Consumers

Among the findings in new mobile trends report were a flip-flop in the number of ad requests from Apple iPhones and iPod touch devices, the Android OS in a solid second position, Symbian showing some spunk, and the iPads potential to be a major crossover device. - More ad requests now come from the Apple iPhone than Apple iPod touch, Android is now the second most popular OS, and while consumers generally dodge advertising, when it comes to mobile ads, theyre far more receptive. These findings were among the consumer preferences and device uses revealed by th...

Apple's Biggest News: An Open Standard for Video Calls —

Shared by Jesse Stay
Open? H.264 is not open.

The presentation by Steve Jobs opening Apple's developer conference today was packed full of details large and small about the company's hardware and software, but the one detail that could have the biggest long-term impact well beyond Apple itself was the introduction of Apple's new video calling system, FaceTime. Jobs said on stage that the system was based on extensive use of open technical standards, and that the company intends to work hard to make FaceTime an open industry standard itself.

Live mobile video, interoperable across different phones and carriers, could be a force for major changes in the way we experience the Web and the world. It could be one of Apple's most important contributions to the future.

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Mobile Video Calling is Coming & It's Going to Be Big

Analyst Alfred Poor estimates in research released today from GigaOm Pro that approximately 3.2 million consumers will have access to mobile video chat in 2010. Poor believes that number will grow almost 50-fold in the next five years, to an estimated 142 million consumers. "The first few years of the market will see fairly small numbers with the main adoptees being early adopters," he writes, "but by 2012 the market will reach beyond the enthusiast audience to a more mainstream audience, and we'll see adoption rates similar to that of SMS and other messaging formats as illustrated in the middle of the last decade."

"The power of video communications," Poor argues, "lies in the ability of the participants to detect subtle emotional nuances during conversations." (Report: The Consumer Video Chat Market, 2010-2015 Subscription required.)

Video communication isn't just about experiencing face-to-face-style interactions remotely, though. It has the potential to enable new forms of cultural experience all together.

As Jake Dunagan and Mike Liebhold wrote in a Skype-sponsored report by the Institute for the Future last fall:

"We've seen throughout history that each new medium comes with its own possibilities and limitations, impacting individuals and the social order in profound ways. The printing press democratized communication and made a literate (and revolutionary) civil society possible. Ubiquitous and accessible communication applications are now allowing more people to join the growing global symphony of text, voice, and video conversations, with vibrant new cultures and practices emerging. We all have the potential to use video-enabled networked devices to communicate in modes and manners we never have before. As Kevin Kelly of Wired magazine wrote, we are witnessing the birth of a new culture around video communication - we are in the midst of becoming 'people of the screen.'"

The Future of Real-Time Video Communication (PDF)

Barriers to the Future

Live mobile video consumption, creation and chat and calling have been held back by a number of factors. Mobile computer processing power has been a big limitation and the iPhone 4's ability to pull it off pushes the envelope. This is presumably a substantial part of why the iPhone 4's FaceTime implementation is only able to call other iPhone 4s at launch. (Note that Nokia phones have supported video conferencing for years, though.)

Bandwidth is another major limitation, and one that Apple is avoiding for now by limiting FaceTime calls to Wi-Fi connections. Jobs said today that the feature is limited to Wi-Fi in 2010, but the company is "working with the cellular providers to get things ready." Note the use of the word providers, plural.

Cries for more and cheaper bandwidth, and more efficient ways to use what is available, will be a defining issue for the near-term future of software development, tech political policy and user experience. See Stacey Higginbotham's excellent write-up of AT&T's new 3G data cap last week for more details.

Interoperability has been another major challenge. Mobile phone users can make voice calls across networks (AT&T to Sprint, for example) and email users can email across networks, but mobile video calling across networks still requires a technical standard that is agreed upon and implemented widely.

That's what Apple aims to do with the introduction of FaceTime. The awkwardly named protocol could be implemented by all major handset manufacturers so that consumers could perform video calls as easily as we perform voice calls today.

Will other companies adopt Apple's proposed standard? If Apple maintains its dominance in desirable markets, they may.

Cross-network calling would make the market explode, as long as carriers can build out capacity fast enough. Unfortunately, there is some doubt that all parties will see big increases in consumer use of their products as a good thing. Some carriers are liable to prefer less use for more pay, and if they can spit in your eye as part of the deal - all the better.

Nothing can be taken for granted, but if Apple can help advance a cross-network standard for real-time mobile video communication - that could become one of the company's most important contributions to the world.

Discuss

Skype 3G iPhone: 5M Downloads — But What’s the Usage? —

Skype says that less than a week after it was made available, nearly 5 million people have downloaded the 3G version of its iPhone app, with the demand distributed across Europe, North America and the Asia-Pacific region. I was among them, even though I don’t have a 3G connection, and I’m pretty sure many others without 3G connections did the same. But how many people are actively using the service? Now that’s an important question, and one Reuters forgot to ask.

The company recently told me that the Skype app had been downloaded a total of 12 million times by owners of the iPhone and iPod touch. And while it plans to charge for 3G calls between Skype users starting next year, “We’re not going to want to price ourselves out of the market,” Russ Shaw, Skype’s VP of mobile, told Reuters. “I can’t ignore the fact that consumers (currently) use us for free.”

I wonder if, between AT&T’s new data tariffs and Skype’s charges, there will really be a cost advantage to using Skype. Regardless, we can expect to see its usage climb starting next week, when Apple introduces the newest version of the iPhone with multitasking features. Many people are likely to leave Skype running in the background, especially for IM and Skype-to-Skype call purposes.

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Acer has announced LumiRead, a e-book reader that supports Acer's clear.fi solution, a content supply platform which allows consumers to access and share e-books and audio-books.

Steve Jobs Wants to Be Your Mommy, Your Daddy and Your Personal Savior —
It's now become painfully apparent that Apple is exercising control over what it allows in its app store not only to assert its economic dominance over subservient app developers, but to impose the idiosyncratic morality of its CEO, Steve Jobs, on Apple consumers.

Correcting yet another post-first-and-ask questions later rumor, sources tell BoomTown that–as has been previously reported many times–Microsoft and Apple have been in long-term talks about adding the Bing search service as a prominent option on the iPhone and not as a replacement of Google.

Currently, Google (GOOG) is the default search on the popular mobile device, although you can easily go into its settings and switch the search to Yahoo (YHOO). Few consumers do, though.

Microsoft (MSFT) has been angling to also be added to those options, but also have wanted it to be in some way to make the choice more visible. In addition, Microsoft wants to have its Bing mapping more integrated with the Apple (AAPL) iPhone.

“Being an option is what’s on the table,” said one source briefed on the talks. “That’s all for now, although who knows where it could lead.”

But, cautioned several sources, talks are not complete, even though the software giant is eager to be able to announce such a deal at Apple’s upcoming developers conference on June 7.

Microsoft execs have been nervous about completing such a deal, especially because Apple is notoriously secretive and is known to end talks due to leaks.

That said, relations Apple and Google have become increasingly tense and sources say Apple has been considering a number of options for search, as well as mapping, for the iPhone.

While being a option is not the same as replacing Google, it would give Bing a prominent platform to show off its technology to consumers.

Microsoft would certainly like to hipcheck Google off the iPhone, of course.

But like rumors that it was going to pay News Corp. (NWS) to “de-index” its content off Google and to display it prominently on Bing, the notion is premature to say the least.

We're the same, we're the same, we're... —

Take a look at just about any industry with many competitors--colleges, hotels, sedans, accounting firms (especially accounting firms)...

The websites bend over backwards to be just like all the others. You can't identify one hotel website from another if you delete the name of the hotel (unless there's a beach or a snow-capped mountain in the background).

Sometimes, we try so hard to fit in we give consumers no choice but to seek out the cheapest. After all, if everything is the same, why not buy what's cheap and close?

How about a site that says, "Here's why we're different." And means it.

(Easy to read this and nod your head, but... what's your resume look like?)

Privacy Machiavellis — Chris Jay Hoofnagle has a piece up at SFGate.com on what he calls the "privacy Machiavellis," which are exemplified by Google and Facebook. (The article is adapted from a longer treatment published last year, called "Beyond Google and Evil.") Hoofnagle heads the privacy foundation set up with money collected from settlements of privacy lawsuits against Facebook. From SFGate: "...you have no way to ask Google to stop this tracking. Instead, you can merely opt-out of the targeted advertising — the product recommendations. Exercising your privacy options creates a worst-case-scenario outcome: If you opt out, you are still tracked, but you do not receive the putative benefit of targeted ads. An illusory opt-out system is just one of the increasingly sophisticated sleights of hand in the privacy world. Consider Facebook's privacy options. .... Facebook can proudly proclaim that it offers ... more than 100 [choices]. Therein lies the trick; by offering too many choices, individuals are likely to choose poorly, or not at all. Facebook benefits because poor choices or paralysis leads consumers to reveal more personal information. In any case, the fault is the consumer's, because, after all, they were given a choice. Reader Kilrah_il sends word that Google has just released a tool that could alleviate some of the above worries: it stops tracking by Google Analytics for users of IE7+, Firefox 3.5+, and Chrome 4+. Perhaps Hoofnagle will comment on it here or elsewhere.

Read more of this story at Slashdot.

Anonymous Mobile Social Network Gets Venture Backing —

BlockChalk, the anonymous location-based social networking service, just announcedthat it is now a venture-backed startup. BlockChalk's investors include Battery Ventures, Mitch Kapor, Harrison Metal, Founder Collective, Joshua Schachter, Josh Stylman, Tom McInerney, and David Liu. The company, which focuses on giving neighborhoods a a forum to share information, plans to use its new funding to hire more engineers and expand its service aggressively.

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As the LBS market expands, BlockChalk stands out from many of its competitors, as it allows users to post on local message boards without having to sign up for the service or reveal their location. Instead, discussions on BlockChalk are completely anonymous, which takes away a lot of the concerns that a lot of consumers have with the current crop of location-based mobile apps.

The service is currently most popular in New York, Los Angeles and San Francisco.

This anonymity, however, also leaves the service open to abuse. As BlockChalk works with its new venture backers, it will be interesting to see if the service will stick to this approach or if BlockChalk will move to a more traditional model.

The New Frontier for Location-Based Networks: Your Neighborhood

As the company's founders note in today's announcement, BlockChalk wants to "help people connect with their neighbors and mobilize their local communities." A number of other ventures, including DeHood, have launched neighborhood-focused LBS apps recently. Most of these have a relatively clear business model (mostly focused on working with local businesses and providing coupons to users). BlockChalk doesn't have a clear business model yet.

Discuss

According to new data from consumer electronics company Retrevo, iPads might be putting a significant dent in netbook sales.

Tablets in general are newer, sexier and sleeker than netbooks, their hardworking if relatively old-school counterparts. When iPads were announced, many consumers put off their netbook purchase plans in order to try out and consider buying an iPad instead.

And for folks currently considering a smaller, portable computer, an overwhelming majority are leaning more toward iPads.

That being said, laptops are also holding a steady lead in the portable computer market. In the past year and the current year, 65% of consumers who had to choose between a netbook and a laptop went for the latter in the end.

If you had to choose between a laptop, a netbook and an iPad, which way would you lean, and why? Do you think netbook sales will suffer further when non-Apple tablets are released?

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Tags: apple, ipad, netbook, sales

Betterment, a new startup that is launching today at TechCrunch Disrupt, is looking to become the “replacement for your savings account” — it earns you more money than a standard savings account while offering more flexibility than you’d get from higher yield accounts. And, unlike most financial services, Betterment is designed so that anyone can use it, regardless of their knowledge about the market and financial products.

The site has established two portfolios, one of which consists of numerous stocks and another of ‘ultra-safe’ bonds. After linking your bank account with the service you use a slider to adjust how much risk you want to take, which determines how much money is allocated into each portfolio. The site cuts out as many steps as possible — as soon as you’ve put in your money and determined how you want to split your money between the stock market and bonds, you’re basically done (at least if you want to be).

There are plenty of other options for users who want to do a deeper dive. If you want advice on how to determine this allocation, you can look at what your peers have done. There’s an interface to adjust age ranges, income range, etc — and it shows you how risky other people in a similar situation are. An analysis section allows you to watch percent returns over time, or the dollar changes in your accounts, and your account balance.

Betterment charges a 0.9% fee.  The company  is registered with FINRA and the SEC — they’ve built their own financial infrastructure for the service (it isn’t just a nice frontend on a different investment platform).

The site goes live tonight.

Q&A:
Chi-hua Chien: The question is, are consumers going to feel they have enough control. At the end of the day customers think they can outsmart the market. How do you ride against that wave?
A: We do see those as the problem, we’re not the only ones with that Jim Cramer style investment advice. We’ve seen a trend of people moving toward investment advisors and self-managed accounts.
A2: Also, most people aren’t doing any of that. They know they should be doing more. They open Etrade and don’t know what to do. We’re trying to replace the savings account. This is where you place excess money, “here’s where I’m willing to take risk”. It feels more like a savings account than an investment account.
Chien: I do think you have to be more transparent..
A: It is completely transparent. We put every ETF on your statement. We break out every individual security. It’s completely transparent. We’re not hiding anything. It’s just a simpler investment product.
Don Dodge: I like it a lot. I was a judge at TC50 when Mint was on stage, told them it’s a huge market, you only need a tiny piece. I think that’s true for you. I would focus on 401k market. Millions of people forced to be investors through 401k. Many of them are totally clueless.
A: We totally agree..
Bijan Sabet: Don’s right. I have noticed a lot of people who manage 401ks offer these age adjusted program that are black boxes. Start with savings, add additional services.
Chris Sacca: I worry that it’s too simple. People don’t always trust it. People expect a little bewilderment that gives it credibility. This starts to feel a little like a toy.
A: It’s not a toy, it feels more like a savings account. Only difference is that you have to choose this allocation.
Vardi: People like to invst in institutions they feel confident in like Lehman Brothers and Bear Stearns

There’s no minimum balance, no transaction fees, and you always have access to your money.

Bettermind . Asset allocation — stocks and bonds are relevant. Stocks are diviersifed to reudce risk . Bond are inflication investment treasuries. With Betterment You choose the allocation.

The site may be dealing with financial information, but it’s designed in a way that makes it attractive to just about anyone. Like TC50 winner Mint, Betterment has clearly put a lot of time into making its graphs look slick and attractive,

I’ll Show You Competitive … AT&T Jacks iPhone Termination Fee —

The day after the Federal Communication Commission released its wireless competition report (it was the first year since 2003 that the agency didn’t declare the industry competitive) AT&T said it would raise the early-termination fee on smartphones including the iPhone from $175 to $325 as of June 1. This may be an indication of the carrier’s imminent loss of iPhone exclusivity, but it’s also bad timing from a major carrier.

Carriers justify early termination fees because they subsidize the price of hardware for cellphone buyers in exchange for those buyers agreeing to a one or two-year contract. Verizon last year raised eyebrows when it increased its termination fee on smartphones to $350 and had to justify its moves to the FCC. No one was impressed with its defense, but Verizon is still charging the higher ETF (although it is now dropping the amount owed each month by $10 a month). AT&t will also lower the fees by $10 per month, and is lowering the early termination fees on non-smartphones from $175 to $150.

It’s not unusual that AT&T is following suit behind the nation’s largest carrier, although it is ironic timing given that high ETFs generally reduce the freedom of consumers to change providers, making the industry overall less competitive. Of course, having the nation’s top two providers set similarly high termination fees doesn’t look that great for competition either.

Related GigaOM Pro Content (sub req’d): How AT&T Will Deal With iPad Data Traffic

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"$10 Minimum For Credit Card Purchase" Signs May Soon Be Totally Legit —

As we all know, merchants are generally not supposed to mandate minimum credit card purchases. It's a violation of the merchant agreements they sign with the credit card companies. (For more info, check out this article.) The proposed finance bill, however, may legitimize those handwritten signs if it ends up passing.

The NYT says that current Senate version of the bill will allow such minimums as long as there is no discrimination between which type of card the customer is using. A Bank of America card, for example, could not have a $10 minimum while an Amex had none.

On the other had, offering discounts to certain preferred card holders would be allowed. So you could get a $1 discount for having a MasterCard while people with Visa were stuck paying full price.

The provision is part of a larger reworking of the way merchant fees are handled. The credit card companies are against it, because it would require banks to lower fees for merchants who use debit cards. The banks currently use those fees to pay for things like rewards programs and free checking accounts -- products that are attractive to consumers and easy to market.

“This is an incredible con job,” MasterCard’s general counsel, Noah J. Hanft, told the NYT. “Under the guise of helping small business, this is just a shrewd and cynical effort that ultimately harms consumers.”

How the Finance Bill Affects Consumers [NYT]

Unbelievable: WSJ Calls Referring URLs a "Privacy Violation" —

In a jaw dropping move of bizarreness, Wall St. Journal writers Emily Steel and Jessica E. Vascellaro have called out major social networking websites tonight for violating user privacy apparently by passing profile page URLs to advertisers as the referring URLs when users click on ads. We've emailed both writers to ask for clarification in the event that they are in fact referring to something else, but haven't heard back from them yet.

"Facebook, MySpace and several other social-networking sites have been sending data to advertising companies that could be used to find consumers' names and other personal details, despite promises they don't share such information without consent," the article begins.

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"Across the Web, it's common for advertisers to receive the address of the page from which a user clicked on an ad. Usually, they receive nothing more about the user than an unintelligible string of letters and numbers that can't be traced back to an individual. With social networking sites, however, those addresses typically include user names that could direct advertisers back to a profile page full of personal information. In some cases, user names are people's real names."

It's just incredible. Go read it for yourself. Or don't.

The writers do allude to something a step beyond referring URLs when they write: "But Facebook went further than other sites, in some cases signaling which user name or ID was clicking on the ad as well as the user name or ID of the page being viewed." Those additional cases weren't discussed any more explicitly.

The Journal coverage even went so far as to claim that some social networks changed their behavior once questioned by said venerable publication! Facebook, according the the Journal, eliminated those mysterious "other cases" upon being questioned. So problem fixed right?

Of course anyone who has ever looked at a website's traffic logs knows that referring URLs are shown to destination domains. And yes, on social networks sometimes those URLs include profile names. As the Journal acknowledged, that doesn't mean it was the profile owner who clicked on the ad.

As the Journal's own coverage said:

A Twitter spokeswoman said passing along the Web address happens when people click a link from any Web page. "This is just how the Internet and browsers work," she said.

That's right. That's just how the Internet works.

Privacy and Facebook are serious issues. It's irresponsible and unhelpful to report on them like this. If we're reading this wrong, then at the very least it's being communicated poorly.

Discuss

Today during its keynote at I/O, Google officially announced that the latest version of Android, called Froyo, will feature tethering and wireless hotspot functionality — a big win for Android users. When we broke the news last week we questioned whether or not carriers would be able to disable or charge more for this functionality given that it was baked into the default Android OS. Unfortunately, at least as far as consumers are concerned, it sounds like carriers will get their say. In other words, expect at least some carriers to charge more for tethering.

I asked Hiroshi Lockheimer, who heads up engineering on Android, about the issue and the answer was confusing to say the least. Lockheimer said that Android doesn’t do anything special to tag data that’s being accessed through tethering, though carriers could probably find a way to detect it if they really wanted to. But they probably won’t have to, because Android is making it easy for carriers to either charge extra for, or disable entirely, tethering on the phones they sell. It sounds like these would both require small modifications to the OS.

That’s straightforward enough — carriers and OEMs have been molding Android to suit their needs for a while now. But what about phones that feature the “Google Experience”, which is the term used to describe devices that ship with the stock Android OS (Google Experience phones include the Motorola Droid and Nexus One)? Presumably carriers wouldn’t be able to insert their payment switch if the OS is unmodified, which means these phones could potentially get tethering included in their normal data plans.  We’ll have to wait to find out — Lockheimer said that the answer isn’t clear yet.

On Monday Groupon will tap the collective power of its group coupon buying site for a nationwide charity drive to raise $1 million for DonorsChoose.org.

Instead of the standard city-specific, deeply discounted deal usually offered, Groupon will use the May 24 offer to support DonorsChoose.org by encouraging members to purchase charity credits that are good for double the value.

For instance, if you spend $50 on Groupon, you’ll receive $100 in credit to contribute to DonorsChoose.org. Philanthropic Groupon users will have the option to purchase half-price credits for $20, $50, $100 or $250.

DonorsChoose.org is a charity whose mission is to outfit U.S. public and charter school classrooms with school supplies. Those that opt to purchase the half-price credits via Groupon can choose to allocate the deal funds to any of the DonorsChoose.org classroom projects that need funds.

Projects are specific to the individual requests of teachers across the nation and require funds for materials such as art utensils, textbooks, literature, teaching tools and other school supplies. DonorsChoose.org is responsible for purchasing the products and sending them to classrooms once the projects are fully funded. Plus, the organization follows up post-funding and provides donors with photos of the project in action, an itemized report on how money was spent and a thank-you letter from the teacher.

The DonorsChoose.org Groupon promotion will run all day Monday as the primary Groupon deal, but will also be highlighted as a side deal for the remainder of the week.

Groupon has already proved that consumers will band together to purchase items for the right discount, so we’re curious to see if the company can rally its community to come together for a much more altruistic purpose.

[img credit: DonorsChoose.org]

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Tags: charity, donorschoose.org, groupon