Saturday, December 10, 2011

The Latest from TechCrunch

The Latest from TechCrunch

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Today Amazon Will Give You $15 To Use PriceCheck and Screw Local Retailers

Posted: 10 Dec 2011 09:05 AM PST

Amazon PriceCheck App

Today, December 10th, Amazon is offering a very special deal you’re going to love and your local brick-and-mortar retailer is going to hate. Use its PriceCheck mobile app and get 5% off your purchase, up to $5 at a time, as many as 3 times. Why the discounts to use PriceCheck? The app is designed to get you to visit local shops, try out a product, submit valuable pricing data to Amazon, leave without buying anything, and make your purchase on Amazon instead.

Actually scanning an in-store item isn’t technically required to get the discount, though Amazon doesn’t make this clear at first. The webpage for the deal states “Get a 5% discount just by checking a price”, but you can check a price by typing in a product’s name from home without submitting a local price. If you read the terms it says “In-store price submission and location confirmation are optional.”

Amazon explains the local pricing data helps it offer competitive prices. That’s exactly right. Because it offers such a wide range of products and makes the real money from hooking users on its shopping experience, Amazon can afford to lower its prices to beat out brick-and-mortars. PriceCheck helps it identify which products it needs to put on sale, and the one-day discount will get shoppers used to looking on Amazon for these deals.

Now, I’m no luddite. Efficient technology’s march over old models is natural and inevitable. But using shoppers to gather reconnaissance on its offline enemies is pretty aggressive. It also promotes show-rooming where users get the benefit of checking out a product in person, but then neglect the shops that pay overhead to offer that service.

There’s little that brick-and-mortar stores can do to stop this. If they berate people for scanning their products with PriceCheck, they’ll just push them right into Amazon’s clutches. Shoppers will have to decide whether to take the discount, or support their local mom-and-pop or even their local Walmart which at least keeps jobs nearby. But in this economy, most people’s allegiance is to their wallet.

UFC’s Dana White: “Twitter Is The Greatest Marketing Tool In The History Of The World”

Posted: 10 Dec 2011 08:30 AM PST

Editor's note: Guest contributor Joseph Puopolo is an entrepreneur and start-up enthusiast. He is also an Ultimate Fighting enthusiast. He took his camera to a Ultimate Fighting Championship event and came back with this interview with UFC president Dana White. His last post was on the social media strategies of professional wrestling

I got to meet and interview Dana White ahead of UFC 140. The event takes place on December 10th in Toronto, Canada and like every UFC event, heavily hyped via social media. Over the past 3 years, Dana White and the UFC have built a very strong social media presence, with 1.7 million followers on Twitter. I wanted to speak to the president of the UFC himself and get some more detail on what he thinks of Twitter and other social media tools. Dana talks about how he got into Twitter, how he uses it to help his business, what are the pitfalls and benefits.

He’s a huge fan. “It’s the greatest marketing tool in the history of the world and it is free,” he tells me. Watch the video.

TC Gadgets Webcast: Jakarta Blues

Posted: 10 Dec 2011 07:49 AM PST

This week HP webOS open-sourcing, RIM’s problems in Jakarta, and giving away a few Speck iPhone cases. Join us, won’t you, in the TC Gadgets Webcast?

This week we have a special giveaway. We’ll pick for commenters at random below to win a Speck iPhone 4/4S case of your choosing. There is a whole slew of them available, so winners will be able to choose from an assortment. Comment below and be sure to watch the webcast for more info on the cases.

Health Conscious Mom Commerce Site Ecomom Raises A Healthy $4 Million

Posted: 10 Dec 2011 07:09 AM PST

Mom commerce site ecomom has raised $4 million in a Series A financing round lead by Cue Ball Capital. The round was followed on by investors Dave McClure, Tony Hsieh, Chamath PalihapitiyaRohan Oza, 500 Startups, Matias de Tezanos, Rhodium, Walter Kortschak, Troy Carter, Crosslink Capital, Summit Series, Nala Investments, Paige Craig, Ed Wilson, Tom McInerney, Zac Zeitlin, Venture 51 and Bruce Leak. Cue Ball’s John Hamel will be joining the board.

ecomom CEO Jody Sherman tells me that what sets ecomom apart from other mom-targeted commerce sites is its expert curation, with an editorial staff culling eco-friendly and healthy products.

“Everything that goes in, on, or around a growing family is available and every product has been deeply researched and evaluated against over 70 separate criteria — focusing first on ‘is it healthy and safe’ then ‘is it useful and cost effective,’ “he says. The site offers anything from diapers to nail polish to parents who want healthier product options for their their children.

“Domain rocks, product rocks, customer segment everything rock,” the infamous Dave McClure tells me, explaining why continues to invest in the service, “What mom doesn’t want to buy healthy stuff for their kids?”


Fly Or Die: The New Xbox “Metro” UI

Posted: 10 Dec 2011 06:47 AM PST

Erick isn’t much of a gamer, which is why he’s particularly suited at assessing the new Xbox 360 UI, dubbed Metro by those in the know. Aside from the obvious changes in design, the UI actually makes it easier for guys like Erick to use the Xbox to watch movies, Youtube videos, UFC fight, and other media ephemera that thus far has been lacking in the Xbox experience.

Microsoft knows that the 360 is reaching the end of its life cycle and next gen stuff will probably be announced by the next E3. That said, this update allows the stragglers – folks who have been thinking about an Xbox but who may not play games – to purchase the device as a media center rather than a games machine.

We look at the UI and some of the apps in this episode of Fly or Die and, most important, assess just how good a sniper Erick is in MW3.

Michael Moritz On Klarna’s $155M Round: “This Is The Public Financing Of Twelve Years Ago”

Posted: 10 Dec 2011 01:00 AM PST


On Friday, a little-known Swedish ecommerce payments company called Klarna raised a massive $155 million round from DST and General Atlantic. Its previous round was a scant $9 million in May, 2010 when it was discovered by Sequoia Capital and superstar partner Michael Moritz took a board seat (yes, he actually flies to Sweden for the board meetings). “This is the public financing of twelve years ago,” Moritz tells me, “it is just done privately.”

Klarna’s mega-round fits into a growing trend with successful internet companies that build out a substantial business on a few million dollars, then don’t take on any more money until they do a huge round. Examples include Dropbox, which recently raised $250 million after only raising $7 million before, and Airbnb with its $112 million round (Sequoia was an early investor in both of these as well).

These are also starting to be called shovel-in rounds because investors shovel in the money once it’s clear the company is a winner. The buyers in these “pre-public investment rounds” are the same investors who would have previously bought IPOs, funds like General Atlantic, DST, T. Rowe Price, Fidelity, Tiger, and Wellington Capital. It is global capital chasing returns.

Klarna could have gone public. It is on track to double revenues to about $120 million this year, CEO Sebastian Siemiatkowski estimates. And it’s been profitable on a pre-tax basis since 2005. It has 600 employees and clears $2.5 billion worth of e-commerce transaction through its payment system.

“I think overall it is better for businesses to stay private because you have more latitude,” says Moritz, “more freedom. The inevitable mistakes made during the hurly burly of developing a business are not penalized by people who do not understand it.” Moritz is a patient guy. He knows Sequoia will get its return down the line.

The company makes it easier for consumers to complete e-commerce transactions by allowing them to pay after they receive the goods instead of when they order them. It solves the abandoned shopping cart problem. Using sophisticated machine learning and other techniques, Klarna tries to figure out the risk of somebody not paying. It essentially extends consumers credit by paying the merchants. Then the consumers pay Klarna. “We want to separate buying from paying,” says Siemiatkowski. “Paying creates a lot of friction.

The only information a consumer needs to provide are her names, address, and email—not even a credit card number. The fraud rate is very low, says the company, because they use all sorts of data—from traditional credit checks to what items you are buying to how you enter your email address—to assess risk. The key thing about Klarna’s model is that the first purchase is always the riskiest. Once a consumer has paid Klarna for a purchase there is a pretty good chance they will pay again.

The service started in Sweden (where 20 percent of all e-commerce sales already go through Klarna), then spread to Norway, Finland, Denmark, the Netherlands, and most recently Germany (where it is growing at more than 1,000 percent annually). “When we started it, people said it was a Swedish phenomenon,” recalls Siemiatkowski, “then a Nordic phenomenon, then a Nordic-German phenomenon. We think this can work in basically any geography.”

But Klarna can become a multi-billion dollar company if it just conquers the rest of Europe. “The greater European theater is obviously an enormous market,” notes Moritz. “For American companies, Europe, despite its importance, is always a second act. For Klarna, Europe is its most important market, and that flavors everything.”

And its European roots may serve as an advantage as it expands there. Moritz adds: “Weirdly enough, payments is an easier business in Europe than U.S. because of the EU. Once sanctioned in one member state, you have freedom to roam elsewhere.” Whereas in the U.S. there are state-by-state laws and regulations to contend with.

Finally, Klarna takes over the whole payments stack. Its fees are not split up between issuing banks, payment gateway providers, and the digital wallet. It delivers all of those services and keeps all the payment fees itself, which can vary between 1.5 percent and 2.5 percent.  But the fees are not so important because Klarna promises to actually boost sales by removing barriers to buying at checkout. Merchants who adopt Klarna end up seeing as much as half of their checkouts paid through the service, as opposed to 5 percent to 10 percent for other “alternative” payment services like PayPal.

Daily Crunch: Arena

Posted: 10 Dec 2011 01:00 AM PST

Apple Made A Deal With The Devil (No, Worse: A Patent Troll)

Posted: 09 Dec 2011 06:17 PM PST


Over the last two years, Apple has been engaged in vicious legal battles over smartphone patents, many of which are aimed at squelching (or squeezing money out of) manufacturers of devices running Android. And now, for some reason, it has given valuable patents to a patent troll — which is using them to sue many of the top technology companies in the world.

Meet Digitude Innovations, a firm based in Virginia that recently filed suit with the International Trade Commission alleging patent infringement by technology companies including RIM, HTC, LG, Motorola, Samsung, Sony, Amazon, and Nokia (note that Apple is not on this list). The ITC is a favorite for companies litigating over mobile phone patent disputes, as it can block the import of products long before a case has actually concluded.

Digitude was founded in 2010 and raised $50 million from Altitude Capital Partners, with aims to “acquire, aggregate, and license key technology areas within the consumer electronics and related technology fields in a patent consortium” — in other words, it buys up patents and then sues other companies until they settle and agree to pay licensing fees, because it’s generally less expensive than actually going to court.

From a Forbes article this past June:

Digitude is a new kind of patent investment vehicle because it seeks to team up with strategic players that can invest in Digitude not with money, but by contributing patents. The contributing entity would then get a license for all of Digitude's patents, [Digitude Chairman Robert] Kramer says.

In April, Digitude announced the “completion of its first such strategic partnership with one of the world's leading consumer electronics companies” — which it didn’t name. The company later announced that additional (unnamed) parties have jumped on board as well, who will receive a portion of Digitude’s proceeds based on the value of the IP each party contributed.

Apple appears to be one of these participants, and may be the unnamed leading consumer electronics company that Digitude boasted about this past spring. Of the four patents that Digitude included in its claim this week, two were owned by Apple earlier this year, before they were transferred to Digitude.

The patents in question:

USPTO #6208879 — Mobile Information Terminal Equipment and Portable Electronic Apparatus

USPTO #6456841 — Mobile Communication Apparatus Notifying User Of Reproduction Waiting Information Effectively

In both cases, Apple transferred ownership of the patent to a company called Cliff Island LLC, which in turn transferred it to Digitude Innovations. In fact, Apple has transferred a dozen patents to Cliff Island LLC this year (though only two of these were named in this ITC suit).

You probably haven’t heard of Cliff Island LLC, because it appears to exist in name only. There is a next to no information about the company available online — though the patent filing does include an address: 485 Madison Avenue, Suite 2300 in New York City.

I was unable to find a phone number for the company, so I attempted to pay a visit to their office, only to find that it doesn’t appear to exist. But there are other tenants on the twenty-third floor of 485 Madison. One of which is Altitude Capital, the same IP-focused private equity firm that happened to lead Digitude’s $50 million funding round.

Put another way, Apple appears to have transferred its patents to the patent troll Digitude, though it first routed them through a shell company that shares the same office as Digitude's lead investor and Chairman. Further evidence of the relationship between Apple and Digitude can be found on the ITC’s own website, where a list of files relevant to the lawsuit can be found. Many of these files are marked confidential, but it appears someone mistakenly left the file names intact. One of which is “Digitude-Apple License Agreement” (see screenshot below).

So what is going on? There are a pair of scenarios that seem plausible — though both of them are strange.

The first is that Apple is using Digitude as a hired gun of sorts in its patent offensive, giving the company valuable patents to wield against its opponents (while avoiding the waves of press that are spurred by each new lawsuit). But Apple hasn’t exactly been quiet about suing its rivals over smartphone patents, so it’s not clear what they’d gain from this.

The alternative is that Apple has given some of its patents to Digitude because the patent troll came after it first. The dozen patents Apple has handed over may have been part of a settlement with the firm, along with the license agreement (which would presumably give Apple the rights to its patents, and additional Digitude patents). This seems more likely.

But even if Digitude shot first, so to speak, it’s still hard to see Apple in a positive light here. This is Apple we’re talking about. The idea that the company didn’t have any options other than handing over valuable patents to a patent troll — knowing full well that it would then use those patents to sue other tech companies — seems ludicrous.

I spoke with Julie Samuels, Staff Attorney at the Electronic Frontier Foundation who focuses on patents, who points out that in some cases certain companies will sell their patents to other parties when they’re under financial stress. But Apple clearly doesn’t fall into that bucket.

If Apple were deliberately aiding Digitude, Samuels says “it would be horrifying — the patent troll problem is completely out of control. Apple has every legal right to sue over its patents, but it should be the one to do it”.

And if Apple was indeed threatened first by Digitude, and only handed over its patents as part of a settlement, she says she “cannot imagine any reasonable scenario where Apple didn’t have any other options”.

Both Apple and Digitude declined to comment.

Also, oddly, Digitude Innovations had a website as recently as December 4, but it apparently took it down in the last few days.

Image by steakpinball on Flickr

GAIN Fitness Raises $650K From Keith Rabois, YouTube & Google Angels For Personal Training 2.0

Posted: 09 Dec 2011 05:23 PM PST


GAIN Fitness, a startup that creates personalized workouts based on certified trainers' expertise, announced today that it has raised $650K in seed funding from InterWest Partners, Slide COO and angel investor Keith Rabois, Former Director of Platform at Facebook and Director of Partnerships, Content and Platforms at YouTube, Ben Ling, Michael Tanne, early founding YouTube team member Brent Hurley, Seraph Group and others.

This comes on top of GAIN’s launch of its iPhone app in July, which allowed fitness enthusiasts to begin accessing their personalized routines via mobile. Founded by former Googlers, GAIN is all about allowing those looking to get in shape access to quality training regimens without having to pay for expensive personal trainers or go through the process of researching workouts by creating a symbiotic marketplace for both personal trainers and fitness consumers.

GAIN’s iOS and web apps currently deliver these personalized workout experiences that can be experienced on the go, but the startup (backed by its new infusion of capital), aims to launch v3.0 of its iOS in January, which will supe up the platform, allowing its professional trainers to design and sell fitness multimedia “packs” that target specific fitness goals, usage scenarios — like at the gym, on the road, or at home, as well as different fitness levels.

This update will be a big lunge forward for GAIN as a GAIN, as it will give users of all stripes, body types, fitness levels — in any scenario — the opportunity to design personalized workout routines, or maintain their plans, from any location, regardless of schedule.

Those with demanding jobs, schedules, and full travel schedules are all too aware of the cost these things can have on staying in shape. The key for success for a young startup (aside from funding, etc.) is listening to feedback from your users, even if taking their feedback to heart means “pivoting” or adapting your service to meet their needs. In the case of GAIN, Founder and CEO Nick Gammell said that, initially, the teams’ focus was solely on the Web.

From the beginning, they’ve wanted to become an “anytime, anywhere” fitness resource, but the Web continues to be the venue of choice for more complex schedule, discovery, and social tools. But the startup’s 600K+ users wanted to be able to access their fitness routines on the go, and so GAIN, which had building an iOS app on the side, launched a paid app. But users weren’t happy about the pay grade, so they relaunched the app for free.

Since then, he says, users have been using GAIN’s workout building and tracking tools 4 to 5 times more, per user, compared to its web app. Now, Gammell said, the service is at a place where 40 percent of sessions are happening via mobile device, a bulk of which has come since the free app launched in October. In case you needed another example of how free beats the paywall, it seems GAIN is it.

GAIN also happens to look great, which is easy when you have the original designer of Google-acquired Picasa and NASA app developers on your team. With more than 700-plus exercises (strength, plyometric, callisthenic, yoga), as well as custom-tailored workouts, the startup is attempting to democratize the fitness experience, and so far it seems to be working. It will have to considering the plethora of gamified fitness startups out there, like Fitocracy, or any number of other cool startups, like Fitango, CrossFit, Fitbit, RunKeeper, WellnessFX — not to mention wellness devices.

It’s wonderful to see, because we, as a country need to stay in better shape.

The startup plans to announce its trainer partners, along with its new iOS marketplace in January 2012, and Gammell says that an Android app is on its way.

Back To Its Roots, Facebook Tests .edu-Exclusive Groups

Posted: 09 Dec 2011 04:27 PM PST

Facebook Groups At Universities

Long ago, signing up for Facebook required a university email address and many users shared openly with everyone in their school’s network. In an effort to revive the feeling of safe sharing within an exclusive community, Facebook has begun testing a new “Groups At [University]” feature. It allows users to create Groups that are only visible to those with an authenticated .edu email address for their school. Users are encouraged to create Groups for their dorms, classes, clubs, parties and more.

Groups at Universities and its restricted visibility is likely designed to get students sharing and discussing a wider range of content — things they might be using private email for. Currently, there’s only Groups at Brown and Groups at Vanderbilt, but if successful Facebook might roll out the feature to more schools

As Facebook opened its service to the public and adults eventually started joining, students may have begun sharing less content related to their academic lives. A status update about a study session or frat party may have reached a more relevant audience in 2006. By 2011, though, too many family members or employers might have seen it without careful privacy control usage, leading students to self-censor or discuss these topics via email. Facebook wants people sharing everything on its site, and Groups at University could help it reclaim a core use case.

Students that have registered with Facebook their .edu email address of a school in the test bed will see be alerted to the feature. Once they’ve authenticated their email address, they’ll be able to create Groups with the same open, closed, or secret settings as the standard Groups feature Facebook launched last year, but no one outside their school will be able to see them. Within their Groups at [University] home page they can invite schoolmates to the feature, and view suggestions of Groups to join and a feed of recent open Group activity.

Brown and Vanderbilt were chosen because they use different email addresses for students vs alumni. Only those with current student addresses can gain access, which keeps sketchy recent grads from crashing the party.

Facebook is grappling with the impact of its own ubiquity. Its enormous 800 million user count might make each user more reluctant to share niche content. Features like Groups at Universities could help Facebook fend off student-only social networks and micronetworks like Path vying to own targeted sharing.

It Begins: Coby Preparing Five Ice Cream Sandwich Tablets For CES

Posted: 09 Dec 2011 03:26 PM PST


Ice Cream Sandwich tablets are already coming out of the woodwork, and it looks like at least a few of them will be ready for CES 2012. The folks over at Coby Electronics have just revealed five, count ‘em five Android 4.0 tablets that will soon be making their Las Vegas debut.

As you can probably imagine, Galaxy Tabs these things ain’t. What Coby has done here is take the same set of internals (a 1GHz Cortex A8 processor, 1GB of RAM, HDMI out, and a microSD card reader) and attached them to five different displays. To their credit, Coby’s selection really runs the gamut: we’re looking 7-inch, 8-inch, 9-inch, 9.7-inch, and 10-inch variants. And hey, if you’re looking to mix things up a bit, the 8 and 9.7-inch models sport 4:3 aspect ratio screens.

Are these going to be the best Ice Cream Sandwich tablets at CES? Probably not — the Las Vegas Convention Center is pretty huge, after all — but they may be the ones to turn to when your wallet’s feeling a little light. Coby promises some “incredible prices” for these things, and the company aims to push them out the door before Q1 2012 is over.

Tablet Zero

Posted: 09 Dec 2011 02:47 PM PST


The global slapfight between Apple and Samsung shows no sign of abating – a victory here, an injunction there, a ruling here, a reversal there – like Aesop’s goats, neither will give way and chances are they’re both going to end up the worse for it, though not likely at the bottom of a ravine.

It doesn’t mean that the conflict doesn’t furnish some interesting topics for discussion, however. Just recently, Apple submitted written testimony by an expert who shares their perspective on Samsung’s design decisions, and very kindly helped to compile a list of things Samsung might have done to differentiate its product. For example, Samsung could have opted not to make their tablet rectangular, or done away with the front bezel, or given it a “cluttered appearance.” Excellent suggestions!

Not surprisingly, there has been some discussion of Apple’s rather ridiculous list of design elements it claims as its own. It’s a good time to examine the creative decisions around the iPad from a different direction. It seems to me that Apple laid a trap for the entire consumer electronics industry, and they fell for it hard. And it’s really a triumph of positioning and branding. They essentially branded the tablet’s Platonic form.

What set me thinking about this was this article about creating a tablet “from scratch.” It’s good, but unfortunately doesn’t achieve the end its author intended, which is to rebut Apple’s accusations. The article certainly shows that, working from first principles like the limits of vision and grip and so on, and make only the absolutely necessary additions given the limitations of technology at the moment, you end up with something that’s a lot like an iPad. The author suggests that this exonerates Samsung. But alas, it does the opposite: it merely glorifies Apple. No, it’s not fair. But it is true. Why?

It’s interesting to think about objects that can actually be reduced to ideal forms. It’s difficult for a chair, for instance. Does the ideal chair have armrests or not? Does it have a square back or a rounded one? Flat, sculpted, or cushioned seat? You simply can’t settle it. Yet if this Platonic chair existed, and someone made it, they would be able to point at every other chair in the world and say “look how they’ve ripped me off.”

Yet that’s what Apple has done with the iPad. I certainly don’t mean that the iPad is the be-all and end-all of tablets — there’s a difference between ideal in concept and ideal in practice. The first means it conforms to a fundamental concept of the object, the second means it’s the best it can possibly be. The iPad is ideal in the first sense: it’s no more advanced in its design than a ball or a cube. It’s a type, not a design. Which is not to say that is isn’t well-done or that they didn’t put a huge amount of work into it.

A true ideal tablet would be nothing but a magic window into content. Apple made a device as close as possible to this magic window and paired it, somewhat hurriedly and crudely, with a powerful and popular platform they already controlled. Its initial success owes itself largely to the momentum of the iPhone. But once they put it out there and sold more than a dozen of them, their triumph was complete.

See, by making the design completely generic, and don’t kid yourself, that’s what they intended and got, they ensured that no one could look at another tablet without thinking of theirs. You can look at a Asus Transformer without thinking of a Xoom, or a Nook without thinking of a Galaxy Tab, but you can’t look at any of those without thinking of the iPad. But not just because they’ve sold more units. Because you can’t make a Xoom without making an iPad first, just like you can’t make a die without making a cube first. This was Apple’s stroke of evil genius.

I say evil because while it’s admirable, among the highest art in fact, to create objects as close to their type as possible, it’s another thing to claim parentage over everything further out from the source.

Consider the Bic.

Now, I don’t mean to say that this pen is exactly analogous the iPad or Apple’s position. But consider it for a second anyway. This little device is the pen defined – essentially it’s the bare minimum for a pen, designed well and simply for human hands to grip and write with. It has no extraneous elements yet is still functional and easily recognizable as an individual branded object. It’s durable, cheap, and reliable – qualities which emerge from its archetypical design.

And while it does fit so closely with our ideas of what a pen should be (roughly cylindrical, of a certain length and width, with a writing tip and perhaps a cap that fits on and doubles as a clip), no would say it’s the best or only pen in the world, or that other pens, which share 90% of the Bic’s most important characteristics, are copies or descendants.

This Bic pen enjoys widespread popularity and huge sales, has for ages. It sells because it’s a type.

The iPad sells for more complicated reasons, but its form is about as original as the Bic’s. Functional, yes; beautiful, yes; but original? How can something so clearly designed to be the opposite of original be considered so? The iPad was made a dozen times before it was made, just like the Bic. It will enjoy long-lasting popularity and be an iconic product for a long time, like the Bic. And like the Bic, it has no claim to its shape. Its shape, like the pen, the chair, the cup, was determined by necessity, and Apple made sure that apart from a few very small features, its shape was determined solely by necessity. That’s not an easy thing to do, and the result (like all good design) speaks for itself. Apple is reaping the rewards, but they must acknowledge that they don’t own the shape which larger forces than themselves imprinted on their work.

Apple’s allegations regarding UI poaching are more realistic. For a touch-based interface, we don’t yet have a type, a Platonic form, as evidenced by all the experimentation and evolution we see every month in apps, OSes, concepts, and so on. Imitation is obvious when the slate (so to speak) is so substantially blank.

And I am not oblivious that there are certain little design flourishes that set the iPad apart from a totally undesigned device. These were intentionally kept subtle and few in number. It’s these that other companies should feel ashamed of being caught copying.

What can companies like Samsung and HTC do when every tablet they build has the same foundation as Apple’s? They can make real design decisions. If they inherit the design (with minor alterations) from a competitor, and someone else makes the OS, what exactly are they contributing? The placement of the power button? That’s not to say they can’t make a perfectly nice tablet, but if they want to be held apart as a truly different device, they need to take a risk. Apple was first on the field and very pointedly took no risks in design — the risk they took was in offering the device at all. Why not take Apple up on its suggestions? No bezel, not thin, non-rectangular shape? Accept the challenge and make Apple eat their words. It’s what they would probably do if the situations were reversed. It’s all impossible until someone does it.

It’s a period of imitation whether you’re ally or enemy to Apple, because they built the mother of all tablets, or as close as they could manage, and everyone else’s devices look like its children whether they are or not. It will take time for the family tree to grow and differentiate. Apple is in the enviable position of being able to claim they invented the wheel (and patented it), and will take everyone to task for their circles until someone makes something truly new.

Apple’s Jam-Packed Grand Central Store (Video)

Posted: 09 Dec 2011 02:17 PM PST

Apple Grand staircase

Apple finally opened up its biggest store yet in Grand Central Terminal today. Since I was passing through, I decided to take a quick walkthrough with my iPhone. The results are the two videos and other images below.

The store covers two balconies which wrap around a corner of Grand Central, with different products laid down on tables and taking up space in grottos towards the back of the balconies. There are a couple interior rooms you can go through as well, and you see the terminal’s huge chandeliers hanging out the window.

It was jam-packed on opening day, filled mostly with gawkers. But I have a feeling this will become one of Apple’s highest-grossing stores just because of how many people go through Grand Central every day. You can get a feeling for the space by watching my jerky-cam videos below.

Tagged Acquires Topicmarks To Improve Friend Suggestions With Natural Language Processing

Posted: 09 Dec 2011 01:37 PM PST

Topicmarks Acquired By Tagged Done

Tagged’s mission is to help strangers meet each other online, so it has to offer friend suggestions of people you’ll like and who’ll like you back. That’s why it acquired Topicmarks, a natural language processing and machine learning company. Topicmarks will allow Tagged to analyze the profiles of its 100 million registered users and match them with others with similar interests and vocabulary. Topicmarks’ technology, CEO, CTO, and 3 senior engineers will join Tagged in exchange for cash and stock. Its existing service will remain active for the foreseeable future.

Tagged’s CEO Greg Tseng tells me the acquisition price was “somewhere in the middle” between covering Topicmarks’ $150K in seed funding and significantly impacting his online gaming and meeting network’s bottom line. Apparently it wasn’t just a graceful, low-payout exit for Topicmarks as many suspect Facebook’s acquisition of Gowalla was.

Tagged has been profitable for four consecutive years thanks to its 10 to 20 million monthly active users. It grew from 50 to 150 employees this year, including 17 from acquisitions of Topicmarks, game discovery platform WeGame, and social messaging client Digsby. One Topicmarks employee won’t be joining the Tagged.

Topicmarks’ existing service scans text and returns short content summaries. It process news article links, RSS readers, desktop files, cloud storage services like Dropbox and, and more. Now its technology will be applied to reading the profiles, messagees, comments, and statuses of Tagged users. It will look for what topics users talk about, their punctuation and emoticon usage, and whether they write in a more urban or rural fashion. It will then produce “bi-directional recommendations” of users who will both be interested in each other.

Internally, Tagged has been calling this a “Pandora for people”. Though really it’s more complicated. As Tseng explains, “When Pandora recommends music, the music doesn’t need to like you back.” More accurate friend suggestions could increase engagement, time on site, and interconnections between users that make Tagged sticky. They could also help Tagged fend off competitors such as 3-D avatar-based Shaker which won TechCrunch Disrupt 2011, and Badoo which now has 130 million registered users and $100 million a year in revenue.

Justice Department Wants To Postpone AT&T/T-Mobile Antitrust Case

Posted: 09 Dec 2011 01:16 PM PST


When AT&T and T-Mobile decided to regroup and withdraw their merger application a few weeks back, I’m not sure they expected it to backfire the way it just has. According to the Wall Street Journal, the Department of Justice is looking to postpone (or possibly withdraw) its antitrust case because the original merger application was summarily yanked off the FCC’s table.

So what does that mean for the deal? Nothing good.

Ever since the U.S. Department of Justice filed their lawsuit, AT&T and T-Mobile have vocally maintained that a speedy trial would have to be the way to go — any legal foot-dragging would supposedly lessen the value of the merger. Judge Ellen Huvelle decided months ago that the antitrust trial would begin in February 2012, which neither party had qualms with, but the new request could mean that AT&T and T-Mobile will be locked up in these legal proceedings for even longer than they had hoped.

It’s also worth mentioning that Judge Huvelle isn’t terribly thrilled with AT&T and T-Mobile’s application withdrawal. She’s now reconsidering the speed of the trial, and is also frustrated by the possibility that the two companies could work up a new deal for the FCC’s approval. Let’s hope that isn’t what’s going on, since it would have made the last few months a huge waste of time.

The longer this whole process takes, the greater the chance that something else goes wrong. And let’s not forget the small (but non-zero) chance that T-Mobile’s parent company Deutsche Telekom could pull the kill-switch and bail out entirely if the merger’s prospects look grim enough. AT&T is also preparing for the worst: they’ve set aside $4 billion just in case they need to fulfill their compensatory obligations if the deal falls apart.

If the request is approved, the two companies have a choice to make — press on in hopes that the FCC is a little more benevolent this time around, or call it quits and go home. It’s a tough call, but we’ll just have to see what AT&T and T-Mobile come up with.

Indonesian Government Threatens BlackBerry Services Over “Security Reasons”

Posted: 09 Dec 2011 01:16 PM PST


Indonesia’s telecoms regulatory agency, the BTRI, has told the Jakarta Post that they may have to shut down RIM’s BlackBerry Messenger and Internet services after the company declined to establish BBM servers within the country. RIM opted to put its servers in neighboring Singapore, for reasons not described in the article. BTRI says it must do this because “the data exchanged is not safe.”

Anyone can see through this transparent excuse for bullying RIM — they’re not the first to try it. Saudi Arabia and India recently made similar threats, though they were more forthcoming about their reasons. They wanted the power to monitor the transmissions, and chances are Indonesia does too.

The trouble is simply that the BBM data is all handled in Canada in RIM’s datacenters, and without a local node on Indonesian, Saudi Arabian, Indian, or other soil, those governments have almost no authority over the information. Naturally it’s in a government’s interest to be able to monitor its citizens, though of course the citizens (including private companies with international dealings) would prefer privacy, and RIM’s duty is to its customers.

That isn’t to say it hasn’t caved before. It has provided some private information to governments when they have requested it, though they maintain they have no way of monitoring or prying into private messages. Indeed, a server in Indonesia would only place encrypted data in the government’s possession, and they would still have to obtain the key from the account’s owner by normal means.

It’s one more problem for RIM to add to the list, and an increasingly popular one globally. Whether Indonesia will actually sabotage its own populace, among which (as it points out itself in its complaint to RIM) there are far more BlackBerry users than in Singapore and other nearby countries, is not clear. This kind of petty brinksmanship tends to drag on publicly and yield to compromises. But situations like this are becoming common as global communication becomes more and more relevant to national security and economic well-being. Sooner or later there will have to be some kind of international accord, or every country in the world is going to make similar demands.

Is December 15 Verizon’s New Galaxy Nexus Launch Date?

Posted: 09 Dec 2011 12:54 PM PST


The Galaxy Nexus, while something we’ve been super excited about, is turning out to be a real pain. Why? Because we can’t seem to figure out when the bleep this thing is supposed to launch. We heard it was supposed to be around today, and then we heard it wasn’t, and then we heard so many different dates it started to get stupid.

Now, however, Droid-Life is claiming to have found the needle in this incredibly annoying haystack. Apparently a “dozen” different sources have said that Verizon is finally letting its employees in on the launch date: December 15. Now, Verizon does enjoy a nice Thursday launch, if we’re to learn anything from history.

Still, this is the Galaxy Nexus we’re talking about, so you can never really be sure about when you’ll see it until we get some sort of official word. Even then, things are looking a little murky.

After YC And Square, Paul McKellar Becomes Founder In Residence At SV Angel

Posted: 09 Dec 2011 12:51 PM PST


As the new founder in residence at SV Angel, Paul McKellar is part of the next layer of web and mobile entrepreneurs in Silicon Valley. People who have come here and been through a couple startups over the last several years – in his case, his own company, then Square — and are now moving into financial and advising roles. That is, at least before they go found more companies.

I talked with McKellar by phone yesterday to hear a little more about what he'll be doing in his new job.

Backed by Ron Conway and headed up by David Lee, SV Angel is one of the more connected and prolific angel investors. It has had one other founder in residence that I know of, BookFresh and FreshGuide founder Ryan Donahue.

McKellar has been in the middle of the action here for the last several years, having been on the founding team of Square since 2009, where he worked on the API and web interface for the payments service provider. He arrived here via Y Combinator in early 2007, developing an anonymous conversations site called Socialmoth that he'd created while a research engineer at Georgia Tech. He turned the site into a Facebook app when the social network launched its platform that May, which he eventually sold.

In my interview with him, below, he discusses the early days of Square, how entrepreneurs should think about approaching investors, and what he'll be doing with SV Angel.

TechCrunch: So you were early in Square. How did that come about?

Paul McKellar: I had been working on credit cards online around the same time Jack [Dorsey] was starting Square, or as it was called at that point Squirrel. We had met already because I'd been in the Twitter offices when it was eight people in South Park. We met for coffee, I saw and raved about the product, and within 15 minutes he offered me a job.

I actually said no because I enjoy doing my own thing, but changed my mind about two weeks later which turned out to be a good decision.

TechCrunch: What did you learn from working there in the early days?

Paul McKellar: It was an unusually fast-growing company. We grew from 25 to 75 in 2010, and managed to do a surprising number of things right early on. The Square interface on the iPhone, for example, had the same alignment of form, and same organization since the very beginning. The way the price is displayed, the credit card sale, the description — it all encourages the right order for convenient transactions, and it hasn't really changed from the beginning. I remember Jack and Robert Anderson agonizing for this detail for hours in Jack’s apartment.

It took a lot of work to get it right and because of that, it hasn’t changed.

TechCrunch: How'd you end up at SV Angel?

Paul McKellar: I'd been meeting the team over the years at tech events, and had always gotten along with them. Kevin had reached out when they started doing the founder-in-residence program.

TechCrunch: Tell me about your new role now? What's your focus going to be?

Paul McKellar: It's basically like an entrepreneur-in-residence. Go to the Monday meetings, listen to conversations about which companies are under consideration.

Being there will help me get more of a perspective on bigger trends, and meet people who are working on other things outside of the entrepreneurs and developers I know.

The team is also small and informal, and focused on very early-stage deals, which are all things I can appreciate.

I've been looking a lot at mobile. I'd say mobile-social but that tends to make people think of Instagram or GroupMe and I'm more interested in social utilities.

TechCrunch: iPhone or Android?

Paul McKellar: iPhone.

TechChrunch: You'd recommend building for both?

Paul McKellar: All apps should be launched on both. It's a false dichotomy. Android devices are going to be ubiquitous. You might not have an Android phone, but you might have an Android fridge or an Android stereo or an Android TV.

Apple is never going to let iOS be installed in a car, that is never going to happen. But Android will. You are going to see Android everywhere.

TechCrunch: Could this position lead you to join or incubate a company as part of the job?

Paul McKellar: I’m looking to start a company with a friend or someone who I know I work with really well. Because of that, it is unlikely that I will join any company I notice because of SVAngel.

TechCrunch: Any advice for founders?

Paul McKellar: Make the decision to invest in your company very very easy. Make it easy for someone to understand what your company is, who your market is, why you’re the people to solve the problem. Good investors look at a lot of different deals and have to make fast decisions with little information. The easier you make it, the more competitive you are.

Watch Out Zynga, Japanese Gaming Company GREE Is Aggressively Hiring In Silicon Valley

Posted: 09 Dec 2011 12:45 PM PST


It’s no secret that Japanese mobile social gaming company GREE is aggressively pursuing the U.S. markets, especially with the $104 million acquisition of mobile gaming platform OpenFeint earlier this year.

Now with sights set on establishing a large engineering and development presence in Silicon Valley, the company has added a new billboard on I-80 northbound to advertise for job openings in the company’s California office. This is the third billboard GREE has put up to attract talent (the others are positioned on highway 101).

Of course the Japanese company faces stiff competition from talent from Zynga, EA, CrowdStar, and the many other gaming companies in the U.S.

But GREE is hoping that game developers and designers will flock to the company (perhaps some of those that are discontent at other gaming companies in the area) to work on its soon to be released mobile social gaming network for the global market.

GREE, which is on track to generate $1.7 billion in annual revenues, says it plans to double its U.S. headcount with 100 new hires over the course of 2012.

Check out my colleague Erick Schonfeld’s interview with GREE founder and CEO Yoshikazu Tanaka here.

Adzerk Launches AdOS, An App Store For Ad Tech

Posted: 09 Dec 2011 12:03 PM PST


Adzerk, the ad-serving technology startup which raised $650K in seed funding this July, is launching its next phase, called adOS. The new platform is intended as an evolution of its current product, and is offering improved ad-serving code plus a marketplace where publishers can find third-party apps to install. Yep – it’s an app store for ad tech.

For publishers under 100 million impressions per month, Adzerk’s ad-serving technology is free, which is one way Adzerk aims to attract new interest. Currently, StackOverflow, Tippr, Land8 Media and StatSheet are using Adzerk, as are a number of ad networks. In many cases, however, Adzerk’s technology is being white-labeled, so the company can’t disclose the names of those users.

Adzerk started out as an internal, proprietary technology used in two niche ad networks run by founder James Avery – The Lounge and Ruby Row. Avery then spun out Adzerk to sell his software.

With AdOS, ad-serving technology is a part of the platform, but the big deal here is the  new marketplace. When it launches publicly (it’s in private beta now), AdOS will feature around 100 “apps,” which includes things like targeting tools, other ad networks, features AdZerk itself offers (like the ability to manage an ad network), custom creatives and more.

By February or March, the company plans to release an SDK which will allow developers to create new custom creatives and sell them in the AdOS store. For example, Avery tells us of a creative in development that pulls in live Twitter data within the ad.

The core idea with AdOS is to solve the challenge for publishers where there are too many ad serving tools available for use, leading to confusion. AdOS, and its “app store” concept will help publishers find the tools they want, while also knowing that all those on the AdOS platform will work together. Want to use Google AdSense? You just click the little green “install” button and fill in the form. Want to install an ad network you’ve never used? You click the green “apply” button to sign up. It’s a one-stop shop.

AdOS is today launching into private beta, and will allow select publishers early access to the new platform for testing purposes. The public platform launch is planned for early next year.

Adzerk arrived this spring, after a beta period in 2010. As noted above, it has already raised $650K in seed funding, but will be looking to raise a Series A starting in Q1 2012. The plan is to use the new funding to double the size of its now nine-person team. Since its launch, Adzerk has gained “hundreds” of customers, says Avery, but the company won’t disclose the exact number.

Publishers interested in AdOS can sign up here.

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