Singel-Minded: How Facebook Could Beat Google to Win the Net - Wired News (blog)

One, there’s so much interaction and information being shared inside Facebook that it has become a decent-sized replica of the Web inside the Web. And Google can’t crawl and analyze much of what happens in there, which is a problem when your goal is to organize the world’s information. Google is blind because much of what happens on Facebook remains in Facebook. (Ironically, this is due to users’ privacy settings, which Facebook has relentlessly tried to chip away at over the last four years.)

Two, Facebook knows who you are and has the right to use that information because you explicitly gave it to them. Google has different kinds of data that reveal a lot about who you are and what you are interested in — some of it very private. But very little of that data is information you explicitly told the company to share, and they’ve assiduously promised not to use your searching and e-mailing data to make a profile of you.

For years, that’s not been a problem for Google. They made the majority of their $7.29 billion in revenue in the third quarter from little text ads that show up next to and above search results, all keyed off the words you type into that little box. There’s no targeting involved. It doesn’t matter to Google’s AdWords system who you are, what you’ve searched for before, or what you do in other Google services (the only real targeting available in AdWords now is by location).

Google then expanded this program to run ads on other people’s sites, its Adsense product, which includes text and banner ads. For years, those ads were also purely contextual — based mostly off the words on the site running the ads. So if you ran a blog about your life as a dentist, your readers would see ads for floss and teeth whitening.

But then, in search of a new revenue stream, Google bought DoubleClick.

DoubleClick is one of the net’s display ad giants and has been serving banners ads on sites across the net since the early 1990s, using each ad serving spot as a way to track what you are reading to make inferences about your interests and build a pseudonomymous profile of you tied to a cookie in your browser.

But despite having a large number of sites running the ads (including Wired.com), AdSense/Doubleclick still accounts for only 30 percent of Google’s revenues. And, surprisingly, the targeting isn’t very good. You can go here to see what Google thinks it can deduce about you just from your browsing.

The problem is that Google built a wall between user search data and advertising — and the mammoth financial success of AdWords proved that the separation was fine at the time. A search query was likely to show intent, and it really didn’t matter to advertisers selling something what demographics the searcher belonged to.

Google kicked a hole in that wall in 2009 when it started including the videos you watch on YouTube as a way to target display ads ads at you, when you visit YouTube and non-Google sites.

Google isn’t talking about how well those ads perform compared to its purely contextual ones, or to DoubleClick’s tracking. But according to a Wall Street Journal story from this summer, Google is “soul-searching” over ways to turn what you do while logged into Google into data that can be used for targeting ads. That’s agonizing for Google since it’s always promised that it would keep that usage data separate from its ads.

But Facebook has never made that promise and its users don’t seem turned off by the targeted ads. They know they gave up the targeting data by typing it into their profile box, by becoming a fan of a company on Facebook or clicking a “Like” button. And now Facebook is training users to stay logged-in to Facebook all the time, thanks to Facebook Connect, the new system to log-in to mobile phone apps using their Facebook credentials and the ubiquitous Facebook “Like” buttons, which only work when you are logged into Facebook.

Why does that matter?

It matters because now you are your Facebook identity all over the net, telling every site that plays in the Facebook ecosystem exactly which dog you are, that you like playing fetch and what other dogs you run in a pack with.

Which means, it’s a virtual certainty that Facebook-targeted ads are going to start showing up in your hometown’s newspaper, your favorite online music site and hundreds of other sites you visit. And unlike the targeted third-party ad systems run by Microsoft, Google and others, there’s no need to track you around the net to try to infer from your reading and video viewing habits how old you are, where you went to college or what you are into.

Facebook knows all of that already because you told them. Facebook touts the story of a wedding photographer in Michigan who’s expanded his business tremendously simply by targeting ads at locals who mark themselves as “engaged.” Gabriel Weinberg, the one-man show behind the search engine DuckDuckGo, went so far as to create an ad targeted just at his wife.

Now, Facebook advertisers don’t actually know anything about you — at least not until you visit their site and handover your e-mail address. Instead, they use a simple panel in Facebook that lets them choose what categories to target, including age, location, education and gender — and then they can further target ads based on the things you have liked or added to your profile. Facebook runs the ads on company’s behalves’ but never turns over a list of who fits the criteria.

As a private company, Facebook doesn’t have to share public numbers, but a spokesman told Wired.com that advertisers are getting comfortable with Facebook, and it has thousands of advertisers. Revenues are estimated at $1.3 billion a year and rising, while investors and secondary markets are valuing the company at more than $40 billion on Sharespost, a private stock market.

Facebook founder Mark Zuckerberg has never loved ads. He kept them off his site as long as he could and even the ones that run now are relatively small, given how big and loud ads have gotten on the Web outside of Facebook. Some marketers complain that the Facebook ads just aren’t visible enough on the site, so they concentrate their efforts on getting people to “fan” their pages, in hopes the news that you like “Starbucks” makes it into the news feeds of your friends.

Facebook says it’s not working on any third-party ad system, and right now, it doesn’t need to. It’s flush with cash from investors, who’ve poured hundreds of millions into the company, without Zuckerberg losing control. It can bide its time, making Facebook even more central to the internet, building more relationships with top advertisers and convincing more sites to turn over their login systems to Facebook.

But it’s a near inevitability Facebook takes the same, logical step Google took and starts putting ads on third-party sites, targeting Facebook users reading the Washington Post, The Daily Beast, or your hometown newspaper.

Those ads could be splashy and dominant – the way advertisers like them these days, without distracting from the Facebook experience. They can also be very targeted, without Facebook having to hand over the info about that reader to the website.

It has the potential to be the opposite of Google’s Adwords/Adsense division, with huge profits coming from outside the site Facebook controls. Facebook could then grab a giant and dominating slice of an evergrowing online display ad market, while simultaneously making display ads actually targeted.

Facebook even makes the case that its ad system is less creepy than third-party systems that track you, mostly without you realizing it, around the web. While they do see what you are doing around the web when you are logged into your Facebook account and there is a “Like” button on that site, the company says it does not mine that information and deletes it after three months. No other third-party ad network comes close to forgetting so closely, and there are a lot of them.

Facebook’s advantage is that they probably don’t need to do this sort of tracking, given all the profile data, friend connections and likes that you’ve fed into their system. If advertisers and users get comfortable enough with ads based off that data, then there’s no reason that a site such as the New York Times wouldn’t want to turn over at least some of their ad sales to Facebook. Facebook, having spent years getting advertisers used to targeting the Facebook generation, would be able to charge very high rates to advertisers.

That’s because it would not only be able to do very granular ad targeting, but it could do so on a site with the reputation of the New York Times.

Online papers love the idea of targeted ads, because contextual ads just don’t work for news. What ad are you going to put up next to a story about a flood in India? An ad for Indian rugs? What about next to a story about a plane crash? Or even a story about a run-of-the-mill mayoral election?

One hope to fix that giant problem facing the media industry is to know who your readers are.

And that means building identity into the internet.

Facebook’s the only company to have done so, and that’s why Google is fighting to catch up to “social.”

There may not be room for more than one online identity company on the net, but Google has assembled a high-powered team of coders and thinkers, including Slide’s Max Levchin, the open social Messiah Chris Messina and Live Journal’s Brad Fitzpatrick, to take on the Facebook crew.

As the underdog in this fight, Google’s best weapon will be openness — tying to turn users against the walls of Facebook, while Facebook will try to be just open enough to keep users and partners from revolting. The best case scenario? Google figures out how to turn identity into an open protocol like e-mail — something you can host and control anywhere that lets you stitch together whatever services you like.

And if that effort fails, Facebook’s relatively benign child-king will be in control of what you can and can’t do with your identity on the internet.

And Mark Zuckerberg will have built a company worth more than $100 billion — and maybe worth more than Google.

Photo: escapedtowisconsin

Follow us for disruptive tech news: Ryan Singel and Epicenter on Twitter.

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Samsung Galaxy Tab Garners Favorable Reviews - Wired News

Samsung’s Galaxy Tab, a 7-inch tablet powered by the Android operating system, has made its rounds with gadget reviewers, and consensus says it’s a solid but pricey device.

Reviewers at tech blogs and mainstream publications, including Wired.com, found that the Galaxy Tab offered a pleasing user experience despite some flaws. Many quipped that the Galaxy Tab, priced at $600, is too expensive when pitted against Apple’s larger $500 iPad.

The Galaxy Tab is the first official Android tablet on the market to compete with Apple’s iPad. Samsung has marketed the smaller, pocketable size of the Galaxy Tab as ideal for commuters, while  highlighting Adobe Flash as a key feature that the tablet supports, unlike the iPad.

Reviews of the Galaxy Tab were mostly positive, but the most dissenting opinion comes from Matt Buchanan of Gizmodo, who described the Galaxy Tab as a “pocketable trainwreck.” A list of excerpts from reviews of the Galaxy Tab follows.

Christopher Null, Wired.com:

“The Tab ultimately reveals itself not as a competitor to the iPad but as a new class of mobile devices: a minitablet that is designed to go everywhere you do.”

Walt Mossberg, The Wall Street Journal:

“The Tab is attractive, versatile and competitively priced, though monthly cell fees can add up. It’s different enough from the iPad, yet good enough, to give consumers a real choice.”

David Pogue, New York Times:

“With the Samsung Galaxy Tab, you’re also buying delicious speed and highly refined hardware. It’s just a shame that you’re buying all that for $600.”

Matt Buchanan, Gizmodo:

“This thing is just a mess. It’s like a tablet drunkenly hooked up with a phone, and then took the fetus swimming in a Superfund cleanup site. The browser is miserable, at least when Flash is enabled. It goes catatonic, scrolling is laggy, and it can get laughably bad.”

Joanna Stern, Engadget:

“It’s the best Android tablet on the market. Now, that’s not saying much given the state of the Android competition, but we can also assuredly say that the Tab is the first true competitor to Apple’s iPad. Its crisp display, compact form factor, touch-friendly software and dual cameras undoubtedly have what it takes to win over the average tablet seeker.”

Melissa Perenson, PCWorld:

“The Samsung Galaxy Tab lives up to its promise as the most credible Android tablet to date. Though it isn’t perfect, it is a strong first-gen device. It isn’t for everyone: The high cost without a monthly contract ($600) underscores that. Nevertheless, if you’re planning to get a mobile broadband data device, the Galaxy Tab’s potential as a mobile hotspot makes it more attractive than some of its competitors.”

Chris Davies, SlashGear:

“Its 7-inch display may offer only half the usable area of the iPad, but the high resolution and responsive, accurate capacitive touchscreen add up to a user experience that’s significantly better than a regular smartphone for browsing, multimedia and – thanks in no small part to Samsung’s custom apps – messaging.”

Donald Bell, CNET:

With the Galaxy Tab, Samsung has created a true peer of the iPad–an uncompromising product that stakes out new territory in terms of both design and features.

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How E Ink's Triton Color Displays Work, In E-Readers and Beyond - Wired News

E Ink’s new Triton line give the company’s displays a long-desired new feature: color. Most of the E Ink team is in Japan this week, demonstrating their new screens in Hanvon’s new e-reader. I spoke by phone with E Ink’s Lawrence Schwartz, who broke down the technology behind the new screens, Triton’s importance for his company, and where their displays fit into the broader ecosystem of readable screens.

“All of our screens have been building towards this,” Schwartz said. “The contrast and brightness we were able to add to the Pearl’s black-and-white screens, paired with a color filter — that’s what lets us bring color to the display.”

Schwartz emphasized that the company’s primary focus is still developing low-power, high-contrast surfaces for reading. “What’s unique about color in reading,” he added, “is that while most textual content is still in monochrome, we can introduce color into cover art, children’s books, newspapers, and textbooks — places still in the reading field where color is at a premium.”

E Ink developed the Triton screen in conjunction with a group of partners, including Epson, Texas Instruments, Marvell, and the semiconductor companies Maxim and Freescale, all of whom worked on the electronic components of the Pearl screen. In particular, Epson played a key role, providing the color filters’ controller chip.

Underneath, it’s still the same white, black and grayscale electrophoretic pigments; it’s only when filtered through the RGB overlay that the image appears in color. To reach for an historical analogy, it’s not totally dissimilar from film’s Technicolor process, which shot in black-and-white film strips through color filters, then reverse-processed.

Because the underlying technology is identical, Triton’s contrast, energy usage, viewing angle are all essentially the same as the Pearl. The image update or refresh rate for monochrome is the same (240 ms), but color animation can take up to about one full second.

Unlike a LCD display, though, pictures on the Triton don’t need to update the entire screen: a moving figure in the foreground might be refreshed while the background remains identical — just like traditional cel animation.

E-readers are the high-profile example of E Ink in action, but the company’s screens are also used in watches, battery indicators, printers, calculators, signage, end-cap displays in stores and a wide range of industrial displays. All of these displays, Schwartz said, could benefit from the introduction of color. And in the vast majority of these use cases, LCD or other full-video displays simply aren’t feasible, either for reasons of power conservation or the inherently limited nature of what’s being shown.

While Hanvon is the first company bringing the Triton screen to market, Schwartz said E Ink had other customers working with Triton screen technology who haven’t yet made announcements about their forthcoming products. Otherwise, he couldn’t comment on future devices or availability.

The most exciting innovations, Schwartz said, were the experimentations with user interface in conjunction with E Ink screens, whether using multitouch, stylus, or other NUI. E Ink, he said, works to optimize each of its displays for every one of these interfaces, which has required the company to be increasingly flexible in how it thinks about its products.

In the meantime, E Ink’s goal is to continue to improve their existing product line: get higher contrast, brighter colors, faster screen refreshes, and continue to find better ways to optimize their screens for every interface, use case and use environment.

E Ink Triton Imaging Film [E Ink]

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Netflix PS3 App Ditches Disc, Adds HD and Surround Sound - Wired News

PlayStation 3 just leapfrogged Xbox 360 and snagged the best Netflix experience on a videogame console yet.

The new Netflix application for PS3, rolling out for download Monday, will enable Netflix subscribers with PS3s to watch movies and TV without a disc. Some titles will even stream in 1080i HD and 5.1 digital surround sound.

Netflix’s “Watch Instantly” streaming-video feature has been available for PS3 since late last year, but it required a Blu-ray disc in order to access the service. Now, by running Watch Instantly as a native PS3 app on the console, users can ditch the disc altogether. Netflix also has a new user interface, optimized for the PS3 controller’s analog joysticks.

In the new UI, search especially seems smartly designed for the PS3 controller, using an alphabetical grid and intelligent auto-complete to minimize the pain of text entry, as seen in this still:

Still from Sony PS3 promotional video.

I even like the way the controller buttons control common text-entry commands in context — like Space, Delete and Enter. There are keyboards available for PS3, but being able to use the controller well is a real asset.

Netflix has not only continued to bring its streaming service to seemingly every device with a screen, but to make that service better. Still, among consoles, the announced PS3 app stands out: Xbox users don’t have 1080i or surround sound, and Wii users have only now added search to their service, which still requires an “Instant Streaming” disc.

Adding media services has become part of the continued rivalry between Xbox and PS3, along with new motion-capture interaction devices like PlayStation’s Move controller and Xbox’s Kinect.

Besides videogame consoles, Netflix can now stream to personal computers on Windows and Mac; TiVo, HD, Roku, Logitech and Apple TV boxes; Windows Phone 7 and all iOS devices; and a wide array of net-connected TVs and Blu-Ray players, including those using Google TV.

Roku’s players, which began as Netflix-only boxes, will soon be available in retail stores through a partnership with Netgear.

Netflix on PS3: Disc-free Next Week [Playstation Blog]

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How and Why You'd Use Windows Phone 7 With A Mac - Wired News

One of the major advantages of Windows Phone 7 is its tight integration with Microsoft’s other devices and software. In a terse statement, Microsoft let Mac users know they can eventually expect a light version: “Later in 2010 Microsoft will make a public beta available of a tool that allows Windows Phone 7 to sync select content with Mac computers.”

The “tool” will probably be a version of the Zune desktop software, if a Microsoft UK marketing head early tweet is any indication: “ANNOUNCEMENT: I’m glad to confirm that Mac users would be able to use Zune on their Macs to sync with #WP7… More details soon.”

This makes sense for Microsoft: not only have they always made software for Macs (notably Office), you’d never want to put too many limitations on what PCs you can use with a post-PC handheld. Imagine if Apple had kept the iPod and iTunes Mac-only. Or if the Zune had never included support for Macs. (Wait, that second one actually happened.)

But why would a Mac user want to use a WP7 phone — particularly when the iPhone works so well with a Mac? Basically, it’s the same reason a Mac user might pick an Android phone over an iPhone. Either you like the physical phone better, or (more often) you’re more tied into Google’s or Microsoft’s software than you are to Apple’s.

Here are some scenarios where that might be true.

You’re a heavy user of Microsoft Office. Windows Phone 7 has the full Office suite built-in. iPhone’s Office offerings aren’t as strong; it’s a little better for iPad, but not that much.

Windows Office 2011 for Mac is coming at the end of the month, and it’s the best, most-interoperable Office suite available for the Mac. It’s also finally bringing a real Outlook application, not the baby Outlook they called Entourage. (Entourage the application provided the exact opposite experience of the TV show Entourage.) By default, iPhone on the Mac syncs with iCal, Address Book, and Mail; a phone that synced with Outlook could be a huge upgrade.

This is where the lack of OneNote on Office 2011 for Mac really bothers me; it’s WP7’s Office showpiece, very smartly implemented on the handset and nearly completely useless to Office users on Macs.

You’re also a heavy user of Windows Live. Android users love their experience with Gmail, Google Docs, etc. Some of my friends who don’t love Windows love Windows Live, preferring it over Google’s cloud apps and Apple’s MobileMe. Office 2011 and WP7 are both extremely well-integrated with Windows Live. iPhone and Android aren’t. You’re a gamer who loves Xbox 360 and Xbox Live. Apple may have a set-top box, but it doesn’t play games. The iPhone offers a lot of good casual games for handheld, but WP7 will too. If you have a Google TV, it’ll be better with your Android phone; if you have an Xbox 360, it’ll be better with a WP7 phone.

The whole industry is moving towards greater interoperability between computers, handhelds and set-top boxes. The Xbox – WP7 combo will be one of the most versatile handheld-to-boxtop media combinations available. Add a Mac to the mix, rig it to stream content to your Xbox and that’s a pretty powerful power trio. Particularly if you don’t care about buying movies and renting TV shows through iTunes, which is the only advantage an Apple TV would offer.

In the tech world, Mac users are stereotyped as Apple evangelists and/or fanboys, people who’ve bought into the ecosystem from top to bottom. But think about your average student with a MacBook, or your parents you convinced to buy an iMac. They are usually agnostic about this stuff.

Most Mac users probably don’t think long and hard about Apple’s long-term peripheral strategy, or whether Android’s lack of hardware standards will cause them problems down the line. They use Office on their Macs, use PCs at work, play Xbox in their living room and want to buy the phone they like on the carrier they use for a price they can afford. They bought their Macs for the same reason.

The last piece of this puzzle is really how well Windows Phone 7 and the Mac will be able to talk to each other. History bears this out: for a long time, Blackberry desktop software on PC was fantastic, but the version for the Mac wasn’t anywhere close. In my case, it eventually drove me away from the Blackberry and towards the iPhone.

If Microsoft decides that it doesn’t really need to give Mac users anything more than the bare minimum, or that they can capture more value by trying to pull WP7 buyers to the PC platform, then it won’t work. They’ll keep their current customers and add value within their existing ecosystem.

But if Microsoft begins to see their world as one that doesn’t have to be centered around the PC, where they can make great software and compelling experiences for all platforms, and shift more of their institutional weight towards the cloud and the living room, then even Mac users might have to take a long hard look at those new phones.

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Microsoft Marshals Dealmakers, Lawyers to Take On Android - Wired News

As it gets ready to unveil its own operating system next, Microsoft is taking careful aim at its closest competitor: Android.

Through patent licensing deals and lawsuits, the Redmond-based computer giant is trying to cover all its bases, aiming for a situation where it wins whether a customer chooses a Windows phone or an Android one.

But it’s too soon to tell whether the strategy will pay off.

On Monday, Microsoft CEO Steve Ballmer said he looks forward to collecting revenue from Android handset makers, including HTC, which has a licensing agreement with Microsoft.

For handset makers that don’t show HTC’s willingness to do it the easy way, Microsoft can do it the hard way, too: Microsoft sued Motorola this week, alleging patent infringement around Motorola’s Android-based smartphones. The suit charges Motorola with allegedly violating patents related to synchronizing email, calendars, contacts, scheduling meetings and notifying applications of changes in signal strength and battery power.

“One reason that Microsoft is going after Motorola is that if patent infringement is found it is easier to establish damages against a company that is selling a product than Google, which is giving the OS away for free,” says Robert Sloss, intellectual property partner at Farella Braun + Martel.

In April, Microsoft announced that it has inked a patent licensing deal with HTC that would allow HTC to continue using the Google-designed Android operating system in its phones while mitigating its risk should Microsoft aim any patent lawsuits at the OS.

Microsoft and HTC did not disclose specific details of the agreement, though the two companies have said HTC will pay Microsoft an undisclosed sum for the patent rights.

Patent battles among technology companies are routine. Oracle has filed a lawsuit against Google over the use of Java in Android, a claim that Google has vigorously disputed. Last year, Nokia sued Apple alleging patent infringement by Apple in connection with the iPhone. Meanwhile, Apple initiated a lawsuit against HTC over alleged infringement on iPhone related patents. In other words, its business as usual.

With the smartphone business becoming extremely competitive, the stakes are higher than ever.

In just two years, the Google-designed Android OS has become a major force in the mobile world. Android, which made its debut in 2008 on a HTC manufactured phone, has now been adopted by almost every device maker including Motorola, Samsung and LG. Android is now the most popular operating system among people who bought a smartphone in the past six months, according to August data from The Nielsen Company. BlackBerry and Apple iOS are in a statistical dead heat for the second place.

With the upcoming Windows Phone 7 OS, Microsoft hopes to attract consumers. But until then, it is trying another strategy.

“The Microsoft innovations at issue in this case help make smartphones ’smart,’ Horacio Gutierrez, deputy general counsel at Microsoft, wrote on the company blog.

Microsoft’s patents relate to features such as the ability to send and receive email, manage calendars and contacts. Microsoft claims it has also patented technologies that manage signal strength, battery power and memory in the device.

“The crux of the argument is that Microsoft is saying Android OS uses technology that has already been part of Microsoft software,” says Sloss.

Although the lawsuit has been filed, it is difficult to know right away how valid Microsoft’s claims are, says Sloss. Both Microsoft and Motorola are likely to go through an extensive process of discovery, which involves presenting documents to support their claims and they are likely to keep it under wraps.

“A lot of it probably won’t be public,” says Sloss. “It is standard to enter into protective order because the core of the patents and the products will be highly confidential.”

There is always the possibility that the two companies settle out of court, with Motorola going down the same road as HTC. In that case, Microsoft could gain “hundreds of millions of dollars” in royalties and further strengthen its patent claims.

“Damages calculations are very complex,” says Sloss. “There’s nothing in Microsoft’s complaint that says exactly how much it is looking for.

But if Microsoft and Motorola choose to settle, it is likely that Motorola may wind up paying a license fee for each Android handset it sells, similar to what HTC is doing.

For Microsoft that may not translate into rich profits but it will certainly add up to sweet revenge.

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Photo: Motorola Backflip (Jon Snyder/Wired.com)

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