Photo Ad Network Pixazza Is Now ‘Image App Platform’ Luminate

Pixazza is losing its unwieldy name as the company looks to evolve from being a photo ad network that specialized in tagging jpegs and gifs for direct response in-image purchases, to a wider platform for sharing, indexing and creating apps for online pictures. The three-year-old Google-backed Mountain View company will now be known as “Luminate” and instead of billing itself as “AdSense for Images,” CRO Chas Edwards tells paidContent that the company now hopes to be known as platform for developers to work out tools for deriving revenue from online photos in a variety of ways.

As Pixazza (the name is a mashup of “picture” and “piazza,” the Italian word for town square), Luminate has raised nearly $20 million from August Capital, CMEA Ventures, Foundation Capital and Google (NSDQ: GOOG), as well as angel investors like Ron Conway, former eBay (NSDQ: EBAY) COO Maynard Webb, and Facebook CFO Gideon Yu. The company developed fairly new twist on e-commerce: it would partner with publishers on tagging and indexing images on their sites. The purpose would be to highlight products within those images so consumers can make a purchase after moving their cursor on top of a desired item.

That will continue to be a big part of what Luminate does. But for where Edwards and Luminate CEO Bob Lisbonne want to take the company, the goal is to expand the social media connections and the controls that users have in choosing and cropping an image. Part of the way the company wants to get that message across is by adding a symbol that resembles two letter “L’s,” one right side up, the other left side down. The new Luminate icon, which will be found on images of participating publishers also suggests an picture about to be cropped. Lastly, Edwards noted that the new icon looked like the physical tags that would hold pictures in place in a photo album.

“As we launch the next wave, Luminate is more in line with our mission, which is making every image interactive,” Edwards said in a phone conversation earlier this week. “We’re not absolutely sure, but we think the business of images could emerge as a fourth trend that underlies the existing trends in mobile, cloud computing and social media. Maybe some day soon, companies will talk about their image strategy the way the do with mobile and social.”

That day could be coming more quickly than even Edwards, a former Digg and Federated Media revenue chief, guesses. Last week, Google acquired Pitt Patt, a startup that provides facial recognition software. Facebook is also expected to look for ways to enhance its images and Apple’s iPhoto does a pretty rudimentary job of helping users identify their frequent photo subjects.

As Edwards noted in the interview, Google Images, if it were not part of Google, would be the number search engine in its own right. But even with Google’s dominance, it still has failed to solve the basic problems associated with cataloging photos on the web, namely adding meaningful metadata to the images people are looking for.

“The online image experience is stuck in 1995,” Edwards said, harkening back to early days of the modern internet. “Since that time, all other kinds of content else has become more sharable and interactive, but not photos. The image lacks data – there’s little image recognition. We’ve corralled human insight. We’re using those approaches that fuel apps that do all sorts.”

Serving as an app platform is a goal by the end of the year, Edwards said, though the company has no firm date yet. The idea is that developers will be encouraged to create apps with Luminate that will improve online images’ value as an e-commerce and social media tool.

Users on the over 4,000 publisher sites Luminate has deals with, will be able to click on the company’s tiny icon that floats over the bottom left corner of an image when the cursor brushes over it. From there, an app tray will appear that will let users e-mail, add to their Facebook status or post to Twitter. But it will do more than that. The app tray will present additional tools, such as the ability to crop a part of the image and send it to friends.

For example, Luminate has a deal with the website for the celebrity TV news magazine Entertainment Tonight and CBS (NYSE: CBS). If a handbag held by Natalie Portman catches a users eye, the user could just crop out the rest of the image and just look at and share the image of the bag as part of Luminate’s “Get The Look” app.

For now, the ads will only remain on the publishers’ websites. But it’s very possible that Luminate would be able to track photos that are swiped and used on blogs or outside sites.

Edwards would like to see an app that lets the users make money from images as well as helping publishers retain some of the revenue from marketers who have signed on to Luminate’s offers. “We’re hoping we can do something similar to what YouTube does with video,” Edwards said. “We ‘d like to provide photo-embeds, Small, independent blog sites wouldn’t think of hosting a video — the costs are too great. But if they were offered the a way to borrow the image and have someone else pick up the hosting costs, that would cut down on image theft, especially if the bloggers could make a little extra money It’s a very easy app for us to do it at some soon. Long tail sites would love that.”