Google, a Silicon Valley giant that built its business on Web services, startled the tech industry last August by saying it would buy the company, a much older, Illinois-based maker of mobile devices and other hardware.

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The move is aimed at helping its smaller operations, such as its mobile, search and e-commerce businesses, gain more independence, analysts said. Over the past year Tencent’s profit growth has slowed as it has sought to spend on a wide array of initiatives to solidify its holdings in areas such as mobile chat and online shopping.

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Big video games like Mass Effect 3 and Halo 4 aren’t going away anytime soon. But a growing cadre of independent games developers is taking the road less traveled — keeping teams tiny and visions narrow.

In fact, they say they don’t want to grow. And despite that unorthodox philosophy, they’re reaching big audiences, making some impressive money and shaking up the games industry as a whole.

These independent developers, or “indie devs,” fill a huge spectrum of opinions about what video games can and should be. But, as with their counterparts in music and movies, it’s not always easy to nail down which games are indie and which aren’t.

Up-and-coming publishers like Zynga and Rovio started out small and indie, of course. In the loosest sense, the term applies to pretty much anyone who’s not one of the big legacy game companies, such as Nintendo, Sega or Electronic Arts.

However, after they put out a hit or two, a few independents peel off from the pack by continually hiring and growing. Contrast Zynga, which has nearly 3,000 employees at 21 offices around the world, with unconventional companies such as San Francisco-based Bolt Creative, where the two co-founders pointedly avoided hiring anyone but themselves.

“We made a decision to stay small,” said Dave Castlenuovo, Bolt’s only programmer. “To me, I get the most enjoyment working out of my home, getting to see my wife.”

Castlenuovo and his design partner Allan Dye eschewed the new-normal start-up song-and-dance: Securing VC funding, finding office space and building a company on the idea of scaling bigger and bigger.

Instead, they found huge success, despite staying small, with their flagship game Pocket God. The game lets sadistic smartphone owners punish an island of perennially doomed cartoon pygmies.

Pocket God was a one-off project started in late 2008, which went from idea to a first version on the iPhone App Store in about a week, Castlenuovo said.

But it has outperformed most one-week larks. The 99-cent app and its downloadable extras have earned about $7.5 million so far.

And the game’s pygmy characters have racked up an additional $600,000 through a spinoff comic book series, which is not bad for a two-man team.

So, how does a little operation such as Bolt Creative thrive while a company like Nintendo, with access to some of the world’s top talent and most beloved video game characters, is reporting to investors its first annual loss since 1981?

Part of it, of course, is the conventional wisdom that smaller start-ups are just nimbler on their feet. But to get at the real answer, you have to look primarily at three big companies: Valve, Apple and Facebook.

On PCs, Valve’s Steam Store eliminated the need for developers to get their games distributed in brick-and-mortar stores in order to find a mass paying audience of gamers. Mobile app marketplaces, starting with Apple’s on iOS, similarly leveled the playing ground for smartphone game developers.

And games have also infiltrated social networking sites, especially Facebook, although the spoils are decidedly lopsided: Zynga alone was responsible for 15 percent of the company’s revenue in the first quarter of 2012.

To raise the money to make new games, new avenues are also springing up fast. In March, San Francisco-based Double Fine Productions solicited donations on Kickstarter for a new point-and-click adventure game in the style of the classic games made by its founder, Tim Schafer. They met their $400,000 goal in about eight hours and ultimately raised $3.3 million from Kickstarter users.

These sorts of developers don’t always have it easy: They have to do more with less, taking on more responsibilities than they might have to in much larger teams. And they can’t bank on legacy pieces of intellectual property for success.

Not that this is an equally bad fate for everyone. For his part, Castlenuovo compares himself to Robert Rodriguez, an independent filmmaker who famously produces, writes, directs, shoots and edits most of his movies solo.

“I enjoy wearing many hats,” Castlenuovo said.

Plus, indie devs can now focus more on making the games they’re most passionate about and less on how they’re going to sell them, at least initially.

Derek van Vliet, co-founder of a Toronto-based indie shop called Get Set Games, seems to be in a good place. His company’s casual iPhone/Android game Mega Jump, initially developed by just three people (now upped to four), has racked up 24 million downloads since May of 2010.

But van Vliet grumbled that bigger companies like Electronic Arts can temporarily take over app store charts by throwing around the weight of some of their biggest properties, including Madden, Tetris and Scrabble.

“That’s getting a lot from very little work for them,” he said.

For better or for worse, the business of games is not a meritocracy. But it might be a mistake to assume it’s all one big, cohesive business in the first place. After all, the devs say, isn’t at least some of what we’re doing art?

Art vs. entertainment?

If you want to quickly start a fight on the Internet, you should follow Roger Ebert’s lead and assert in broad strokes that video games are not and will never be art. Even among the game developer community, the dividing line between art and entertainment is fuzzy at best and may be impossible to place outright.

After all, some games are just casual fun. But others are deeply personal for their creators and, if you believe their many fans, are more meaningful and higher-quality as a result.

George Fan, co-creator of Plants vs. Zombies, said he knows his game is a piece of entertainment, which he developed independently and later distributed through PopCap before EA bought the company in 2011. But he questioned whether art and indie projects even have a chance amid the business pressures at EA.

“It’s pretty much as far as you could get from indie in any company,” Fan said.

Castlenuovo echoed the sentiment, noting big companies are best able to serve their investors when they focus on making top-10 hits.

“I’m going to stick with the creativity,” he said.

Even if you accept that some developers are making artful games, getting others to appreciate them in that way is an uphill battle. In the delightful new documentary “Indie Game: The Movie,” developer Jonathan Blow explains how his indie mega-hit Braid explores the concept of trying to reverse past mistakes by giving players the ability to rewind time.

However, the directors then cut to an online video reaction to the game from Soulja Boy. The young rapper enthusiastically tells his fans that Braid “ain’t got no point … you just walking around, jumpin’ on shit.”

Still, when developers can work by themselves or on very small teams, rather than as part of a publicly traded company, they’re freer to pursue “passion projects” that mean more to them. On the surface, that’s good, but it can also be a sort of psychological poison.

For Leo Alterman, a hobbyist indie dev and senior at Stanford University, making games is about recreating a sense of wonder he felt as a child playing Nintendo 64. And he’s not just talk: A game he built from scratch starting in high school, Tasty Static, has racked up 100,000 free downloads online in the past two years.

But Alterman said he could never make games his profession — the personal stakes are just too high.

“If you’re doing that as a job, and you fuck it up, then yeah, you’re kind of in trouble,” he said.

Indie devs straddle the stressful line between living to work and working to live. Despite his quest for childlike wonder, Alterman describes himself as morbid, and he’s in good company: In “Indie Game: The Movie,” one developer compares his work to being in a concentration camp as a major deadline approaches. Another earnestly threatens to kill himself if he can’t finish his game as planned.

“So, that’s my incentive,” he deadpans.

It seems unlikely that gamers would look at the latest update to Madden or Words With Friends and use it to judge those games’ creators. But Edmund McMillen, co-creator of the popular (and maddeningly difficult) indie platformer game Super Meat Boy, said the game and its public image are so tied to his story and personality that it’s impossible not to feel judged.

“We put everything into it,” McMillen said of himself and his “Team Meat” partner Tommy Refenes. “We are the game.”

The mainstream response

Just as with indie music and movies, there’s a more emotional response to the idea of a game produced by one or two people than one produced by a faceless company. And finding indie game developers who are willing to question the values of big games companies — like EA and Zynga — is like finding sand on a beach.

“That doesn’t seem like art to me,” the hobbyist dev Alterman said of Zynga, which did not respond to requests for comment. “They’re playing a different game.”

“Zynga’s a business,” Team Meat’s McMillen said. “I would go so far as to say they don’t even make games. They make money.”

“That sounds like hell to me,” Refenes says in “Indie Game: the Movie,” after he’s asked about working at EA or Epic Games.

Plus, players are responding to independent developers in a big way. According to the mobile app analytics and advertising firm Flurry, 56 percent of all mobile games played in Q1 2011 were made by indie devs; one year later, in Q1 2012, that share had jumped to 68 percent.

But those opinions and trends don’t seem to deter Rich Hilleman, EA’s chief creative officer and one of the company’s first 20 employees from the early 80s. He’s careful to praise talented indie devs who have gone on to join EA, but also stresses the administrative headaches that come with staying small.

“I want to not have to worry about clearing credit cards and legal issues and translating this stuff into Maltese,” he said. “I think you recognize that it was fun to be independent, except that that stuff wasn’t all that fun.”

When Hilleman joined EA, the company didn’t do any development in-house; it was solely a publisher that connected independent game designers with bigger audiences. Within the gaming world, the company helped make rock stars out of developers like Bill Budge, whose game, Pinball Construction Set, was packaged like a music album, with Budge’s name in giant script on the front.

Not really something you’d see today. I’ve sunk countless hours into EA’s Need for Speed racing game on my iPhone, but I couldn’t tell you the name of a single person who helped make it.

When I told him this, Hilleman countered that customers, not publishers, are the ones who decide who the stars are, although it’s hard not to wonder why that star status doesn’t correlate with hugely popular games like EA’s Star Wars: The Old Republic, which gained 1 million subscribers within three days of its launch last year.

Hilleman readily volunteers that one of the closest modern rock-star successors to Bill Budge is an indie dev: Notch, the creator of Minecraft. In the past three years, Notch’s sandbox game has built an extremely passionate community of over 16 million players, despite having primarily three programmers listed in its credits.

Despite all this, Hilleman draws a firm line in the sand in opposition to independent developers who say they’re freer to pursue “passion projects” than developers at EA.

“Building video games is just hard,” Hilleman said. “There is no such thing as building something you do not like. It just does not happen.”

Of course that doesn’t mean life is necessarily easier for devs who, at big companies, don’t have to translate anything into Maltese. James Swirsky, co-director of “Indie Game: The Movie,” said he saw plenty of hardship in his two years as a games tester at EA.

Devs there, he said, “were just as stressed out and pushed to the brink as the guys you see in the film.”

The key difference

Independent game developers share a lot of DNA with their big-business brethren, and the differences aren’t big enough to merit a culture war or to force audiences to choose between one or the other.

Furthermore, the mainstream world is not clueless: EA has learned its lessons from the years in the mid-aughts when console games seemed stuck in a rut, and has tried to reach out to and learn from the independent community — although Hilleman is quick to point out the irony of the situation, since in the 80s “Electronic Arts” was still small enough to be synonymous with the indie scene.

Meanwhile, Zynga has established a successful pattern of growing by acquisition, looking for the independent shops that are happy to sell out (not that that’s a bad thing, as OMGPOP and others can tell you).

But there’s still a key difference between the independents and the rest, and everyone watching the gaming space should note: With the rise of indie games as an economic force to be reckoned with, the charges are set for an explosion of creativity in the gaming world in the coming years. Indie devs have been around for decades, but now it’s easier than ever for them to make a comfortable living while making the games they personally pick and love.

The “hardcore” gamer community often derides social games on Facebook and mobile devices as too simplistic. But that will change. Games will get better and more ambitious as barriers to entry continue to fall and more outlier voices come into the mix.

With indies coming into the spotlight, games may finally be able to come into their own. Call it a real-world power-up.

While Facebook is slowly working out the kinks to bring more games to mobile, there’s a small company in Menlo Park, Calif., that has beat them to it.

ISwifter is announcing a new iPad app today called theWorx for Facebook, which gives users the full Facebook experience — social games and all.

That means users can check their crops, maintain their cities and feed their fish without having to boot up their computer.

A small company of 20 employees, iSwifter is almost entirely bootstrapped, having generated $10 million in revenue last year.

As my colleague Ina Fried wrote, the previous iPad app allowed users to access any Flash-based content on the Web by running a browsing session on its servers and streaming the results to the iPad. What iSwifter quickly realized was that “one of the major use cases is Facebook games,” said the company’s co-founder Rohan Relan.

TheWorx will work similarly to the old app, except that it is tailored specifically for Facebook. ISwifter will host the content on its servers and then stream the games to the user on the iPad, with little latency. By taking this approach, users will have access to all games on Facebook without developers having to lift a finger.

Additionally, all of the original ways to monetize the applications will be in place, including advertising and Facebook Credits. TheWorx will be free for a short trial period, and then users will pay for additional access. The app will come out later this month or in early June. At that time, Relan said, the company will figure out how much it will charge. The iSwifter app currently costs $5.

“Our plan is if we do everything that the Facebook app does, then we can charge for that functionality,” Relan said.

The biggest threat to iSwifter is if Facebook starts bringing more content to mobile. “That would be pretty devastating to us,” Relan admits. However, he said there’s not an easy way for all developers to bring their content to mobile. Currently, some of the largest game developers, like Zynga, have created content specifically for Facebook’s app, but it has been a slow process.

“Some of the big apps have made native versions, but it will take time for the Long Tail to migrate over,” he said.

Here’s how the app works:

ESPN has reengineered its streaming radio app to offer improved sound quality, push alerts for when a favorite program is going live and content-caching for listening to podcasts without an Internet connection.

It’s also launching the app for the first time on iPad. The app is already available for iPhone, Android and BlackBerry; the updated version will hit Android in June, and a Windows phone app will be available this summer.

If you vaguely recall ESPN having just updated its radio app, you would be correct: The company retooled it less than 18 months ago to include new search and personalization features, as AllThingsD’s Peter Kafka reported here.

Marc Horine, ESPN’s vice president of digital and print media, says that with the newest version, the network is trying to refocus on what’s most important with a radio app — the listening experience. Files have been compressed for faster streaming and downloading, and the sound quality has been enhanced, Horine says. And the app includes DVR — which allows users to skip ads, by the way, though I doubt ESPN would encourage that — and the ability to download full podcasts for listening offline.

Most of the content on the app is commentary, though there are some live play-by-play game options, and there’s a SportsCenter update available every 20 minutes (for the really, really rabid sports fans). To lure listeners to the app, ESPN has mixed up its app offerings to include original, app-only programming with stuff that’s already broadcast on terrestrial radio, like “BS Report with Bill Simmons,” “Pardon the Interruption” and “Fantasy Focus.”

At $4.99, the new ESPN Radio costs two dollars more to download than the old version, and runs in-app ads as well as commercials throughout the podcasts.

Horine says the mobile radio app has been downloaded more than 740,000 times since it first launched two-and-a-half years ago. That’s actually a pretty small percentage of the 24 million weekly radio listeners ESPN claims across all platforms.

And the majority of listeners — 90 percent, Horine says — listen to radio while at work Monday through Friday. But now, with the ability to stop and start radio podcasts on your desktop and pick up right where you left off on the mobile app, ESPN envisions mobile will become a growing fraction of those listeners.

(Full disclosure: I worked as a non-Disney employee for ESPN from 2003 to 2006. I was not involved with network’s radio programming.)

The Nokia 110 and 112 are both dual-SIM, 1.8-inch-screen phones that offer basic Internet access as well as connections to Facebook and Twitter and a collection of bundled games from Electronic Arts. Compression technology can help cut data use by as much as 90 percent, Nokia said.

“Today’s mobile phone users want a quick internet experience that allows them to discover great content and share it with their friends — but without being held back by high data costs,” Executive VP Mary McDowell said in a statement.

The 110 is priced at 35 euros and is set to ship this quarter, while the 112 is estimated to sell for 38 euros and is due to ship next quarter.

While Nokia’s woes in the smartphone market have been well documented, the company has also been losing ground in the lower-end feature-phone market — a key source of company profits.

In the final speech of the CTIA trade show in New Orleans, Clinton talked about how cellphones are enabling the first banking in Haiti, allowing people to detect counterfeit drugs in Africa and connecting refugees throughout the globe.

Wireless technology is also going to help in America’s battle to control healthcare costs, which now account for 18 percent of U.S. spending.

Clinton also spoke about the need for bipartisanship and the consequences that can and do occur when people don’t work together to solve the tough problems facing society. He pointed to examples in Costa Rica and Brazil where people of different viewpoints are coming together even on issues with no clear solution.

The 42nd president began his talk on a light note, pointing out that among the findings of the genome project is that most humans have between 1 percent and 4 percent Neanderthal DNA.

“My wife and daughter weren’t surprised,” Clinton quipped. “They already knew I was part Neanderthal, but they were stunned to find they were too.”

Just a reminder, even though CTIA wraps up later on Thursday, our coverage will continue in the coming days as we share some interesting stories we found through meetings and our tour of the show floor.

(Thanks to Taylor Hatmaker for the photo.)

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Build it with your mom in mind.

That’s according to Eric Migicovsky, the 25-year-old creator of the Pebble watch that shot to time-telling fame in no time and has smashed records on Kickstarter, the crowdfunding Web site through which people make pledges to projects in the works.

The watch just surpassed $10 million in pledges from nearly 66,500 backers, with eight days to go before the campaign was set to close. The Pebble, which is expected to ship this fall, is now “sold out.”

So what’s the big deal about the Pebble watch? AllThingsD’s Ina Fried covers this quite well here, but in short: It’s a Bluetooth 4.0-enabled wristwatch that integrates with iPhone and Android smartphones to show app updates and other data on its E-Ink (so, sun-friendly) screen.

The idea of a “smart” watch, with some computing functions or the ability to pair with a smartphone, is hardly a new thing. Here’s my recent review of Sony’s latest SmartWatch, to give you an idea of how some of these watches work.

But Migicovsky, who sat down with me a few weeks ago to talk about the project, thinks he’s hit on something different. Prior to the Pebble, he created three watches, including a BlackBerry-friendly watch called inPulse; none of them took off the way this one has.

Migicovsky, center, with the Pebble team.

“When you make something that your friends say is amazing, and not just because they’re being nice, that’s when you know you’ve hit on something,” Migicovsky said.

He added, “I definitely have my mom and dad in mind when I build something.” Migicovsky said his mom isn’t particularly tech-savvy, but even she has taken to his Pebble project, to the point where she’s helping him with media outreach. She even threw a party to celebrate the success of the gadget.

And speaking of friends, Migicovsky hasn’t gone far in his search for the handful of new employees he’s hired over the past few weeks.

“I’m basically hiring all my friends,” he said.

Earlier today, Demand Media turned a Q1 performance that beat expectations and also raised its outlook for the year ahead.

Revenue was $82.9 million, up 9 percent, compared to an estimate of $79.6 million. Earnings per share, adjusted for one-time costs, were seven cents, above the expected five cents.

You can read it all here in these lovely Demand slides:

Demand_Media_Q1 Supplemental Data FINAL

Not bad, given many investors have been down on Demand, for a variety of reasons, mostly centered on traffic pressure due to search algorithm changes on the all-important Google. The low stock price resulted in a deal, in which Demand recently almost went private.

So what does CEO Richard Rosenblatt have to say for himself about all this? Here’s a liveblog of the conference call with Wall Street analysts, taking place at 2 pm PT.

Earlier:

2:05 pm: The call started a little late, but Rosenblatt was quick at it, noting the news was a lot better than was thought.

Always a jaunty dude, he was jauntier than usual, if possible, throwing in a lot of terms like “growth,” “momentum” and “Those fiddling geeks from Google did not kill us, after all!” Okay, not the last one.

It was a strong performance, indeed, which is a cause for happiness, I suppose, and especially since Demand’s stock has been in the doldrums since it went public earlier this year.

Not Groupon bad, but that’s a moon crater.

“It was a strong performance,” said Rosenblatt. He gets to say that.

More on the specifics, which showed growth in pages views, engagement and such things on its flagship sites, such as Cracked and LiveStrong. Its juggernaut, eHow, is still recovering from the Google search changes, in an effort deceptively called Panda.

This was not a cuddly panda, but Panda Gone Wild.

2:18 pm: The CFO guy who just repeats the numbers in the press release. (This is the part where I go to the bathroom.)

2:28 pm: Back! Sorry I took so long, but I was getting a computer science degree. (You knew that Yahoo joke was coming!)

The CFO is still chitchatting, still positive about the year ahead and saying “growth” a lot.

2:30 pm: Time for Q&A!

The first is about the mobile arena and monetization there.

Important, but no one is anywhere on this, due to the fact that it does not monetize very well at this point in time.

Everyone has a smartphone now, but the advertising part of it is still a wee baby.

“The monetization will come later,” said Rosenblatt, pointing out the obvious, although he did note that Demand was focusing in it.

Whee! Get on it, Chief of Revenue Joanne Bradford (I know you work hard, but work harder)!

Now to video. More monetizable, obviously, and Demand has a lot of videos to offer, being one of the bigger content providers to YouTube.

I am now officially tired of this question. Next!

2:35 pm: Ooh, a future and direction question about eHow.

“How should we think about its utility in the world?,” asks the analyst.

You should think about it as a place to learn to boil an egg, which is what Rosenblatt mentions. Who doesn’t want to know how to boil an egg? And who doesn’t forget how long to do it, resulting in rubber balls or drippy messes?

These are the great queries of our day, people!

The next question is about “bullish” YouTube upfront last week, in which Google pretended to go Hollywood.

Google will never go Hollywood, by the way, since it requires charm and glamour.

Demand was not there, but it is all up on the YouTube channel thing.

And, why not, since Google is giving away dough to become Hollywood. (Not … gonna … happen … ever, but take the money, all you celebs!)

2:40 pm: Next question is about mobile, again. Quantify that, and when is it going to be big?

No one can say yet, but why not ask!

Still, Rosenblatt makes a college try (I wonder if he has a CS degree?), noting it is “happening fast.”

Another question on YouTube channels and then on registar business.

Rosenblatt and Google are apparently going to see if they can make a go of this thing! Like kids putting on a show in the barn! Let’s see if we can make something of this dang talented group of kids!

The questions never end. Wait, the analyst asks about All Things Digital and my story on their private equity deal!

I can check another one off my bucket list: Being mentioned on a Demand Media earnings call!

Rosenblatt cannot say much, but notes, “We have a duty as a public company to look at anything that comes across.”

Which means it’s true, though he might have taken a moment to compliment my scooptastic skills.

Sigh.

2:51 pm: I am bereft by the slight, but shall recover.

And now it is over, so it is back to boiling my egg.

Asked to decide whether Google had infringed upon Oracle’s copyrights to certain parts of the Java programming language, the jury agreed that it had. But then, when asked to decide on four specific examples of that infringement, jurors could agree on only one: The rangeCheck method in TimSort.java and ComparableTimSort.java. Don’t ask me to explain exactly what it is, but it is being described widely as “nine lines of code.” And, unfortunately for Oracle, the damages it can collect are limited to somewhere in the neighborhood of $150,000 to $200,000, or less than pocket change for either company, not the $1 billion or more Oracle had said it wanted.

Jurors were also unable to decide if the portions of Java code that it copied could be protected by the long-established doctrine of Fair Use, under which certain infringements can be excused. Google lawyers pounced on this, and said they would move for a mistrial.

The conclusion is that Oracle proved at least part of its argument, but failed to prove the dramatic injury it said it had suffered. It also proved that Google knew that it needed a license to Java in order to use the portions of Java that it did use. The complication there was the fact that one flavor of Java is compatible with other flavors of Java: It still operates under the old “write once, run anywhere” principle that Sun Microsystems envisioned when it created Java. Oracle still wants Google to take out a commercial license that would require Google to maintain Java compatibility with other platforms.

Still undecided — and this is the big issue that has the eyes of the software industry watching this case closely — is whether Oracle can prevail on the issue of protecting software APIs using a copyright in the first place. Jurors were instructed to proceed under the assumption that this was a matter of settled law, when in fact it is not. Judge William Alsup will decide on this issue later, and it is unclear exactly how the jury verdict in the first phase of this case will affect his decision.

Had Oracle won a more ringing endorsement from the jury, that portion of the argument might seem to be stronger. It’s an important point that Google argued against, saying APIs shouldn’t be subject to copyright protection, because they’re more like tools and techniques that programmers use to build software. You can copyright a given program because it’s unique, but you can’t copyright the language it’s written in. The possibly strained analogy I came up with before is this: You can copyright a musical composition like Miles Davis’s “So What,” but you can’t copyright the form of music known as jazz.

Oracle argued at trial that copyright law offers the only proper protection for original expression in software, mainly because software advances are incremental, building upon previous advances and innovations. Laws governing trade secrets and patents don’t get the job done. Oracle lawyers contended that copyright law, while still imperfect, protects innovations and advances at a more granular level, but mainly against copying.

Also still ahead is the patent phase of the trial, where Oracle will assert that Google violated Java patents in building Android. After that, there will be a third phase, where the two parties will wrangle over damages. So far, it seems — unless Oracle prevails in the patent portion — that there won’t be much to wrangle over.

At least for now, it appears that Google has escaped the worst of Oracle’s accusations. That was the conclusion of shareholders of both companies. Google shares rose by more than 2 percent on the news of the verdict yesterday, closing at $607.55 a share. Oracle shares fell by more than 1 percent to close at $27.92 a share. The case isn’t over, and Google hasn’t exactly come out of it looking virtuous. But if the point of defending against a lawsuit is to escape paying huge monetary damages, Google won the day.

Embedded below is the filled-out jury questionnaire:

Verdict

In three years, Groupon has grown to 11,000 employees in 48 countries, and in the past year alone has acquired 11 companies and launched 11 new products.

“Although there are risks in moving too fast, companies often don’t survive long enough to apologize for moving too slow,” Mason writes. “Perhaps more importantly, by moving quickly, we reached a scale that has helped us solidify our market leadership, and accumulated data that is enabling our future and helping us continuously improve the experience of our customers.”

Mason writes that now it has that scale, the company’s mission is “to become the operating system for local commerce.” He promises to share new products soon.

The letter follows a particularly tough week, where the daily deal company’s shares slid 3.3 percent, or 34 cents, to settle at $9.97 a share, marking the first time its stock closed in single digits. Today, the stock is trading up 5.5 percent, or 55 cents, to $10.52 a share.

At that price, Groupon’s value still hovers around $6.8 billion, which is uncomfortably close to Google’s $6 billion buyout offer, which the Chicago company turned down in late 2010.

Groupon has been unable to regain investor confidence since revising its fourth-quarter results at the end of March, despite putting out a string of press releases. Over the past couple of weeks, it has hired a new SVP, Kal Raman, and appointed two new directors with accounting expertise.

In the letter, Mason attempts to outline what the company has done to date, and where he believes it is heading. Mason writes: “Groupon’s chief accomplishment to date has been discovering a business model that brings the power of the Internet to local commerce.”

Going forward, the company is building a suite of tools and services that it believes will profoundly change the way everyone shops. Today, it might be a glorified mailing list or daily deals company that is easy to replicate. “Tomorrow, we aim to move upstream and serve as the entry point for local transactions,” Mason explains.

A couple of metrics Mason provides detailing its successes:

• Groupon says emails sent to people using its targeting algorithm have a 50 percent higher purchase rate.
• 30 percent of its North American transactions were completed on mobile devices in April, compared to 25 percent just four months ago.
• According to a research report commissioned by Groupon, its U.S. consumer satisfaction score is 83, placing Groupon 11 points higher than the e-commerce benchmark. Merchants give Groupon a satisfaction score of 79.

Dear Stockholders,

2011 was an exceptional year for Groupon. I will start by listing a few of our achievements:

• By year-end, we sold more than 170 million Groupons to more than 33 million active customers on behalf of more than 250,000 merchants in 48 countries around the world.
• We drove well over $2 billion to the small businesses of Main Street, helping them to overcome challenging global economic conditions.
• We launched 11 new products and services, including Groupon Goods, Getaways, Rewards, Now!, and Scheduler.
• We completed 11 acquisitions, which both expanded our geographic footprint and accelerated our product roadmap. Additionally, these acquisitions brought dozens of talented entrepreneurs to our team.

Along the way, we delivered strong growth and improved our operating leverage. Revenues grew 415% year-over-year to $1.6 billion, and we improved our operating margin from negative 134% to negative 14% for the full year. We improved our GAAP EPS during the year from a loss of $0.48 per share in the first quarter of 2011 to a loss of $0.12 per share in the fourth quarter of 2011. And so, though the six months since our IPO have been rocky to say the least, the fundamentals of our business have continued to improve.

As much as this letter is intended to catalog our achievements in 2011, I would also like to use it as an opportunity to share our vision for Groupon and the tangible progress we are making. We are more excited than ever for our future.

Our Mission: To Become the Operating System for Local Commerce

Entertainment, media, politics, and the way we buy products, connect with each other, and consume information—nearly every aspect of life has been fundamentally changed by the Internet. But there’s a huge exception—the way we shop locally.

Groupon’s chief accomplishment to date has been discovering a business model that brings the power of the Internet to local commerce. During the past three-and-a-half years, that business model has allowed us to connect with millions of consumers and hundreds of thousands of merchants and build a brand that they deeply trust.

Upon the shoulders of this business model, Groupon is setting out to reinvent the multi-trillion-dollar local commerce ecosystem. We are building an integrated suite of tools and services that we believe will profoundly change the way we shop locally. Today, Groupon is a marketing tool that connects consumers and merchants. Tomorrow, we aim to move upstream and serve as the entry point for local transactions.

Why Groupon? Aren’t we a daily deals company? A glorified mailing list? What our competitors have learned is that success in local commerce requires an unusual combination of skills—a proficiency in both technology and people-driven operations. With a world-class engineering team—built quietly over the last several years in Chicago, Silicon Valley, and Berlin—and with thousands of salespeople who have cultivated relationships with hundreds of thousands of small-business owners, we believe that we are uniquely in possession of both sides of the equation. That makeup is why we remain the clear leader in local commerce, despite the efforts of hundreds of competitors—from start-ups to the world’s largest technology companies—who have validated the consumer and merchant value created by our business model through their attempts to replicate it.

Many of the seeds we’ve planted in pursuit of our mission are beginning to bear fruit:

• Site and Email Personalization In the past year, we doubled the efficacy of SmartDeals, our deal personalization algorithm. For example, in markets with high deal density such as Chicago, emails sent using SmartDeals have a 50% higher purchase rate. It has taken time to get deal relevance right, but progress has begun to accelerate, and we believe that we’re still in the early stages. We’re excited to finally have begun rolling out SmartDeals outside of the U.S., and we are targeting a broad international rollout by the end of 2012.
• Mobile Adoption The rapid adoption of Groupon on mobile devices demonstrates the importance of smart phones to local e-commerce. Our average North American mobile customer, for example, spends well over 50% more than customers who have never purchased on a mobile device. In April 2012, nearly 30% of our North American transactions were completed on mobile devices, compared to 25% just four months ago. This growth has created momentum for Groupon Now!, our real-time deals service offering deals for whenever you’re hungry or bored, which recently surpassed 1.5 million purchases. Our Now! customers buy approximately twice as many Groupons as customers who only buy daily deals.
• Groupon Rewards: Making Groupon Customers a Merchant’s Best Customers Groupon Rewards allows customers to effortlessly earn rewards at their favorite merchants, simply by paying with a normal credit card. Thousands of merchants are already participating in our pilot cities, and we expect many more to join. During the past two months, about 30% of eligible daily deal merchants in those cities have signed up for the program. As part of Rewards, we are also providing merchants with deep payment analytics to assess the profitability of their Groupon campaigns. Though the preliminary dataset is small, pilot results show that Groupon Rewards customers are more loyal than other customers.
• Groupon Scheduler: The Foundation for Automated Yield Management Groupon Scheduler is a bookings management system that addresses a fundamental need of many of our merchant partners—but that’s only half the story. As we begin to feed merchant inventory to our demand-generation services such as Groupon Now!, we plan to offer a fully automated yield management system for every local business. Scheduler embodies our intent to provide every mom and pop store with powerful technology solutions that were once reserved for sophisticated corporations with multimillion-dollar budgets.

Though our transformation from daily deal provider to local commerce platform will not happen overnight, in the coming quarters, we will release the products that we believe complete the foundation for our ecosystem. We look forward to sharing them soon.

—

In my letter to potential stockholders that accompanied Groupon’s S-1, I warned investors of a bumpy road—an unfortunate side effect of our unprecedented growth. Groupon has scaled to more than 11,000 employees and 48 countries in only three-and-a-half years. Why move so fast? We believe that Groupon is standing before an enormous opportunity, one that hundreds of competitors large and small have seen. Although there are risks in moving too fast, companies often don’t survive long enough to apologize for moving too slow. Perhaps more importantly, by moving quickly, we reached a scale that has helped us solidify our market leadership, and accumulated data that is enabling our future and helping us continuously improve the experience of our customers.

Bumpiness aside, there are three things I come back to again and again that give me confidence in our ability to execute against our mission:

1. Consumers and merchants love Groupon.
Making merchants and consumers happy is core to the Groupon culture and at the center of everything we do. It’s not surprising, then, that we like to talk about how much consumers and merchants love Groupon, and why we go to great lengths to measure their satisfaction. You don’t have to take our word for it—we commissioned ForeSee, a leading third-party research firm and a standard in e-commerce for measuring customer satisfaction, to use their internal methodology to evaluate our relative positioning versus other top Internet retailers, and their results validate our internal research.

Looking at previous ForeSee online retail satisfaction reports, our U.S. consumer satisfaction score of 83 places Groupon among the highest—11 points higher than the e-commerce benchmark, 6 points above the ForeSee Internet Retailer 100 benchmark, and within approximately 2 points of the average #1 satisfaction score for online retailers during the past five years. We believe the #1 spot is within our reach.

What about merchants? The B2B satisfaction benchmark in the United States is a score of 64, and our merchant satisfaction score is a very strong 79. This is a significant number: not only is it 15 points higher than the B2B benchmark, it is a full 10 points higher than the Fortune 500 benchmark.

2. We have an enormous, untapped opportunity in our core business.
Through smarter deal targeting, there is significant growth waiting to be unlocked in our core daily deal business. In the United States alone, we have more than 10 million geo-located subscribers engaging with Groupon every month who have yet to make a purchase. We are kicking off a campaign to activate these customers, primarily by featuring deals that are closer to them; as you might imagine, deal proximity is a major driver of purchase behavior.

3. We are most excited about our long-term potential.
We are focused on what is arguably the last great white space in the consumer landscape that has yet to be disrupted by the Internet. We are deploying significant capital and talent toward the opportunity to bridge the large but fragmented local commerce ecosystem. The opportunity before us is substantial: merchants need customers, and customers crave simple tools to discover and buy locally at a great price, tools we believe we are best positioned to provide.

Armed with our mission, strong execution, and courage, Groupon has the opportunity to become one of the world’s great companies. We believe it is our duty to you, our stockholders, to pursue our mission with unyielding perseverance. Thank you for joining us as we continue on this journey.

Sincerely,

Andrew D. Mason

Chief Executive Officer

Groupon, Inc.

So this year I’m getting serious about scanning. Fortunately, there are plenty of portable scanning options out there, ranging from mobile apps to wand-like scanners.

This week, I set out to determine whether an app or a pocket-sized scanner with receipt-management software can really do the job of a larger scanner. I tested three options: The smartphone app JotNot Scanner Pro by MobiTech 3000, PlanOn’s tiny SlimScan SS100 scanner and Xerox’s new wand-shaped Mobile Scanner.

The JotNot Pro app uses the iPhone’s camera to capture images of documents. And after five days of testing, it became apparent that the app was great on the go, but I wouldn’t use it to scan tons of files. The SlimScan scanner’s size was attention-grabbing, but the device and its software were problematic for me. Despite its larger size and $250 price point, the Xerox scanner was my top pick, because of its fast scanning and its wireless connectivity via an Eye-Fi card.

I began the scanner tests with JotNot Pro for iPhone, which was updated late last year and costs $1.99.

I was at a conference last week, accumulating business cards and receipts, so it was a good opportunity to test the app. After I snapped a horizontal photo of a business card, the app immediately found the edges of the card and cropped the image. Then it processed the image, and the text in the final file was clear and easy to read. I did this with receipts as well.

JotNot Pro let me enhance each file before processing it, whether it was a hard-to-read receipt or a file with lighter text; and I could also adjust the contrast or add a timestamp to the files.

Next, I shared the files. I had the option to email the files, print or fax them, open them in compatible apps, such as DropBox, or copy them to DropBox, Evernote, Box and Google Docs. JotNot Pro can also easily convert the saved files into PDFs.

I was impressed with all of the options packed into the JotNot Pro app, and would continue using a mobile app to scan when I have my phone and no other options. But for high-volume scanning, I wouldn’t rely solely on an app.

I had high hopes for the SlimScan, but it didn’t deliver. The SlimScan SS100 is a super-thin, credit-card-sized device that launched last month and currently lists on Amazon.com for $106. It claims to store up to 600 scanned images before you have to dump the files off of it, and its expected battery life is 200 to 300 scans per charge.

It confused me from the start. The SlimScan has five tiny unmarked buttons, and I had to read the instruction manual to figure out which one was the power button, which is never a good sign. I had to dig my nail into each button to press it down. When I removed the bottom portion of the stainless steel device to start scanning, I felt like I might break it.

I found that with the SlimScan, I had to have a slow, steady hand as I was rolling the device across a file, or the images wouldn’t scan properly. The first few images I scanned were cut off or missing lines of text as a result of this.

PlanOn’s software for the SlimScan, which is installed straight from the device, was confusing at first as well. The software doesn’t work on Macs, so in order to test it I installed the software on a laptop running Windows 7.

I initially had some trouble transferring files from the scanner to the SlimScam file-management system. The PlanOn software on my laptop would only recognize the files when I renamed them with a JPEG extension. It turned out I needed to install an additional software component in order for SlimScan to convert the files to readable files, and PlanOn suggested I upgrade the software running on the actual scanner as well. According to SlimScan, any SlimScan software earlier than version 4.3 needs to be updated, and my SlimScan was running version 3.8.

After I managed to import images of receipts, business cards and a portion of a book cover, I had the option to move the info to Contacts and export it to Outlook, among other things. Some of the scanned data from business cards didn’t transfer over to Contacts, though optical-recognition software often isn’t 100 percent accurate.

The $250 Xerox Mobile Scanner launched in January, and is comparable in size to the mobile scanner made by The Neat Company, which has been making digital filing and scanning products since 2003. The Xerox scanner can be set up to wirelessly share images, too.

The scanner is 11.5 inches by 2.75 inches by two inches, and weighs 1.5 pounds. Its expected battery life is 300 scans per charge. Like the SlimScan, it isn’t fully compatible with Macs, though Xerox says a Mac utility will be available soon. The Xerox scanner has ports in the back for a flash drive as well as an SD card, so you can scan directly to those, then transfer the files to your computer.

Getting set up to transfer files from the Xerox via Wi-Fi was a bit of a process. First, I inserted an Eye-Fi card, which comes with the scanner, into my laptop, and signed up for an account online. Then I moved the Eye-Fi card to the back of the scanner. I had to temporarily disable other nearby wireless networks so I could “train” my devices to use the Eye-Fi card as a wireless hotspot.

I also had to download a Xerox app for my smartphone if I wanted the files to wirelessly transfer to my phone.

But after all that, I was a scanning machine. The Xerox device scanned all of my business cards, receipts and documents well — and quickly. And files transferred seamlessly to both the Xerox mobile app on my phone and my Eye-Fi dashboard on my laptop. From there, I could email the files or share them with more than 25 productivity, social networking and picture sites.

If the Xerox app itself took photos, it would be the perfect mobile app companion to the hardware. The Xerox mobile scanner may be expensive and slightly less portable — and it probably won’t make tax season any more fun — but for scanning lots of documents and easy file transfers, it gets the job done.

]]> http://allthingsd.com/20120507/a-scanner-for-all-seasons/feed/ 6 http://allthingsd.com/20120504/ramping-up-mobile-discovery-facebook-acqhires-glancee/ http://allthingsd.com/20120504/ramping-up-mobile-discovery-facebook-acqhires-glancee/#comments Sat, 05 May 2012 01:40:59 +0000 Mike Isaac http://allthingsd.com/?p=203967 More than ever in the looming spectre of its multi-billion dollar IPO, Facebook realizes the need to beef up its mobile experience. Which is why, in part, the company acquired Glancee, a mobile start-up that focuses on discovery of similar folks nearby.

“We can’t wait for co-founders Andrea, Alberto and Gabriel to join the Facebook team to work on products that help people discover new places and share them with friends,” Facebook told AllThingsD in a statement.

To date, Facebook has admitted to maintaining one product independently of Facebook, the billion-dollar Instagram. Despite this acquisition, following the Instagram purchase Facebook will most likely use the technology to ramp up its existing mobile application.

As of late, Glancee competitors began to pop up, including the much-hyped Highlight application, the profile of which rose tremendously during South By Southwest 2012. One of the main issues with Highlight — and similar applications like Glancee — is the serious drain on battery life that the ambient discovery app causes while running in the background of the mobile phone.

The fundamental premise of services like Glancee or Highlight is that you’re surrounded by folks you would probably get along with; based on shared interests or connections, these apps hook you up with others.

But, of course, there’s the sticky issue of privacy, which Facebook knows all too well. Not everyone wants a new friend coming up and saying hello, however novel the app idea is.

Regardless, it signals that Facebook remains committed to innovating in mobile. And that’s important, considering that nearly half of the company’s monthly visitors are accessing the site on a mobile device.

The final sum and terms of the deal were not disclosed, but all three co-founding members of the Glancee team will join Facebook at its Menlo Park campus.

]]> http://allthingsd.com/20120504/ramping-up-mobile-discovery-facebook-acqhires-glancee/feed/ 4 http://allthingsd.com/20120503/fitbit-now-tracks-heart-rate-data-through-digifit-app/ http://allthingsd.com/20120503/fitbit-now-tracks-heart-rate-data-through-digifit-app/#comments Thu, 03 May 2012 19:22:57 +0000 Lauren Goode http://allthingsd.com/?p=203243 Fitbit, the popular fitness device that clips on to clothing and measures the wearer’s activity levels, is adding heart rate to the list of metrics it will support, through a partnership with the Digifit heart-rate app. When users are wearing the Fitbit and using Digifit’s app, they can now pull their cardio info into Fitbit’s online dashboard, and can merge it with data from Fitbit’s new Aria scale, as well.

]]> http://allthingsd.com/20120503/fitbit-now-tracks-heart-rate-data-through-digifit-app/feed/ 0 http://allthingsd.com/20120503/live-samsung-puts-its-next-galaxy-into-orbit/ http://allthingsd.com/20120503/live-samsung-puts-its-next-galaxy-into-orbit/#comments Thu, 03 May 2012 17:18:28 +0000 Ina Fried http://allthingsd.com/?p=203177 Aiming to capitalize on its Olympic sponsorship, Samsung is using a London event to launch its next flagship smartphone.

The new Galaxy device is set to be unveiled at 7 pm London time (11 am PT). AllThingsD will have live coverage of the announcement, which is also being webcast.

In the past, Samsung has announced its main Galaxy devices at Mobile World Congress; however, the company held back this year, saying it wanted to announce the product closer to when it would ship. A top Samsung marketing official also told AllThingsD in January that the company wanted to use the Olympics for a major product launch.

Samsung has since announced a quad-core chip expected to power the new Galaxy.

Earlier:
10:38 am: The live stream is slated to be available here.

11:00 am: Okay. Here are the key details on the Galaxy S III (and yes, that’s the name).

4.8-inch HD Screen

8-megapixel rear camera, 1.9-megapixel front camera

“S-Voice” voice recognition tech

Android 4.0

11:03 am: The device will be available in Europe at the end of May, with launches in other markets to follow.

Here’s a picture of the phone:

11:06 am: As for when it will come to the U.S., Samsung had this to say:

“Samsung Mobile is planning a U.S. version of Galaxy S III, optimized for the fastest LTE and HSPA+ networks in the U.S., which will be available in the summer of 2012. Exact timing and retail channel availability is not being announced at this time.”

11:09 am: Here’s a more direct link to the livestream.

11:10 am: Samsung’s JK Shin:

11:11 am: “There were a lot of rumors and speculations about the next Galaxy,” Shin said. “Some were right and some were wrong.” But, he said, Samsung Galaxy S III is the best in class.

Shin touts the quality of the screen and says the design is inspired by water and leaves.

The phone can listen to you and understand what you want. The screen can notice your eye movement and can stay bright when you are looking at it.

If you are texting and you want to call someone instead, Shin said, “it understands your intention to make a call and calls for you.”

Simply put, he said, Galaxy S III is a “human phone.”

11:15 am: It has more than 140 countries with more than 290 carriers, Shin said, making it the largest launch in history.

The 3G version, Shin said, will ship in May in Europe, followed by Asia, Middle East, Africa and Asia.

The 4G version will ship first in North America, Japan and Korea starting in the summer.

11:18 am: Other features include direct wireless sharing to a television or other Galaxy device, tablet or PC.

The updated S-Beam feature can share a 1GB video in three minutes or a music file in two seconds, Samsung said.

11:23 am: A European Samsung executive is demoing the “smart stay” feature that avoids going to sleep or dimming the screen by detecting when a user is looking at the screen.

It is annoying to touch the screen to keep it awake, or even worse to have to enter a password, Samsung says. The Galaxys S III can instead determine when to dim the screen by sensing a user’s intentions.

11:25 am: Next up is voice recognition, which can be used to do things Apple’s Siri does, such as getting the weather, but also to launch apps.

“I want to take a picture,” for example, opens the camera app.

The voice engine understands British and American English, Italian, German, French, Spanish (Spain and Latin American versions) and Korean.

11:29 am: Samsung is pushing hard the notion that the new Galaxy is designed with the user in mind, repeating often that the new phone “sees, listens and responds.”

11:31 am: Now demoing improved social sharing features that allow users to, among other things, bond with another phone.

Under the hood, the new “S-Beam” feature combines Wi-Fi direct and NFC technologies.

“It’s the fastest and easiest way to share content with your friends and it happens with just one touch,” said the European Samsung executive.

11:33 am: An add-on dongle extends the sharing option to any HDMI-capable device.

11:33 am: Galaxy S III has a new “buddy” photo sharing feature that recognizes friends in your photos and offers to send them the photo.

11:37 am: Video showing the S3 in action, including its quad-core chip, intelligent photo taking and other features.

11:39 am: It comes in “pebble blue” and “marble white.”

Some other specs:

It’s 8.6 milimeters thick, weighs 133 grams and packs a 2,100 mAh battery.

11:41 am: A “pop-up play” feature allows one to watch a video in a small window while performing another task, such as searching the Web. It’s kind of picture-in-picture for your phone.

A “best photo” feature picks the best shot out of a burst of eight.

11:47 am: Now showing, the first TV commercial for S III.

Among other things, the commercial notes that the Galaxy S III “follows your every move.” Hmm, not sure that’s quite the way they want to put things.

11:49 am: Accessories include flip cover for the screen, wireless charging kit, extra battery and aformenentioned HDMI dongle.

11:52 am: Samsung says the Galaxy S III has improved security and other features for businesses, allowing for better device management.

Galaxy will come in three storage options — 16GB, 32GB and 64GB.

Galaxy S III will go on sale in Europe on May 29.

11:57 am: Santa Clara-based Sensory Inc. says its voice activation technology is helping power the voice command features in the Galaxy S III.

12:00 pm: The presentation ends and those in London are invited to check out the phone in various booths designed to replicate the kind of pop-up stands where Samsung plans to show the device.

]]> http://allthingsd.com/20120503/live-samsung-puts-its-next-galaxy-into-orbit/feed/ 0 http://allthingsd.com/20120503/microsoft-slips-mobile-developer-conference-between-apple-and-google-events/ http://allthingsd.com/20120503/microsoft-slips-mobile-developer-conference-between-apple-and-google-events/#comments Thu, 03 May 2012 17:12:44 +0000 Ina Fried http://allthingsd.com/?p=203164 Any mobile developers not from the Bay Area might just want to rent a place in San Francisco for the month of June.

Apple’s Worldwide Developer Conference is set for the week of June 11, while Google’s I/O event runs June 27 to 29. Now, as noted by ZDNet, Microsoft has started sending invitations for a mobile developer event for June 20 and 21.

Of course, that assumes developers can get into these events. Both Google I/O and WWDC sold out quickly.

A Microsoft representative confirmed its event, but declined to offer any details on what would be on the agenda or who would be able to go, beyond those who were invited. Redmond has been extra quiet about its plans beyond the current “Mango” version of Windows Phone 7.

The rest of the industry hasn’t been so quiet, with various partners talking — occasionally publicly — about the next version, dubbed “Apollo,” shipping later this year. Several reports have suggested the next version will shift from the current Windows CE core to one based on the desktop version of Windows.

Microsoft has said that current Windows Phone apps should run on the next version of the operating system, but has not committed that the operating system will run on existing hardware.

]]> http://allthingsd.com/20120503/microsoft-slips-mobile-developer-conference-between-apple-and-google-events/feed/ 0 http://allthingsd.com/20120503/virtual-graffiti-app-wallit-now-lets-users-create-their-own-walls/ http://allthingsd.com/20120503/virtual-graffiti-app-wallit-now-lets-users-create-their-own-walls/#comments Thu, 03 May 2012 11:52:27 +0000 Lauren Goode http://allthingsd.com/?p=203026 When an augmented reality app called Wallit launched a couple months ago, some users were excited by the possibilities of writing on virtual walls at established locations, such as the Eiffel Tower or an Apple store, but griped that the app was too closed-off.

Only app administrators could create new Wallit walls, and users had to be in relative proximity to a place to properly use the app.

Wallit has now torn down those walls to the app. Starting today, users can create a virtual wall anywhere, from their office to their living room to a party at a friend’s place.

Since the whole idea of writing on virtual walls could be a bit confusing to those who haven’t seen the app, there’s a video below to help show how it works.

Basically, Wallit app users have the option to leave a note on a virtual wall that’s superimposed over a real location. Depending on whether the wall is private or not, users within Wallit’s social network can use their phone’s camera to capture an image of that building or structure — such as the Golden Gate Bridge, for example — and see what people have written around it, as well as other data that might be available.

Augmented reality apps that show contextual info based on your location are hardly new, though Wallit does add an interesting social twist to AR. Mobile apps like Wikitude and Google Goggles display info about your surroundings on a smartphone screen and, of course, Google’s Project X glasses aim to remove the smartphone from the whole equation, and instead show relevant local information through a wearable device.

The Wallit app is free, and right now the 700 existing walls don’t show any ads. However, Wallit creator Veysel Berk says that “value walls” may be a part of the app in the future, where brands will customize certain walls. Whether that means ads will appear on already existing virtual walls, or whether the ad walls will be completely separate, is still unclear.

The app can be found here in the iTunes store. It’s currently only available for iOS devices, though Berk says an Android version is in the works.

]]> http://allthingsd.com/20120503/virtual-graffiti-app-wallit-now-lets-users-create-their-own-walls/feed/ 0 http://allthingsd.com/20120502/novel-android-malware-spotted-on-compromised-web-sites/ http://allthingsd.com/20120502/novel-android-malware-spotted-on-compromised-web-sites/#comments Wed, 02 May 2012 22:37:22 +0000 Ina Fried http://allthingsd.com/?p=202809 Demonstrating the increasing sophistication of mobile malware, a new Android Trojan is spreading via compromised Web sites and could potentially be used to crack corporate and government networks.

The bug, dubbed NotCompatible, is the first Android bug to spread this way, according to mobile-security specialist Lookout. The Trojan poses as a system update and, while the current version doesn’t appear to do harm, it could be used in malicious ways.

“This threat does not currently appear to cause any direct harm to a target device, but could potentially be used to gain illicit access to private networks by turning an infected Android device into a proxy,” Lookout said in a blog post.

In order for a device to be infected, the user would have to install the downloaded Trojan, Lookout said.

“Based on our initial investigation, we’ve confirmed that a number of websites have been compromised,” Lookout said. “However, affected sites appear to show relatively low traffic and we expect total impact to Android users to be low.”

]]> http://allthingsd.com/20120502/novel-android-malware-spotted-on-compromised-web-sites/feed/ 0 http://allthingsd.com/20120502/theres-a-robot-in-your-pocket/ http://allthingsd.com/20120502/theres-a-robot-in-your-pocket/#comments Wed, 02 May 2012 21:38:23 +0000 Amit Kapur http://allthingsd.com/?p=202678 When I was a kid, I dreamed of someday having my own robot. From HAL to R2D2 to KITT, robots were the ultimate technology in my eyes. They could do your chores, order you a pizza, finish your homework, and even warn you when danger was approaching. Today, I’m very excited to see my dream come true because, in fact, there is a robot in each of our pockets.

Let’s begin by drawing the distinction between a tool and a robot. Tools enable us to work more efficiently. Robots do the work for us (in fact, the original word robata means “hard work” in Czech). The vast majority of the Web sites and apps we use today are tools that enable us to work, play and share more efficiently. Over the last few years, through advances in artificial intelligence and data science, Web sites and apps are evolving. There is a new breed of applications focused entirely on working on our behalf. As humans, we constantly seek means to reduce the amount of work needed to reap rewards from a system. While the tools of today allow us to work less, the robots of the future will eliminate much of the work in the first place.

This incredible transformation is happening right before our eyes.

Your Search Robot

A long time ago, we would search for information by painstakingly looking up sources in a card catalog and reading a book. As much of that knowledge moved online, the directory (like Yahoo!) enabled us to browse and find content of interest. In time, the amount of information flowing online overwhelmed the directory — it would simply require too much work to browse the entire Web. Fortunately, a revolutionary tool, search — Google, really — made it very easy to find the documents that contain the answers we’re looking for. But while search presents us with a huge set of choices, it still takes a lot of work to find the answers.

Today, a new technology is eliminating that work by acting on our behalf to find the answers and even solve our problems. Siri is an artificial intelligence client that turns our devices into a virtual assistant. It removes the steps between searching for answers and finding them. Have a question about converting metric units? Ask Siri. Need to order your mother flowers? Let Siri handle that. Need to make dinner reservations for your date Friday? Let Siri do the work for you. And we’re just scratching the surface. We possess the vastness of all human knowledge in our pockets, yet much of our usage is limited to Angry Birds. This transformation to intelligent machines means we no longer have to work as hard to apply the knowledge locked in our devices; they’ll do the work for us.

Your Location Robot

In the 20th century, an enormous yellow book was delivered to our doorstep every year. We would heft this behemoth and flip through hundreds of pages to find a local business or restaurant of interest. Eventually, that process gave way to more efficient tools as local information moved online through apps like CitySearch and Yelp. Recently, via the mobile check-in, we can be presented places of interest and people near our current location. This new layer of geographical context is great, but checking in is still work.

Today, ambient location apps like Foursquare, Radar and Highlight are beginning to do that work for us. By passively monitoring our locations, they alert us to interesting people and places around us. Over time, as they learn our preferences, they’ll be able to filter these places and help us discover the best restaurants and people wherever we are. At last, we are within reach of the “Danger, your ex-girlfriend is in the area!” robot.

Your Personal Robot

Not that long ago, the primary way we would discover new media was through browsing a printed newspaper, magazine rack or record store. As this content moved online, it became much more accessible and real-time. As the option pool grows, we have to put in more and more work to find the content that’s interesting to each of us. There are more and better options than we could ever imagine. But it would take an incredible human effort to find all the needles in the growing haystack.

To address this, many Web sites have offered customization tools for users to focus their experience. But manual customization also requires a lot of work, and it usually fails to paint the rich, dynamic picture of who we are and what we like. Fortunately, a solution is emerging from companies like Pandora (and, full disclosure, my own company, Gravity). Using machine learning, these platforms get to know you based on the things you read about, listen to, or share. They can then move way beyond customization by generating adaptive, personalized experiences that bring the best content on any website or app right to the top. It completely shifts the paradigm from you having to search for information to information searching for you. It’s like having a personal robot who thinks just like you do reach across the Web and return the best music, stories, videos, even daily deals everywhere you go. “Welcome back to ESPN, Amit. The surf report in Venice tomorrow is 3-4 feet, and the Lakers are leading by 10 points at the half.”

All of this paints just a small picture of what’s to come. Imagine the applications in fields like education, health care, or personal finance (wouldn’t you love a robot that does your taxes?). As the Internet starts to work for us, it will enrich our lives in ways we can’t even imagine. I, for one, am very excited that my childhood dream of owning my own robot is finally coming true.

Amit Kapur is the CEO and co-founder of Gravity, a company that makes the Internet adaptive and personalized. He was formerly the COO of Myspace. As an early Myspace employee, he led the development and growth of Myspace Music and Myspace Mobile.

]]> http://allthingsd.com/20120502/theres-a-robot-in-your-pocket/feed/ 0 http://allthingsd.com/20120501/facebook-still-not-making-much-money-in-mobile-but-driving-lots-of-traffic-to-others/ http://allthingsd.com/20120501/facebook-still-not-making-much-money-in-mobile-but-driving-lots-of-traffic-to-others/#comments Tue, 01 May 2012 22:23:57 +0000 Ina Fried http://allthingsd.com/?p=202152 Ahead of its planned stock offering, Facebook is looking to show itself as a serious player in mobile, even if the company has yet to make much money in the category.

The social network has purchased Instagram, launched several industry initiatives and offered some details on its efforts to move its desktop platform onto phones and tablets.

On Wednesday, Facebook noted the impact it is having in driving traffic to other companies’ mobile apps.

“Facebook sent more than 160 million visitors last month to mobile apps (up from 60 million in late February),” the company said in a blog post. “These mobile visitors were responsible for more than 1.1 billion visits to mobile apps in the same time frame (up from 320 million in late February).”

Facebook also noted that seven of the top 10 grossing iOS apps and six of the top 10 grossing Android apps have Facebook integration — typically for identity and authentication. In its developer blog, Facebook touted integration work with BranchOut, Viddy and Flixter.

Mobile remains a huge question mark for the company’s future. Although Facebook apps remain among the top third-party downloads for all the major mobile operating systems, the service isn’t nearly as much of a platform for third-party developers as it is on the desktop.

Also, while the company is getting more and more of its traffic from mobile devices, most of its ad dollars come on the desktop.

Facebook has been working in several areas to address this, some of them publicly and others behind closed doors. Among its public efforts are an HTML5 platform and industry initiatives around carrier billing and Web apps.

As covered in a series of articles by AllThingsD, the company has also been working for more than a year on “Buffy,” its own phone technology built on top of Android. The company is expected to debut its own hardware, designed with Taiwan’s HTC, as early as the third quarter of this year.

]]> http://allthingsd.com/20120501/facebook-still-not-making-much-money-in-mobile-but-driving-lots-of-traffic-to-others/feed/ 0 http://allthingsd.com/20120430/interview-ctia-boss-steve-largent-aims-to-keep-conference-from-being-lost-in-the-shuffle/ http://allthingsd.com/20120430/interview-ctia-boss-steve-largent-aims-to-keep-conference-from-being-lost-in-the-shuffle/#comments Mon, 30 Apr 2012 22:45:53 +0000 Ina Fried http://allthingsd.com/?p=201544 While the U.S. mobile industry is thriving, its annual trade show has struggled to stand out.

Coming on the heels of both January’s Consumer Electronics Show and February’s Mobile World Congress, the CTIA event in March had become something of a rehash of products announced at those earlier events.

In response, the show’s producers have pushed this year’s event back to May, a move aimed at creating some separation from the other conferences.

“We were told by a lot of people ‘I’m out of breath,’” CTIA chief Steve Largent told AllThingsD. “We heard that. We listened.”

This year’s event takes place next week in New Orleans, at the end of that city’s popular jazz festival.

By changing the timing, CTIA is also hoping that some companies may be ready to announce products due to ship by the back-to-school shopping season.

“I would say the verdict is not in yet but all the indications are it is a good move,” Largent said.

It seems some companies aren’t waiting for CTIA to make announcements.

BlackBerry maker Research In Motion, for example, is announcing news at its own developer conference this week, while Samsung is using a May 3 event in London to announce its next flagship Galaxy device.

Some device makers and carriers have said to expect noteworthy announcements at the show, while others are planning just meetings and social gatherings at the event.

As for formal events, the highlight is likely to be a panel on Tuesday afternoon featuring top executives from the four major U.S. carriers. CNBC’s Jim Cramer is set to moderate that. The conference wraps up on Thursday with a speech from former President Bill Clinton.

Last year’s show, in Orlando, was dominated by the news announced on the eve of the event that AT&T was planning to buy T-Mobile in a blockbuster $39 billion deal.

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]]> http://allthingsd.com/20120430/interview-ctia-boss-steve-largent-aims-to-keep-conference-from-being-lost-in-the-shuffle/feed/ 0 http://allthingsd.com/20120430/paying-with-squares-new-mobile-payments-app/ http://allthingsd.com/20120430/paying-with-squares-new-mobile-payments-app/#comments Mon, 30 Apr 2012 13:00:20 +0000 Lauren Goode http://allthingsd.com/?p=201092 Over the past week and a half, I’ve purchased seven cups of coffee, three bags of beef jerky, two cookies and a pastry. With my smartphone.

It’s not a sustainable diet, but that’s what was available at the relatively few shops around San Francisco and New York City that are accepting Pay with Square and PayPal’s mobile app.

In case you’ve missed it, there’s a battle brewing over the future of mobile payments — that is, the ability for consumers to ditch the leather wallet and purchase things with their mobile phones. Companies like Google, PayPal, Square, wireless providers and credit card companies are debating various forms of mobile payment technology.

But in the battle over who gets to control your digital wallet, it’s important not to forget the consumer experience. Is it really that much easier to pay with a mobile phone than it is to just pull out cash or a credit card?

That’s what I set out to find this week, mainly using Pay with Square.

Square is a company known for creating a device for small businesses that plugs into an iPhone and can read a swiped credit card, but the company recently renamed and relaunched its app for consumers. Now called Pay with Square, the app works only at stores that are using Square’s register system for the iPad. Currently, around 75,000 merchants across the U.S. are accepting payments via the Pay with Square app.

In my experience, Pay with Square proved to be an easy, enjoyable app to use to purchase things using my smartphone — though it won’t be an everyday app for me until there are more businesses accepting it.

The free Pay with Square app works with iPhone and Android phones. It used to have a wallet-like interface, but now it simply lists nearby merchants, and has a rotation of featured businesses at the top of the page.

I first used Pay with Square at a coffee shop in San Francisco. I had to link the app to my credit card account, and then upload a picture of myself; otherwise, I wouldn’t be allowed to pay. Square says this provides a layer of security on top of other standard security measures it puts in place, alongside the security your credit card company provides.

Of course, a customer could upload a picture of their cat or something, and use that as their Pay with Square image. It’s up to the merchant to decide whether it’s a good idea to accept payment from someone whose photo doesn’t align with what they look like.

Then, on the coffee shop’s page within the app, there was the option to auto-open a tab for payments. Once I indicated in the app that I wanted to open a tab, my name and photo appeared a few moments later on the cashier’s iPad register, and the cashier was able to tap on my name and charge me.

Square has been touting the idea that this app actually allows for “hands-free” payments, which means a user shouldn’t even have to take her smartphone out of her pocket in order to pay, provided that the auto-open tab is turned on. I had mixed experiences with this at shops in New York.

One shop I bought coffee at didn’t see my name right away, even though I had turned on the tab in the iPhone version of the app. I tried to buy another item using the app on a Samsung Galaxy Nexus Android phone, and my name didn’t appear at all on the list of customers in the store.

But at another downtown coffee shop I was able to walk in, place my order and say, “Charge it to Lauren Goode” — without taking my phone out of my pocket — and the transaction was completed in seconds. This worked well on both iPhone and Android.

The app has a new tilt-to-map feature that I like a lot. Tilting your smartphone at an angle turns the screen into a full map, with little red pins showing where Square-friendly merchants are. I could also tweet from within the app that I was at a shop and paying with Square, text-message the same notification, and email the store’s link to a friend.

One part of the app that I found lacking was the amount of information that some merchants list on their pages within the app. Some show addresses, phone numbers, business hours and full menus. But a couple of Square-friendly venues in the app only listed their business phone numbers or addresses, so I had to exit the app to run an additional search and find out what the business actually sold.

This past March, online payments giant PayPal introduced PayPal Here, a Square-like dongle for small businesses to accept credit card payments on a mobile phone; PayPal also has a mobile app that uses location services to recognize where a customer is. PayPal already has the advantage of a massive user base of over a hundred million and, unlike Square, it is available in international markets.

But PayPal’s triangle device for payments still hasn’t been fully rolled out yet, so locating businesses where I could test that in conjunction with the PayPal app was challenging. The company says it’s still in “beta,” so it’s unclear how many merchants are actually using the triangle.

So that’s how I found myself buying beef jerky from a merchant amid a row of warehouses in Brooklyn on a rainy day. The founder of Kings County Jerky used to use Square, but he is now using the PayPal triangle.

Once I arrived, I opened the PayPal application on my iPhone. It recognized my location and listed a couple places nearby that would take my money via my PayPal app.

Since data service on my phone happened to be particularly bad in that area, I initially had trouble dropping the digital pin within the app that’s supposed to let the merchant know I was there. The merchant also had to reboot his phone once to process the payment on his end.

But once I switched over to Wi-Fi, I had four options for paying him: Pay directly from my PayPal account through the app; handing him my credit card, which he would swipe through the PayPal triangle; and scanning my credit card. The last resort would be for the merchant to manually enter my credit card number into his phone, though he would get charged a slightly higher fee for processing my payment that way.

Mobile connection issues aside, paying through my PayPal account on the app was relatively quick and painless.

In terms of loyalty rewards and discounts, mobile payment companies are trying to make paying with a smartphone compelling, but I haven’t been using the apps long enough to glean the rewards. Square, for example, gives merchants the ability to offer purchasers 10 percent off transactions just for being repeat customers, and while Google Wallet is currently only available on five Android smartphone models, the company has partnered with name-brand retailers to offer small promotions to app users.

Paying with Square was an easy way to pay with my mobile phone and, for me, the current lack of merchants accepting it was its biggest downside. This category of technology is too young here in the U.S. to see what the real benefits — and drawbacks — will be, but consumers can likely expect to see more options to pay with their smartphones in the near future.

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