Steve Ballmer has a certain inimitable style (I use the term loosely.) This recapitulation of his famous “monkey dance”, delivered last week on a stage in Las Vegas, has Microsoft insiders squirming, but at least it makes a point. The software company now has its sights set on building a technology platform for Web developers, not just the software developers commemorated in Ballmer’s original 2001 outburst.

Google has a quieter way of doing these things, but make no mistake: there is a fight brewing here for hearts and minds. This battle will determine which vision wins out for the next stage in the internet’s evolution as a computing platform.

Google has just reserved San Francisco’s cavernous Moscone Center for a two-day event in May to draw Web developers into its own camp. This is a clear sign of how fast its aspirations have been taking shape. Its first pitch to developers came two years ago with a small conference aimed at people interested in building applications using the Google Maps API. Last year, that turned into a broader developer day that drew 5,000 to San Jose, before graduating this year to the main stage for technology industry convocations.

When I spoke to senior Google product manager Tom Stocky today, he was at pains to play down any suggestion that the internet company was about to go up against companies like Microsoft and Adobe.

“I’m not sure I see it as Google versus anyone else. What we’re really doing is promoting the Web as a platform. There’s no Google agenda.”

Well, up to a point.

Google’s “platform play” has two parts to it. One involves promoting open source tools for Web development - things like the Google Web Toolkit, for writing more effective AJAX applications, or Google Gears, for creating Web applications that can also run offline. Clearly, even if Google does not benefit directly from offering these tools, keeping developers out of the Microsoft and Adobe camps is important.

The other part of Google’s strategy for the May event will be to attract more developers to write applications that ride on top of the internet company’s own services. It has released 40-odd APIs so far, exposing services like YouTube and its Google Docs applications for independent programmers to draw on.

You can expect the blogosphere to be stuffed with laudatory coverage nearer the event about how Google is fostering a more open Web than the one some of its rivals seem to have in mind. Only, don’t expect Eric Schmidt to put on his monkey suit.

The investors in San Francisco start-up Zivity would prefer to think they are funding the next wave of social networking rather than an online peepshow.

Zivity, which serves up photo-shoots of scantily clad and tastefully nude women for subscribers paying $10 a month, is announcing its second-round funding today and has raised $7m from some prominent venture capitalists.

Founders Fund and BlueRun Ventures are providing the financing for the company founded by Scott Banister and his wife Cyan.

The connection is the online payment service, PayPal, bought by eBay for $1.5bn in 2002. Founders Fund founder Peter Thiel was chief executive, John Malloy sat on PayPal’s board before he co-founded BlueRun and Scott Banister was also a director. Mr Thiel was also an early investor in Facebook and both have invested in Slide, which provides popular social-networking widgets.

“The fundamental investment is in people who can make the seemingly impossible possible and the unlikely likely. We’ve worked together on other things and Scott is someone who has done great things a few times over and he is still a young guy,” says Mr Malloy.

The 32-year-old is a serial entrepreneur and co-founded IronPort, an email security company that Cisco bought for $830m last year.

Mr Banister draws parallels with Zivity – IronPort aimed to challenge the dominance of Sendmail in email, Zivity aims to challenge the dominant advertising model for social networking.

“The subscription model is coming and we are interested in having great content and paying the people that create that content,” he says.

Subscribers to Zivity, which is still in invite-only mode, get their own profile page where they can add their details, friends and status updates, but the focus is really on the models and photographers, with members allowed five votes a month to give to their favourites.

Mr Banister says it is giving an unprecedented 40 per cent of its subscription revenues to the content creators, divided according to how many votes they get. His own wife Cyan, as well as being Chief Strategy Officer, is also one of the topless models eligible for the profit sharing.

“You see stars like Lindsay Lohan appearing nude [as Marilyn Monroe] in New York magazine and getting paid for it, but in this era of self-publishing, women do it on MySpace and see their photos taken down by the MySpace abuse department,” he says.

“There’s a big gap we can bridge here, the models and photographers are really excited.”

Despite soft-porn photos being available in abundance on the internet for free, Mr Banister feels Zivity can still create sufficient interest to be a profitable business.

“We’ve close to 30,000 people on our waiting list to get in, the reaction has been incredible,” he says.

“We’re creating something here that is just not available on other social networking sites and we’re providing an outlet for models and photographers that they’ve never had before.”

At least Microsoft and Yahoo can agree on one thing. Noone wants the best brains to bolt (last week Bradley Horowitz, head of the company’s Advanced Development Division, left for Google, joining a brain drain that has been underway for some time - and yes, the A.D.D. acronym seems to have been a deliberate joke, to judge from Horowitz’s blog.)

This is what Jerry Yang had to say at the end of last week to Yahoo employees in an email that we’ve just got our hands on [note: the punctuation is all Jerry’s]:

i know the current environment can be unsettling. to ease your concerns, we’re putting in place a “change in control employee severance benefit plan” to ensure that all of you have financial protections in the event of a job loss if a change in control does take place. let me stress that this shouldn’t be construed as any indication that a change in control might or might not take place. it’s a way of protecting you and putting your minds at ease so you can all focus on creating value for yahoo!.

If you happen to be Microsoft this looks like a double-edged sword. If it stops top talent leaving, so well and good. But it also means that anyone you actually want to get rid of (and let’s face it, with more than $1bn in annual cost savings to be found there are bound to be a few) is going to cost. Will it keep employees focused on creating more value for Yahoo shareholders? Probably not - the best that investors can hope for now is a sweeter offer from Microsoft.

It’s hardly surprising that Legg Mason is the only major Yahoo shareholder to speak out on Microsoft’s takeover bid thus far – strongly hinting it would be happy to sell if Microsoft raised the price.

It is the only one of the top institutional shareholders in Yahoo without a major stake in Microsoft as well. It can therefore see a clear profit from the deal, while the rest have been buried in silence as they carry out frantic calculations on how much their Microsoft holdings may be hit by buying Yahoo.

Financial risk-management analysis group RiskMetrics has also been doing the maths. It says the 13 per cent drop in Microsoft shares since it made the bid public on February 1 “does not bode well for the long-term value creation potential of the proposed transaction.”

It cites a 2004 study showing that in three-quarters of the deals that get an immediate thumbs-down in the stock market, the company concerned is still underperforming the market index two years later.

RiskMetrics lists the cross-shareholdings, starting with Capital Research & Management’s 11.36 per cent stake in Yahoo worth $4.076bn and 5.98 per cent share of Microsoft worth $16.4bn.

Legg Mason is next with a 6.59 per cent stake in Yahoo, worth $2.364bn, but only a 0.02 per cent stake in Microsoft, worth $66m.

Vanguard, Barclays Capital and State Street all have substantial holdings in both.

“We can expect shareholders who own both companies to pressure Yahoo directors to extract a material sweetener from Microsoft…that isn’t seen to destroy the perceived benefits of the merger,” RiskMetrics predicts.

A bit like Victor Kiam and his Remington shaver, some bloggers liked the Seesmic video product they tested so much that they decided to buy the company.

Well, almost: a long list of industry “names” has been announced as investors in Loic Le Meur’s hot San Francisco start-up.

They include well-known bloggers Michael Arrington of Techcrunch, Dan Gilmor, Steve Garfield, a video blogger, and Jeff Pulver.

Also investing are Atomico, the investment group of Skype founders Niklas Zennstrom and Janus Friis, Steve Case, co-founder of AOL, Ron Conway, an early Google investor and Reid Hoffman, LinkedIn founder, among others.

This first round of funding is worth $6m. Seesmic allows users to make videos of their thoughts as easily as adding a comment to a blog post.

It is still in closed alpha, but Mr Le Meur’s clever cultivation of well-known bloggers as testers has garnered Seesmic influential support, plenty of publicity and now, loads of money.

Apple is not the only Silicon Valley company trying to shake up the mobile world with more graphically rich phones.

Nvidia, known best for its PC graphics cards, unveiled an applications processor at the Mobile World Congress today that enables 10 hours of high-definition video playback and 100 hours of audio on a phone.

The Santa Clara company says its APX 2500 is the world’s lowest power HD computer on a chip.

The processor is the fruit of its $357m PortalPlayer acquisition in November 2006. The chip company was picked up after it lost a key Apple order for its iPods.

“PortalPlayer was the technology behind the first five generations of the iPod – a system on a chip that decoded the audio with very low power use,” says Mike Rayfield, general manager of Nvidia’s mobile unit.

“We’ve combined that with our graphics processors for handheld devices to make application processors.”

Nvidia saw a trend where the modem parts of mobile phones were being separated from application processors, which were becoming more like computer processors, he added.

Mr Rayfield sees applications such as immersive 3D maps and users plugging their phones into hotel-room TVs to play two-hour movies stored on the handset.

Nvidia expects full production of the processor to be underway by mid-year and is pitching it at Windows Mobile devices. It says it allows handset makers to come up with a “Smartphone 2.0” that can challenge the iPhone’s graphical richness, with Windows Vista-like 3D-overlays and transparency possible in the display.

Amazon is looking more like Apple every day in the audio department.

It now has an iPod (its Kindle electronic book plays MP3s), iTunes (its MP3 beta service), downloadable video to rent or buy (Unbox) and now podcasts and audiobooks ( it just bought Audible for $300m).

The Audible.com acquisition, announced today, is an interesting one as Audible supplies audiobooks for iTunes – no word yet on how that relationship might change.

Amazon said it would pay $11.50 a share for Audible, a 23 per cent premium on its closing price on Wednesday.

Audible, founded in 1997, has more than 500 spoken-word content partners and offers a subscription model for access to audiobooks, radio shows and podcasts.

Amazon recently scored a big win over iTunes, signing deals with the four major record companies to offer music free of digital rights management software. Apple’s only such deal is with EMI.

The one thing Amazon can’t add is Apple’s cool. When it comes to brand recognition in music, Apple still has the edge.

Palm Desert, California: Online video creation, distribution and analytics are becoming more sophisticated as the industry matures. A number of companies focused on video are launching products here at DEMO 08. The highlights:

Xtranormal, based in Montreal, Canada, introduced "movie-making in a box". It can turn an IM-like chat into a movie, attaching the text to a 3D avatar and using emoticon-type animation icons in the text to add movements. It’s an intuitive interface that should be easy enough for children to construct school projects and adults to make their own chat shows, business presentations or animated blogs. Users can add their own mugshots to the avatar to make it more realistic and their animation can take place in a range of sets. Xtranormal will likely sell additional packs of props and sets. The finished result can easily be published to a blog or social networking site. Xtranormal plans to launch in April.

BitGravity launched BG LiveBroadcast, a Flash-based video streaming service. It showed video in high-definition quality and switched between sources in the rapid channel-hopping style of regular television.  There were also digital video recorder features - skipping back and forward. Perry Wu, chief executive, said the service was designed for live broadcasting. "The only thing traditional TV was better at was live broadcasts, today that’s all about to change," he said. To demonstrate its technology, BitGravity has been streaming the DEMO conference itself.

TubeMogul showed off how it could deploy video to different services such as YouTube, Metacafe and MySpace, saving content creators the bother of encoding for the different services and allowing them to instantly reach a larger aggregate audience. For anyone uploading less than 150 videos a month, the service is free. TubeMogul is also able to provide detailed analytics on where the video is being most watched and a breakdown of the demographics of the audience.

Visible Measures can give creators information on how viral their video is and how much it engages its audience. It demonstrated how the well known World of Warcraft Toyota ad lost 20 per of its audience online before the truck actually appeared. It has just acquired Vidmeter, a viral video ratings and distribution service. The Boston-based start-up has also announced $13.5m in second-round funding at DEMO.

Palm Desert, California: Here at DEMO 08, we have two days of product launches by 77 companies unveiling new web tools and services, hardware, software and the latest in consumer electronics.

Products like the Roomba vacuum cleaner and Pleo the robot dinosaur were introduced at DEMO and the room here is packed with media and venture capitalists watching six-minute demos of the next big ideas.

Some highlights from the opening session:

Iterasi unveiled its "Notarize" web toolbar. This is bookmarking on steroids. Iterasi captures a complete web page when you click on its button. That means not just the link, but an image of the page and a full html version that will render just as you first saw it. This has become more difficult as sites have become increasingly complex with the use of Ajax, but search results pages and annotated maps can be saved as you created them. The page can also be tagged and filed to make it more findable.

LeapFrog, the educational toy company which has sold 30m of its LeapPad platforms worldwide and more than 70m LeapPad books, introduced its new Tag device.  The pen-like peripheral is aimed at helping four to eight-year-olds to read. Pressing on any word or object in Tag-enabled books makes the pen speak the word. It can also be connected to a PC to download words for new books and to upload information on the child’s reading, showing a parent how their child is progressing.

One of the irritations of current mobile phone browsers is that they lack the software capabilities to play video. Skyfire launched a browser for mobile phones at DEMO that can handle Flash, Ajax, Java and Quicktime elements in web pages. The bad news is that is still in private beta and only works on Windows Mobile devices currently. The presenters said users could also listen to last.fm music, and later showed me how other kinds of non-Flash-based internet radio like the BBC could be heard.

The storage company Fabrik showed off Joggle, which it described as "aggregation through virtualisation". Joggle, built on the Adobe Air platform, finds your content whether it is online or offline and presents it in a single view. Fabrik showed a window of thumbnail pictures that were stored on a combination of Flickr, a USB thumb drive and a MyDocuments folder. Content such as photos and music can be dragged into a slideshow creation tool that can then be served as a widget on a users’ blog or MySpace page.

SpeakLike showed an instant-messaging translation service. An English speaker typed in English in his chat window, but his words appeared translated into Spanish in the window of his Spanish friend. The reply in Spanish was translated back into English. SpeakLike also demo’d an English to Chinese conversation. The company uses a mixture of machine translation and human interpreters, which raises questions about how the business will scale and make money.

Finally, Notchup showed off a job recruitment service for people not looking for jobs. The idea is that people happy in their jobs but interested in listening to good offers are the most sought-after recruits. Companies can pay tens of thousands of dollars to headhunters to reach these people, but Notchup cuts out the middleman. Workers enter their CVs and use a calculator for their skills to set a price of say $500 that they expect to be paid to be interviewed. Companies contact them directly although the worker’s anonymity is initially preserved. Notchup says 50,000 people and 400 corporate clients have signed up in the past eight days.

SeeqPod, the music search engine that we wrote about in September, has finally incurred the wrath of the record companies.

The Bay Area start-up is considering its legal position after Warner Music Group filed a suit in a Los Angeles court alleging copyright infringement.

SeeqPod users type in the name of a song or artist and the search engine compiles a list of instances that can be played with the click of a mouse.

SeeqPod told us at the time that they did not host any of the music and therefore felt they were acting legally, which seemed a little hopeful and perhaps naive.

Warner’s complaint, a copy of which has been posted on the Electronic Frontier Foundation’s site, says that SeeqPod links to sites with illegal copies of copyrighted music and makes this “practically unlimited catalogue of unauthorised sound recordings available for on-demand streaming.”

“SeeqPod directly supplants legitimate contractual arrangements that exist for the authorised digital audio transmission and distribution of copyrighted music.”

While SeeqPod does not allow actual downloads of the music it finds, the major record companies are clearly inclined to clamp down on streaming services that do not have their approval.

In contrast, Warner, EMI, Sony BMG and Universal made a deal with CBS’s Last.FM on Wednesday that permits free streaming of their music.

The four majors earlier gave their backing to streaming from imeem, a social networking site. But that was only after Warner launched litigation last May against imeem similar to that it is now bringing against Seeqpod.

The message to the search-engine start-up therefore seems to be: Sign up or sign off.