a total of $23M in a bit more than 1,5year. Has anybody an idea where they’re spending the money? I guess that this should be enough to prepare for an exit? Anyhow, are investors eager to be in, so they see the exit already, do they first need to expand abroad, do they need the cash to secure them getting through the current economic recession? Anyway, its a lot of money European competitors can only dream of getting (if only the early VC funds would have that much cash at hand). Full article.

 I. Widgets have infiltrated the social media landscape and are now fixtures on millions of user’s profile pages on dozens of social networks. Users themselves recognize the utility and fun of widgets, pass them on to friends, and actively endorse them by installing them on their profile pages as a way to express themselves to the world.

II. Widgets are driving the decentralization and democratization of the web. Particularly as they relate to emerging open standards for data portability, “ownership” of user generated content and publisher and advertiser “control” over distributed services.

III. Looking for the best business model. Eye-popping valuations for widget companies have given new urgency to a debate that’s been around as long as web widgets have: Other than being acquired, how does one build a successful business on widgets?

IV. Entertainment brands and media companies realize the importance of social media and are now moving beyond the passive ad experience, and instead are actively looking for compelling ways to engage their online entertainment consumers. Widget publishing platforms offer new solutions to help entertainment brands design and create ‘customized’ widgets. The result – powerful social media marketing campaigns.

V. It’s a widget world and widgets are going mobile! Ushering in a new era of mobile user interface (UI) is advanced research. Mobile social networking is a quickly evolving industry. What will be the strategies and technologies necessary for mobilizing social networks and monetizing user-generated content?

VI. The world is permeated with net-connected screens that are always on and can’t include keyboards, mice or browsers, such as digital photo frames, LCD TVs, clock radios and LCD panels on appliances. How can widgets serve a market for mostly-passive, screen-based devices.

Interesting post from Widgetbox‘ CEO, Will Price, about the discrepancy of ad expenditures between the top 10 websites versus the long tail of websites. The discrepancy is 2,7x between usage and spend.

Instead of choosing a more effective way, it seems that today’s advertisers are still taking the easy way to get brands/messages online. Buy ad properties at one single source, understand that audience, make projections, easy PM, clear projections, ROI’s, and to monitor the whole campaign. Especially in Europe, there are only a few alternatives.

Also today’s web is more and more fragmented and it would be interesting to see how advertisers will cope with that change.

Personally I think that the discrepancy will remain (pareto principle). However, the further fragmentation or further widgetization of the web should be tackled accordingly, with widgetized ad solutions. This is known by those active in the widget ecosystem, yet not quiet understood by the rest.

Because widgets have the ability to spread virally, they are often touted as an ad medium of the future, but there’s a downside to that virality: exponentially increasing costs.

Marketers also are billed for serving that application onto Web portals like Yahoo! and MySpace, and every time a widget is grabbed and loaded onto anyone’s social networking page. It’s that installation or engagement fee, which can range from $1 to $5 per install, that some contend can exhaust an advertiser’s budget and limit the reach of the digital campaign. Since the most-activated widget so far (an application called Top Friends from Slide, San Francisco) claimed 6.2 million downloads, widget campaigns have the potential to cost big money. But Peter Kim, CEO of widget developer Interpolls, Pasadena, Calif., contends billing for engagement could slow widget adoption.

“The client or ad agency will have difficulty figuring a budget for that widget because they can blow through that in a short period of time or if the widget doesn’t succeed, they could be left with unused money at the end of the campaign that they could have spent simultaneously on other media,” said Kim.

Interpolls develops widgets, hosts them onto the Web and charges clients only for impressions per CPM. Knowing the upfront cost convinced hotelier La Quinta to launch its first widget campaign during May. The effort with Interpolls repurposed TV spots from the “Wake up on the brighter side” campaign created by Mullen, Wenham, Mass., and included city and state search boxes for reservations and news about property upgrades. Of the people who have loaded the application on their personal pages, 78% have interacted with the La Quinta widget by watching the video, taking the survey, reading the comics or having visitors to their page click on it. Some hotel bookings can be traced to those engagements. “Not knowing how much to budget would have delayed our response or engagement with getting widgets out there,” said Ted Schweitzer, La Quinta’s vp-ecommerce.

Not every engagement fee business model carries uncertainty, however. Gigya, a Palo Alto, Calif., widget distribution network, assesses clients between $1-2 per installs only on the Gigya Ad Network launched last January. Advertisers can budget for a specific number of installs within a prescribed period and viral pass-alongs outside the network are free.

“Part of the problem with a new medium is getting clients to understand that it isn’t easy to get your widget in front a large audience and get the them to install it to their page. The only way you’re going to have an impact with your widget is to get installed in scale,” said Liza Hausman, Gigya’s vs-marketing. In the meantime, Taylor said other widget makers need to create a model that works: “The media and advertising worlds will be far less tolerant of taking a decade to see if widgets work. If widgets don’t perform, we’re not going to see them in the long term.”

Here’s the full article.

Nokia’s known widget platform “widsets” for smartphones with almost 5000 widgets in the database just launched the possibility to pick and choose standalone widgets. This means that you don’t need to download and run the full widset application and manage your personal library of widgets through the application. Instead, you only pick and download the widget of your choice. They work on your mobile as independent mini-applications. To be found on widgets.nokia.mobi.

Some widget development and distribution companies:

Widgetbox (US): Widgetbox helps people express, connect, create and inform using web widgets that can be easily shared and distributed anywhere on the web.

iWidgets (US): iWidgets helps you produce social widgets so your users can show off their activity. Whether it’s recipes, outfits or comments, their friends will want to clickthrough and see what’s up!

MuseStorm (US): MuseStorm provides the one platform for agencies, brand marketers, and entertainment companies to produce, manage, analyze, and deliver widgets that extend their brand message into social and viral environments.

Gigya (US): Gigya helps publishers and advertisers increase reach and engagement, distributing widgets to any platform and providing powerful social features to any website.

Springwidgets (US): widget development and distribution platform focusing on the most US social platforms

Zembly (US): Zembly helps you easily create and host social applications of all shapes and sizes, on the most popular social platforms on the web.

I hope this blog helps me to get info about widget ecosystem a bit more structured and organized … we’ll see what happens…