Wednesday, June 27, 2012
Saturday, May 26, 2012
Is NFC is killing Google Wallet??
Google Wallet is turning one, but the application that was supposed to transform the smartphone into a wallet and revolutionize how consumers pay for things has barely gotten off the ground.
Why? The reason may be that Google has bet on the wrong technology: NFC.
A year ago, Google execs, along with its partners MasterCard, Citibank, and Sprint, took the stage in New York City to show off the future of payments. No longer would people have to overload their wallets with cards and receipts. Google's plan was to virtualize it all.
Through an application for its Android smartphones, Google promised a world in which consumers could leave their bulky George Castanza wallets at home and instead load all their credit cards, loyalty cards, gift cards, and even some day their driver's licenses into a so-called digital wallet that stored all this critical information on a smartphone.
Using a very short range and secure wireless technology called near field communications, or NFC, consumers could pay for things simply by tapping their smartphone onto a terminal, which reads a user's credit card, coupon, or loyalty card information.
But a year has passed since Google first introduced this new application. And even though it's made some progress in signing up new retail partners, the company still hasn't managed to scare up additional credit card, bank, or carrier partners.
What this means for potential Google Wallet users is that the only credit card you can add to your "digital wallet" is a Citibank MasterCard. If you don't have a Citibank MasterCard, you can still use the wallet, but you have to load money on Google's prepaid card. And because Sprint is the only carrier supporting Google Wallet, it means that users must be Sprint (or Virgin Mobile) subscribers to use the app. The only exception is if they buy the unlocked version of the Nexus S, which can be used on GSM carriers, such as AT&T.Google Wallet still only works with one credit card and bank combination: Citibank MasterCard. And the only major carrier where Google Wallet phones can be found is Sprint Nextel. (Virgin Mobile, one of Sprint's prepaid brands will also soon offer a Google Wallet device.)
Blame it on NFC
So what went wrong? One reason the service may not have gotten much traction is because it relies on the NFC tap-to-pay technology. While the technology itself has been around for a while and works fine, the problem with using it for payments is that it requires a broad ecosystem to get it off the ground.
So what went wrong? One reason the service may not have gotten much traction is because it relies on the NFC tap-to-pay technology. While the technology itself has been around for a while and works fine, the problem with using it for payments is that it requires a broad ecosystem to get it off the ground.
First there's a hardware problem. Devices need to be equipped with tiny NFC chips. And terminals at the point of sale must also be equipped to read the information from the NFC chips installed in devices.
The second big problem is that there are still business issues centering around who controls the customer via the NFC technology that's embedded in the device.
"The biggest problem with NFC payments is a political one," said Yossi Yarkoni, founder and CEO of a startup mobile payment company based in Israel called Digimo. "The question comes down to: 'Who owns the customer?'"
Digimo has developed a mobile payment system that uses QR scanning technology instead of NFC. Yarkoni said it is this fundamental question about who owns the secure element that has held up the deployment of NFC-based mobile payments, such as Google Wallet.
"Why should Apple or Samsung bother putting NFC in devices if they simply hand over that customer relationship to others?" he said. "Everyone in the ecosystem wants a piece of this action."
As a result, fewer than 1 percent of the phones sold today have NFC chips embedded. But Google says it's making progress on the device front.
When Google Wallet first launched, the only device that offered the app was the Google-branded Samsung Galaxy Nexus S. Now there are a total of six devices that support NFC and the Google Wallet app. Five of these devices were announced just recently.
Here's a quick list:
- Sprint Galaxy Nexus, Unlocked Galaxy Nexus
- LG Viper on Sprint
- LG Optimus Elite on Sprint
- LG Optimus Elite on Virgin Mobile
- Nexus S on Sprint
But experts say more devices are needed to make Google Wallet and other NFC-based mobile payment solutions successful, especially since companies, such as PayPal, are developing solutions that don't require NFC or any other specialized hardware.
"NFC-based mobile wallet plays will be disadvantaged in the short-term due to lack of hardware," said Linda Barrabee, an analyst covering payments for NPD Group. "This potentially gives PayPal, among others, some running room."
Alternatives to NFC
PayPal, which had been experimenting with NFC payments last year, ditched the short-range wireless technology when it launched its in-store mobile payment solution. Instead, the company has launched a mobile payment app that only requires users to type in a PIN to access their PayPal accounts. So far, it has deployed the service at more than 2,000 Home Depots around the U.S. And it announced on Thursday that it's adding another 15 retailers.
PayPal, which had been experimenting with NFC payments last year, ditched the short-range wireless technology when it launched its in-store mobile payment solution. Instead, the company has launched a mobile payment app that only requires users to type in a PIN to access their PayPal accounts. So far, it has deployed the service at more than 2,000 Home Depots around the U.S. And it announced on Thursday that it's adding another 15 retailers.
The new retailers include, Abercrombie & Fitch, Advance Auto Parts, Aeropostale, American Eagle Outfitters, Barnes & Noble, Foot Locker, Guitar Center, Jamba Juice, JC Penney, Jos. A. Bank Clothiers, Nine West, Office Depot, Rooms To Go, Tiger Direct, and Toys "R" Us.
PayPal's CEO John Donahoe said on the company's second-quarter earnings call that he doesn't see NFC ever making a splash in the market, because it doesn't offer consumers any real value.
"When is it (NFC) going to be ready? Never," he said. "I think other technology solutions, like what PayPal is doing where you pay hands-free with a mobile number and PIN, provide compelling consumer experiences that don't require the actual use of an NFC technology."
"History has shown that unless a new technology saves people time or money, it won't reach mass adoption," he said. "NFC is a technology in search of a problem. Tapping a phone against a reader is no faster than swiping a credit card. In fact, it can take longer."
It's this ecosystem that is holding back NFC. And it's not just strictly about whether handset makers want to add NFC to their devices. The ecosystem is largely controlled by wireless operators. And so far, Google has also not gained much support there either.
Even when a device supports NFC, some operators have refused to enable the Google Wallet app on their networks. For example, Verizon Wireless disabled the Google Wallet functionality on its version of the Galaxy Nexus, even though the hardware supported it.
One reason why wireless operators haven't signed onto Google Wallet is because three of the four major wireless operators in the market -- AT&T, Verizon Wireless and T-Mobile USA -- are involved in a joint venture that's developing its own digital wallet. The joint venture, called Isis, is currently being tested in two markets: Austin and Salt Lake City. It's supposed to launch later this year.
But even Isis, which has support from wireless carriers and has signed up several credit card companies, has also been slow in getting off the ground. Part of the issue is that Isis also relies NFC technology as a way to authenticate payment.
It's this uncertainty around NFC that has caused other companies looking to break into the mobile payment to put NFC-based solutions on the back burner. For example, MasterCard, which is Google's partner on Google Wallet, did not include NFC in its own recently announced digital wallet.
Instead of focusing on the point of sale in physical stores, MasterCard has improved the experience of simply buying things from a mobile phone. In other words, the company has streamlined the interface so that consumers can buy things from a mobile Web site with a single click.
"NFC may become really important in the future," Ed Olebe, head of PayPass Wallet services for MasterCard. "So we are waiting to see how the industry works out its issues. But given there is a pressing problem today with commerce on a phone, we wanted to address that issue."
Friday, March 23, 2012
New iPad not quite running circles around iPad 2
At this point in the performance narrative of i...Things, I've gotten accustomed to each new iteration of the iPad or iPhone becoming demonstrably faster than the last. I'm not talking strictly about frame rates in games either. App load times, movie encoding, and app download speeds are all things that seem to noticeably improve with each new iOS device.
However, with the announcement that the newiPad's A5X processor would only see an upgrade in its graphical capabilities over the A5, I have to admit to being more than a bit disappointed.
Still, there's no way to know for sure what improvements or lack of improvements to general performance there are without rolling up your sleeves, using a little elbow grease, hunkering down, and doing some testing.
Honestly, conducting these types of tests is something I genuinely enjoy so no need to thank me, I'd likely be doing it even if CNET wasn't constantly driving dump trucks of money to my house. Really, they are (not really).
Since I know how much you love things you can read, I've organized the results into an easily digestible chart. Check below the chart for explanations on what exactly these numbers mean. I ran the tests on the iPad 2 (Wi-Fi, 16GB) and new iPad (4G, 32GB).
| New iPad | iPad 2 | |
|---|---|---|
| Boot time (in seconds) | 27 | 14 |
| iMovie export Front Cam, 720p (in seconds) | 26 | 32 |
| iMovie export (Rear Cam, 720p) | 32 | 37 |
| iMovie export (Rear Cam, 1080p) | 50 | n/a |
| Game load (Puzzlejuice) | 6 | 6 |
| Game load (Real Racing 2 HD) | 3 | 4 |
| Game load (Flip Ship) | 10 | 10 |
| App download (Cut the Rope HD Lite) | 22 | 26 |
Boot time
Whiletablet owners will rarely turn off their tablets, boot time is still a simple and easy way to gauge and compare overall speed. For this test, I loaded the exact same apps on each iPad, put them in airplane mode, and powered them off. I started the timer as I pressed the power button and stopped it as soon as the lock screen appeared.
iMovie encoding
I shot two 30-second clips. One with each iPad's front camera and one with each of their rear cameras. I exported the front camera's movie from each iPad to the camera roll at 720p and timed the process from the moment I tapped "HD - 720p" until the process completed.
I followed the same methodology for the rear camera videos. In addition, since the new iPad possesses the power of 1080p (the iPad 2 isn't capable of 1080p output), I exported the back camera movie at that resolution as well, just out of curiosity really.
App loading
I used three different games to determine if apps load any faster on the new iPad than the iPad 2. First up was one of my favorite games on iOS, Puzzlejuice. I timed the test from the moment the app icon was tapped until the game screen appeared.
For Real Racing 2 HD, I chose Quick Race and started the timer as I tapped the default course and stopped as soon as the cars appeared on screen.
Lastly, I used Flip Ship since, one, in my previous experience, it wasn't always the fastest loading app and two, it has a useful progress bar. I timed it from the moment I tapped the app until the title screen appeared.
App download speed via Wi-Fi
I downloaded Cut the Rope HD Lite (23.8MB) from the App Store via Wi-Fi over a closed Wi-Fi network where the tablets were about 5-7 feet away from the router. I timed both the download and installation of the app from the moment I tapped "Install app" until the app icon lit up. Check out the full iPad review for information of its 4G speeds.
Analysis
The chart above definitely indicates that the new iPad opens apps about as fast as the iPad 2 does. While I didn't test every app available, given the evidence gathered during testing as well as anecdotal evidence garnered by simply using the device, I think it's safe to say that you won't find much speed difference, if you do at all, when opening apps.
App download speeds over Wi-Fi were also very close; however, we used Cut the Rope HD Lite, a 22.7MB game. The speed difference when downloading larger games could be greater. Also, while the new iPad is consistently faster at encoding 720p video, it's not dramatically so.
Boot time was faster on the iPad 2, but the storage size must be taken into account here. As mentioned above, our iPad 2's 16GB of storage cuts the boot process duration, making it quicker than the new iPad's with its 32GB of storage.
If you're considering replacing your iPad 2 for a new iPad with the hope that the speed increases will justify your purchase decision, you may want to consider something else, like sticking with your iPad 2.
While overall, the new iPad does perform faster, the small increase in speed isn't alone worth an upgrade from iPad 2; however, if you've got your eye on the iPad for other reasons (like the gorgeous screen, its impressive graphical capabilities, or its fast 4G speeds), well that's something I'd be much more inclined to support.
Friday, February 3, 2012
Facebook could soon be worth $200B so forget $100B
For all the naysaying about Facebook, that it's a flash in the pan and such, there are very few that say that "social" is going away.
Facebook has defined the social era of computing--and the companies that defined the previous eras of computing each command market values of $200 billion or more.
Facebook should get there, too.
IBM kicked off the mainframe era of computing and to this day is the leader in big enterprise computers and services. Microsoft was an early leader in personal computer software and now dominates microprocessor based desktops and servers. And after joining the scrum at the tail end of the dotcom boom of the 1990s, Google emerged as the leader of the Internet era of computing, amassing huge market share and most of Internet advertising's profits.
Coincidentally, those three companies--each of which dominated an era of computing--are now each worth roughly $200 billion.
While many still think of Apple as a computer company, it's not. It's reinvented itself as the leader of the mobile era of computing. Three quarters of Apple's revenues are now from the iPhone, iPad, and iPod, and it is in the process of re-creating the Mac as a mobile computer with the MacBook Air. Apple, as the leader of the mobile era of computing, is now valued at an astounding $400 billion plus.
Given the history of IBM, Microsoft, Google, and Apple, that each respectively led the mainframe/minicomputer, personal computer, Internet, and mobile eras of computing, it is not that much of a stretch that Facebook, as the company that defines the social era of computing, will be right up there with them. Each of these eras have produced prodigious revenue and earnings, and as Facebook's S1 filing shows, social is already well on its way to stellar revenue and earnings--making the bulk of its money the way Google does, through advertising.
The leaders of each era have managed to lock in a generation of users ranging from business datacenters, PC operating systems and applications, and the portal by which people search. Facebook's social graph will be just as persistent. While other niche social networks will emerge, most of us aren't going to switch.
Of course, Facebook's current revenue and earnings does not justify such a valuation, but Facebook is still young and doubtless will figure out plenty of ways to make more money, including selling valuable new ad units such as sponsored stories against its increasing number of mobile users. So long as it it continues on its existing trajectory, the leader of the social era of computing will join others in the $200 billion club.
Or--dare I suggest?--the $400 billion club.
Facebook should get there, too.
IBM kicked off the mainframe era of computing and to this day is the leader in big enterprise computers and services. Microsoft was an early leader in personal computer software and now dominates microprocessor based desktops and servers. And after joining the scrum at the tail end of the dotcom boom of the 1990s, Google emerged as the leader of the Internet era of computing, amassing huge market share and most of Internet advertising's profits.
Coincidentally, those three companies--each of which dominated an era of computing--are now each worth roughly $200 billion.
Given the history of IBM, Microsoft, Google, and Apple, that each respectively led the mainframe/minicomputer, personal computer, Internet, and mobile eras of computing, it is not that much of a stretch that Facebook, as the company that defines the social era of computing, will be right up there with them. Each of these eras have produced prodigious revenue and earnings, and as Facebook's S1 filing shows, social is already well on its way to stellar revenue and earnings--making the bulk of its money the way Google does, through advertising.
The leaders of each era have managed to lock in a generation of users ranging from business datacenters, PC operating systems and applications, and the portal by which people search. Facebook's social graph will be just as persistent. While other niche social networks will emerge, most of us aren't going to switch.
Of course, Facebook's current revenue and earnings does not justify such a valuation, but Facebook is still young and doubtless will figure out plenty of ways to make more money, including selling valuable new ad units such as sponsored stories against its increasing number of mobile users. So long as it it continues on its existing trajectory, the leader of the social era of computing will join others in the $200 billion club.
Or--dare I suggest?--the $400 billion club.
Adobe gives Photoshop CS6 which is a new graphics-chip boost
The graphics processing unit (GPU) speeds the Liquify tool, which lets people smear images in a finger-painting way, according to a Zorana Gee, a Photoshop product manager. She demonstrated the change in a YouTube video, the second in what looks to be a series of previews of the software. An earlier Photoshop CS6 preview showed new raw image editing tools adopted from the Lightroom 4 beta, a darker user interface, and improvements to brush size selection. Expect Adobe to add more previews but to withhold some goodies for the official launch sometime later in the first half of 2012.
When firing up the Liquify plug-in with the current Photoshop CS5.x to edit a 100MB image, the image arrives only gradually, broken up into multiple tiles. "And further, if I want to increase my brush size beyond 1,500 pixels, I can't," Gee said. Worse, when she tries to use the brush, there's a big lag between her stroke and the on-screen result.
In CS6, she said, the image opens immediately in the Liquify filter, the brush size goes beyond 14,000 pixels, and interactive performance is snappy.
"You can see real-time editing--no lag," Gee said. "Your edits immediately follow your cursor."
It's not clear if the GPU help applies to other new tools. Adobe has added other GPU acceleration to assorted features in earlier versions of Photoshop.
Photoshop is one of the most popular programs from the San Jose, Calif.-based company, but Adobe is in the midst of a transition to a $600-per-year subscription called the Creative Cloud that combines Photoshop with all the other Creative Suite programs, the Touch mobile apps, and online services for publishing and connecting socially to other subscribers. Cheaper subscriptions and traditional perpetual licenses also will be available for those who want individual packages.
Adobe had wanted to add the GPU acceleration and background save features to Photoshop for some time, but programmers had been derailed by the need to move from Apple's older Carbon user interface to its newer Cocoa interface after Apple canceled its plans for 64-bit Carbon support, said John Nack, an Adobe principal product manager.
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Facebook deserve its astronomical valuation or not?
In its filing with the Securities and Exchange Commission yesterday, Facebook revealed that it had 845 million monthly users and was rapidly closing in on 1 billion. As many have noted, the key will be leveraging that massive user base to generate more revenue through its display ads and its app platform.
However, some have suggested the historic offering is overblown, characterizing Facebook as a "badly overpriced photo-sharing and gaming site."
Besides making a lot of people rich, Tech Republic's Jason Hiner makes the case that while Facebook's photo sharing is nice, it's not very lucrative. And that while gaming is "very lucrative," it's also "faddish," and Facebook's stake is dependent on third parties such as Farmville creator Zynga. (Twelve percent of its revenue comes from Zynga.)
But Bill Gurley of Benchmark Capital sees promise in the IPO (Benchmark Capital has a minority position in the social network as a result of the acquisition of FriendFeed) and has created a report card of sorts to explain why he believes the company belongs in the "10x forward price/revenue multiple club." Gurley grades Facebook based on 10 metrics that investors consider when deciding whether a company deserves a high valuation.
According to Gurley, the company registers an outstanding score for sustainable competitive advantage and presence of network effects. ("All current non-U.S. Facebook users have immediate connections if they log in," he points out.)
He also gives Facebook high marks for customer lock-in, saying that "leaving Facebook is possible, but finding an alternative with all your friends on it is not really possible." Some fans of Google+ might disagree with him, along with his assertion that the "inclusion of Timeline works to increase this even more by creating a permanent dependence on past content."
Facebook falls short on marginal profitability calculation, noting that its peak profitability was in the fourth quarter of 2010 and that spending has kept pace with revenue growth since then. "Top line" growth is also a sore spot for Facebook; while it had a growth rate of 88 percent for 2011, its fourth-quarter rate was 55 percent.
"If growth rate hurts the company, then it's a direct result of waiting too long to go public--past peak growth," Gurley said.
