Twitter Founder Turns Square (with Mobile Payments)
Is it hip to be square again? Maybe according to Twitter co-founder Jack Dorsey. His new startup, called Square, is a mobile payments (credit card processing) system that appeals to small businesses. But is he targeting the right customers?
I think we’ve all heard rumors of a credit card reader for the iPhone—and this is it. A small, white plastic cube plugs into the audio jack of an iPhone or laptop (with software planned for Blackberry and Android). It scans the card, geotags the transaction and emails a receipt to the buyer. And just to be clear, Square is an app for merchants, not a way for individuals to electronically zap their bucks into the nearest Starbucks to pay for their latte.
And that may be the problem, too—because the product isn’t designed for big retailers like Starbucks. Its users will be smaller vendors, “who don’t qualify for accounts with traditional credit card processors because the would be deemed ‘high risk’ by these companies,” as Read Write Web puts it. According to the CEO of competitor Billing Revolution, Andy Kleitsch, that’s not going to be enough of a market, and bigger vendors just aren’t going to be interested in the product.
RWW also notes the potential for fraud:
Square will also have to deal with potential fraud. While we don’t know the exact details about how Square will operate, chances are that the company will have to keep a large reserve in an escrow account with the credit card processing companies that power Square’s back-end. Anybody who sits on a pile of stolen credit cards, Kleitsch pointed out, could use Square to run up charges on these accounts. Once the defrauded credit card owners dispute these charges, Square could be left with a large bill to pay.
However, one would hope they’ve taken precautions against this.
While Square’s website contends that processing card payments is “difficult, requiring long applications, expensive hardware, and an overly complex experience,” Kleitsch says that a payment terminal is typically free, with $20/month + 2% of all transactions as the monthly fee for the service. (While Square’s service is free, last time I checked, an iPhone runs $200, plus Square’s hardware investment, plus a monthly fee—AT&T’s$60 data fee. Ouch—unless you truly already need the iPhone for your business.)
Although one of their examples is of a local coffeeshop (of which Dorsey is a part owner), Dorsey appears to be targeting vendors even smaller than coffeeshops as well—vendors that may or may not have brick-and-mortar establishments, like artists or flower carts (another of the examples on their site).
What do you think? Does Square have the potential to take off—and if so, with small businesses or just micro ones?
YouTube Now Serving 1 Billion Spam Videos Per Day!
Congratulations YouTube!
The video site is celebrating over 1 billion views per day and the 3 year anniversary of being acquired by Google with…some nasty spam videos.
No, this just in. YouTube is celebrating with a new logo. The spam is something it doesn’t actually have any control over–and that’s going to be a big problem.
RWW is reporting an uptick in spammy videos posted to YouTube:
Researchers at Kaspersky Lab have recorded a mass mailing of spam emails containing a link to a video advertisement on YouTube. Although in the past, spammers have have attempted to lure people into clicking links by claiming the link would display a YouTube video, this is the first case in which the link actually did. In this particular incident, the video in question is a Russian ad promoting industrial real estate.
As Sarah Perez points out, will YouTube take any action to remove these videos. After all, the "spam" is the mass emails being sent out, while the videos themselves seem to not violate any YouTube policies. Hmm, where have we seen this before? Oh yeah, Blogspot hosted blogs.
Whether Google decides to take any action to prevent YouTube being a pawn in the game of email spam, is yet to be seen. Whether it can actually prevent it anyway, is another question. In the meantime, YouTube will happily accept the poor schmucks that were fooled into watching a spammy YouTube video–after all, that all contributes to the 1 billion views, baby! 
Google Goes Real Time—In Gmail
Google continues to struggle with real time search results, but interactive real time features may be headed for a Google property you probably use—Gmail.
Recently, a few people spotted favicons appearing on emails in Gmail. Read Write Web traced the new feature to Google’s Enhanced Content feature, as mentioned in a Google Help page last updated in July:
If you’re subscribed to receive email from certain senders, the messages you receive from them will be enhanced with an interactive gadget that has up-to-date content from their website (you’ll also see an icon in your inbox identifying these messages).
That’s right: an interactive gadget inside your email. RWW imagines a future for Netflix emails (one of the favicons spotted) featuring a widget/gadget to let you add movies to your queue right in Gmail. The Google Help page give the example of Baby Center’s pregnancy bulletin including top baby name lists or a baby name of the day. (Not what I’d call “interactive,” but okay.)
In the page, Google says the feature not only ensures that we know the email is from the purported sender (cross your fingers for putting an end to eBay and bank phishing!), but allows real-time interaction between the service without leaving Gmail. “We’re currently testing this with a small number of senders,” said the page (again, last updated in July), “and will decide whether to make it widely available based on user and partner feedback.”
RWW points out another benefit for marketers:
This sort of interactivity is sure to be an email marketer’s dream as it allows for whole new levels of user engagement with the brand. Instead of simply dismissing the email with a click of the “delete” button, recipients might find themselves actually taking the time to read through what were once thought of as “throwaway” messages. In this information-overloaded era where out-of-control inboxes have many email users declaring email bankruptcy, doing mass deletes, and filtering all non-personal email to other folders, any extra incentive to not delete or ignore an email is a feature which marketers are sure to take notice of.
What do you think? Would a favicon speak to you enough to get you to open a message? Are you interested in interactive real time gadgets in your email, and if so, what kind?
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Push Gmail Comes for Mobiles with Google Sync
Back in February, Google premiered Google Sync, which coordinated participating phones (all those with the SyncML standar) with Google Calendar, Contacts and Gmail.
However, in the first iteration of the product, the Gmail sync left a little to be desired. Rather than popping up with new messages, you had to manually check your email from your mobile. (The horror! The horror!) But that stone age interface has finally passed—Google has unveiled push Gmail for Google Sync now.
Are you a visual learner? Good news: Google drew you a cartoon.
We can all finally breathe easier. Sync actually works with your phone’s native email app, so it doesn’t require a new email app to download.
You can also pick and choose which Google apps you sync with—Calendar, Contacts and Gmail, any two of the above, or all three.
Really, we were expecting this a lot sooner. Google Sync premiered just two weeks after offline Gmail, and RWW agreed that the logical next step was to go to push Gmail.
What do you think? Are you using Google Sync and are you exited for the new capabilities? If you’re not using Google Sync, will you start now?
A Billion Reasons for Twitter to be Happy
So it looks like Twitter has entered some rarefied air for sure. According to ReadWriteWeb and TechCrunch the micro-blogging juggernaut is moving into an exclusive club by securing a new round of funding ($50 million) based on a valuation of $1 billion (yup, it’s a b). No doubt, this will begin to stir the supporters and detractors alike. Unless we have ridiculously short memories or just think that this time will be different one has to wonder how a company that no one can figure out revenue wise can be valued at that much.
While I am not an analyst I did think about staying at a Holiday Inn Express over the past year so I qualify for jumping into the fray, right? Let’s hear what the RWW folks had to say first though.
While it’s unlikely that Twitter CEO Evan Williams was wearing a Dr. Evil costume when he delivered the news, he had the pleasure of announcing his company’s $1 billion dollar valuation today at an all hands meeting. According to TechCrunch, the company has raised a $50 million dollar funding round and the money will be in the bank shortly. Given the fact that Twitter turned down an offer to be purchased by Facebook earlier in the year, it appears the two are about to tango.
So of course, this conversation wouldn’t be nearly as much fun without bringing Facebook into the mix. Facebook is starting to look almost like IBM compared to Twitter. What with actual revenue generation plans and actually having the audacity to be cash flow positive one begins to wonder if Facebook is going to actually merit its own valuation. As we mentioned yesterday, Master of the Universe, Mark Zuckerberg, has something to say in the Facebook blog.
We’re also succeeding at building Facebook in a sustainable way. Earlier this year, we said we expected to be cash flow positive sometime in 2010, and I’m pleased to share that we achieved this milestone last quarter. This is important to us because it sets Facebook up to be a strong independent service for the long term.
So is Twitter in for the long term? They certainly still have the buzz going and now there appears to be a a real Facebook faceoff looming for the foreseeable future.
In the past, ReadWriteWeb has looked at Twitter’s platform potential. The service has already been used to create meme trackers, emergency alert services, news feeds and brand monitoring tools. As the infrastructure and search have improved, Twitter has become the go-to site for real time media. But can the company make a Facebook-like leap?
Facebook has added Twitter like features so why not? So what’s your take? I bet there at least a billion opinions on this one.
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Nielsen to Measure Online TV Audience
Nielsen has been measuring television audiences for decades. Now online TV is starting to take over—but do we have accurate measurement of the online TV audience?
comScore and other online measurement companies are watching videos—I mean, online video audiences—grow and grow. Now Nielsen will use a new “Internet Meter” with its People Meter families to measure online as well as offline TV consumption.
The Internet Meter will measure the “extended screen”—online television from cable companies, such as OnDemand Online from Comcast and TV Everywhere from Time Warner. This type of viewing may have slipped past online measurement companies looking at web-based TV, like from Hulu. Nielsen has worked in online measurement as well, though they don’t say if they’ll be combining Hulu numbers with the online cable numbers.
According to Read Write Web, Hulu has tended to prefer comScore’s measures of its audience, since comScore’s numbers have shown a higher viewership than Nielsen’s. Online measurement is notoriously tricky in this area, since there aren’t set industry standards on how to count audiences, and as always, there can be sampling biases.
RWW says that the Internet Meter might combat inherent problems in sampling—but the Internet Meter will be based on the same statistical principles, which are fairly sound. (Yeah, I know, it doesn’t seem like a small number of people can accurately predict the habits of the general population, and a larger sample usually yields more accurate data, but if people are truly chosen at random, a small sample has a 90-95% chance of accurately reflecting the population, depending on how they do their calculations. </AP stats lesson>)
What do you think? Will this make a difference to online television? Will it affect ad prices online?
Will Facebook Get Us Ready for M-Commerce?
Don’t you just love how every year, someone predicts that “the mobile” will “arrive”? (Me too! I love these crazy forecasts! Must be my penchant for fiction.) Well, today, Read Write Web takes a hard look at mobile eCommerce and the challenges that stand between us and buy-anytime-anywhere.
A couple years ago, about 6 months after the iPhone came out, I sat on a panel about the mobile Internet, and the final question was something along the lines of “When will the mobile Internet arrive?” My answer was when we had large scale adoption of a browsing experience like what the iPhone provided. Well, smartphones have come a long way in technology and adoption in the intervening years, and the mobile Internet is gaining in popularity worldwide—and yet m-Commerce is still lagging behind.
Mobile Is Up; M-Commerce Isn’t
Having smartphones and a good mobile browsing experience are just one part of the puzzle. RWW cites several sources that show the continued growing popularity of mobile, and even mobile Internet and mobile TV. But mobile eCommerce is “struggling.” Two of the biggest barriers are privacy/security concerns and a lack of mobile payment providers.
It may simply take time to overcome users’ concerns about the security of mobile information—or perhaps a popular mobile app can help us out.
RWW point out that just last week, Facebook announced a virtual mobile payment deal with Zong. The mobile app will let verified users purchase Facebook credits using only their cell number (instead of, say, a credit card number, which they would have previously entered and verified).
Despite Facebook’s struggles with privacy issues, RWW says the mainstream public will be more likely to accept a mobile payments app from a site they know and trust (wisely or not). Other mobile payments initiatives are in the works from trusted names like Visa, MasterCard and Nokia.
But considering that most of the developing world can only access the Internet through mobile phones (and they do), maybe this problem is unique to the US.
Outside the US—M-Everything Thrives
Although a few mobile sectors are doing really well in the US, it’s nothing compared to the popularity of mobile everything around the world. RWW gives some examples:
In developing markets, however, where critical infrastructure like bank branches and high-speed internet is often lacking, people use mobile phones for all sorts of things including mobile banking, mobile money transfer, mobile education, and mobile medicine.
For example, one of the more successful mobile phone money-transfer services is M-PESA, a branchless banking service which has seen success in Kenya, Tanzania, and Afghanistan. Then in Sri Lanka, parts of Africa, and other low-GDP region a company called Amdocs even helps mobile users to spend their minutes like currency.
However, RWW predicts that, eventually, the mobile market will see adoption once the apps are available and useable.
What do you think? What will it take before you’ll give out your credit info over SMS or mobile Internet—Facebook or another site? Or does the future lie in systems like Facebook’s, where you can input sensitive data on “secure” lines, and keep that on the merchants’ servers rather than transmitting it?
Wikipedia to Take on YouTube?
Okay, no, not really—but the encyclopedia anyone can edit is looking to add video to its offerings, according to Technology Review (via RWW).
To launch in the next 2-3 months (by the end of the summer), Wikipedia’s new system will allow users to contribute and even edit clips for articles, posting the entire clip or only portions. Wikipedia itself will only allow videos from the Internet Archive, Metavid and Wikimedia Commons.
No video editing software is necessary to post full or partial clips, but “One of the requirements for any video added to the site is that it be based on open-source formats.”
The project also includes developing Web tools to create smooth methods for transferring and editing videos. When a Wikipedia editor finds relevant snippets, he will be able to preview them, and set the “in” and “out” points, without having to worry about file conversions. “Presently, the work flow is pretty atrocious” for people trying to download, convert, and edit video, says [Kaltura software engineer Michael] Dale, citing the notoriously confusing array of incompatible video formats now in use. With the new Wikipedia system, “people will be able to easily inject media into pages, in a way that wasn’t possible before,” he says.
Kaltura, an open-source “video solution provider” (Sigh. Buzzwords.), which has been a partner with Wikipedia since January 2008.
What do you think: a good move or yet another opportunity for spam on Wikipedia?
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Tweet No Evil: Twitter Censoring Trending Topics
Were you on Twitter last night? I was—it’s about the only thing I can do while watching my favorite summer show. And Burn Notice was one of the trending topics—among other . . . “less savory” terms. Some of my friends complained about the offensive trending topics; I minimized the list.
But it appears Twitter didn’t just let things stand. Read Write Web reports:
Within minutes (as far as we could tell), both terms were removed from the list on the web interface at Twitter.com. However, they still showed up on third party services such as TwitScoop and Hashtags.org.
RWW’s Julie O’Dell asks whether it was the over sexual nature of the offending tags that made the difference here, since the Trending Topics list is often plagued with the “asinine, spammy, emo, and pointless.”
To many users, the vulgar tags aren’t the biggest problem in the long term—it’s the spammy ones (not to mention the spammy usage of trending topics). Julie asks:
Should there be an algorithm for trends rather than making trending topics a pure numbers game? Should the system be fixed so that #liesboystell doesn’t win out over truly important, significant, or newsworthy content? Should tweets, like images and other kinds of content, be screen for “adult” material and user preferences be set accordingly? Or do trends really belong to the lowest common denominator?
What do you think?
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eReaders, eBooks Poised to Grow
K, I know that probably 98% of you aren’t rabidly following the blogs of people on the inside of the publishing industry. So here’s the deal: the publishing industry is getting very excited about eBooks, even without Google saying they’re going to get into the eBook business.
We’ve covered the Kindle here a couple times, but I’m willing to bet most of you don’t have one. Sometimes we like to think that means that eReaders and eBooks are nonstarters. But according to new research from Forrester, that’s just not the case. In fact, as RWW says of the report:
the eBook and eReader market has now hit a point where it is ready to break out of its niche and become a mainstream phenomenon
Now this is kind of a big deal coming from Forrester, who initially pegged the Kindle as “a niche device that would only attract a small number of book-loving early adopters.” Now they’ve revised their projections:
This is the year that eReaders are supposed to make the transition to widespread acceptance—and that may already be underway. Seven months ago, Oprah’s favorite new gadget was the Kindle, and she spent quite a bit of a show extolling its features (though it’s possible her love for the Kindle has waned as her love for Twitter did).
This isn’t a format war—there will probably always be a place for paper books in our society, and that doesn’t mean that eBooks can’t have one. But this could well be a turning point—and Google is poised to catch that wave, with its eBook offering reportedly coming out by the end of this year.
What do you think? Is Google getting in on the eBook trend just in time? Or will Amazon, with its eReader and eBook hand-in-hand, continue to dominate paper and electronic book sales?
