Posts Tagged ‘CNN’

Twitter creator reveals Square mobile-pay device

December 11, 2009

This is brilliant…

Twitter creator reveals Square mobile-pay device

By Barry Neild, CNN, December 9, 2009 6:06 a.m. EST

Paris, France (CNN) — Twitter creator Jack Dorsey Wednesday gave the first public demonstration of his hotly-anticipated latest venture — a device to allow credit card payments by cell phone — and revealed it would be given away for free.

Details of “Square” — a card reader which plugs into the headphone socket of most mobile devices — have been circulating on the Internet since it was announced earlier this month, but little has been known about how it works or who it was aimed at.

However, Dorsey — whose microblogging Web site has proved hugely popular but not hugely profitable since launching in March 2006 — gave no explanation on how he would make money from his new creation, beyond revealing there would be a per-transaction charity donation.

Square, a tiny cube about an inch in length, contains a magnetic strip reader that allows users to swipe and read credit cards, then deduct payment on or offline through a downloaded application that communicates with card issuers in the same way as retailer devices.

Customers then use their finger on the phone’s touch-recognition screen to sign their name to the transaction.

Dorsey, Twitter‘s co-founder and chairman, says the device, scheduled for launch on iPhones and iPods in March 2010, was inspired partly by the “immediacy, approachability and transparency” of Twitter and by the global economic crisis which has exposed a need for a radical rethink of the financial sector.

“The financial world is amazing right now because there’s a clean slate. A lot of these industries are looking for something very small and innovative,” he said during the gremlin-hit demonstration of his device at LeWeb, a major Internet forum in Paris.

“My co-founder is a glass artist. He sells things that people don’t need — $2,000 glass faucets. They’re beautiful. If he could not take credit cards, he wouldn’t make the sale because no one carries around $2,000 in the cash.

“So we looked at it. Ninety percent of the U.S. has moved to credit cards, but it’s still very difficult to accept them.”

Dorsey said he considered a number of options in developing Square, including using cell phone cameras and character recognition software to read images of the credit card.

“The other thing we looked at is the audio jack — and it’s on Macbooks, desktop PCs, BlackBerries and Androids. We built this hardware. It’s a self-powered swiper. Powered by the magnetic power of the swipe itself, converts it to an audio signal, which the software interprets.”

Dorsey, who joked he had pocketed $650 by allowing potential business partners to road test the device with their own credit cards, said Square was currently being beta tested in a handful of major U.S. cities by a cross-section of small business users.

“We’re trying with a bunch of different profiles of folks in New York, San Francisco, LA and St. Louis, Missouri. There are piano teachers, flight instructors, and coffee shops. It can be used in a retail store like Apple, all the way down to Craigslist or paying me back for that dinner you owe me.”

Dorsey said his developers were still working to ensure the device was fraud proof.

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‘Next year’s Twitter? It’s Foursquare’ by Pete Cashmore

November 24, 2009

We love Pete Cashmore’s insight into the future landscape of social media.

Next year’s Twitter? It’s Foursquare

By Pete Cashmore, Special to CNN, November 19, 2009 1:18 p.m. EST

Editor’s note: Pete Cashmore is founder and CEO of Mashable, a popular blog about social media. He is writing a weekly column about social networking and tech for CNN.com.

London, England (CNN) — As 2009 draws to a close, with Twitter undoubtedly this year’s media darling and Facebook continuing on its path to global domination, you may wonder which social-media service will become tech’s poster boy in 2010.

Among the Web’s early adopter set, the answer is nearly unanimous: Foursquare.

While the technology landscape is ever-changing, I’d argue that Foursquare already has aligned itself to become next year’s mainstream hit.

The Twitter connection

Birthed by the team that brought us the mobile social network Dodgeball (acquired by Google in 2005 and later shuttered), the location-based mobile startup serves a simple purpose: It lets an individual share his or her location with a group of friends.

Foursquare ventures beyond utility, however: It’s a virtual game in which participants earn badges for checking in at various locations; those that check in most become a venue’s “mayor.” By all accounts, this mechanism is as addictive as Twitter, Facebook or checking your e-mail on a BlackBerry.

Originally launched as an iPhone application and seeded by the young early-adopter set in cities such as New York and San Francisco, the site’s founders were able to leap from a ready-made springboard: Twitter.

With users’ “check-ins” being posted to the messaging service, Foursquare was able to gain a foothold in much the same way YouTube built its lead from videos embedded in MySpace pages.

The parallels with Twitter are numerous. As technology early adopter and popular blogger Robert Scoble wrote in September: “Go back three years ago. Twitter was being used by the same crowd that is playing with Foursquare today.”

The similarities don’t stop there: Twitter first took hold at Austin’s South By Southwest festival in 2007; Foursquare made its debut at SXSW 2009. Members of both founding teams have previously built successful social startups; both those startups were sold to Google.

The two companies share investors, too: Union Square Ventures is a backer, while Twitter inventor Jack Dorsey made an angel investment in Foursquare. Other notable investors include the founders of Digg and Delicious, and famed angel investor Ron Conway. Union Square Ventures’ Fred Wilson observed that Foursquare’s first round financing was “among the most competitive early round financings I’ve seen in a long time.”

Foursquare’s power play: Platform for developers, retailers

This week Foursquare debuted the singular piece that launched Twitter into the stratosphere: an API. This application programming interface allows third-party developers to build anything they desire on top of Foursquare’s location-based social network.

It’s been shown time and again that once these ecosystems gain momentum, potential competitors face an arduous task. From Flickr to Google Maps to Twitter and beyond, it’s clear that early critical mass — having enough users and applications to make a service invaluable — sets the stage for a landslide victory.

Google’s Android, entering the mobile platform wars long after the iPhone App Store had served up a veritable smorgasbord of apps to its army of users, is evidence of the chicken-and-egg problem that arises for new competitors: What’s the incentive for users and developers to switch to a smaller, less visible platform once a leader has emerged?

With the launch of its API, Foursquare looks set to capitalize on this “rich get richer” phenomenon before others can make a play. Foursquare is doing more than wooing users and developers, however: It’s also courting local bars and restaurants.

“Foursquare for Businesses” is a platform for retailers wishing to offer special deals to Foursquare users: Check in to frozen desert maker Tasti D-Lite at two venues in New York, for instance, and you’re eligible for a discount.

Competitors abound

Nonetheless, multiple players are vying for victory in the location-based services market. Between GowallaLooptBrightkite and Google’s Latitude, Foursquare will by no means have an easy ride. While Gowalla debuted an early version at SXSW 2009 alongside Foursquare, both Loopt and Brightkite have a head start.

All of these services, I’d argue, lack the highly addictive game play that appears to have Foursquare users hooked.

Google is undoubtedly the 800-pound gorilla, but the fastidiously numbers-driven search engine has proven time and again that it cannot grasp social-networking dynamics — from Orkut to Friend Connect (its Facebook Connect competitor) to its failure to turn Google Video into a YouTube competitor.

One company may unwittingly squash Foursquare in its infancy: Twitter itself. The very service that propelled Foursquare to prominence is rapidly building out its location-based features, with a location API that directly challenges Foursquare. Twitter already has the critical mass of users and ecosystem of eager developers. If it executes correctly, the service could leave Foursquare in the dust.

In Foursquare’s favor: Young, fast-growing startups such as Twitter often find their engineering teams overstretched simply trying to achieve scale. Twitter has added less than a dozen new features since launch as preventing frequent downtime has become its greatest challenge.

Meanwhile, the overlap in investors means the Twitter-Foursquare relationship is unlikely to turn sour. Foursquare may network its way to the top in 2010 or find itself lost in an increasingly competitive landscape. Early adopters are betting on the former.

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