But Spotify has yet to make a key expansion: To the U.S., where the big music labels worry that consumers will love everything about the site except paying for it. That’s bad, since Spotify is supposed to work best as a subscription service.

Most Americans have never heard of Symbian, though it remains the biggest player in the global smartphone market (as long as you use a broad definition of smartphone). But it’s telling that Spotify made a point of making its service compatible with Apple’s (AAPL) iPhone and Google’s (GOOG) Android handsets first.

In any event, Spotify is only available via mobile to paying subscribers, who shell out around $16 a month in the U.K. (and less in some countries). They key question for the music business is how many subscribers there are.

Spotify won’t release statistics, but one number that I’ve heard from people close to the company is 100,000, which works out to less than two percent of the company’s overall user base (free users can listen to the service only on their PCs and have to endure a small smattering of ads). But U.S. music industry executives worry that the subscription number may be even lower than that.

The two sides continue to chat, and conventional wisdom is that the service will indeed get to the U.S. one day. But at one point, Spotify was talking about coming to America in 2009, but that looks just about impossible. Now, CEO Daniel Ek is talking about the first half of 2010.

Spring sued Barnes & Noble yesterday in U.S. District Court in San Jose, Calif., accusing the bookseller of turning its “Alex” design into the Nook. I have embedded a copy of the complaint below, but here’s the short version:

• The Nook, which is on sale now and is supposed to ship this month, runs on Google’s Android (GOOG) platform and sports a large monochrome screen and a smaller color screen. The Alex, which doesn’t appear to be in production yet, is also supposed to run on Android and will feature two screens.
• Spring signed an NDA with Barnes & Noble (BKS) on Feb. 12 this year and says it first met with the company to show off its design for a dual-screen e-reader shortly after that.
• By May, Spring was showing the design to B&N.com president William Lynch. Spring says Lynch warned it not to work with Amazon (AMZN) because that company would “steal Spring’s unique idea.”
• The two companies talked a few more times during the summer.
• Spring says that “up until B&N’s Nook announcement on October 20…it believed that it was disclosing the confidential features of its Alex device in exchange for B&N’s implicit promise that it would seriously consider acquiring Spring’s product.”

Happy to hear from experts who know consumer electronics and/or trade-secret law, but I can’t say I’m convinced by Spring’s argument.

For one thing, Barnes & Noble would have had to work very fast to copy Spring’s design and get it to market in less than a year. Another problem with Spring’s case: As far as I can tell–based on its own complaint–Spring only showed Barnes & Noble some PowerPoint slides, which means there wasn’t much for it to copy.

Eric Kmiec, Spring’s VP of sales and marketing, told me last month that he and CEO Priscilla Lu were brought in this summer to “focus” the Cupertino, Calif.-based firm, which had previously been “playing around in R&D” and had “no real market focus.” It’s hard to believe that the bookseller had made a promise–even an “implicit” one–to buy something that didn’t exist.

Anyone have a different take? Please let me know via email or in comments, below.

nook suit –

You can reach me via email (peter@allthingsd.com) or by leaving a comment below. I can’t promise any results, but I’ll do my best.

For the record: From afar, the Nook appears very similar to Amazon’s (AMZN) Kindle, with a few additional bells and whistles–a second color screen at the bottom of the device for navigation, wireless connection from AT&T (T) instead of Sprint (S), Wi-Fi connectivity, etc. The most intriguing tweaks, from my perspective, are a “sharing” feature and the fact that the Nook runs on Google’s (GOOG) Android operating system, which might allow for interesting upgrades over time.

But all of these features seem to be aimed at tech’s earliest adopters and not the general book-buying public that Barnes & Noble (BKS), Amazon, Sony (SNE) and everyone else is hoping to court. Recall that in the early days of music players, plenty of competitors offered competitively priced gadgets with features that Apple’s (AAPL) iPod didn’t have, and today, it’s like we never heard of them. My hunch is that we might see a similar dynamic play out with e-readers.

Before I get to the supposed details on this one, though, some big chunks of salt you should consume while reading: It’s hard to take Spring all that seriously at this point given that it doesn’t appear to have any track record creating mass market consumer electronics. Or much of a record at all, really.

Spring’s press release says the company was founded in 2006 and that it “delivers innovative e-reader solutions and products to the e-book market,” but aside from that release and a bare-bones Web site, Spring Design has next to no footprint, at least on the Internet.

LinkedIn says CEO Priscilla Lu started running the company in July; it also says she is still running something called ViDeOnline, Inc., “a digital media network company.” (LinkedIn also says Eric Kmiec is doing double duty, as VP of marketing at both firms). That’s about it.

Which isn’t to say that “Alex,” the gadget Spring Design says it will release “later this year” for “selected strategic partners,” doesn’t look interesting. It’s just that the e-reader/tablet wars won’t just be about specs and features but about distribution and marketing, which are partly what have given Amazon (AMZN) a huge head start and what give heavyweights like Sony (SNE) and Barnes & Noble (BKS) a fighting chance. And, of course, Apple (AAPL), if it really does enter the fray.

So. For what it’s worth: Alex is actually two gadgets in one–a conventional-looking black-and-white “reader” screen that sits atop a smaller full-color screen that runs a Web browser powered by Google’s (GOOG) mobile operating system. That looks cool, as does the notion that the two screens are connected such that a hyperlink in the “reader” screen would synch up with information supplied by the Web browser.

Also for what it’s worth: Alex looks similar, but not identical, to mock-ups we saw on Gizmodo last week. The gadget blog says it got its images and information via “a source within” Barnes & Noble, and that the book chain will show off the device to the public tomorrow.

Schmidt added a bit of nuance to that message today, noting that the company had been surprised to see its European business bounce back as quickly as it has. Here’s my transcript of his opening statement.

We are clearly seeing aspects of recovery, and what is notable is that we’re seeing aspects of recovery not just in the United States but in Europe. I had been in error in assuming that there would be a lag, that it would the U.S. first and Europe second. Asia, of course, was never significantly hit in the first place.

So that means from a Google perspective that…we never stopped hiring, but we told our team internally and again, we’ve said to many other people that we are increasing our hiring rate and our investment rate in anticipation of a recovery.

Schmidt and Google co-founder Sergey Brin covered a lot of ground in the hour-plus press conference, and I’ll try to go back and break out out some of the other highlights. A few items worth noting in summary:

• Brin expressed contrition over recent Gmail outages and said the company was working both to prevent future failures and to react more quickly if and when they do happen. But he reiterated the argument, common among cloud-computing fans, that conventional email systems fail much more frequently.
• Schmidt repeatedly defended the proposed settlement Google had reached with authors and publishers regarding its book archive. Recurring theme: It’s not a perfect settlement, but it’s workable.
• Schmidt stressed the importance of porting Google’s Chrome browser to Apple’s Mac platform and said this would happen within months.
• Schmidt said Google was working on ways to help publishers sell their work on the Web (via one-offs or subscription). But he said he had no interest in promoting one publisher’s results over another, as Associated Press officials had recently suggested: “We have to be very very careful not to favor one media organization over another, with regard to speed or latency.”
• Schmidt, who’d previously noted that he expected Google to start making an acquisition per month, said that these would likely be small, five-to-ten-person companies. He added that it was unlikely the company would be in the market for something the size of a YouTube acquisition, which cost Google $1.65 billion. Translation: Don’t expect us to pony up billions for Twitter.

Earlier: My live coverage of the press conference:

Google (GOOG) co-founder Sergey Brin is sitting down with about a dozen reporters in Google’s New York City headquarters for a Q&A session. Tune in for live coverage. This should be a wide-ranging conversation, which I’ll attempt to cover live as well as I can. Please consider everything below to be a paraphrase unless it’s in quotes.

Brin is joined by Google CEO Eric Schmidt. Brin gives an unofficial intro.

Schmidt adds his own informal introduction.

Schmidt: We’re here because we have a global sales meeting in New York, and we’re winding that up right now. A series of internal talks, and the mood was “very, very positive.” We told them that “the worst is behind us” (which Schmidt has said before). We’re seeing recovery not just in the U.S., but in Europe as well. I had been in error in thinking it would be U.S. first, then Europe second. Asia is less important, obviously. We’re increasing our hiring rate and investment rate in an anticipation of a recovery.

Brin discusses some tweaks to search. Do you feel that Microsoft’s innovations with Bing will cause you to accelerate your innovations?

Brin: Competition is healthy. Microsoft (MSFT) has made its contributions. So has Cuill. Many of the tweaks in Bing we’d already seen from Microsoft Live earlier in the year.

Schmidt: I agree!

But do you think Bing is really different? Or just a rebranding.

Brin: [Demurs]

Schmidt: You guys should judge us and our competitors. We’ve been criticized for having a self-referential view of the world. But I’d argue that our success so far proves that’s been a good strategy.

Please talk about Android and other mobile plans.

Brin: We started with Android because it was a problem for us, as an end-user and a developer, that phones lacked powerful browsers and the ability to install powerful apps. I think Android has addressed this very well, but it has also pushed the market. It has pushed Apple (AAPL) with the iPhone and RIM (RIMM) and Windows Mobile. I’m pretty excited about the future; they’re getting increasingly capable browsers, and you can now write native applications across five platforms that will cover most smart phones. I think that having the software platform has freed the hardware makers from spending time on that, and they can rejuvenate their efforts on hardware.

Please talk about enterprise efforts.

Brin: We started in enterprise, like mobile, to address our own needs. When we started with mail in ‘04, Web email was like a toy. We really focused on something that would work in an enterprise and then made it available to consumers. We feel we’re farther ahead (than competitors) both in email and in collaborative document-editing. We’re moving toward eventually having everything (all our applications) available everywhere. “I just think the cloud model is a better model….I do think this install-less model of a cloud is better….It’s definitely made me more productive.”

More on enterprise from Brin: We’ve been successful with both SMB [small and medium business] and increasingly with enterprise. We’ve got a big implementation with Genetech (DNA), and in Washington D.C. We’re specifically adding features for enterprise. That’s part of the Postini acquisition–to add some of those email features for enterprises. You’d be surprised to hear some of the things businesses ask for.

Please talk about recent Gmail outages.

Brin: Certainly we’re not happy with any outages. With those outages we’re at the “three nines” level, which is not where we want to be. Targeting “four nines” by end of quarter. We’ll let you know how we do. Focusing not only on outages, which we don’t like, but recovery time. Second outage could have been resolved in five or ten minutes, but we made errors in handling it, and it extended over an hour. But if you look at a typical enterprise today, those outages tend to add up to more than even these kinds of outages that we had in Q3. Also, we’re working on the number of people affected by outages. Trying to group people into pods so that if one goes down it doesn’t affect others.

You’re adding more complexity to search. It’s more confusing than it ever was. Same thing with site links. Is that an issue (it is for Danny Sullivan)?

Brin: I’d like to see all the options, available in all the corpuses. We don’t have all the same options in each offering. In terms of the links and snippets that we’re offering, we’re trying to experiment with that.

On Google book deal: If the judge asked you why he shouldn’t be concerned by the concentration of Google’s power, what would you say?

Schmidt: It’s an error to answer a theoretical question from a journalist. But anyway, we won’t get that kind of question. With respect to book search, we were doing something that we thought was appropriate. We were sued, and after three years of discussion, we’ve come to a settlement. This is perfectly normal. From our perspective, this is a settlement we like, it’s a settlement we think they’ll like, and we’ll hear what the court says, within minutes. Let me reframe your question: There’s nothing particularly exclusive about what we’re doing. The rights registry we’re doing is for the benefit of orphan works. “It’s not a particularly good business for us. We’re going it because we think it’s the right thing to do.” We don’t think the settlement is perfect, but we think it’s good.

What are plans to expand book search?

Schmidt: We’re already huge. There are millions of books that have never been read, and we’re going to deliver readers to those books.

Brin: We want as many works as possible in some form, because that’s of tremendous value.

Schmidt: This doesn’t cover all international books, all books in the world. [Some disagreement about this between Brin and Schmidt]. It will take time to get the registry up and running, so for the near future I think that’s all we can achieve.

Back to the economy, please.

Schmidt: We’ve tried for a while to figure out if Google is an accurate predictor of the economy, and we can’t prove it. If we could, we’d brag about it. Last early in the year we saw a decline in U.K., which surprised us. From our perspective, the low point was somewhere in the spring. Which is why I said worst was behind us in May, June. We noticed a recovery “June-ish.” The conventional wisdom is that U.S. recessions are 18-24 months. Bernanke sees a recovery too, which we agree with. Conventional wisdom was that Europe would lag by three-five months, which we’re not seeing. Europe is not one country, and it varies a great deal depending on which country we’re in. I won’t go in to specifics but it’s the obvious stuff–the countries that didn’t have a big bump did not have a big fall. More on being a leading indicator: Obviously we’re a leading indicator in advertising.

Brin: And we’re good indicator for consumer spending, and you can see for yourself by looking at Google trends.

It seems as if Chrome isn’t having the impact with consumers that you would like.

Brin: [Starts, then stopped by Schmidt]

Schmidt: Some of your premise about Chrome is incorrect, in terms of adoption, and we’re going to get that message out.

Brin: It’s actually exceeding our benchmarks.

Schmidt: I see a lot of Macs in this room, and a lot of very sophisticated people are using Macs now and we need to get a version of Chrome out for that, which we’ll have in a couple of months. Key to browser strength is speed. In general, we announced Chrome OS and Chromium product. Everything is linked together: Cloud, chrome, etc.

At one point do Android and the Chrome OS come together or not come together?

Schmidt: Current definition of use platforms has to do with use patterns. Android for mobile, delivered via telecom store, heavily integrated with telco offerings, like our Verizon (VZ) deal, which we’re enormously excited about. The analog for Chrome is that it’s designed for a 10, 12-inch form factor. They both use Linux, etc. But they’re designed for different uses. [Netbooks?] May be some overlap there.

Is Google being too nice? Is there a rethinking of relationships with aggrieved groups?

Schmidt: In many ways we’ve always wanted to be this Google as opposed to the way we were perceived a few years ago. We’re particularly proud of the way we’re working with advertising agencies, which is very important to us. With the media industry, we’re having success with YouTube and YouTube monetization, and we’ll have more on that coming forward….”We have always wanted to have these partnerships….We’re learning how to do them in a way that they win, too.”

Brin: People can now differentiate between us and the Internet.

Schmidt: Google is an innovator. The Internet is causing collisions. Innovation plus collisions equals opportunity. For instance, the fact that Verizon has embraced most of the open principles that we put forth five years ago is shocking. “It’s pretty amazing. This is Verizon. It’s not some itty-bitty telecom start-up.”

Are you uncomfortable with Google employees’ sense of entitlement? [Per new Ken Auletta book]

Brin: [Refers to layoffs--Schmidt corrects him: "We did not have layoffs."] [Addendum: Schmidt was talking about Google closing engineering offices in Phoenix and other locations; Google did have layoffs last winter.] You’re right:

What do you think about publishers requiring pay walls, and how will you help surface that.

Schmidt: We’re starting with that YouTube. Overall, “there’s clearly a market for free content, and that market is the size of the Internet.” Also a market for subscription/paid. The analogy I would offer is TV. We all grew up with “free” TV. Now almost everyone pays for cable, and some people pay for pay-per-view, “which is ridiculously expensive,” but people will pay for particular events, like boxing. I think all three of those uses will emerge. We’re working on payment models, subscriptions, to enable that.

But what about surfacing paid content in search [this comes from WSJ.com editor Alan Murray]? Will you factor the desire of someone to pay for content into results?

Schmidt: We’re not going to use the price you use as our ranking in results. That’s not going to be our signal. But we’ll incorporate the price people are paying for your content into results. But I’m not going to answer this precisely because I don’t want to discuss how we produce results. The most interesting improvement you could make is that to the degree that we have more of the marketplace data available, we could take that information and reflect some of that in our rankings.

The AP CEO said Google or Microsoft might be willing to pay a premium for an advance look at the news.

Schmidt: We have a deal with the AP, and I don’t want to talk about any specifics of any deal. I don’t think that’s proper. “We have to be very very careful not to favor one media organization over another, with regard to speed or latency.” We are staying out of the media business. “You guys are very good at it, and we’re not.”

[Apologies for tech error; I missed the specific question and part of the following exchange, but the subject is entitlement.]

Brin: We cut down on snacks, etc. to “reset expectations” regarding entitlement.

Schmidt: “Google pays very well. Google is clearly a growth company. People at Google don’t work for those reasons at Google. We don’t want them to come to work for Google for those reasons. We want people to come to Google to change the world. Life is short.” The tightening in the last year has been good for this, by the way, the controls put into place by Patrick Pichette, who is our hero, have been very helpful.

Please talk about M&A plans and goal of one acquisition per month.

Schmidt: That’s been our historic pattern. I think we will be buying small companies–five, ten people. That’s where some of our best stuff has been. One day Larry and Sergey bought Android, and I didn’t even notice. Think about the strategic opportunities that has created. Sergey found Google Earth one day while he was surfing on the Web. And then he walked into my office and told me he bought them. “And I said, ‘for how much, Sergey?’ And it turned out to be a few million.”

Would you buy a YouTube?

Schmidt: Is there another one to buy? The problem with that size of acquisition is that you have to make your money back. I think that DoubleClick and YouTube will be two of our best acquisitions. DoubleClick is already close to paying back, and YouTube will get there soon. But bear in mind that any major acquisition now will involve a regulatory review, because of our size and because our competitors will make sure of that.

[Sorry, missed another question]

Do you anticipate making large upfront commitments for new or renewed search deals [as you did with MySpace and AOL]?

Schmidt: I’d rather not comment on search deals. We are in discussions with both of those companies. “Some of our best friends are in those companies.”

[Missed yet another one]

What will new tablet machines [like Apple's] mean for you? And to content producers?

Brin: Hardware is getting amazing with regard to cost. Used to be that display was expensive. Now that’s cheap, and so are chips, etc. Now, the main cost is broadband connection, or cellular, or however you get to the Internet. That’s why wide broadband availability is important to us. Think about how much you spend on access costs compared to the amount you spend on your handset. The phone cost is negligible.

Schmidt: Not sure how to answer question. We provide the infrastructure below what you’re talking about [touch interfaces, etc.]. Kindle is a good example. Don’t think about current one, think about one two or three years out. I think there will be many kinds of things like Kindles, and that’s a material change in the way people will interact with hardware, media.

Brin: I think it’s better if hardware isn’t locked down to specific platforms.

[Long exchange between Schmidt and Danny Sullivan that I'll have to pick up later]

Should Google be required to lease servers and access to Google checkout numbers to deal with “lock-in” issues that broke up the telcos?

Schmidt: Google Checkout isn’t interesting. But I think your analogy is wrong and that there are no data to support your theses.

[I missed the next question on the book settlement about orphan works, etc.]

Schmidt: A lot of these complaints are being made by people who don’t want a solution.

What are the reasonable book settlement proposals you’ve seen?

Schmidt: Goal is to get all the books to everyone and to get all the authors compensated properly. Some of the proposals make sense to me, but I don’t want to characterize them. Not a perfect solution, but the best one we can do.

How will book settlement affect international users?

Brin: It won’t. We’d love settlements that work across a range of countries.

Why won’t you be like Microsoft with regard to antitrust?

Schmidt: Many reasons. Culture, for one. Another reason is that majority of users are one click away from moving away from us. Third: If we went into an “evil room” and had an “evil light” shined on us, and we then behaved in an “evil way” we would be destroyed….There is a fundamental trust between Google and its users.”

Schmidt walks through “ludicrous” thought experiment whereby Chrome takes 80 percent of market share and then tries to lock consumers in, noting that it wouldn’t work due to open source.

Do you think you’ll take another stab at moving into radio, print?

Brin: We are quite optimistic on the TV front. Radio and print didn’t pan out as well as we thought initially. One of the reasons is that those mediums are moving online and consumers are moving online and the publishers/producers want to work with us there. “We were kind of at the dock where the ship had already left.” But TV is quite similar to the Web in terms, potentially, of measurability, so we’re excited about those prospects.

Is page rank broken? People are gaming it, etc.

Brin: No. We have to continually develop. Part of the issue is span, but the main issue is that everything changes. We’re doing a much better job of ranking than we did a decade ago. If we just rested on our laurels with what we wrote in paper from 1998, we’d be in big trouble.

And many also had this reaction: Why, exactly, should I care about Foursquare?

The first reaction makes sense. Foursquare is just a few months old, but it has received an extraordinary amount of buzz and press since its debut at South by Southwest in March. That seemed to reach a fever pitch this summer when Twitter investor Fred Wilson started blogging about it.

And sure enough, Wilson’s Union Square Ventures did indeed end up betting on the company. The $1.35 million round was actually led by O’Reilly AlphaTech Ventures, and by all accounts investors were clamoring to throw money at the revenue-free start-up, which may have all of 50,000 users. I know of at least one high-profile VC firm that wanted into the deal but got shut out.

But the befuddled reaction some people have to Foursquare also makes sense. Foursquare is a “location-based” app for your iPhone (or Android-based phone, or even your BlackBerry) that sort of combines elements of Twitter and Yelp and “social” Web/mobile games like Zynga’s Mafia Wars. But even if you’ve used it, it’s not exactly clear what you’re supposed to do with it. You tell your pals that you’re visiting this bar or that restaurant and then…what?

At least, that was my reaction when I played with Foursquare at South by Southwest in Austin: I couldn’t figure out how it was more useful than Twitter at broadcasting my location and/or finding my friends.

And once I got back to Brooklyn, there didn’t seem to be any point to the service at all for me. No point in telling anyone where I am because it’s almost always the same place: My apartment in Brooklyn. Nothing to see here.

But my nightlife problems aside, there are a bunch of people who think co-founders Dennis Crowley and Naveen Selvadurai are on to something. Even if they’re not sure exactly what it may be.

A more cynical take: Crowley sold Dodgeball, his last buzzy mobile start-up, to Google in 2005. And even if Crowley was unhappy about the way things turned out after that–he left in 2007, and Google (GOOG) pulled the plug on Dodgeball (along with a host of other nonstarters) this year–it’s always good to bet on a guy who’s already had one successful exit.

But why not listen to Dennis Crowley explain what he’s up to in his own words? Here’s an interview I taped with him last month, a couple days before he closed his funding round.

]]> http://mediamemo.allthingsd.com/20090908/what-exactly-is-foursquare-and-why-are-investors-clamoring-for-it/feed/ 3 http://mediamemo.allthingsd.com/20090901/napster-dont-hold-your-breath-waiting-for-our-awesome-new-iphone-app/ http://mediamemo.allthingsd.com/20090901/napster-dont-hold-your-breath-waiting-for-our-awesome-new-iphone-app/#comments Tue, 01 Sep 2009 13:40:20 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=10574 Best Buy’s Napster wants you to know that you can now buy music “over the air” and beam it directly to your phone. Yawn.

What about the company’s awesome new iPhone app, the one that will let you stream music directly to your handset? You know, like the one that Apple (AAPL) just approved for Spotify, the superhyped service you can’t even get in the U.S. yet?

Don’t hold your breath says Best Buy (BBY). That Napster app is not coming anytime soon. And neither are apps for Google’s (GOOG) Android platform or Research In Motion’s (RIMM) BlackBerry.  And it’s because of those darn music labels. From a press note the company sent out this morning:

One of the most common questions Napster receives is, “When will you offer an iPhone app?” Well, Napster has created an iPhone application that allows subscribers to stream music on-demand to their iPhone—including personal playlists, albums and radio stations. You can imagine the company is also looking at streaming applications for several other mobile platforms as well (Blackberry, Android). However, due to the high licensing fees for streaming to a mobile phone, Napster has not yet submitted the iPhone app to Apple for approval or attempted to bring the application to market.

Now that’s an interesting approach–something akin to showing off a shiny new sled in a toy store window below a sign that reads “Not coming soon, not our fault.” Or that bank ad where the jerk takes the truck from the chubby kid.

I also don’t know if Napster’s explanation tells the whole story: Best Buy/Napster and the big labels already have an agreement that lets the company stream unlimited music to your PC for $5 a month. Just how much more would the company have to charge to accommodate the fees the labels want for mobile streaming? I’m supposed to talk with Napster folks later today, and if there’s anything I can pass along, I will.

UPDATE:  A little clarification from Napster president Brad Duea. His company’s position is that it doesn’t want to move about its $5 a month price, and that it would have to do so in order to offer streaming.

Why would it have to do that? Duea won’t spell it out. But henotes that RealNetworks’ (RNWK) Rhapsody, which has submitted an streaming music app to Apple, charges $15 a month for “on the go” service it already offers, and assumes it will charge the same for a service that works with the iPhone. Similarly, Spotify charges the equivalent of $16 a month for its premium service in the UK.

Of course, it’s possible that RealNetworks or Spotify will try subsidizing some of the cost for a mobile app in order to grab market share, and offer their iPhone/mobile services for something closer to Napster’s $5 fee.

]]> http://mediamemo.allthingsd.com/20090901/napster-dont-hold-your-breath-waiting-for-our-awesome-new-iphone-app/feed/ 0 http://mediamemo.allthingsd.com/20090604/who-wins-the-pre-vs-iphone-battle-google/ http://mediamemo.allthingsd.com/20090604/who-wins-the-pre-vs-iphone-battle-google/#comments Thu, 04 Jun 2009 15:48:31 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=7949 The Palm Pre (PALM) debuts this week. Next week, we may hear about a big update for Apple’s iPhone (AAPL). And by the end of the summer we’ll have new phones running Android platform.

So who’s going to emerge as the winner? Easy, says analyst Mark Mahaney: It’s Google (GOOG).

But Mahaney, Citigroup’s (C) longtime Internet guy, isn’t talking about Google’s smartphone platform. He’s talking about Google’s core search business, which he thinks is finally about to see significant lift from mobile users.

It’s a straightforward thesis: As more people use smartphones, which are essentially portable computers that happen to make phone calls, they’ll start using them to do the things that people do with conventional computers — like search.

Our simple point here is that Mobile Internet usage, Mobile Search usage, and Mobile Google Search usage are all likely to be derivative beneficiaries of the “Smartphone Summer.” The So-What here is that Mobile Internet is beginning to emerge as a material Secular Growth driver for GOOG.  And getting back to the basic Core drivers of Google’s financial model, we believe this will show up in the form of consistently robust Paid Click growth in 2010 and beyond.

Want to see actual numbers before you buy into this? Fair enough: Google, like a lot of its peers, has been making a lot of noise about mobile with little to show for it so far. But if it is able to deliver, then the company may finally have that second business it’s always pined for.

]]> http://mediamemo.allthingsd.com/20090604/who-wins-the-pre-vs-iphone-battle-google/feed/ 0 http://mediamemo.allthingsd.com/20090512/7278/ http://mediamemo.allthingsd.com/20090512/7278/#comments Tue, 12 May 2009 09:00:35 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=7278 Apple iPhone and iPod Touch users have downloaded one billion apps for their devices in nine months. Someone other than Steve Jobs and co. ought to be able to make money from that, right?

That’s more or less the logic behind Medialets, a start-up that serves up ads on Apple’s (AAPL) mobile applications, and to a lesser degree, programs designed for Google’s (GOOG) Android mobile platform. The New York-based company, founded last June, is announcing a $4 million Series A round led by Foundry Group. DFJ Gotham and angel investor Bobby Yazdani also participated.

Medialets also provides free analytics services for mobile applications. But its revenue comes from its mobile ad platform, which specializes in serving up iPhone and Android app users.

Given that mobile ads in general are in their infancy, this is a nascent market at best. Medialets CEO Eric Litman figures that the market for mobile display ads tops out at perhaps $300 million, and that ads for iPhone and Android apps can’t be more than $100 million.

But he figures that number will shoot up rapidly, of course, and perhaps hit $400 million within four years. He’s also betting that the majority of apps, and the majority of apps downloaded, will be free, advertising-supported ones.

In order for that to happen, both apps and the ads that run on them will have to move past the novelty stage. This Medialets-produced ad for Dockers, shown here running on SGN’s iBowl game, is sort of interesting. But it seems more like a proof of concept than anything else.

Still, it’s a start:

]]> http://mediamemo.allthingsd.com/20090512/7278/feed/ 0 http://mediamemo.allthingsd.com/20090209/kindle-on-your-iphone-not-today/ http://mediamemo.allthingsd.com/20090209/kindle-on-your-iphone-not-today/#comments Mon, 09 Feb 2009 19:36:42 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=4077 Anyone expecting anything mind-blowing out of the Kindle 2.0 unveiling today is going to be disappointed: Amazon showed off a device that looks better than its predecessor and should work somewhat better. But it does the same core stuff as the old one–it lets you read books you buy from Amazon–and costs the same, too: $359.

CEO Jeff Bezos did, however, reiterate an interesting tweak that Amazon (AMZN) has in the works: At some point, it’s going let you read Kindle material on devices other than a Kindle. Bezos just mentioned this briefly, noting that you can now sync material between your old Kindle and your new Kindle, and “in the future, other mobile devices.”

That Bezos and his team took time to point this out on a slide during a brief launch presentation means that they’re definitely signaling at… something. But Amazon being Amazon, the company didn’t say anything else.

Last week, an Amazon spokesperson allowed that the company is “excited” about the idea. Today, I tried to get Amazon exec Ian Freed to elaborate, but he deflected my clever queries. See video below for evidence of my futility–it kicks in around a minute into the clip.

[ See post to watch video ]

(The guy in the background who starts opining about the screen size midway though? The one who sounds like the Comic Book Guy on the Simpsons? He’s from MobileRead, the site that got those leaked Kindle images. Maybe he knows what he’s talking about.)

So in absence of any information, let’s just go ahead and speculate. The notion that has the technorati most excited would be a plan that lets Amazon customers read Kindle books on their Apple iPhones. But while Amazon does sell some stuff that works on Apple (AAPL) products–namely, music–it remains a rival in most aspects of the digital content wars. So who’s to say Amazon won’t end up in a tie with everyone except Apple–like Research In Motion’s (RIMM) BlackBerries or Google’s (GOOG) Android platform?

The bigger question: Do Bezos and folks think that people will end up choosing devices other than a Kindle to do most of their reading? After all, he spent most of today’s presentation (and all the Kindle talk he’s done prior to that) talking about the way the machine is designed specifically for long-form reading.

If he thinks customers don’t really feel that way, then perhaps he’s trying to build up as large an installed base as he can before e-books really do go mainstream so that he’ll have a lock-in like the one Apple ended up achieving with its iPod/iTunes system. But if that were the case, you’d figure he’d cut gadget prices dramatically to grab share.

Alternate theory: Bezos truly believes the Kindle is a unique platform and that anyone who reads on anything else is doing so and hating the experience. If that’s the case, then perhaps he starts providing Kindle titles in the near future–so that people can see just how unpleasant it is to read a book on any other device.

Anyone else want to weigh in?

Meantime, here’s Amazon’s own video. Much more polished, but very long. Six minutes!

]]> http://mediamemo.allthingsd.com/20090209/kindle-on-your-iphone-not-today/feed/ 5 http://mediamemo.allthingsd.com/20081215/amazons-mp3-store-one-year-in-no-itunes-killer-probably-wont-be/ http://mediamemo.allthingsd.com/20081215/amazons-mp3-store-one-year-in-no-itunes-killer-probably-wont-be/#comments Mon, 15 Dec 2008 16:58:15 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=2115 Amazon has been selling digital music from all the big music labels for nearly a year now. It’s the first major challenge to Apple’s hammer lock on that business. So how did it do?

If you view Amazon’s MP3 store as a would-be iTunes-killer, or even a would-be iTunes rival, it has failed miserably. Neither Amazon (AMZN) nor its big label partners–Warner Music Group (WMG), EMI Music Group, Sony (SNE) and Universal Music Group–is publicly releasing any sales numbers. But the best estimates I’ve been able to get from label executives give Amazon 5-to-10 percent of the digital music market, with Apple (AAPL) hanging on to its 70+ percent share.

Billboard reaches the same conclusion, pegging Amazon’s market share at eight percent. Lucas Gonze, a smart digital music guy who spent a brief stint at Yahoo (YHOO) after it acquired his start-up, does some back-of-the-envelope math and concludes that Amazon’s store contributed all of $82 million to the music business, and that Universal collected most of that. That same math means that Amazon grossed all of $39 million from its music store.

And while Amazon’s presence–and the fact that all of its music was sold as MP3s, meaning there were no DRM locks on the songs–was supposed to give the labels more leverage when they negotiated with Apple, we have yet to see Steve Jobs make any significant changes in his contracts.

But the labels would still rather have Amazon in the game. The fact that the world’s biggest e-commerce company is in the music business does have some tangible benefits, like giving players an easy way to get into the music business: Both News Corp.’s (NWS) MySpace and T-Mobile’s new G1/Google (GOOG) phone, for instance, use Amazon to sell downloads. There’s no way Apple would have worked with either platform.

And Amazon can afford to lose money as it figures out its digital media strategy–the company logged nearly $4.3 billion in sales last quarter alone. Right now, it seems content to serve a handful of dedicated MP3 fans/anti-DRM zealots who are actively shunning Apple. But I’m guessing Jeff Bezos and crew have bigger ambitions. So when do we see what those look like?

]]> http://mediamemo.allthingsd.com/20081215/amazons-mp3-store-one-year-in-no-itunes-killer-probably-wont-be/feed/ 9 http://mediamemo.allthingsd.com/20081110/google-t-mobile-give-aol-a-hand-and-a-big-check/ http://mediamemo.allthingsd.com/20081110/google-t-mobile-give-aol-a-hand-and-a-big-check/#comments Mon, 10 Nov 2008 13:24:35 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=824

Apple (AAPL), Research In Motion (RIMM) and Google (GOOG) are duking it out for consumers’ smartphone dollars this fall. But here’s an early winner: Time Warner’s (TWX) AOL, which has just landed a giant contract to push Google’s G1 phone for the next two days.

Wireless carrier T-Mobile, which is selling the phone in the U.S., is launching a big push on AOL’s Platform A ad network today. It has agreed to buy a billion impressions today and tomorrow, reports AdAge.

Reporter Michael Learmonth talks to industry sources who think the buy could cost T-Mobile around $1.5 million, which would work out to a cost per thousand of $1.50. Ad folks I talk to think that number sounds high, and guesstimate that the CPM will be closer to the $1 to $1.10 range.

But no matter what the number is, the campaign will be a win for AOL. Anything approaching $1 million over two days will be well-received at the company, which saw ad revenues drop six percent in the last quarter.

And the fact that AOL can offer an advertiser a billion impressions in two days also points out how the ad network business is supposed to work: Gather lots of Web sites and offer their combined inventory to advertisers, who can buy a lot of eyeballs at a discount. Now AOL just needs a lot more of these, fast.

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