Starting tomorrow, the carrier is running a limited-time promotion during which customers can trade in their old smartphone for $100 off the purchase of a new device, including the Samsung Galaxy S4, BlackBerry Z10 and HTC One.

To be eligible for the discount, the smartphone must be no more than three years old and still in good working condition. The carrier said some handsets might even have a higher trade-in value than $100, and if so, the customer will receive a further discount.

Trade-ins will be accepted at AT&T stores and authorized dealers, and all credits are offered on the spot.

This is just the latest move by a carrier to retain and woo new customers. In April, Sprint and Virgin Mobile offered a $100 credit to people who switched their phone number over to their service.

AT&T did not reveal how long the promotion would last, but if I were you, I’d jump on the deal while you can.

The Microsoft discounts are particularly tailored for portables with small displays that would likely appear this fall, these people said.

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Over the past couple of years, American Express has been actively working on ways for its members to interact with merchants online.

As a result, Amex cardholders can link their account to a number of social networks, like Foursquare, Facebook and Xbox Live, for the chance to unlock discounts.

This announcement today, however, marks the first time American Express is allowing consumers to buy things through social networks.

Leslie Berland, the SVP of digital partnerships and development at American Express, said a year ago, it started distributing offers and coupons on Twitter. In that time, she said, cardholders have saved “millions of dollars” from “thousands of merchants.”

Starting today, all cardholders will have to register to participate, even if they’ve used the service before, this time to provide a physical address for delivering products.

After that, it should be pretty painless to buy something. For instance, participants will be able to buy a $25 American Express Gift Card for $15 this afternoon by tweeting #BuyAmexGiftCard25. American Express will reply via Twitter, asking the user to confirm the purchase in a tweet. All products will be shipped via free two-day shipping.

Starting Wednesday, more items will go on sale, including an Amazon Kindle Fire HD for $150 and an Xbox 360 4GB console with three months of Xbox Live for $180. All deals will be offered for a three-week period.

While it’s easy for cardholders to participate, American Express is having to do a lot of work on the back end to make it run smoothly. There is a customer care support team to address any issues that arise, and it is working with a partner to provide the shipping logistics — neither function trivial … or cheap.

Berland acknowledges that it took “a great deal of work to think about every single use case.”

The commerce platform is coming to Twitter first, but it will also eventually come to Facebook and other platforms, Berland confirmed. Twitter is not getting a cut of the revenue from the transactions. “This is Chapter One,” she said. “We are very invested in Twitter, and we’ve taken it a step further here, but the best is yet to come. We are very confident that it will perform very well.”

To date, there have been very few examples of Twitter commerce. The most high-profile launch, perhaps, was by Chirpify, a Portland-based startup that helps merchants accept payments from a Twitter stream. Otherwise, the best implementation of selling products on a social network so far is likely by Facebook itself through its sale of gifts.

Here’s a video demonstrating how an Amex cardholder can redeem offers and buy something through Twitter:

The company is backed by $3 million in funding from GRP Partners’ Mark Suster, 500 Startups’ Dave McClure and other angels, including Brian Lee, David Tisch and Jason Calacanis, and was founded by Ethan Anderson, who sold his first startup, Redbeacon, to The Home Depot last year.

Anderson calls the service “the world’s first online open appointment superstore” because it aggregates local merchant calendars in one place online. So far, the company has launched in Los Angeles, where it is working with a few thousand merchants, who have more than half a million appointments available for the next month.

Categories include automotive, health and beauty, home and garden, medical and dental, sports and fitness and pets, but not restaurants or other food services.

On the consumer-facing side, customers come to the site to find open appointments, then book and pay for the services in advance, whether for that day or later.

For the merchant, the service is all about finding new customers and getting new people in the door, much like Groupon.

MyTime will help local service providers fill unused inventory by advertising on Google, Facebook and Twitter. The site will also dynamically price the services, so if there is free time coming up immediately – or in generally slow times or hours — MyTime will encourage customers to book by offering a discount.

The service is free for merchants to get started, but if they elect to use some of MyTime’s premium services, like dynamic pricing or its advertising services, then MyTime will take a 40 percent cut of the revenue it generates from bookings that occur because of the advertisements.

“It’s a generous business model,” Anderson said. “If we are promoting them, only then do we keep the commission. If someone just finds them through the browse or search features, then we don’t charge them. It’s a freemium service.”

However, a majority of businesses do elect for MyTime to advertise on their behalf, he said.

It takes about a day for a company to get up and running and to connect its calendar to MyTime’s system. Merchants then get paid within one to seven days of a customer’s appointment.

The San Francisco-based company has 15 employees and plans to use the cash raised for salaries and sales and marketing. Anderson said they’ll expand to new markets slowly because the service requires a large number of merchants to be on board for it to work. He said if they don’t have a lot of appointments available for customers to choose from, it’s like a retailer being out of stock (in other words, it just doesn’t work).

Interestingly, MyTime didn’t pick San Francisco as its first market because “there are so many startups calling merchants here. Five years into the Groupon craze, and I really feel like they are jaded.”

Wall Street is certainly enthusiastic for such an outcome — even grabbing onto a specious rumor that perhaps Google was sniffing around the troubled Chicago-based social discount deals company, which is currently valued at just over $3 billion. On Friday, Groupon’s stock jumped 23 percent on takeover speculation after Tom Forte of Telsey Advisory Group was quoted as saying: “Where the stock is currently trading, it’s a takeout candidate.”

Actually, the stock has been trading at these levels for a very long time, so the sudden attention is decidedly overwrought. More to the point, sources close to Google — which had offered $6 billion for the company before it went public — said that Google has not been contemplating a second foray into acquiring Groupon.

The same is true for eBay, said sources, and Amazon is an unlikely buyer because it already owns a stake in LivingSocial, the second-largest daily deals provider. Additionally, there are lots of other problems that any purchaser would face in buying the company, which sells everything from bikini waxes to GPS devices at a discount.

In an onstage appearance this morning, CEO Andrew Mason declined to address the thinly sourced rumors of a takeover. “What I have said about Groupon is everything I will say about it,” he said. “I am focused on looking forward.”

Given the non-answer, it’s still prudent to ask, is there actually a buyer for Groupon?

First, let’s address the price. Two years ago, Google offered to purchase Groupon for $6 billion. A year later, it went public at $10 billion, and today, it is trading for $2.9 billion. The company has $1.2 billion in cash, and owes merchants about half of that, or around $573 million.

That said, it is still a relatively low price for a company that includes a customer base of 40 million people who bought something in the past year, a hodgepodge of local retailers and merchants that consider Groupon their online marketing channel, and — perhaps most importantly — a better-than-expected mobile business that now represents a third of its transactions.

But, while it costs much less than it once did, that doesn’t necessarily make Groupon a steal.

That’s because over the past year, the Chicago company has stumbled operationally. Europe is underperforming, the company’s main coupon business is slowing as the novelty of the business is wearing off and it has started investing heavily in selling products, a low-margin business that requires tons of logistics to package and ship items to people’s front doors. On top of that, the board recently discussed replacing Mason, who some directors fear may not be the right choice to continue leading the company. While they ultimately decided to keep him, it was a perceptual blow.

At least one big investor is betting something will happen: Tiger Global Management, which recently bought up close to 10 percent of Groupon. The well-regarded hedge fund and private equity firm may be betting it can’t get worse, and perhaps would even push for a sale.

In any case, here’s a look at some of the scenarios:

Google

When Google made the offer two years ago, the search engine was interested in entering the daily deals business as a way to gain a foothold into all things local, including commerce. Since Groupon rejected that $6 billion acquisition, Google has spent the past two years building Google Offers.

While Google Offers still has a very small piece of the market, it has been pivoting toward an integrated ads model, which is less complementary to Groupon’s approach. Google believes that merchants will pay Google only after a purchase has been made, and the sum will be determined by the consumer. The cost per acquisition model is very different from Groupon, which has the consumer paying up front for a heavily discounted coupon.

As one source with knowledge of the situation said: “The timing would be a bit wacky.”

That said, Nikesh Arora, Google’s SVP and chief business officer, had been a very strong advocate of the original deal and might still want more heft in Google’s corner in the competitive local scene. One major plus is that Groupon could also help build a local salesforce to push Google+ Local, which includes Zagat, the online reviews site that competes against Yelp. Groupon might also support its Google Wallet business, which has largely failed to gain traction among consumers.

Another source familiar with the two companies said running a daily deals business is “operationally intensive, and it’s a muscle that Google doesn’t have, so from a synergy standpoint it would be complementary.” But, “if they are still serious about local, is that the business model for local that they want to pursue?”

eBay

For the past two years, the e-commerce company has aggressively been going after the local commerce market by helping transactions occur online or at a nearby store. Additionally, its PayPal division is moving fast into the physical payments space. Strong merchant relationships, like the ones Groupon has, could go a long way toward making those things happen faster.

EBay recently raised $3 billion in debt financing and has $7.3 billion cash on its balance street. Its stock price also has gone up more than 65 percent in the past year, giving it plenty of fire power to make a big move.

It also has the stomach for acquisitions. However, many of its purchases over the past two years have been about buying technology and talent. It bought RedLaser, the barcode scanning technology for $10 million; Milo.com, a local inventory company, for $75 million; and Zong, a mobile payments company, for $240 million. Over the years, it has also made substantial purchases, including GSI last year for $2.4 billion, Bill Me Later for $1.2 billion and Skype for $2.6 billion.

A few months back, the company entered the daily deals business with the launch of eBay Lifestyle Deals, which runs daily deals in a number of markets, including San Francisco, Seattle, Los Angeles and Washington, D.C. To do so, eBay teamed up with Signpost, which arranges the deals with local merchants. Interestingly, Signpost is backed by Google Ventures, and already provides deals for Google Offers.

The company is also experimenting with eBay Now, a service that allows consumers to buy something on their phone and have it delivered within an hour. “They continue to be interested in local, and they have this experiment going on right now with eBay Now, but they are still iterating and figuring out the local angle,” one source said.

Likewise, PayPal’s local strategy is under development. It is trying to roll out physical payments to big-box retailers like Home Depot while also offering a credit card reader for smaller retailers called PayPal Here.

The biggest argument against this deal is that eBay may not need Groupon, and that it already has the infrastructure to roll out deals through partnerships — which would cost a whole lot less and be a lot less painful.

Amazon

Simply put, Amazon already has its own troubles with its significant stake in LivingSocial, which just slashed 400 jobs. In the third quarter, Amazon took an impairment charge of $169 million, or 37 cents a share, related to its stake in LivingSocial, resulting in the company reporting an overall third-quarter net loss of $274 million, or 60 cents a share.

Any potential Amazon-Groupon tie-up would then be a merger between LivingSocial and Groupon, creating perhaps an even bigger black hole that would also result in a lot of ongoing integration problems. While together LivingSocial and Groupon would easily make Amazon the largest daily deals company and up its local commerce efforts, it’s still not clear if the online retail giant wants to double down here.

Separately, Amazon has entered the daily deals business on its own with a service called Amazon Local that competes directly with LivingSocial and Groupon. The offers became particularly interesting to the company after it started using them to discount the price of its Kindle e-readers and tablets. If owners don’t want to see the offers, the tablets can cost up to $40 more.

The company has said that it essentially doesn’t need help building the business – it thinks it can get to scale fast in the space because it already has 164 million active customer accounts worldwide (which are defined as people who have made a purchase in the past year).

Perhaps most importantly, though, Amazon has a history of building, not buying.

Visa, MasterCard, American Express

These three payment companies have huge market values, and should not be discounted as players in the local commerce space. In addition, a year ago, all of them started looking for new revenue streams after the Durbin Amendment capped the amount that banks and card networks charge merchants on debit card transactions.

Already, many banks are sending targeted ads or deals to consumers based on their spending habits. However, it’s unclear whether they need to be the actual deal makers, or just act as a distribution system for advertisements and coupons. For example, MasterCard recently partnered with Gilt City, the daily deals division of Gilt Groupe. Through the partnership, MasterCard will be able to offer its users deals for restaurants, concert tickets and travel, and at the same time, help Gilt City get in front of some of the card issuer’s millions of users.

MasterCard may be the frontrunner of the three as a potential suitor. Not only has it shown direct interest in the space, American Express is still absorbing its acquisition of Revolution Money, for which it paid $300 million cash in 2010, and Visa has been active with its purchase of CyberSource for $2 billion in 2010. More recently, it made an investment in Square, the hot mobile payments company.

Other Suspects

A number of other companies could be put on a Groupon acquisition list, such as Yahoo, Microsoft and Facebook.

Microsoft and Yahoo both have the money, but have not done much in the space so far. An acquisition would allow them to catch up quickly, but would be expensive and largely not complementary with what they are doing already — which is almost nothing. Facebook, in particular, tried once to enter the space and failed and might be focused on other lower-hanging revenue sources.

Groupon could also look to private equity firms for a buyout, which would allow it to have some space while it fixed some of its issues.

Internationally, there is Japan’s Rakuten, which owns Buy.com in the U.S., and China’s e-commerce giant Alibaba, which has been looking at ways to enter the U.S. market.

Of course, Groupon might simply keep stumbling forward and hope it can turn itself around. But, at some point, without improved revenue and cohesion at the top levels, something is sure to bring pressure to its options. 

In fact, in afternoon trading today, the rumors continued to keep the stock elevated. Shares closed 3.76 percent higher today at $4.41 a share.

Venture capitalists often tell entrepreneurs that, beyond investing, a VC can provide a lot of value by giving advice or making valuable introductions.

Here’s one I hadn’t seen before: VCs promoting their portfolio companies to friends, families and associates as places to do their holiday shopping.

First Round Capital is launching a special site today, where more than two dozen of their investments are listing holiday deals for Cyber Monday. Companies participating include One Kings Lane, Kiwi Crate, Birchbox, Dog Vacay, Warby Parker, Fab.com, Threadflip and Hotel Tonight. The offers range from free shipping to $50 or 15 percent off, depending on the kind of products and services for sale.

First Round Capital is heavily invested in e-commerce, so it knows all too well what the holidays can mean to a young company trying to grow its revenue.

This year is promising to be a monster online shopping event, with record-setting days already taking place. The day after Thanksgiving, called Black Friday, turned into an online feeding frenzy, with consumers spending $1.04 billion, an increase of 26 percent over last year. Amazon saw the most action, as was expected, followed by Walmart, Best Buy, Target and Apple.

If First Round Capital’s companies can capture just a slice of that discretionary spending, it could mean a couple of good months to top off the year (which leads to higher valuations and happy investors). First Round Partner Josh Kopelman wrote a brief blog post directing people to visit the site, adding that the companies “will be shipping hundreds of thousands of products this holiday season to customers all over the world.” You can bet we’ll see other partners tweeting it, Facebooking it and sending it out via email, as well (not to mention tipping off the media).

The company has begun telling retail employees that they may offer discounts of $49 on the iPhone 4S and the iPhone 4 to customers who cite lower prices from other outlets, according to two people familiar with the matter.

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The San Francisco company, which allows people to book last-minute hotel deals for the same day at steep discounts, said that it will also be adding additional cities in the U.K and other Western European markets in the near future.

The company said its iOS and Android apps have been downloaded more than two million times, up from 300,000 just a year ago.

By offering deals in more than 40 U.S. cities, plus Toronto and Vancouver, B.C., you can expect downloads to continue to rise, but it also makes HotelTonight more competitive with some other last-minute apps, like Priceline’s Booking.com Tonight application. Although we’ve found that while Priceline’s app has a big selection in a lot of cities, it doesn’t necessarily offer huge discounts.

HotelTonight’s pitch is to provide ways to sell unfilled rooms without impacting a hotel’s brand. And for procrastinators, it offers the ability to find rooms at a discount of up to 70 percent off, starting at noon for the same evening.

HotelTonight recently raised $23 million in a third round of capital, led by US Venture Partners with participation from Accel Partners, Battery Ventures and First Round Capital.

As part of the expansion, HotelTonight also said it was opening a London office and hired Heather Leisman as Managing Director of Europe. Most recently, Leisman ran the supply, operations, customer service and merchandising functions at Jetsetter, a Gilt Groupe company.

Over the past year, Amazon has slowly been entering that space, aiming to go up against industry-leading Groupon.

So far, it has done fairly well. For example, Amazon is the fourth-largest daily deal provider in the U.S., following Groupon, LivingSocial and Travelzoo, according to Yipit, a deal aggregator that closely tracks the major players.

Starting early tomorrow, the company is planning a publicity stunt to raise its awareness even further, by posting $10 Amazon.com gift cards for five bucks.

The offer will be distributed on the AmazonLocal site, via email and on some Kindle devices, and has the potential to sell out, since limited quantities will be available. (Don’t get too excited, it’s limited to one per customer.)

As part of the promotion, Mark Eamer, a director of product at AmazonLocal, provided a glimpse into the company’s plans in the crowded local deals space (but that’s pretty good, considering the company’s corporate culture to not disclose much of anything).

Offering gift cards is a common way for companies in the space to drum up new subscribers, even though the companies often lose money. For example, last year, LivingSocial sold 1.3 million $20 Amazon gift cards for $10 apiece, Groupon pawned discounts for Barnes & Noble, and more recently, Google offered up gift cards from REI.

Eamer said this represents the first time it has sold gift cards for Amazon.com, but in the past, it has sold deals for other Amazon-owned properties, such as Diapers.com and Soap.com.

Up until now, most of AmazonLocal’s growth has been supported by the $175 million strategic investment it made two years ago in LivingSocial. Nine months ago, Amazon launched its first local deals site in Boise, Idaho, with the help of LivingSocial, and today it operates in 90 markets across 26 states and the District of Columbia.

Eamer said that even now most of the deals listed on the site come from LivingSocial, although AmazonLocal is hiring its own sales team in Seattle and in other locations to help source deals. He declined to say how many people work in the division.

Still, it’s clear that one of Amazon’s advantages in getting merchants to work with them over a competitor is its scale, he said.

Eamer would not disclose how many subscribers have signed up for AmazonLocal, but overall, the company has 164 million active customer accounts worldwide, defined as people who have made a purchase on the site in the past 12 months.

“There’s lots of competitors in this space, and we all want attention from the merchants. By far and away, they [merchants] answer the phone and want to hear what we have to say. We have relationships with millions of merchants around the world, and 164 million customers worldwide. We know how to work with merchants and connect with customers — it’s unique to Amazon.com.”

In the future, Eamer said, AmazonLocal would be open to talking to other providers beyond LivingSocial to bring more offers to the platform. “We would consider it and evaluate that as time goes on, or as another relationship presents itself,” he said.

Amazon’s success in the space is important not just because it is interested in going up against Groupon, but because it uses offers to discount the price of its hardware, including the Kindle e-readers. For instance, a Kindle Touch “with special offers” costs only $99, but one without offers — a.k.a. ads — is $139. In other words, if it can subsidize the cost of its hardware through the use of these offers, it can compete more deftly against Apple and others in the tablet space.

Another goal for the year is to continue to refine its targeting abilities. Currently, offers are only delivered to people based on geography only.

“One of our key tenets is delivering the right deal to the right person at the right time … Our targeting is limited by geography, but we’ll be working on some things in 2012.”

Of course, in the case of tomorrow’s Amazon.com gift card, it will be sent out to everyone.

The promotion goes live Saturday and will serve as a way for Amazon to increase usage of its bar-code-scanning application, while also collecting intelligence on prices in the stores.

This holiday season, mobile commerce is surging as more people become comfortable using applications on their phone to compare prices or simply shop when not at home or at work.

On the Monday after Thanksgiving, the biggest online shopping day of the year so far, mobile sales reached 6.6 percent, jumping from 2.3 percent in 2010, according to IBM’s online retail study.

Amazon is not the only company hoping for a strong mobile Christmas.

Last quarter, eBay started airing TV commercials – its first in the past few years — to promote its mobile applications. The company estimated that mobile commerce merchandise volume this year will hit $5 billion. Additionally, eBay’s PayPal unit is expected to exceed $3.5 billion in mobile revenue.

Amazon has never released figures on how well its mobile applications do.

While the information empowers consumers, it terrifies retailers, who increasingly are feeling like showrooms — shoppers come to to check out the merchandise but ultimately decide to walk out and buy online instead.

Amazon’s Price Check app, which is available for iPhone and Android, allows shoppers to scan a bar code, take a picture of an item or conduct a text search to find the lowest prices. Amazon is also asking consumers to submit the prices of items with the app, so Amazon knows if it is still offering the best prices.

“We scour online and in-store advertisements from other retailers, every day, year-round,” said Sam Hall, director of Amazon Mobile. “Now, we are enabling customers to use the Price Check app to share in-store prices while they search for the best deals.”

While Amazon’s applications and its $5 incentive can be viewed as friendly to consumers, physical retailers will see it only one way — as an attack.

The one-day promotion Dec. 10 will offer 5 percent, or up to $5, off on as many as three items.

The investment round values two-year-old One Kings Lane at $440 million, said Chief Executive Doug Mack. The San Francisco start-up, which is unprofitable, is on track to bring in more than $100 million in revenue this year, he said.

One Kings Lane sends its more than two million subscribers emails and other notifications offering discounts of about 50 percent on designer furniture and other home goods. The discounts are available on the site for just 72 hours. Unlike traditional e-commerce sites that serve shoppers on the hunt for something, flash sites appeal to serendipity.

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Ironically, the event took place at Terranea, which was the same resort where Google demonstrated its Wallet and Offers platforms at the D Conference only three months ago.

Since then, not only has the space heated up, with all the major players announcing their plans, but so has the rivalry between the two Bay Area companies. PayPal filed a lawsuit against Google for stealing trade secrets and key employees, and now they will compete for the attention of merchants and consumers.

In an interview, PayPal’s president, Scott Thompson, explained how the online payments leader was different, and why he believes the space will take off “faster than you ever imagined.”

In demonstrations earlier in the day, PayPal showed me a number of different scenarios, including using a phone number and PIN code to replace swiping a credit card at the payment terminal. It is also integrating check-in capabilities to its mobile application and location-based services to identify nearby stores or restaurants. What it won’t be doing is relying on near-field communication technology or implementing an offer network, unlike Google’s approach to the market.

Thomson, in his thick Boston accent, was eager to share his side of the story, after hearing so many other competitors go before him. Here are some highlights from the interview:

What problem are you solving?

Thompson: An offline merchant today is seeing slow to no growth. It’s tough. E-commerce companies are still growing, and if you have both, you are seeing slow to no growth.

First, we know merchants are worried about consumers coming to you from all different ways — online, in-person, mobile, etc. Multichannel retailing is real for them.

Second, retailers are asking “Who is the customer?” If you visit the site, we know. There’s a wealth of information about them. In offline, they don’t even know you are in the store.

You are battling the competition with your hands behind your back. The question is “How do I close the loop? How do I know that Tricia’s here?” Our solution does close that loop.

What about NFC? In the four presentations I saw, it wasn’t used once.

Thompson: We are not embracing technology, we are solving the problem of what can I do today. It’s hard for me to speak [about NFC] until there are standards. You can’t ask retailers to implement three to five standards.

We can’t be so bold or arrogant to think that you’ll adopt to the standards we’ve created. If we said “Throw away your terminals and get a new one, or buy a new phone” — no one has that level of influence and pull to say “You’ll have to adopt to the standards we’ve created.” … We will work with the new and the old.

If we only built something that worked with this phone, this bank, and this network and NFC, you might address 50 people out of the 350 million people in the U.S. We hope that all 350 million people use what we are doing today.

You boldly predicted recently that by the end of 2015, digital money will be accepted everywhere in the U.S. Some people think you are nuts!

Thompson: This wave is going to happen faster than you think. If every consumer can pay with PayPal with a mobile phone number and a PIN, then I don’t ever have to reach and find this [Thompson pulls his money clip out of his pocket].

Why is that a possibility? There’s lots of reasons!

The value to the merchant is compelling, and the other thing that’s true is that there’s been a lot of compression of credit. A whole lot of people don’t have credit cards, and there’s a higher number of debit transactions. That’s an important change, if your debit card is compromised. The bad guys will get your money. I need more security than ever before. So, will it happen? Will it be fast?

It will be faster than you ever imagined. The one that wins will be the wallet that lives with you everywhere.

How important is this intiative to PayPal? It has spent hundreds of millions of dollars in acquisitions to get to this point.

Thompson: At analyst day, we said we would double our business by 2013, and those numbers don’t take into account any revenues from this point-of-sales initiative we are working on. This is going beyond to the next three-year commitment.

We’ll see revenues next year, but we are planting the seeds now [for 2014]. We said revenues would total $6 [billion] to $7 billion in 2013. To continue to grow at the same rate in 2014, you better do things now. We see an opportunity. We see technology changing, and now is the time to invest.

Just because you aren’t using NFC right away, doesn’t mean you won’t have a steep adoption curve. You’ll have to sign up offline merchants and get consumers on board.

Thompson: Our work is hard, and the relationships we’ll forge will be hard, too. You’ll see next year, when we formally announce our partners, that they are very big merchants.

[On the consumer side] If merchants see value, and integrate it and push it, consumers will use it. It will become a natural thing for you to use it in the grocery story or the pharmacy. You’ll be able to use it for everyday spending — that’s age-old logic. If the companies with the most foot traffic use it, it will be adopted.

So, it’s not for the mom-and-pop coffee shop?

Thompson: It’s where you are most frequently visiting.

Let’s talk about the competition. There’s American Express, Visa, MasterCard, Google and others, like Square, all coming up with different mobile payment strategies.

Thompson: I love it! I actually do!

It reinforces that the opportunity is big. I find it humorous that they find it a novelty. It wasn’t long ago — after all these years of them saying that no one needed a [digital] wallet — that they are saying that the wallet is now important and we better have one.

Besides, this is not unique to PayPal, but we play better the more sophisticated the competitor is. It’s remarkable how competitive our organization is.

Other payment providers are rolling out wallet technology for the chance to offer coupons or offers to the consumers — which could be a lucrative local advertising strategy. Will you be doing the same?

Thompson: In subsequent releases, merchants will be able to do things in the wallet, like offer coupons, but it is not our intention to compete in offers. We are doing payments.

I talked to a major retailer recently that said they’d find it a conflict if the payments provider offered discounts, rather than the retailer being the one to own the relationship with the consumer.

Thompson: That’s where we are different. The others are about coupons and advertising. We are about payments. That’s where 110 percent of our focus is. I believe we have this right. This will be a really big phenomenon in the multichannel world. We are in the business to help merchants grow their business. We are not trying to take the customer relationship away from them.

If we do our job right, all of our businesses will grow.

AmazonLocal first went live in Boise, Idaho, on June 2, and then followed up yesterday by launching in its hometown of Seattle and three neighboring suburbs, Tacoma, Bellevue and Snohomish County.

For now, Amazon says, the deals are all sourced by Washington, D.C.-based LivingSocial, but that will change over time. “AmazonLocal will soon offer direct deals sourced by Amazon,” a spokesperson confirmed.

Amazon invested $175 million in LivingSocial in December, timed perfectly with acquisition talks between Google and Groupon falling apart.

The rollout of AmazonLocal is not the first time we’ve seen Amazon experiment in the deals space.

For $25 off a Kindle, Amazon will subsidize the hardware by serving ads on the e-reader’s screen. Instead of typical ads, a lot of them were a lot like offers, such as a $20 Amazon gift card for $10; $6 for six Audible books (normally $68); $1 for an album from Amazon’s MP3 Store and $10 for $30 of products in Amazon’s Demin Shop.

Eventually, you can imagine the two initiatives merging to create an offering different from either Groupon or LivingSocial.

For instance, Amazon may try to go after a much more tailored approach. Today, the daily deals that are sent to our inboxes are not very personal — a man will receive an offer for a manicure and a woman could receive a discount for a barbershop.

Both Groupon and LivingSocial are trying to become more relevant by delivering better offers using your location. But Amazon’s approach could be based on your purchasing history.

Already it’s experimenting with this by allowing Kindle users to dictate the kind of ads they will see by placing votes on a system Amazon calls the AdMash.

While details are fuzzy, I see a bigger correlation with what Google is doing in the space with Google Wallet, which is supported by local coupons and other offers that may be of interest to the user, than what Groupon is doing. Retailing and merchandising, more than advertising, is in Amazon’s DNA.

Regardless of the future, Amazon’s first day in a large market clearly demonstrated its access to a very large population. Across the four Seattle-area deals, AmazonLocal sold 4,801 offers on Thursday. (And I thought it was impressive that Google sold more than 8,000 offers in its first 22 days in the Portland market. Go figure.)

For LivingSocial, Amazon is a strong partner.

The company, which already operates in the same Seattle markets, was able to bring in roughly $170,000 across both sites in total. (That does not take into account how much it shares with merchants, or what it might share with Amazon.)

It probably helps that the AmazonLocal deals are not exact replicas of what LivingSocial is offering on the same day. Amazon said that’s on purpose.

The biggest performer yesterday was $15 for $30 at the Coho Cafe Restaurant & Bar on the Eastside, which was purchased by 2,709 people. The second biggest performer was in Seattle. The Garage, a bar with bowling alleys and pool tables, sold 1,207 $25 deals for $50.

That deal was sold by Jessie Burrough, a LivingSocial employee, who was featured in a story I wrote about a day in the life of a daily deals salesperson. Coincidentally, the last time the Garage conducted a deal with LivingSocial, it sold nearly the exact same number of vouchers.

Mary Osako, Amazon.com spokesperson, provided this statement about the launch:

“AmazonLocal isn’t just about the amazing deals; it’s about opening up Seattle, our hometown, for exploration. From coffee shops to the arts scene, there are so many innovative businesses and locally-developed services to try out right in our own backyard. With AmazonLocal, Seattleites can rediscover their city and get great deals at the same time.”

Starting today, the additional category takes off, offering steep discounts to hotel rooms around in about 30 locations.

The launch of Overstock’s vacation category–its fifth new category since 1999–marks a substantial investment for the publicly held company.

The decision to pick travel is in line with what Gilt Groupe’s Jetsetter and LivingSocial.com’s Escapes are doing in terms of offering occasional deals to certain locations. With all of them, the focus is on price, not selection.

But rather than Gilt’s high-end affluent niche and LivingSocial’s curated-packaged approach, Overstock’s inventory is more for the masses–something you’d expect from Expedia, Orbitz, Priceline or Travelocity.

On day one, the choices will vary.

Three nights at the Crowne Plaza London at Heathrow costs $207.85 per person during May. In June, the four-star Renaissance New Orleans Marquette Hotel will run $238.14 per person for three nights. A perfectly decent hotel in Honolulu, which is a little drab and is across the street from the beach, will cost $351.25 per person for seven nights.

But how much you are saving is not exactly obvious.

“We’d love to put the rack rates up there, and if you go to other travel sites, you’ll see these are slick deals, but at the moment we aren’t putting up the rack rate,” said Overstock’s CEO Patrick Byrne. “The suppliers would like to make it not so transparent.”

The Vacations tab will be featured prominently at the top of the web site, along with the other categories of Shopping, Cars, Real Estate and Auctions.

The addition follows other recent launches by Overstock, including Eziba.com, which focuses on selling a small number of items, ranging from furniture to jewelry, at heavily discounted prices via a daily email.

As for the Vacations business, Byrne said they’ve hired a dedicated sales team to source the deals. “We have been working on it for about a year, and we believe we can expand the cities and inventory very quickly.”

The deals are colorfully laid out on the page to highlight the scenery in each location. They can sell out, or at least that’s the hope.

“This is the equivalent of a private shopping site. They will sell out and quickly. Or, at least we hope so, and then we’ll go get more,” Byrne said.

Nordstrom will acquire the company for $180 million in stock. However, the transaction size could jump to as much as $270 million over time if the company meets certain performance goals and vesting requirements for the existing management team.

At that price, the transaction gives a lot of weight to a burgeoning new area of e-commerce, fueled by private/flash sales and other group-buying trends.

Los Angeles-based HauteLook offers discounts of 50 to 75 percent off home, beauty, travel and local services for women, men and kids. In the last two years, HauteLook says it has conducted 2,500 private sales events for 1,000 high-profile brands.

Seattle-based Nordstrom said HauteLook will operate as an independent, wholly owned subsidiary, to be managed by its current leadership. The HauteLook brand and Web site will remain separate from Nordstrom, and there are plenty of incentives to keep the management team in place.

While Nordstrom is primarily a physical department store, it has a fairly sizable online presence and recently has spent time integrating its online and store presence, so customers can see what inventory is online and what’s available in the store.

The transaction is expected to close in the first quarter of 2011 and is subject to customary closing conditions, including regulatory and HauteLook shareholder approval.

The company said it is performing well, as deal seekers around the world–from North America to Western Europe to the Asia-Pacific region–look for deals on hotels and rental cars, specifically, and benefit from improvements in the economy.

The company’s stock is trading at $463.33, up $6.32 a share today. A new 52-week high was hit yesterday, trading at $459.57 a share.

Yesterday, Priceline announced it entered its fifth straight year of its well-known advertising campaign, featuring William Shatner–a.k.a. “the Priceline Negotiator.”

Shatner is portrayed as a James Bond-like character who will stop at nothing to obtain the best travel deals and maximum savings for Priceline customers–although he does silly things along the way, too, like watch a gorilla wrestle a scrawny man.

Shatner will be joined in the campaign–created by Butler, Shine, Stern & Partners–by new sidekicks Naomi Pryce and the NBA’s all-time leading scorer, Kareem Abdul-Jabbar.

The Norwalk, Conn.-based company will release its fourth-quarter and full-year results Feb. 23.

Expect the focus to be on growth.

Priceline is forecasting total gross travel bookings to jump year-over-year by 36 to 41 percent, with most of the growth coming internationally.

International bookings are expected to jump by 54 to 59 percent vs. minimal growth in domestic gross travel of 5 to 10 percent.

Annual revenues are forecasted to jump by 31 to 36 percent, and gross profits are expected to soar by 49 to 54 percent.

As a close competitor to Priceline, Expedia.com hit a 52-week high of $29.85 back in September, but has fallen considerably since, to trade around $21.69 a share.

Yesterday, Expedia relaunched a new price-savings campaign called ASAP: A Sudden Amazing Price. The  promotion will offer two discounts a day on hotels and other items of up to 50 percent, aimed at both sides of the country.

Likewise, it will give merchants the tools to find customers immediately should business get slow.

The service represents a big shift in the way daily deals are sold.

Instead of having to commit to a restaurant deal at least a day in advance, consumers can search for a discount in real time, on the way to lunch or dinner. And for merchants, it solves an immediate problem–it can offer a service right away, rather than selling a discount voucher that can be redeemed at other times.

The idea of walk-in deals is the latest evolution of the rapidly evolving daily deals space, which is fueled by stiff competition and millions (wait, scratch that), billions of dollars in venture capital.

“This could be a big next step in how people interact with local businesses. It’s a more efficient marketplace, and whenever you can do that, there’s potential for a lot of success,” said LivingSocial CEO Tim O’Shaughnessy.

The concept is brand-new for LivingSocial.

Just yesterday, it started approaching merchants about “walk-in” deals and plans to launch them in Washington, D.C., first, over the next couple of weeks. Soon after that, it will roll out the deals steadily across the country.

The service, however, is akin to efforts by others in the space, such as Foursquare, Gowalla and Facebook.

But matching a critical mass of merchants who are willing to make an offer at a particular location and time with a critical mass of consumers is extremely difficult to do.

O’Shaughnessy believes LivingSocial can check both boxes.

“From the merchant perspective, there’s a reason we invested so heavily in a field sales team–it’s so we could try new initiatives. Getting a density of merchants is going to be easier for us than other check-in deals stuff,” he said.

As for customers, he said, “We have a really big mobile presence already. We are in the millions on iPhone or Android apps. They buy through us and redeem through us, and we have an active user base already.”

LivingSocial, which is backed by Amazon.com, will spend the next few months educating merchants as well, O’Shaughnessy said.

To make it all work, the company will be testing out different platforms, including giving merchants iPads and other proprietary hardware. During the pilot, LivingSocial will pay for that hardware.

By getting the tools in their hands, merchants will be able to  spontaneously decide whether their lunch crowd isn’t big enough and create a deal on the iPad that is designed to get people through the door within minutes. Once created, the deal will be instantly pushed out, and could expire a couple of hours later, based on the merchants’ preferences.

As with other offers found on LivingSocial or its competitors, like Groupon, merchants may ask the customer to pay $3 for a $5 sandwich or salad, and the customer must buy the voucher up front from the mobile application.

LivingSocial’s very lucrative business model will remain the same for walk-in deals, O’Shaughnessy confirmed.

That means, if a consumer pays $10 for a $20 dinner, LivingSocial will take roughly half, or $5.

Once inside the establishment, consumers can always choose to pay more for additional items–a drink or bag of chips with that sandwich, maybe?

Many of the major location-based social networks launched in early 2009, including Latitude. But Latitude was different: Instead of asking users to manually check in, it continuously displayed their locations on a map in real time. The specificity of that information meant Latitude was primarily used for location-sharing with close friends and family.

Due in part to Google’s heft, the service is relatively popular; now available on all the big smartphone platforms, it has 10 million users who participate each month, compared with six million registered users for Foursquare.

Still, in the past year, just about every local-social pundit and competitor has announced a desire to go “beyond the check-in.” In that context, Latitude’s move to catch up seems oddly timed.

Ken Norton, senior PM for Latitude, justified today’s change by saying Latitude users have been asking for check-ins. Plus (and this is no small thing), Google is associating check-ins with its Google Places project, which means Latitude now has a business model: Connecting its users to local merchants.

Google is not facilitating Latitude-specific deals yet (as companies like Facebook and Foursquare already do), but Norton said there’s nothing stopping merchants from giving a discount to people who check in frequently.

What’s different about Latitude’s version of check-ins? There are a few innovative tweaks that some users may prefer. Google will automatically detect when users are stationary in a place it considers a business, and send them a notification asking if they want to check in.

Also, (with user permission) Latitude supports automatic check-ins for common venues, as well as supporting “checking out” of a place when the users’ location indicates they’ve left the building.

However, users cannot add locations; so, for instance, they can’t check into their homes (unless their homes are already businesses with Place pages).

And while Latitude is hopping on the trend, how about a sprinkle of gamification! Based on their participation, users can qualify to be a “Regular,” “VIP” or “Guru” of a specific establishment. However, there is no leaderboard or public acknowledgment of such users, yet.

Users can publish their locations to their public-facing Google Profile, if they want to share beyond their Latitude friend network. It’s expected that Google will increasingly include these public profiles in new social product launches.

The capability to check in on Latitude is only available on Android to start (through the new Google Maps 5.1 app), but should be coming to the BlackBerry, Symbian and iPhone, said Norton.

In December, retail sales jumped 0.6 percent as consumers bought more goods from online retailers, drugstores and building-supply companies.

When excluding auto sales, which can vary wildly, sales were up 0.5 percent, which was just shy of the 0.7 percent forecast that economists surveyed by MarketWatch were expecting.

The biggest gains in the retail sector were led by online and catalog companies, such as Amazon and Land’s End. That category witnessed sales jump 2.6 percent, the biggest increase in almost three years.

Earlier reports by comScore hinted that may be the case, with December online sales up almost 12 percent over last year. Many retailers encouraged shoppers to spend online by offering discounts and free-shipping incentives up until the last few days before Christmas.

Overall, the full-year gains were the most impressive numbers from today’s government report. Retail sales jumped 6.6 percent in 2010 compared to the year-ago period. The last time sales rose at a faster clip was 11 years ago during the Internet boom, when sales surged 8.2 percent.

Of course. But has it raised nearly $1 billion?

That’s the number being thrown around today by VCExperts, which claims to have seen documents filed by Groupon with the Secretary of State’s office.

And our sources say that’s the right number, with the company’s valuation placed at $4.75 billion, but that the deal hasn’t firmed up yet, and it doesn’t involve any one major new investor. A Groupon representative declined to comment on the report.

In the meantime, Groupon has the gigantic round it raised eight months ago to lean on. BoomTown’s Kara Swisher reported in April that Groupon raised $135 million at a $1 billion valuation.

The big thing that’s likely changed since then is the company’s run-rate, now at $2 billion annually (up from the previously reported $500 million).

The group-buying site, which offers consumers discounts of 50 to 70 percent on things like trips to spas and restaurants, already has a plethora of investors.

It has raised money from the same Russian investors that backed social networking powerhouse Facebook and game phenom Zynga, as well as from Digital Sky Technologies and Battery Ventures. In December, Groupon nabbed $30 million in its second round of funding, led by Accel Partners.

The money in April was being set aside for growing the business and getting ahead of its numerous rivals.

One investment source that has since dried up is Amazon, which decided to back Groupon’s nearest rival, LivingSocial, with $175 million. Kleiner Perkins has been named as a potential candidate, but it would also be nice to see a deep-pocket media company step in.

Newspapers, specifically, have been hard hit by a shift in local advertising and classifieds. A Groupon partnership could make it less appalling that they’ve missed yet another trend.

Such steep discounts are a cornerstone of Amazon’s strategy to gain traction in a market in which iTunes remains the dominant player. At the same time, a debate has arisen among music labels about whether such discounts risk undermining the value of their products.

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TrialPay is bringing the concept of enticing shoppers with the latest tabloid magazine, a pack of gum or a Snickers bar from the line at the grocery store to the online checkout world.

However, there’s a twist: If you bite, you’ll also get a discount on your original purchase.

Up until now, the Mountain View, Calif.-based company’s offers were most likely seen by people playing Facebook games.

Through a fairly exclusive partnership with Facebook Credits, TrialPay can offer a virtual good for free if a player considers buying another deal, like a cup of Starbucks coffee or a Chipotle Mexican Grill burrito.

TrialPay’s founder and CEO Alex Rampell explains that Starbucks or Chipotle pays TrialPay for the sales lead, and TrialPay pays FarmVille. Rampell said it’s a system consumers are comfortable with, because they are often buying physical goods, rather than intangible goods.

TrialPay’s new service, which is coming out of a long beta today, is bringing these alternate payment options to the online shopping cart. The goal is to convert more sales before they are abandoned at the point of sale.

One of its guinea pigs was MediaMall Technologies, which sells online streaming TV subscription packages. It offered customers a $15 discount on its PlayOn Premium software (normally $40) in return for signing up for a particular offer.

One such offer required users to also sign up for a GameFly subscription, which sends videogame rentals to your door, or a RealPlayer SuperPass.

Rampell said MediaMall immediately saw a 10 percent increase in revenue and a dramatic increase in average order value. The increase in average order value was due to the fact that it received a bonus commission based on every in-cart offer completion.

TrialPay is calling it a hosted shopping cart because it also handles the various payment systems, including PayPal and credit cart providers, on behalf of the retailer.

ComScore said in the past week alone, four days exceeded $800 million in spending, including Cyber Monday, which became the heaviest online spending day on record at $1.028 billion.

On Tuesday, spending hit $911 million, making it the third-heaviest day on record, and Wednesday and Thursday came in at $868 million and $850 million, respectively. These figures include both physical merchandise, and relatively new categories, like virtual goods.

The big winners in the past week have been the Amazon.coms of the world and other large retailers, comScore noted.

The top 25 online retailers generated 20 percent more sales for the month of November, compared to last year, and their share increased to nearly 68 percent of the market. Meanwhile, the marketshare of small-to-mid-size retailers shrunk to 32.2 percent.

These increases aren’t expected to last as some retailers became less aggressive with promotions and discounts toward the end of the week, when year-over-year growth rates fell to single digits. “We may see another week of this effect before late season discounts and buying by procrastinators gives the season a final spending surge,” said comScore chairman Gian Fulgoni.

Now, Google may be on the verge of buying one of those companies, Groupon Inc., for $6 billion or so, and another one, LivingSocial Inc., just bagged a $175 million investment from Amazon.com Inc.

Snicker no more. Daily deals are big money, and big money is required to gain dominance.

“The size of the round is enormous because the size of the opportunity is enormous,” said Jeremy Liew, managing director at Lightspeed Venture Partners, which added $8 million of its own to the round.

The Amazon investment, as well as the potential acquisition of Groupon by Google, signals the quick explosion of and high expectations for an online-to-offline local small business advertising industry that just three years ago did not exist.

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