Local Search

Report: ChaCha Heading toward Profitability

ChaCha it appears is back from the brink. We've heard negative rumors about the company's financial condition for a long time. Now Mike Arrington (a former ChaCha basher, now kinder and gentler toward the company) has spoken to CEO Scott Jones and disclosed the following:

  • ChaCha is the no. 1 SMS search service according to Nielsen (surpassing Google). This was previously reported
  • Guides make an effective hourly wage of $2.50
  • The cost per query was $0.50 two years ago and is now only a "few cents." Arrington says Jones told him it would drop to "under a cent soon" (primarily due to more automation and recycling of answers)
  • ChaCha has roughly 60 FTEs

ChaCha recently introduced online and mobile coupons to boost frequency and the utility of the service, as well as diversify its advertising programs. ChaCha competes directly or indirectly with kgb, Vark, 800-Free-411 and search on smartphones. 

Vlingo Top Search Terms/Categories of 2009

Vlingo released what it calls the top 10 voice-powered mobile Web searches of 2009:

  1. YouTube
  2. Facebook
  3. MySpace
  4. Weather
  5. Movie Times
  6. Twitter
  7. Yellow Pages
  8. MapQuest
  9. craigslist
  10. White Pages

On first glance, this list is considerably different than Nielsen's top mobile sites of 2009:

  1. Google Search
  2. Yahoo! Mail
  3. Gmail
  4. Weather Channel
  5. Facebook
  6. MSN Hotmail
  7. Google Maps
  8. ESPN
  9. AOL Email
  10. CNN News 

Here's Yahoo's top PC search queries list of 2009:

  1. Michael Jackson
  2. Twilight
  3. WWE
  4. Megan Fox
  5. Britney Spears
  6. Naruto
  7. American Idol
  8. Kim Kardashian
  9. NASCAR
  10. Runescape

Here's Google's main list:

  1. michael jackson
  2. facebook
  3. tuenti
  4. twitter
  5. sanalika
  6. new moon
  7. lady gaga
  8. windows 7
  9. dantri.com.vn
  10. torpedo gratis

As TechCrunch correctly points out the Vlingo list is "action oriented" -- people trying to accomplish some objective out in the world or on the go.

As we long ago discovered people calling directory assistance (the earliest form of "voice search") were usually “in the car" (where other search methods are more difficult). DA callers also emerge as “qualified” sales prospects typically on their way to potentially conduct a transaction in a store or other offline business.

The presence of YouTube on the top of the Vlingo list is curious, although smartphone users consume a great deal of mobile video. The presence of social networks however is consistent with broader mobile Internet trends.

The Vlingo search query results above are coming, of course, via Google or Yahoo search. So in that larger context, there's general consistency between the Vlingo and Nielsen lists above. However, I wonder if the "yellow pages" and "white pages" queries are not "yellowpages.com" or "whitepage.com" but stand-ins for a broader range of local and business or people searches.

My belief is that while mobile search queries will skew local in the near term they'll be generally comparable with PC search queries over time. 

A $6.8 Million Vote of Confidence for Jingle

In filings at the U.S. Security and Exchange Commission, Jingle Networks Inc. has indicated that it has issued and sold new shares for $6.651 million, raising the amount of money it has raised since inception roughly five years ago to $68 million. Reports indicate that nine investors participated in this round, but the company would only disclose that participants in previous rounds took part in this recent underwriting. That list includes First Round Capital, Goldman Sachs, Hearst Interactive Media, and Liberty Associated Partners. The company's Board of Directors include Ken Bronfin of Hearst, Chip Hazard of Flybridge Capital Partners, Josh Kopleman of First Round Capital, Louis Toth of Comcast Interactive Capital and David Berkman of Liberty.

Scott Kliger, former CTO, is now the CEO. In an email, he told TechCrunch that the new funds would be used to build up its mobile ad network dramatically and that the "voice service is profitable."

Update: Our research and that of others shows that two-thirds to three-quarters of mobile users are not aware of free 411 alternatives. Most people, aware to varying degrees of the cost of calling 411 on mobile handsets, call directory assistance infrequently. 

Jingle may be "profitable," but "free DA" a market that basically never happened (there may still be opportunity). The carriers, which launched their own free DA services in anticipation of usage that didn't occur (i.e., Verizon's 800-THE-INFO), now have no incentive to promote them. And Google's GOOG 411 (probably most used after Jingle's 800-Free-411) has used the service primarily as a way to train its speech recognizers to support voice search on smartphones. 

Earlier 2009 research we conducted shows that 411 usage in general is threatened by smartphones (many of which will have voice search). Below "owner" is smartphone owner, "planning" refers to those intending to buy one in the next year and "non-owner" refers to feature phone owners. 

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Twitter Buys Mixer Labs, Originator of Geo API and Townme

In this post on Screenwerk, Greg Sterling explains what's so very interesting about Twitter's purchase of Mixer Labs. There's little more to add except to suggest that we all think expansively about the possibility of delivering rich, local content in 140 characters or less. The holidays are approaching; as is a new year which, based on my informal poll of everyone I know, we expect to hold better things than 2009. Twitter, in both good and bad economic times, has stayed true to its role of fostering a wide open interchange among self-identified community of interests in innovative ways that integrate or link to the full spectrum of Internet- and Web-based features and functions.

Twitter's purchase of Mixer inspired Greg to wax rhapsodic about the prospects for location-awareness to bring about the dawn of a new era in mobile communications and services, including new mechanisms for advertising. I, personally, have mixed feelings. I share in celebrating the prospects for new services that leverage a service provider's awareness of my location, coupled with knowledge of my expressed interest and past explorations and informed guesses about my current intention. But I want that information to be used on my behalf first and then accommodate advertisers, according to my (implicit or explicit) instructions.

The combination of Twitter, with its low barriers to enroll and transparent mechanism around natural selection of the people, companies or (even) brands one might choose to follow. In one sense, the purchase of Mixer by Twitter was inevitable. Recent press reports claim that Twitter is profitable in its present state. Almost every gathering of analysts and practitioners improvising around the "real-time" Web has featured a mash up of a mapping service with pin-drops depicting places where people are originating Tweets. Pins indicated liveness. Multiple pins indicate hotness. The scroll of comments add editorial content ranging from informative to snarky and everything in between. By bringing the API inhouse, Twitter can exert a bit of control over the quality and quantity of new, geo-aware twitter mashups.

Tweets are user-generated information that the originators knowingly put out there in the public domain. Individuals post them voluntarily and they are permanently associated with their names (or Twitter handles). Associating Tweets with specific geographic locations creates a ready-made venue for venue owners to post fresh information. Bald promotions come to mind, but they would be a wasted opportunity. How about a restaurateur telling expressing pride in tonight's special or a baker mentioning that he or she made way too many brioche and has them on special.

Townme made an effort to be the repository for locally generated content, but it staid interesting only as long as it contains information that is fresh. The stream of the Tweets form the Twittersphere is certainly a rich font of info with the potential to populate such local repositories. But as Google's Vic Gundotra is quoted in the Screenwerk blog, this is "the beginning of the beginning." Pouring content from real-time feeds like Twitter into local catch-pools for all to see will be an interesting [social] science experiment. Whether it better serves advertisers and "brands" or mobile subscribers and shoppers is an open question. I have my fingers crossed that the Twitter/Mixer combo turns into a virtuous combination of both.

ChaCha Raises $7 Million More

TechCrunch points to an SEC filing that shows ChaCha as having raised another $7 million. The "mobile answers" service recently sought to diversify its model, which is SMS advertising, with coupons. Apparently the coupon effort, right now limited to ChaCha's home market of Indiana has been popular.

While coupons is a very crowded segment it's also highly popular with consumers. It's one of the forms of mobile advertising that consumers don't object to in the abstract. (There's a difference between survey responses and consumer behavior in practice; however consumers tend to object to ads on mobile devices generally.)

Not long ago, the company tied coupons to the mobile service

ChaChaCoupons.com's new "C3 on demand coupon service" allows users on the go to easily text in a request for coupons by business type or name and receive several offers back from ChaCha on their cell phone. For example, customers may text "C3 pizza" or "C3 tanning" to 242242 and receive offers for pizza or tanning. Or, they may text in "C3 Cabo Sun" to see all of the current offers from the business Cabo Sun. Additionally, ChaCha offers a simple "directory assistance" free text-based business category search. Users may simply use "biz" followed by a business type or category on their cell phone to find a listing of names, phone numbers, and addresses of local businesses. For example, customers may text "biz pizza" or "biz clothing" to 242242 and receive a listing of these businesses in the area. 

The company has struggled financially because it was somewhat ahead of the market. However, getting into coupons and the rising interest in mobile marketing may help ChaCha in 2010. 

With this latest cash infusion the company has reportedly raised $70 million (approx.) over several funding rounds. 

WTF Is Google Doing with Nexus One?

Bar none the Nexus One (made by HTC but branded Google) is the best Android handset on the market. It ends Droid's claims about speed and power. I had a chance to play with it last week for about five minutes. Here were my quick takeaways:

  • It looked to me like a thinner Droid Eris with a larger, more impressive screen (both are made by HTC; Nexus One has no “Sense” interface)
  • The screen resolution was great and crisp
  • The stand-out dimension of the phone iwas its speed; it was extremely fast (running on the T-Mobile network)
  • It features the “new” version of the Android Market, which is a considerable step up from what exists now
  • A surprise and disappointment: no multi-touch

Here's more from Gizmodo after its "hands-on." Engadget asserts there will be an "invitation only" sale starting January 5 (think GMail, G Wave rollouts) with broader availability sometime thereafter, including directly from T-Mobile. 

While I still don't believe this bests the iPhone holistically -- although it does in terms of speed -- this is a compelling device. In fact it's more compelling than any of the other Android handsets being sold by Google's partners. Verizon has built interest in the "Android brand" with its massive "Droid" marketing campaign. Now Google comes along and puts out a better phone that will benefit from Verizon's marketing spend and related brand buzz it's created.

I don't know what the price will be -- a key variable here -- but I heard a rumor that it would be $99 with a two-year T-Mobile contract (some arrangement between Google and T-Mobile has been made to subsidize the device). If that price is correct it will be a big hit, capital "H." It won't work in the US on Verizon or Sprint's networks because its appears to be a GSM only device.

For now Droid is safe at Verizon. But people who were buying the phone because they were getting something cutting edge will now have to deal with "second best." What exactly is Google doing, risking alienating its partners and Motorola in particular, here? It's not clear if this is arrogance, shrewdness or simply a myopic emphasis on building the best Android device possible. 

Google has a history of competing with partners because it's focused on building the best consumer experiences it thinks it can. We'll know at the end of next year answers to the following:

  • Whether this device elevates Android to iPhone and RIM-like status
  • Whether it has sold well in the US and abroad
  • Whether Google's partners have moved away or become less enthusiastic about Android the OS because of this directly competitive move
  • Whether Nexus One turns out to be just another Android handset, among many

Here's a video walk-through of the user experience of the Nexus One:

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See related: Android's 'Campbell Soup' Strategy

Top 'Socially Recommended' iPhone Apps

A social marketing company envIO Networks recently launched an iPhone app called "Chorus." A kind of social network for apps, it enables users to share their app download and purchase histories and generates app recommendations based on what other other people are downloading and buying accordingly. 

The company released its list of top apps based on what Chorus users are downloading and sharing. As the release points out, the lists are very different than other top lists being exposed:

Top 10 Most Recommended Apps Among Chorus Community:

  1. Eliminate Pro FREE
  2. Shazam FREE
  3. Gowalla FREE
  4. Loopt FREE
  5. WhatsApp Messenger $0.99
  6. Google Earth FREE
  7. PocketMoney $4.99
  8. iFitness $1.99
  9. WebMD Mobile FREE
  10. Photoshop.com Mobile FREE

Top 10 Free Apps for November 2009 based on buy attempts:

  1. FunMail
  2. AccuWeather.com
  3. Redbox
  4. ShopSavvy
  5. HD Radio
  6. Black Friday
  7. Stain Brain
  8. Waze
  9. Nearest
  10. TowerMadness Zero: 3D Tower Defense

Top 10 Paid Apps for November 2009 based on buy attempts:

  1. Touch DJ
  2. Ravensword: The Fallen King
  3. AppButler - App Organizer
  4. Garters & Ghouls
  5. Trillian
  6. Park'n Find
  7. Mail Notifier
  8. Call of Duty: World at War: Zombies
  9. MindMeister (mind mapping)
  10. Big Buck Hunter Pro

Distimo/Skyhook Report on Location Apps

App store analytics provider and Distimo and Skyhook Wireless have put out their latest report on location-based apps. Skyhook used to do this alone and recently teamed up with Distimo for a more complete picture of location apps on multiple smartphone platforms.

The top free location apps in the iTunes store contain some household names and some surprises:

  1. Google Earth Google
  2. MapQuest 4 Mobile AOL
  3. Yellow Pages Avantar LLC
  4. Urbanspoon (IAC)
  5. Yelp
  6. Traffic.com uLocate Communications
  7. Trapster speed trap alerts
  8. AT&T Navigator: GPS navigation
  9. Kayak Flight and Hotel Search kayak.com
  10. MotionX GPS LTE MotionX
  11. priceline Hotel Negotiator priceline.com
  12. WHERE uLocate Communications
  13. GPS Tracker InstaMapper LLC
  14. NYC Subway Map Gotham Wave Games
  15. Restaurant Finder Softweb Solutions Inc.

What this illustrates is that PC brands have significant "equity" but that doesn't immediately or always translate into mobile leadership. And now the rest of the data (charts by Distimo/Skyhook):

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I haven't included the paid apps lists but take a look and compare the free apps in the Apple, Android and RIM apps stores. Multiplied Media's Poynt is the top LBS BlackBerry app but not available on the other platforms yet. Yelp is only on the top list for the iPhone. Where/uLocate is the only app present on all three lists:

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BirghtKite First to Bring AR Ads to US

Once every piece of data is geotagged then all manner of things will be possible: such as floating coupons in augmented reality (AR) apps. Today BrightKite announced just such a thing. The company has brought "offers" (deals, coupons) into AR via the Layar browser. According to the release out this morning:

Using the Brightkite service, users can look at the world around them through their phone’s camera to see real-time digital information on top of real-world locations. As the camera is turned in different directions, the graphics change to accommodate the lens’ movements and the user sees all their friends’ Brightkite data revealed around them. New partnerships with retailers, bars, restaurants and other businesses will allow Brightkite users to not only see Brightkite data but also nearby stores and local offers exclusive to each location. This is the first time AR has been used for an advertising campaign in the U.S. 

This is much more novelty right now than anything else. Layar is not yet widely adopted and BrightKite is somewhat buried on Layar. However deals/discounts/coupons will proliferate in mobile, including in AR environments. As I said, all you have to do is tag the coupons and then they can be "distributed" in myriad ways -- and associated with physical stores as they are in this implementation. 

Other "AR" coupon approaches: barcode scanning with competing offers presented in the results (e.g., competing store or etailer offers same TV at a lower price). In addition, you might see offers/deals when you hold the camera up in front of a business location (e.g., Yelp's monocle: free appetizer, etc.). 

AR works best right in front of a place, building, store, product as a way to get more information. However the idea that I'm going to scan the horizon looking for deals and then head to that location is unlikely. This is an early experiment that will eventually give way to specific use cases as those emerge over time. 

Bing iPhone App Doing Very Well

I was in the iPhone app store and discovered this: Bing was the number four free app on iTunes. That puts it ahead of such venerable iPhone apps as Facebook, Pandora, Google Earth and the Google Mobile App.

I really like it quite a bit. There are some things here and there that can be improved; but it's impressive as a version 1 and works well, including voice search. 

It would seem that the iPhone audience is responding well to the app or at least taking it out for a test drive. 

Barcode Scanning Going Mainstream

The Wall Street Journal has good overview article on mobile barcode (not QR code) scanning during holiday shopping. It features TheFind, NearbyNow, ShopSavvy and RedLaser. There's also a nice graphic/chart at the bottom that discusses the available data and platforms:

Many of the apps make creative use of the cameras built into most smart phones. An app from Amazon, which lets you search and buy products from the Seattle-based online retailer, has a feature called "remembers," in which you use the app to take a photo of something you're interested. Then the feature matches the photo (sometimes with the help of a real person) to a product on the site.

Several of the apps rely on the cameras built into phone to scan bar codes. Some handsets, such as the iPhone 3G, have difficulty reading bar codes in low-light settings, where the basic cameras can't focus on the label. Occipital LLC developed some specialized bar-code-reading technology for its RedLaser app, which has more luck reading bar codes in different settings. The company's app, which costs $1.99, is currently the No. 1 paid app in Apple's "utility" category, with about 750,000 users.

We've long maintained that shopping is a very near-term use case for mobile. And this season among iPhone and Android handset owners it's becoming much more mainstream as consumers do in-store price checks (and in some cases get reviews).

Being able to take a picture of an object or scan a barcode and get immediate quality feedback, competitive pricing and nearby inventory information (in some cases) and, soon, promotions is a very practical application of "augmented reality." Here's a video of RedLaser in action:

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Several things are now coming together to enable these apps and experiences: retailer inventories are being opened up and delivered as feeds to third parties (some are getting data in other creative ways, such as Milo). This combined with online price and reviews information, which has been around for some time, create the basis for very useful in-store mobile shopping apps. We'll only see this area expand and grow in the future.

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Related: CNET releases Android barcode scanning app, "Scan & Shop" (MediaPost covers). Very much like other barcode scanning apps. You can: 

  • Search for a product
  • See wish lists
  • Get price alerts
  • See history
  • Settings 

Finally, the NYTimes offers a broad article on smartphones and shopping: Mobile Phones Become Essential Tool for Holiday Shopping

MapQuest Enhances Mobile Web Sites, Apps

MapQuest announced a bunch of ugrades for its mobile products, including the introduction of automatic geo-location for its mobile Web property:

We have listened to your requests and added Geo Location to the latest release. That's right, iPhone and Android users visiting MapQuest.com now have the ability to utilize their Smartphone's GPS receiver to pinpoint their current location within the map, directions and search forms.

Other new features include access to saved maps and walking directions. 

There were also new iPhone and BlackBerry app releases that featured a range of improvements. I appreciate the scrolling horizontal menu on MapQuest4Mobile on the iPhone and the ability to locate categories of businsses with a single touch on an icon. But that's not a new feature. 

Here are the new iPhone app features:

  • Walking directions feature that provides directions to navigate pedestrian-only paths.
  • New map styles with terrain and vegetation imagery that emulates the MapQuest.com experience.
  • Directions Mode now includes a collapsible "hat" that allows users to expand and contract their route narrative, resulting in a larger view of the map.
  • Metric Units Support. In Directions Mode, users can now view their route detail in metric units.

As MapQuest tries to figure out its competitive online strategy in a new era for AOL, mobile becomes a very strategic and important component of that overall strategy.

According to our data Maps & Directions are the top local content category for all users (49%). The numbers are even larger for  smartphone owners:

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Source: Universal McCann-AOL n=1,800 smartphone users (Q2, 2009)

Will 'Point & Find' Get Nokia Back in the Game?

There's a long NY Times article that discusses the current competitive predicament of Nokia, the leading handset maker in the world. At the high end the OEM is losing the battle against the RIM, Android and the iPhone. Of course Apple and Nokia have recently sued each other. Nokia sued Apple after not being able to gain licensing deals (and access to Apple IP) on its terms; Apple counter sued saying, in paragraph 3 of the cross-complaint:

In dealing with Apple, Nokia has sought to gain an unjust competitive advantage over Apple by charging unwarranted fees to use patents that alleged cover industry compatibility standards and by seeking to obtain access to Apple's intellectual property. Nokia needs access to Apple's intellectual proety because Nokia has copied and is now using that patented technology.

While the company still maintains control of 37% of the global handset market, that share will continue to decline as more users adopt smartphones and Nokia offers weak handsets at the high end. The company maintains that its devices are more advanced than the iPhone but that it misjudged the market. In a statement that sounds very much like a rationalization (and one that's factually inaccurate to boot) Nokia's Anssi Vanjoki tells the NY Times:

“We didn’t execute; we were aiming at too geeky a community,” he says. “Apple is made for the common man. It’s more for Joe Six-Pack than techno-geeks. But we understand Joe Six-Pack too.”

I've argued in the past that to gain re-entry to the US market, Nokia should make high-functioning cheap devices for those people transitioning from the lowest end of the handset market. It can then re-establish the brand as it brings out better smartphones. Next year is supposed to see a refresh of the Symbian UI and UX; however there are doubts about whether the OS can compete long term with the iPhone OS and Android. 

There has been repeated speculation about whether Nokia was going to abandon Symbian in favor of Maemo. But recently Nokia said it was still very committed to Symbian. It issued the following statement about how it sees the two in its portfolio:

“While it is our policy not to disclose details of our product roadmap, we’d like to explicitly communicate that we remain firmly committed to Symbian as our smartphone platform of choice. Any speculation on what our 2012 roadmap, including operating systems and product branding, are completely premature.

As we have stated earlier, Nokia has multiple platforms to serve different purposes and address different markets. Symbian is more successful than ever in bringing smartphones to the masses. Maemo is our software of choice for devices based on technology that you’d typically find inside a desktop computer. It delivers a different user experience and enables us to widen the market we can address.”

Nokia, whose brand is strong outside the US but weak inside, must do some practical and splashy things to revitalize. One of those could be "Point & Find." Announced at the CTIA trade show in April, it's a visual search technology that uses the camera to obtain information by taking pictures of objects, images and places in the physical world. Conceptually this is identical to what Google demonstrated with Google Goggles

There are a range of companies that offer similar technology or "visual search" capabilities but only handset OEMs such as Nokia or Apple, or major Internet companies such as Google and Amazon, have the power and visibility to drive mainstream adoption. But the strategy that Nokia is pursuing with Point & Find may limit adoption: it relies on third parties to buy in/implement and it's charging them to become a part of the program. 

Point & Find is a next-generation capability that could generate excitement around Nokia handsets but it needs to be pushed aggressively. Nokia should go buy up all the "visual search" companies out there and make that experience a centerpiece of a new UX on its handsets. You can't beat Apple by trying to play the iPhone game; you need to change the rules.

Point & Find would be largely differentiated from everything else (especially if the company could do this aggressively across its product lines). In addition, given the installed base of Nokia users it could create an entire ecosystem around Point & Find that could rival the iPhone app store in one way of thinking. However I'm not sure that Nokia sees the opportunity clearly. 

Indeed, the 'GPhone' Is Upon Us

Before Android launched there were rumors that Google was developing its own mobile phone. Those rumors turned out to be "sort of" true as Google displayed Android, a mobile phone operating system. The company said it hoped that would spawn hundreds of mobile Android devices. Cut to a little over a year later and one financial analyst recently predicted that there would be roughly 50 Android phones in the market next year.

Almost every major handset OEM has or is launching an Android line. HTC, Motorola and Samsung, in that order, are the three leading Android OEMs so far. And PC makers such as Dell and Acer are making Android handsets as well. 

By all measures Android has been a huge hit for Google -- and maybe its most strategic product after core search -- yet all Android devices and experiences in the market today still fall short of the integrated hardware-software experience offered by the iPhone. Android has features and capabilities that the iPhone does not -- especially the ultra-masculine Motorola Droid. Yet there remain rough edges, flaws and awkwardness about the user experience. (I'm not suggesting the iPhone is perfect, but it's still the best overall mobile device in the market.)

Google is clearly aware of all of this. The deep involvement of the company with Motorola and Verizon to bring Droid to market shows how it wants to realize its vision of what Android can be. To that end in late October rumors surfaced of a new "Google Phone" -- a Google branded handset that would be sold directly by the public and designed/developed substantially by Google. 

Yesterday word got out (via Twitter and blogs that picked up Tweets from Google employees) that this mythical Google Phone had been distributed internally as a holiday gift. Yesterday during the day more detail emerged from a range of sources. Reportedly built by HTC, it's called the "Nexus One." According to the WSJ:

The phone is called the Nexus One and is being manufactured for Google by HTC Corp., these people said. It runs Android, the operating system for mobile phones that Google developed, they added.

But unlike the more than half-dozen Android phones made by phone manufacturers today, Google designed virtually the entire software experience behind the phone, from the applications that run on it to the look and feel of each screen.

The Internet giant is taking a new, and potentially risky, approach to selling the device. Rather than selling the phone through a wireless carrier–the way the bulk of phones are sold in the U.S. today–Google plans to sell the Nexus One itself online. Users will have to buy cellular service for the device separately.

The image at the upper right is an alleged picture of the device (from Cory O'Brien). 

For its part, after the news of the phone started generating huge buzz on Techmeme, Google issued the following statement on its Mobile Blog:

At Google, we are constantly experimenting with new products and technologies, and often ask employees to test these products for quick feedback and suggestions for improvements in a process we call dogfooding (from "eating your own dogfood").

Well this holiday season, we are taking dogfooding to a new level. We recently came up with the concept of a mobile lab, which is a device that combines innovative hardware from a partner with software that runs on Android to experiment with new mobile features and capabilities, and we shared this device with Google employees across the globe. This means they get to test out a new technology and help improve it.

Unfortunately, because dogfooding is a process exclusively for Google employees, we cannot share specific product details. We hope to share more after our dogfood diet.

But in the wake of all the other information now out there and surrounding the device, the statement above is a little like Tiger Woods denying he's had affairs at this point. Perhaps this device, allegedly running Android 2.1, will be a true rival to the iPhone.

Google's recent Navigation, voice search advances and "visual search" are exciting products. If these and other apps and software have been integrated in an elegant way with the hardware, the device could be very impressive. In the meantime, to build its reputation as the most advanced platform on the market, Google is favoring Android when it does product launches (e.g., Navigation, Google Goggles), promising to bring the same functionality to other platforms (read: iPhone, et al.) sometime later. 

Let's assume that this GPhone device will be sold unlocked to the public; and let's assume it's a GSM device so that it offers the broadest international reach possible out of the gate. All of that is great. However, one fundamental issue with the device is price. Unless Google were to subsidize the phone itself it would be probably twice as expensive as other Android handsets in the market. That would keep lots of people away.

And the company does risk ruffling carrier feathers or worse by going straight to the public. Despite the fact that Google Voice is morphing into a Skype competitor, the company is several years away from being able to function as a wireless operator. In a future, potential scenario Google resells 4G WiMax from Clear (it's an investor) and VoIP calling with Google Voice as part of a package. But Clear's coverage is not yet able to support that model. Perhaps three years from now. 

On the other hand, mobile operators in the US (if not globally) need to be very afraid of pent-up consumer demand for cheaper or more complete alternatives, such as a 4G subscription that might cover Internet access in the home and on the go. The iPhone, BlackBerry and, to a lesser degree so far, Android devices have shifted the balance of power from the operators to handsets and devices. And VoIP calling options will only get better and put more pressure on carrier voice revenues over time. 

Notwithstanding all the carrier app stores and other efforts, the era of the "dumb pipe" is truly dawning. There will only be two ways for operators to compete going forward: with their networks and with pricing. Other considerations will be a distant second or third in the consumer mind.

If Google does sell this device unlocked and online we'll see what the carrier reaction is. Google probably figures there won't be much (if any) backlash because their power is waning. But probably the biggest determinant of the success or failure of this hypothetical, idealized device will be the perennial and mundane issue of price.

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Related: Silicon Alley Insider says that the phone may be serviced by T-Mobile, which will offer a credit to bring the price down:

It appears the phone will be ideally serviced by T-Mobile, as that's the 3G radio bands it's suited for. Perhaps T-Mobile will offer a $200-300 service credit (in lieu of a device subsidy) for those signing 2-year contracts.

Google's Updated iPhone Adds Accents, Languages to Voice Search

Google has updated its iPhone app. Overall the app is a bit cleaner and more user friendly. However, the update is relatively minor -- there are some interface and settings changes -- except in the area of voice search. Now a range of English accents are available: American, UK, Australian, Indian. Google has also added Mandarin and Japanese. Support for more languages are coming in the near future.

Despite the fact that Google Apps are right now richer on Android (e.g., Goggles, Navigation), the incarnation of voice search on the iPhone is the highest expression of Google's product because of the way in which voice is initiated: by moving the handset up to the ear. 

Google is pushing aggressively on multiple fronts to make itself the center of the mobile experience for end users:

  • Voice search
  • Traditional search
  • Mobile products/shopping
  • Navigation
  • Maps/local
  • Image recognition/visual search 

Google is battling lots of specialized apps that offer functionality or content that is deeper or richer than general search can provide. It's also dueling a host of "horizontal" local content providers (e.g., Yelp).

Google Visual Search: AR 1.5 and Beyond

With the debut of Google Goggles/Visual Search we've seen the immediate (and maybe long-term) future of augmented reality (AR). The apps that show you restaurant reviews floating in space or Tweets in mid air are novel and fun yet ultimately not very useful. As I previously wrote, "augmented reality 1.0" is what we have now.

What Google demonstrated at its Search Evolution event yesterday morning amounts to a considerable advance over Layar, Wikitude and the other AR tools and apps. Google Visual Search, though experimental and incomplete, holds out the promise of being able to position the smartphone camera in front of a place or object and get information and data back by taking a picture or just by looking through the camera in the case of local businesses. 

This is a radical development for "mobile search" and is clearly useful in ways that most AR apps and tools are not. The only thing truly comparable in my mind, though on a more narrow level, is Amazon's "Amazon Remembers" (SnapTell) capability. Others may protest that Layar or other AR apps offer comparable or greater utility. But I don't agree.

Rather than attempting to be a complete substitute for the conventional search box or even voice search, the camera or "visual search" complements Google's other approaches. It works for objects, products and places that I'm right in front of:

  • A TV set
  • A business card (OCR)
  • A work of art in a museum
  • A business
  • A building or landmark

This is especially useful when I wouldn't know what query to type or it would be particularly cumbersome or awkward to enter a query, even for voice. One example might be a interesting building without an obvious address or other identifying markers . . . or a public sculpture where the artist's name or title weren't visible. And the business card/OCR capability (see video below) can't be accomplished at all via "search." 

Here's an explanatory video:

Picture 53

In the image above, the ability to quickly discover information about this Frida Kahlo painting through the camera is much more pleasurable and efficient than typing in the query "Diego Rivera and Frida Kahlo" and getting back a bunch of links (even images), then having to sift through them. 

Again this is the use case for AR: I'm right in front of the thing (or eventually the person) I want to know more about -- not 100 yards away. I'm realistically not going to scan the horizon for restaurants; there are more efficient ways to get information about where to eat on mobile devices. 

The hope of many of the AR competitors was to beat Google to the punch with the new experience. But now that Google has shown this functionality and the breadth of its ambition with "Visual Search" the hope of competitors has got to be data depth, quality or some social angle that Google would have difficulty doing. 

Google's long shadow online and now in mobile and its ability to bring together the search box with voice -- and now the camera -- makes it almost impossible to disrupt the relationship the company has established with the end users and search. Google is proving it recognizes the limitations of traditional search on mobile devices and can quickly adapt to the new medium. Indeed, Visual search is quite a bit more compelling than the Google PC search experience and even makes that latter appear quite primitive by comparison.

Perhaps only Microsoft is in a position to challenge Google on the multiple fronts that have now opened up in what we can expansively call "mobile search."

Yelp Launches Android App

Yelp has gone from a company that just a couple of years ago was relatively passive about mobile -- people at Palm were the ones that got Yelp Mobile going -- to one that now is intensely focused on mobile and has apps for iPhone, Blackberry, Palm Pre and mobile Web. Today Yelp extended that to Android.

It offers basically the same functionality as on the other mobile platform apps. According to Yelp:

Similar to all of our other mobile apps, Android launches with basic search and browse functionality search. But we've also been able to work in sales and special offers (just in time for the holidays) and "Hot on Yelp" (buzzworthy businesses according to yelpers - according to bookmarks in the past 30 days).

Here are a few screens from the app:

Picture 40

Yelp now sees the profound connection between the PC and mobile (in the local context) and the importance of mobile for the future of Yelp, its brand and user loyalty.

Will Aardvark Sell for $30 Million?

TechCrunch is reporting a rumor that answer community and social search tool Aarvark is considering a $30 million buyout offer from Google:

Social search service Aardvark is considering accepting a $30+ million offer by Google, say multiple sources close to the companies (one source says it’s $40 million). The company, which was founded by ex-Googlers, has raised around $6 million in venture capital to date.

The company is also talking with other potential buyers, say our sources.

Here's the dilemma and challenge: selling to Google or another will probably take the company in a somewhat different direction than the founders envision. Dodgeball launguished under Google and Jaiku was shut down. However, this is guaranteed money and the Aardvark business model is "embryonic" at best. 

Is Aardvark a service that will continue to grow and become an alternative "word of mouth" tool that people use instead of conventional search (esp. on the go)? Or is it a promising service that won't quite live up to user expectations (which is what some are saying today). In the former scenario, Aardvark could potentially sell for much more. In the latter, $30 million would represent a good (and very quick) exit. Recall that Google early on tried to buy Friendster for $30 million

This is obviously a tough choice and to some degree about predicting the future. The founders will need to evaluate their growth, look at how viable their intended business models are and search their gut instincts.

But investors and the "rational" decision may be to try and create a bidding war and then sell with some assurance that the new parent will allow development consistent with the founders' vision. 

 Here are previous posts on Aardvark:

Google Visual Search: Break Away from the Box

As we've argued previously "mobile search" has so far been a small-screen version of its PC sibling: a box producing links and images on a tiny version of a Web page. But as 2010 begins we'll see "mobile search" start to break away more and more and take on more of the "native" attributes of the handset (location awareness, voice input, camera).

Local "discovery" (what's nearby) apps and tools are starting to do that, leveraging the phone's location awareness. In addition voice is starting to assume a more prominent role as a query input mechanism. Verizon's Droid ads featuring voice search are an example of the increasing visibility of this utility. And the camera is increasingly a search tool. Product barcode scanning is one use case, which is gaining traction. Augmented reality (AR) is yet another example. However, AR is mostly novelty now -- although it will evolve and mature quickly.

In that latter category Google Goggles or Google Visual Search, as it's more descriptively called, is a potentially compelling use of the camera as a search tool. Currently being tested, it will allow a user to take a picture of an object, building, product, etc. and retrive information and maybe commercial content (e.g., coupons, what's on sale). AR "browsers" such as Wikitude and Layar offer an early version of visual search. But, so far, these are somewhat awkward integrations of third party data displayed in the camera viewer.

Google Visual Search is a more ambitious version of what Amazon has done with products: you take a picture of an item and Amazon will find it for you in the database. In the recent CNBC documentary "Inside the Mind of Google," there was a bit on "Google Googles." Here's the video segment that has it (about 3:58) 

Picture 13

Google is one of the few companies, Microsoft is probably the other, that can bring all the evolving elements of search together on the handset: location/maps, camera/AR (including barcode scanning) and voice with the massive databases needed to make it all work. Unlike the PC where search is "flat," (box + links) search on a mobile device will be "variegated," featuring the integration of different tools and capabilities together in context sensitive and relevant ways. 

And if Google can do "visual search" well -- again, being able to tie the database together with images and location is the key -- others will have a hard time breaking through in "mobile search." On a related note, as a kind of baby step in this realm, Google has integrated QR barcode search with local business window decals.

We don't need to worry about the business model for Visual Search, it's pretty obvious: text and display ads, videos with pre-roll, sponsored contextual links and coupons could all be presented in results, depending on what was relevant and appropriate to the information shown. 

Update: Google Goggles available from Google Labs today. 

A Peak into the BlackBerry App Strategy

BlackBerry is trying to play the iPhone apps game and still create something distinctive. In general the RIM platform needs to create a better "home grown" (as opposed to Opera) mobile browser experience and offer enough apps to keep App World generally competitive with the iPhone. It doesn't need to cultivate 100K apps, but it needs to have "enough" in each category. That's something of a moving target but there are clearly diminishing returns when the numbers get too large -- and discovery becomes a problem. 

Simply duplicating what the iPhone or others (e.g., Android) are doing is probably not a winning strategy for RIM. But an interview with ZDNet offers a peak at how RIM will seek to differentiate and distinguish the BlackBerry apps experience from the competition. 

Here's an interesting bit from the interview with RIM Senior Vice President Alan Brenner:

This notion of enabling deep integration is distinctive, and it speaks to our traditional strength as BlackBerry — which is we make the applications work together, and their functionality is orchestrated around users' needs and tasks and objectives, rather than [around] the features of an application.

So the idea is to make BlackBerry apps work with the core functions of the handset and software at a deeper level than the iPhone or other smartphone apps platforms, where the apps are like stand-alone sites and basically don't integrate much with the handset (save the camera and location awareness). 

We'll see how this turns out in practice but conceptually it's very interesting.