In theory, the system might work, but LiveBook may rely too heavily on its points scheme. Points aren't just used to add lines to the story, but are also a sort of creative currency within the application. It takes 5 points to add a new sentence, for example, starting a new chapter costs 20, and every time you vote for a sentence it costs you a point. Earning points is, according to the FAQ, a matter of inviting new users.

Presumably, having a sentence selected for inclusion also earns you points, but what this adds up to is a book that heavily relies on the popularity of the app to succeed. Since new users only start with 10 points (enough to add a couple of sentences or dole out a few votes before going bust), the app has to be popular or run the risk of having very few users with enough points to contribute -- which would suddenly make the crowd a lot smaller. Right now, the Facebook version of LiveBook has 45 active daily users.

Other Innovative Ways to Write Online

We've looked at a number of innovative new collaborative writing applications on ReadWriteWeb over the past year. Here's a brief overview:

Recently, Sarah Perez reviewed the very slick Protagonize, on which users can work together to create choose-your-own-adventure style stories, as well as more traditional linear collaborative fiction. Last June, we looked at six "fiction 2.0" applications. Collaborative writing apps Novlet, Portrayl, and Ficlets, are still going strong, but Unblokt, has since shut down, which is too bad because it had produced some suprisingly readable fiction (note, you can actually still read the completed stories by navigating to this link).

We also looked at the National Novel Writing Month, in which people attempt to write a 50,000 word novel in a single month. For the 2007 edition this past November, there were a whopping 1,187,931,929 words written, and of the 101,000 participants, over 15,000 managed to crank out a full 50k word novel. For the even more insane writer, there's the 3 Day Novel contest during which people compete for cash prizes by writing a novel in 3 days. They actually publish the winners, some of which have won awards.

On more than one occasion we've mentioned the One Million Penguins Project. A collaboration between De Montfort University and Penguin Publishing in the UK, the idea was to see if a novel could be written by the crowd via a wiki. The result? According to one organizer it was "unlike anything I’ve read before." The novel has been broke up into sections, which you can read online. The banana version may be the oddest.

Clearly, there are a lot of new and interesting ways to write fiction online, and participating in any one of which can be a lot of fun. What's your favorite?

It's an incredible piece of PR and, some might suggest, fear-mongering. But let's throw these questions open. Let us know in the following poll what you think about Google's response to Microhoo!.

UPDATE: Microsoft has responded to the Google blog post. In a statement from Brad Smith, General Counsel, Microsoft states that "the combination of Microsoft and Yahoo! will create a more competitive marketplace by establishing a compelling number two competitor for Internet search and online advertising"; areas where of course Google is number one. The lawyers are sniping, this battle is getting heated...

Reminder to PR people and startups: If you would like ReadWriteWeb to consider covering your product, you should email us at tips@readwriteweb.com. This address is monitored daily by all our main bloggers. Pitch emails sent to my personal email address almost always get forwarded to the tips address, so skip the middleman by emailing tips! Due to volume, we cannot respond to every email - but be assured that they are being read and considered by our writing team.

The top story this week came right at the end: Microsoft's $44.6 billion offer to buy Yahoo!. It's a huge story and Marshall Kirkpatrick had RWW's analysis:

It's going to validate a lot of innovation at Yahoo! Many people, including Microsoft on the conference call early this morning about the news, are focusing on what this means for advertising and for search. Since when is Yahoo! particularly good at either of those things, though? Yahoo! has created a web presence with more traffic than almost anyone else on earth. That's what they are good at and the issue is that they haven't been able to make money off of it.

Yahoo! is great at content and online innovation, though. That's what Microsoft needs right now. Google is posing a threat to Microsoft not just because it is winning in advertising, where Microsoft is a relative beginner, but because Google is shifting the software world to online.

Read the whole post here

In other news, this week Google announced the release of a new API for graphing social net connections on the web at large. The Social Graph API is a way for developers of social applications to let users easily find data on their social connections across the open web. The information the API returns can be useful in helping users locate and add their friends when starting up at a new social application. See also: Plaxo Pulse First to Use Google's Social Graph

DEMO Coverage

This week the venerable DEMO conference was held and Marshall Kirkpatrick was at the show for ReadWriteWeb. Here is his coverage during the week:

• Seesmic Transcends Comparisons With Twitter
• Capturing Structured Data With an AIR App: Acesis Goes to DEMO
• SproutBuilder: You've Got to See This Drag and Drop Widget Maker
• The Pros and Cons of DEMO
• The RWW Toolkit for DEMO08

Web Trends

The International Federation of the Phonographic Industry (IFPI) last week released their latest report, summing up the digital music landscape at the start of 2008. The IFPI claims in the report that for every legal music download, there are 20 illegal downloads taking place. Or in other words, illegal downloading is happening at a rate that is 20 times that of legal downloading. This, says the IFPI, lead to US$3.7 billion in industry losses. But there are some big holes in that claim.

As part of MTV's coverage of the 2008 presidential elections in the US, the media network assembled a "street team" of 51 amateur journalists -- one in each state and the District of Columbia -- to file blog reports, photos, videos, and audio podcasts about election issues during the course of the campaign season. The videos are being syndicated to MTV's mobile web site, social network, and to the Associate Press Online Video Network. Members of the street team have been outfitted with laptops, video phones, and other popular tools of the citizen journalist via funding from a $700,000 grant from the John L. and James S. Knight Foundation's Knight News Challenge.

How YOU Can Make the Web More Structured

We have written a lot here about the the vision of building a structured layer on top of the current web. Annotating billions of HTML documents in a bottom-up way or building top-down tools that can automagically interpret the existing information are the two approaches that we discussed. Together these approaches would result in a global database which will make the web even more connected. The ability to correlate content and concepts accross web sites would reduce the time necessary for searching and would enable the discovery of related information.

SEE MORE WEB TRENDS COVERAGE IN OUR TRENDS CATEGORY

Web Products

For 2007, our Best Web LittleCo was Twitter, the microblogging/status application that captured the collective attention of Silicon Valley at SXSW last winter and has been on a meteoric rise ever since. We picked Twitter because it "has captured the imagination and become a new hybrid of chat, social networking and blogging." But, unlike 2006's Best LittleCo YouTube, which has become firmly entrenched in the mainstream consciousness, Twitter still exists outside of most mainstream circles.

There appears to be evidence that Facebook users are beginning to suffer from app fatigue, and there is growing discontent about how applications are being distributed and about the amount of noise that the application platform has introduced into the Facebook ecosystem. As Mark Glaser writes on the PBS MediaShift blog, Facebook has a growing trust problem. Further, new numbers suggest that fed up users might have had enough of some of the most popular Facebook apps. This, however, could be a good thing for users and for the health of the platform in the long run.

Last October, Mozilla announced that they were working on a mobile version of the Firefox browser. As it turns out, they were working on two versions: one designed for touchscreen devices like the iPhone and another for traditional phones. Now Mozilla has finally given us a glimpse of their designs by posting the plans, mockups, and details of these two upcoming mobile browsers on the Mozilla wiki.

SEE MORE WEB PRODUCTS COVERAGE IN OUR PRODUCTS CATEGORY

That's a wrap for another week! Enjoy your weekend everyone.