Drewbot

NFC Payment Systems are Just Another CueCat

Fri, 10 Feb 2012 16:02:53 -0500

NFC payment systems, like Google Wallet, remind me of the CueCat.

Launched in 1999, the CueCat was a little plastic cat (really) that let you scan proprietary barcodes on magazine advertisements or other printed material. Scanning a “cue” launched launched an advertiser’s webpage. Despite $185 million invested , the CueCat was a spectacular failure.

In hindsight, the CueCat’s fate is hardly surprising. But at the time the potential benefits for incumbent companies overshadowed the fact that no one would ever want to use a CueCat. Rather than examining the CueCat’s use case (and realizing it’s absurd), investors focused on the possible outcome: that magazine advertisements and other businesses based on printed material would not only survive the rise of the internet, but thrive by using the web to provide data regarding audience engagement (a brass ring for advertisers if there ever was one). The billion dollar print industry would be saved and everything would remain the same for the media incumbents.

Of course none of this came to fruition. No one used the CueCat¹ and Digital Convergence, the company behind the system, folded.

NFC payment systems remind me of the CueCat because they provide very few benefits for users but promise their investors protection from digital disruption. The allure of such protection is sufficient to spur investment, PR, and partnerships. Media companies backed the CueCat in an effort to preserve print and now financial transaction companies are funding NFC systems in an attempt to save point of sale systems and the counters they reside upon.

To quickly situate ourselves let’s consider the counter, a fairly recent invention. For background we’ll turn to Wolfgang Schivelbusch, who chronicled the rise of the counter/bar in restaurants in his book Tastes of Paradise.

Initially the restaurant was identical to the kitchen of the house. Cooking, hosting, dining, and commerce took place in a single setting, organized around the hearth. But around 1800 the restaurant became separated from the host’s quarters, and the counter or bar grew from a small transaction point to a larger, central delineation between the two areas. Schivelbusch writes of the bar:

With this new piece of furniture the restaurant once and for all shed its cozy private character. The bar, like the counter, was never found in private households. Restaurants would now be divided into two areas—the space behind the counter where the innkeeper did his business, and the actual restaurant.

[The bar is] a genuine product of the Industrial Revolution… The bar sped up, i.e., shortened, the length of a drinker’s stay in the bar. Liquor is not consumed slowly in long sips, but abruptly ‘tossed off.’ The process is so quick that it can be performed standing up. Because of their bars, the gin places that were springing up like mushrooms in Manchester and other English industrial cities at the start of the nineteenth century resembled factory assembly lines. One such establishment in Manchester served over 400 customers an our. In a single week the fourteen largest gin palaces in London served 270,000 guests—almost a metropolis unto itself. Thus it seems no exaggeration to characterize the bar as a traffic innovation.”

The bar and the counter emerged because the scale of service demanded it. The bar evolved into a long, prominent structure to most efficiently handle the largest number of customers. 200 years later, long counters dedicated to transactions still divides retail rooms into public and private zones.

But with personal, networked computers in our pockets we are presented with an opportunity to revisit the bar/counter arrangement. Mobile payment solutions could be more efficient than the long bar or counter without limiting the interior arrangement of our spaces.

The Apple Store is already embracing this opportunity by arming wandering sales staff with mobile payment systems to accept credit cards anywhere on the floor. Payment now occurs right at the conclusion of a conversation about a product, not as a process unto itself. Further, a recent update of the Apple Store iOS application grants the transaction privileges to the shopper, whom can now scan and pay for their wares (via their iTunes account) without intervention. The environment created by this payment is system is one of trust: the first time you self-pay and walk out feels weird and invigorating. I’ve watched more than a few people nervously ask a staff member if for permission to leave following a self-transaction.

Square’s Card Case system is similar as well. My morning coffee is paid for by opening an app and asking the host to put it on my tab. The transaction is more social than monetary, which is easily Square’s best feature.

On the other hand NFC solutions, like Google Wallet, reenforce rather than reinvent consumer spaces. A central point, a place to tap your phone, is still required, which is being rolled out as an extension of current point-of-sale systems. To the user the only difference between paying with Google Wallet and a credit card is whether they tap or swipe. The terminal is the same, the counter remains, people still have to wait in line², Visa takes the same cut, and the consumer benefits are thin.

Sure, NFC enthusiasts will counter that the data provided to the user is worth the change, but such information is of niche interest and could be provided regardless (my Mint app updates when I swipe plastic). And even if NFC is widely adopted, it’s not as if we’ll all suddenly stop carrying wallets for cash, driver’s licenses, and more. The benefits of an Apple or Square like system (no lines, pleasant sociability, better store layouts, and an atmosphere of trust) greatly trump the consumer benefits of any NFC prototype we’ve yet to see.

NFC benefits incumbent companies and systems, not users. Like the CueCat’s investors, NFC payment proponents hope a dongle will shield their unchanged, underlying systems (and the profits they provide) from digital disruption. NFC will continue to be bundled into many phones, just as CueCat shipped with many magazines. I’d wager they’ll have similar adoption rates.

No one used the CueCats except me and my friends whom helped ourselves to unclaimed CueCats at our local Radioshacks in an attempt to crack the bar codes on the back of our junior high school IDs. ↩
It’s a bad sign that the one place I regularly see Google Wallet terminals is Duane Reade, home to the 2nd most consistently unpleasant check-out experience. (Fry’s is easily #1) ↩

So, so good. How many other shops will use Kickstarter to fund...

Fri, 10 Feb 2012 12:12:53 -0500

So, so good. How many other shops will use Kickstarter to fund passion projects this year and at what point will Double Fine eschew publishers for every game they make?

"The fundamental story of digital media is the commodification of distribution."

Fri, 10 Feb 2012 11:05:49 -0500

“The fundamental story of digital media is the commodification of distribution.”

- Content and businesses supported by profitable distribution systems are not long for this world.

Kodak is Now a Shell

Thu, 09 Feb 2012 11:00:05 -0500

Kodak is Now a Shell:

More than anything, this feels like the nail in the coffin: Kodak will stop making cameras and will focus instead on brand licensing.

Eastman Kodak Co, the bankrupt inventor of the hand-held camera, plans to stop making digital cameras, pocket video cameras and digital picture frames in the first half of 2012 in a bid to cut costs.

…

The company, which generates three-quarters of its revenue from digital, plans to instead focus on seeking licensees to expand its brand licensing program. It plans to continue to offer online and retail photo printing, and desktop printers.

(Via NYT)

From Distributed Files to Distributed Websites

Thu, 09 Feb 2012 09:09:00 -0500

From Distributed Files to Distributed Websites:

The Pirate Bay recently switched from hosted torrent files to magnet links. This change greatly reduced the size of the site, making it possible for the site to fit on a free USB key:

“I did a complete snapshot of ALL the Pirate Bay torrents, in case somebody wants to close it or something similarly crazy,” he told TorrentFreak.

Using this script, “allisfine” managed to copy the title, id, file size, seeds, leechers and magnet links of 1,643,194 torrents. Comments were not copied to keep the files as small as possible, and the end result is a full copy of all magnet links on The Pirate Bay in a 90 megabytes file, 164 megabytes unzipped.

The magic of BitTorrent was that it distributed files across a network of computers, rather than a single server. This redundancy made sharing faster, more robust, and helped creating a feeling of anonymity (BT is easy to track, but there are so many sources it’s easy to get lost in the crowd).

An easily downloadable Pirate Bay is the beginning of the next step, distributing the website itself. Within a year, I bet there will be a version of the Pirate Bay that uses a BitTorrent like hosting mechanism, where there’s not a single server but thousands of distributed hosts. As I understand it, such a system, without a URL, would have been immune to SOPA as it was written.

Double Fine Just Used Kickstarter to Fund their Next Game

Thu, 09 Feb 2012 08:51:00 -0500

Double Fine Just Used Kickstarter to Fund their Next Game:

Their goal was $400,000. They’re at $532,459 in less than 24 hours. Why this matters:

Keeping the scale of the project this small accomplishes two things. First and foremost, Double Fine gets to make the game they want to make, promote it in whatever manner they deem appropriate, and release the finished product on their own terms. Secondly, since they’re only accountable to themselves, there’s an unprecedented opportunity to show the public what game development of this caliber looks like from the inside. Not the sanitized commercials-posing-as-interviews that marketing teams only value for their ability to boost sales, but an honest, in-depth insight into a modern art form that will both entertain and educate gamers and non-gamers alike.

Over a six-to-eight month period, a small team under Tim Schafer’s supervision will develop Double Fine’s next game, a classic point-and-click adventure. Where it goes from there will unfold in real time for all the backers to see.

Funded.

Et tu, Angry Birds?

Wed, 08 Feb 2012 23:33:15 -0500

Et tu, Angry Birds?:

interactioned:

A Wall Street Journal post from two years ago shows a list of apps that gather your data and what you do with them. Angry Birds not only collects your contacts — it transfers them to third parties.

Remember when magazine publishers were in heavy negotiations with Apple to access subscriber data for purchases made through the App Store?

They should have just flipped through the API docs…

More on the Shutting of a Virtual Currency

Wed, 08 Feb 2012 19:29:00 -0500

I asked Nick Kam (who unlike myself actually understands law) to take a quick look at the virtual currency class-action lawsuit filed against Google. Here’s his take (emphasis mine):

Upon a cursory review of Google’s Notice of Removal to Federal Court which contains a summary of the Complaint filed in Santa Clara Superior Court, it seems the Plaintiffs’ central claim is one of unjust enrichment. They didn’t get the benefit of the bargain with Google through their purchase of gold from the in-game store or from the secondary market, which they claim Google and Slide, Inc. promoted or at least encouraged. Said another way: Google got something for nothing and the Plaintiffs want their money back.

But there’s more. If you look at item three in paragraph five, the Plaintiffs want the game to stay online: they seek “an injunction barring Defendants ‘from terminating the SPP gaming application as announced in September, 2011.” Not only do Plaintiffs want their money back, they also want to keep playing SuperPoke! Pets. Presumably they’ll turn around and buy more gold once the game’s back online.

It’s important to note that Plaintiffs’ first claim of relief sought is preventing Google from enforcing the Terms of Use of SPP. I’d be willing to wager there’s something in there that says: “This gold has no real world value and we can shut the game off whenever we want.”

You’d have to review the Complaint to see all of their causes of action to try and recoup their virtual-bucks for a better idea of how this is going to shake out.

Pinterest is essentially a well designed interface for Amazon wish lists. How do you think Jeff...

Wed, 08 Feb 2012 15:09:06 -0500

Pinterest is essentially a well designed interface for Amazon wish lists. How do you think Jeff Bezos feels right now and how large of an offer do you think Amazon has made?

What Happens when a Virtual Currency Disappears?

Wed, 08 Feb 2012 13:03:00 -0500

In 2011 Google acquired social games maker Slide for approximately $200 million. Only a few months later, as part of their 2011 spring cleaning, Google decided to shut down all but one of Slide’s existing games including SuperPoke! Pets. Player outrage was impressive following Google’s announcement, and today we learn that it was not empty: a class action lawsuit against Google has been filed.

The suit focuses on the matter of virtual currency which was purchased with the expectation that it’s value would hold. I Programmer quickly sums up the complaint:

Although the lead plaintiff,Christalee Abreu, says she spent more than a thousand dollars on virtual gold, the class action represents thousands of people across the who purchased gold and/or subscribed to a $4.95/month VIP subscription with the total “amount in controversy” exceeding $5,000,000 - a sum that is credible given that there were at least 7,000,000 users of the SPP site just before Slide sold out to Google.

Not versed in law, I cannot evaluate the claims Abreu makes but it is interesting to consider the long-term contracts that virtual currency might imply. When an app or service goes under is their an obligation to refund the currency? Should virtual currency be treated as bonds or debt? I imagine these products receive similar treatment to gift cards, but what happens if a Facebook currency catches on as a standard? At what point does the currency graduate from gift card to currency?

"All of the energy concentrated in one gallon of gasoline is enough to charge an iPhone once a day..."

Wed, 08 Feb 2012 12:02:00 -0500

“All of the energy concentrated in one gallon of gasoline is enough to charge an iPhone once a day for almost 20 years.”

- ExxonMobil’s Perspectives Blog

ExxonMobil’s intent is to illustrate our need for gasoline, but every time I see this figure I can only think that internal combustion engines could become more efficient.

Take note PR teams: this is a poor metaphor to use if your audience treasures their phones more than cars.

The new version of Tweetings uses a lifts Tweetbots’...

Wed, 08 Feb 2012 09:20:00 -0500

The new version of Tweetings ~~uses a~~ lifts Tweetbots’ switch control to toggle between mobilizer and full web. ~~Interesting~~.

Update: Chartier informs me that not only is Tweetings a rip off of the unfortunately named but wonderfully designed Helvititweet, but this particular feature is ripped off note for note from Tweetbot. Go buy Tweetbot if you haven’t already. While unaware of its mobilizer, I already thought it was the top iOS Twitter app.

Ah, App Store politics.

On the Language of Marriage

Wed, 08 Feb 2012 09:09:00 -0500

On the Language of Marriage:

Nick Kam dives into the Perry v. Brown opinion and discovers “the law clears at the 9th Circuit are having too much fun”:

We need consider only the many ways in which we encounter the word “marriage” in our daily lives and understand it, consciously or not, to convey a sense of significance. We are regularly given forms to complete that ask us whether we are “single” or “married.” newspapers run announcements of births, deaths, and marriages. We are excited to see someone ask, “will you marry me?”, whether on bended knee in a restaurant or in text splashed across a stadium Jumbotron. Certainly it would not have the same effect to see “will you enter into a registered domestic partnership with me?”

Groucho Marx’s one-liner, “marriage is a wonderful institution… but who wants to live in an institution?” would lack its punch if the word “marriage” were replaced with the alternative phrase. So too with Shakespeare’s “A young man married is a man that’s marr’d,” Lincoln’s “marriage is neither heaven nor hell, it simply purgatory,” and Sinatra’s “A man doesn’t know what happiness is until he’s married. By then it’s too late.” We see tropes like “marrying for love” versus “marrying for money” played out again and again in our films and literature because of the recognized important and permanence of the marriage relationship. Had Marilyn Monroe’s films been called How to Register a Domestic Partnership with a Millionaire, it would not have conveyed the same meaning as did her famous movie, even though the underlying drama for same-sex couples is not different. The name “marriage” signifies the unique recognition that society gives to harmonious, loyal, enduring and intimate relationships.”

Path uploads your entire iPhone address book to its servers

Tue, 07 Feb 2012 15:27:21 -0500

Path uploads your entire iPhone address book to its servers:

“Two Paths diverged in a wood, and I—I took the one that uploads your entire address book without permission.” -Paul Haddad

"Build task claims to succeed in spite of generating error messages."

Tue, 07 Feb 2012 14:11:55 -0500

“Build task claims to succeed in spite of generating error messages.”

- Best Xcode error message yet.

Photo

Tue, 07 Feb 2012 13:29:49 -0500

Content Creep Check-In: Salon's Record Numbers

Tue, 07 Feb 2012 13:17:00 -0500

A few days ago I noted the continuing erosion of “content” based businesses; businesses that use page views and revenue, not quality, to gauge their output.

But enough of the Demand Media deathwatch, today we have some good news: Salon has turned themselves around by focusing on quality first. Kerry Lauerman, editor in chief of Salon, explains how Salon achieved a record year in 2011 and sees trends continuing in January:

We’ve also — completely against the trend — slowed down our process. We’ve tried to work longer on stories for greater impact, and publish fewer quick-takes that we know you can consume elsewhere. We’re actually publishing, on average, roughly one-third fewer posts on Salon than we were a year ago (from 848 to 572 in December; 943 to 602 in January). So: 33 percent fewer posts; 40 percent greater traffic. [emphasis mine]

What makes this all the more impressive is that only few years ago Salon was making the standard metric-centric decisions which lead to the content-crunch:

A few years ago, as Salon (like all publications), tried to right our ship in deeply troubled recessionary waters, we followed the familiar script of other sites — we laid off terrific staffers to lower our costs; we brutally pared down our expenses; we revamped staff priorities so that writers could simply produce more; we experimented in a fair amount of low-calorie aggregation. And yes, there’s that word: Aggregation, the most inflammatory (and sometimes, hilarious) in our industry… At its worst, we monitored Twitter and Google for trending topics, and dispatched an intern to cobble together our own summary of it, posted it quickly, then prayed to the Google gods that the effort would win, if only briefly, their favor.

Congratulations are in order to Lauerman and his team. It’s great to see Lauerman and Salon’s founder/CEO David Talbot betting on quality and succeeding. (Via Kerry Lauerman)

Photo

Mon, 06 Feb 2012 21:19:00 -0500

"Windows in the building will not be opened nor are they allowed to be opened. This is for your own..."

Mon, 06 Feb 2012 14:05:21 -0500

“Windows in the building will not be opened nor are they allowed to be opened. This is for your own protection and safety.”

- An all-building email regarding tomorrow’s ticker-tape parade, which kicks off outside my office window. No word on what to do with all this ticker-tape.

"News Corp. has spent $30 million on development (which has been “written off”) of The..."

Mon, 06 Feb 2012 11:54:59 -0500

“News Corp. has spent $30 million on development (which has been “written off”) of The Daily and current costs are less than $500,000 per week, according to chairman and CEO Rupert Murdoch.”

- FolioMag.com

Imagine the iPad newsroom you could build with $500,000 a month. Hell, I’d consider $500,000 a year.