Posted on 2012 under Communications |
21
Jan
Losing your phone is never fun. But losing your wallet is much worse, and that’s one argument where those trying to roll the mobile-payments boulder up the mountain might find some help.
My wife and I, both tech industry media professionals working for separate companies, were all set to descend upon Las Vegas two weeks ago for CES 2012 when her wallet was stolen from a San Francisco bar the night before she was scheduled to get on a plane and check into a hotel. We carry the financial ingredients for modern life—identification, access to cash and credit, and casino loyalty club cards—in our wallets, and finding ways to replace things that important and ripe for fraud when you’re about to go on the road is a nearly impossible task.
All worked out in the end—two weeks later—but multiple trips to a local Wells Fargo branch as well as several conversations with patient but harried customer-service representatives made it clear that the old system of cashless payments, however convenient and established, makes less and less sense every year.
Imagine if her wallet was also her phone, making it the only thing of interest in her purse to the jerk that was also at the bar that night. First of all, the initial likelihood of fraud decreases because current mobile-phone payment systems—offered by Google (NSDQ: GOOG) and PayPal, among others—require the holder of the phone to enter a personal identification number to complete the transaction.
The loss would still have to be reported quickly to the company managing the account, of course. But the identifying details regarding that account could be remotely wiped from the lost or stolen phone and transferred to a new phone in far less time than it takes to replace lost or stolen bank cards. Sure, you’d still need to make a quick decision on a phone (and it would probably have to be purchased in person at retail from your carrier or Apple (NSDQ: AAPL) for this all to work), but you just lost your phone: if you’re among the growing numbers of people who have come to depend on mobile access to the Internet, you’re a person who is not going to wait very long to replace that phone.
In other words, instead of visiting two separate Wells Fargo branches that happened to be open on a Saturday in Oakland with just hours to spare before her flight departed only to kick off a two-week process of phone calls and further visits, she could have headed over to our local Verizon store to assess her options. Verizon would have gleefully taken the opportunity to sell her another phone, of course, but again, she was going to have to replace that phone anyway. And maybe when your wallet is your phone, you start to think about insurance programs that could provide for a loaner phone in the event of theft until you’re ready to make a bigger decision.
Point being, she walks out of that Verizon store with a new device that would allow her to check into the hotel that night with the required credit card for incidentals, obtain cash, pay for meals and cabs, and all else that is part and parcel of modern business travel. The current system provides for a temporary ATM card that doesn’t function as a credit card and a two-day wait for expedited bank and credit cards that Wells Fargo, for some strange reason, did not seem too enthusiastic about shipping to a casino in Las Vegas.
I’ve been a mobile-payments skeptic in the past, wondering last year if Google Wallet was a solution to a problem that doesn’t exist. If you’re lucky enough to avoid theft and loss under the current payment system, then it’s not hard to doubt that the wheel needs reinventing just so a new wave of companies can obtain more data on consumer purchasing habits.
The problem surfaces when you have to move quickly to rebuild a personal payments system designed half a century ago. An awful lot needs to happen for the scenario outlined above to fall into place, and platform wars are probably a given considering what is at stake for traditional payment companies and those eagerly seeking to disrupt the old guard. And I still agree with what I said last fall: this is years away from falling into place on a mass level.
But the concept just makes too much sense. Your credit card is a data string, not a physical piece of plastic: why not enclose that data—and the privileges and responsibilities it unlocks—in a remotely accessible mobile container with an extensive system of checks and balances that has a much healthier respect for that data?
And if one of the companies working on this also finds a way to avoid a trip to the California Department of Motor Vehicles, they may really be onto something.
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Posted on 2012 under Communications |
21
Jan
This week saw a number of developments at Twitter and Facebook, two of the world’s biggest social networking sites, that are signs of them looking to capitalize more on their already-hefty user bases by creating services that keep them on their sites for longer.
Twitter bought up Summify, a news summary service, and Facebook introduced some 60 new apps to its network. And Facebook could soon be extending time spent on the site even more: a report out today says that Facebook is in talks to replace YouTube (NSDQ: GOOG) as the host for premium music video service Vevo.
The report, from CNET, says that Facebook has held talks with Vevo to move its video service over to Facebook when its contract with Google’s YouTube expires in a year. The report cites sources close to the matter, but has not confirmation from any of the named parties.
The arrangement, CNET writes, would be similar to what Vevo already does with Google on YouTube: Facebook would host and stream the videos, and Vevo and Facebook would both sell and share revenues for ads that run alongside those videos.
Vevo could be a lucrative partner for Facebook in its bid to grow advertising on the site. According to November 2011 figures from Nielsen, Vevo is second to YouTube in terms of unique users (43 million versus 130 million). Facebook itself has made a lot of moves to add video partners to its service too, and it comes in fourth at 30 million. When it comes to the total number of streams, however, Vevo pales to YouTube (535,000 vs 13.4 million), and Facebook does not rank at all. Ditto on time spent per user, where neither Vevo nor Facebook make the top ten, and YouTube is in fourth place (Netflix (NSDQ: NFLX) is the king of time spent per user, by the way).
A deal with Vevo would also follow a pattern of moves that Facebook is making to increase user engagement.
The company this week also introduced a lineup of new apps—some 60 of them—specifically designed for users to add into their Timeline, the new graphical homepage view that Facebook has introduced.
These apps will add more functionality—and hence, the hope is, engagement—in its new Timeline feature. They cover all manner of special interests, from food (a Foodspotting app) to crafts (a Pinterest app) and travel (TripAdvisor) and of course those social games that are a cornerstone of Facebook’s regular apps catalog. Facebook says that the list will grow over time.
Timeline has seen some controversy—some complain they don’t like the look of it; others question how Facebook will use the new layout and information manipulation for commercial gain. In that sense, the apps will either win skeptics over with their usefulness, or make them even more suspicious of how Facebook is encouraging information sharing, even when it does provide some options for limiting that.
When you think about it, it’s not too surprising to see Facebook adding more usefulness and stickiness to its site, as it seeks to grow its primary form of making money: advertising. Eyeballs are the currency of online advertising and so social networks have to figure out not just how to grow their user bases, but how to keep them interested once they are there. That’s an area where Twitter is also focusing:
Yesterday, it was announced that it would be acquiring Summify, a Vancouver-based startup that developed a way to read users’ feeds from Twitter, Google Reader and Facebook and pull out relevant news into a summarized list. The selections, which can be viewed via an app or the web, are made based on your own browsing history, as well as the popularity of particular stories (eg, those that have been retweeted a lot).
Twitter has not revealed much about the deal: no details of the price, or how, exactly, Summify will work as part of Twitter. From a blog post at Summify, we do know that the company has stopped taking new users and will evenutually shut down the standalone service. Also, its employees are packing their bags and moving to Twitter’s HQ in San Francisco.
But given that Twitter, too, is looking to grow engagement on its site—a recent hire in the UK from BBC’s Sports division also demonstrated that—you can see where a service like Summify could potentially fit in: a secondary view of your followers, perhaps, maybe integrated to have a better experience around a user’s lists and favorited tweets. The added information a curated list of news would provide on content consumption could also come in handy for figuring out what ads to point a users’ way, too.
Posted on 2012 under Communications |
21
Jan
Stark new research statistics suggest digital replacement of analogue content is now very high amongst tablet owners.
- Newspapers: Seventy two percent of worldwide professionals polled by IDG Connect say they are buying fewer since owning an iPad.
- Books: 70 percent are buying fewer.
- DVDs: 49 percent are buying fewer.
Asia and the Middle East lead the way with, respectively, 90 percent and 80 percent of respondents saying they now purchase fewer printed papers.
“These markets for physical media are already in decline,” the iPad For Business Survey 2012 concludes. “On this evidence, tablet computing will hasten their demise.
“For advertising- funded media (newspapers and magazines), the challenges are particularly substantial. Readers who can afford iPads tend to be more demographically desirable than those who cannot.”
In North America, 15 percent of respondents said they would consider buying an alternative tablet to iPad next time.
Posted on 2012 under Communications |
19
Jan
Microsoft’s fourth-quarter earnings came in about where Wall Street had expected, but the decline of its Windows business continued during a holiday quarter when it seems pretty clear other gadgets dominated shopping lists.
Revenue for the quarter was $20.89 billion, a little off of what analysts were expecting but when the numbers are that big a miss of $40 million isn’t the end of the world. Earnings per share were $0.78, two cents better than expectations, and so overall there was much rejoicing in the after-hours market, which really shouldn’t be held during Happy Hour on the East Coast.
Still, Microsoft (NSDQ: MSFT) has a well-documented long-term problem. Windows continues to generate big profits but it’s in decline, buffeted by the mobile revolution that Microsoft mainly participates in through licensing agreements. This is a big year for Windows Phone and Windows 8, two projects that appear to show Microsoft has learned some lessons over the last five years but are still in “wait-and-see” mode.
In other areas, the company is doing quite well. Xbox sales continue to grow, leading Microsoft’s Entertainment and Devices group to a 15 percent revenue boost, the best performance of any division. And the amount of money Microsoft continued to pour down the Internet drain decreased in its fourth quarter, to “just” $458 million, an improvement from last year’s loss of $559 million coupled with revenue growth of 10 percent.
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Posted on 2012 under Communications |
19
Jan
Google (NSDQ: GOOG) missed analyst expectations for earnings per share during the fourth quarter, sending its stock plunging in after-hours trading Thursday. The company had been expected to produce earnings per share of $10.49, but it chalked up just $9.50 in earnings per share excluding special items and also missed revenue targets.
It’s important to note that Google has never provided its own earnings estimates on a quarter-to-quarter basis; these estimates are those of financial analysts that follow the company. They were looking for more than $2.71 billion in GAAP (generally accepted accounting principles) net income, which was a six percent increase compared to net income of $2.54 billion a year ago.
Google’s revenue growth was strong, up 25 percent to $10.58 billion before traffic-acquisition costs are factored in. Analysts tend to focus on that latter number, and they were expecting net revenue of $8.41 billion, as compared to the $8.13 billion in net revenue it otherwise recorded.
Without directly acknowledging the estimates of financial analysts gathered on Google’s earnings conference call, CFO Patrick Pichette noted the negative effects of currency fluctuations and an impairment charge related to a previous Google investment in Clearwire (NSDQ: CLWR) on Google’s earnings during the quarter. That might account for much of the disconnect between Google’s performance and the expectations of the financial community.
Analysts peppered CEO Larry Page with so many questions about the eight percent decline in the important cost-per-click metric—the average cost that advertisers pay Google per a click on their ads—that he half-jokingly asked for a break from discussion of the issue. Google doesn’t think it’s that big a deal: overall clicks increased as the result of site improvements, said Susan Wojcicki, senior vice president of advertising, who also said this was positive for both Google’s revenue and for the campaigns of its advertisers.
The surprise miss overshadowed what was otherwise a pretty decent quarter for Google, but seems right at home amid the disastrous few weeks the company has had to kick off 2012. Google+ now has 90 million users, Google said (without defining what a “user” is in this context) and advertising revenue on the core search site was up 29 percent compared to last year at this time.
Page and Wojcicki defended the decision to integrate Google+ into the company’s core search project, which Page said allows Google to provide a better product because it helps the search engine understand the differences between how two different individuals with identical search queries perceive the world. If Google had as much social data as Facebook or Twitter, that might be true, but it does not, and Page admitted that those companies don’t seem very interested in sharing that data with Google.
Page also said 250 million Android devices are in use, and the company also said that its display-advertising business is on pace to do $5 billion a year in revenue.
(More to come.)
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