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Don’t Blame The IQ, Blame The Carrier

Posted: 02 Dec 2011 07:20 PM PST

eyevo

You couldn’t swing a cat this week without hitting a story about Carrier IQ, which (if you have somehow avoided this information) is a bit of software installed on millions of phones that has access to a huge amount of user data. As developers hinted for months and eventually proved on camera, the software is aware of SMS content, secure web traffic, contacts, key presses, and more.

Naturally there has been an outcry. Who are these people? What phones is the software on? How do you remove it? What can’t it do?

The surprising thing is that the ire has been directed at Carrier IQ themselves. Why? If someone runs you over in their car, you don’t write a stern letter to Ford. Carrier IQ made and sold an invasive piece of software, certainly. But they didn’t install it on your phone. Sprint did.

No doubt that part of the problem is simply yet to be addressed, but I have to say I genuinely sympathize with Carrier IQ, a company that sells a legitimate and potentially useful product, and is now facing the rage of the entire internet, and what’s worse, Al Franken.

Who wrote the contracts the users signed? The carriers. Who handled the phones? The carriers. Who added bloatware and special services and skins and branding to the OS? The carriers, the carriers, the carriers. And who called Carrier IQ in the first place and said “Hi, we’d like a surreptitious method of peeking at certain user habits”? That’s right, the carriers.

Who should have informed their customers of this tracking software and its capabilities, regardless of what information they intended to collect, or what was turned on or off by default? The carriers. Who would own the information scraped from the millions of phones being monitored? The carriers. And who should be the object of the internet’s rage right now? You’re damn right it’s the carriers.

What makes the whole thing even worse is that it wasn’t just some marketing deal Sprint had where they would collect stats from, say, Samsung phones running Android. T-Mobile and AT&T have used the software as well, and it’s not much of a leap of faith to suggest that Verizon and smaller carriers have something similar in place. Hell, Apple had a (mostly harmless) version of it, though understandably RIM was careful to note it avoided the software entirely.

If it was a misguided scheme by an isolated individual company, that would make it stupid. But it’s not — it’s an industry-wide collaboration that shows how incredibly little the carriers value their customers’ needs and privacy. If it was as integral to maintaining quality service as they seem to think it is, you’d think at least one of them might have mentioned it sometime in the last couple years. Do you remember anything like that?

There’s not a lot we can do, but if Senator Franken and the FTC and others can roll this ball of deceit uphill (as they indeed are attempting), they might be able to force carriers into having some basic standards for privacy and disclosure. It’ll take time, but the fact is that the damage is already done and these jokers have been caught in the act. Carrier IQ isn’t blameless, of course, and their handling of the situation has been bad, but they’re just the dealer. Sprint and the rest are the ones behind the wheel.

Are you mad? You should be. Go tell them so.

The Kindle Fire Is On Fire; Amazon Expected To Ship 3.9 Million This Quarter

Posted: 02 Dec 2011 03:29 PM PST

Tablet pie chart

The Kindle Fire looks like a bona fide hit right out of the gate. New estimates from IHS iSuppli have Amazon shipping 3.9 million Kindle Fires this quarter, which would make it the No. 2 tablet after the iPad 2 (with an estimated 18.6 million shipments). The Kindle Fire will become the No. 1 Android tablet by a wide margin (the Samsung Galaxy Tab is the next biggest, with an estimated 1.4 million shipments).

To put this 3.9 million number in context, just remember that the very first quarter Apple sold the iPad back in the September quarter of 2010, it sold 3.3 million. So the Kindle Fire sold more in its first quarter than the iPad did in its first quarter on the market. Of course, Apple sold 7.3 million iPads the second quarter it was on the market, which was the 2010 holiday quarter.

However you slice it, this is a good start for the Kindle Fire. It looks like Jeff Bezos was on the money when he predicted at the launch event Amazon would sell “millions” of Kindle Fires.

I can see why people are flocking to the Kindle Fire. Personally, I am a big fan. It’s a great stocking stuffer that will actually fit in a stocking. It’s smaller size is an advantage for certain applications such as ebooks. I just took it with me on a trip to Japan instead of my iPad precisely because of its smaller footprint. The price is right too, at $200.

Will the Kindle Fire ever outsell the iPad? Nobody is predicting that just yet, but it is certainly in the realm of possibility.

Now In 70 U.S. & Canadian Markets, Dealfind Goes Mobile

Posted: 02 Dec 2011 02:01 PM PST

Dealfind

Toronto-based deal provider Dealfind, which recently became one of the first half-dozen or so partners to be featured within Google Offers, is now available as its own standalone mobile application. The new app works on both iPhone and Android, allowing deal hunters to locate, purchase and store offers on their mobile phone.

There’s nothing all that remarkable about the app itself – you pick your city, find a deal you like and tap “Buy.” The app will also keep a record of your vouchers, whether new, used, pending or “gifted” (that is, given to someone else). My one quibble with the app’s user interface is that, upon first launch, it didn’t show all the supported cities in the main list until you selected your country – it defaulted to Canada. But instead of walking you through the sign-up process by asking for access to your location or having you type your city’s name in a form, you had to hit the “country” button to access the U.S. list. It’s a minor complaint, but there you go.

Dealfind was founded in 2009, and is now operating in 70 markets across the U.S. and Canada. In the past, the company has been referred to as the “Canadian Groupon,” or “Canada’s Groupon,” but that label no longer seems accurate. In November, Dealfind added 18 more U.S. markets to its lineup, bringing the total to 41 U.S. cities versus the 28 it had in Canada. Seems more like a “North American” Groupon now, eh?

Perhaps. But not all the supported markets have the same quality of deals. For example, in the far-off-land known as Tampa, Florida, today’s deal was on a toy shark from an online toy store. Yawn. Your mileage may vary, of course.

The company says that it has sold 1.6 million vouchers totaling $390 million since launch and sees website traffic between 12 and 16 million visitors per month. Which just goes to show, if you call it a deal, some people will buy almost anything. Even a toy shark. In general, however, the service is focused on local deals, like restaurants, spas and salons.

Dealfind says it will add travel, national, everyday deals and other verticals to the service by the end of the year.

Video: iPhone Games In Real Life

Posted: 02 Dec 2011 12:29 PM PST

Flight

It’s not rare for me to post videos on Fridays, but I generally preface them with some big explanation as to why I’ve posted it on TechCrunch. This week’s explanation is simple: because it’s friggin’ awesome.

It’s got Angry Birds! It’s got Fruit Ninja! It’s got Flight Control (plus super cute Flight Control girl!) It’s got stupidly catchy indie music! Seriously, what more could you want? A puppy? Because it has that too.

Good job, guys. I still don’t have any idea what the iPhone games have to do with the song, but your creativity/problem solving (not to mention the number of pretty people you found to help with this) impressed the hell out of us.

[Thanks Paul!]

Yoshikazu Tanaka On How Mobile Social Gaming Will Make GREE The Next Nintendo (TCTV)

Posted: 02 Dec 2011 11:19 AM PST

Tanaka

One of the fastest growing companies in Japan right now is GREE, a publicly-traded mobile social gaming network with 900 employees and on track to generate $1.7 billion in annual revenues. I interviewed GREE founder and CEO Yoshikazu Tanaka through an interpreter earlier this week at the TechCrunch Tokyo conference. Here are two videos from that interview. (You can watch a third video in my post today comparing GREE’s financials to Zynga’s).

In the video above, Tanaka talks about why he bought OpenFeint in the U.S. last April and how he wants to follow Nintendo in getting to 80 percent of revenues from outside Japan. But more than just follow Nintendo, he wants to displace it. Smartphones are replacing traditional gaming hardware and the games are different in that social features (playing with and against other people over the network) can trump graphics. “Our goal is to make our brand just as successful, if not better, than Nintendo,” says Tanaka.

Tanaka tells me how he started GREE o a server in his apartment in 2004 in the longer video below. Originally, it was a PC-based social network (the Friendster of Japan), but he shifted to a mobile social network for games a few years later. Now 99 percent of GREE’s users are mobile. “We believe the PC will get erased at some point,” he says matter-of-factly.

As Christmas Nears, The iPhone 4S Is Still In Short Supply

Posted: 02 Dec 2011 11:10 AM PST

iphone-christmas

Just hear those sleigh bells
ringing and jing ting tingaling too
Come on its lovely weather for
an iPhone purchase for you!

Christmas is sneaking up this year and you better be prepared. The iPhone 4S is still in short supply at all three of the US’ wireless carriers. Verizon is suffering the worst with immediate shipping only available on two variations. Your best bet, that is if you need an iPhone as soon as possible, is ironically at the iPhone’s original carrier: AT&T. Good ol’ reliable seemingly has the best on-hand inventory of Apple’s latest smartphone.

The iPhone 4S is incredibly popular at Verizon. It’s the most sought after product for sure, said a retail assistant sales manager I spoke to this afternoon. And the carriers estimated shipping date for the iPhone 4S backs up his statement. Only the black version of the 16GB and 64GB models are available for two-day shipping. There is a relatively substantial delay for the rest. The 64GB white is slated for shipping next Friday while the 16GB white isn’t until the following Monday, December 12th. The 32GB black ships on December 16th while the white flavor isn’t available until the Friday before Christmas, December 23rd.

Sprint and AT&T are faring a bit better with on-hand inventory than Verizon. Per the Sprint website, both the 16GB white and black model are delayed but only by a week. Both versions of the 32GB and 64GB are apparently available for immediate shipping. Then AT&T buyers only need to wait for the 64GB which ships in seven to 14 days.

Oh, and you can forget about circumventing the delays by going directly to Apple. Apple.com shows more of the same. In fact all iPhone 4S incarnations are backordered 1-2 weeks.

The delay’s might not be indicative of a sales leader. AT&T did manage to activate more 2.7 million iPhones to Verizon’s 2.0 million. However, AT&T also offered the lower-priced iPhone 3GS where Verizon only had the iPhone 4.

Apple announced the iPhone 4S in early October and the handset immediately broke records and faced delays. Just days after pre-orders started Verizon and Sprint put up sold-out signs where AT&T simply pushed ship dates to 3-4 weeks. Apple previously stated that the iPhone 4S is the company’s fastest selling iPhone and the delays partly show the demand hasn’t slowed down.

With Christmas quickly approaching, don’t expect the estimated shipping dates to decrease. If you’re planning on gifting an iPhone 4S this year, get your carrier of choice on the horn to reserve yours as soon as possible. Or you could make a papercraft iPhone 4S and place that under the tree. Your call.

Carrier IQ, Samsung, And HTC All Facing Class Action Lawsuits

Posted: 02 Dec 2011 08:50 AM PST

ciqhtcsamsung

To say that Carrier IQ has been going through a lot is a bit of an understatement, and it looks like things are only getting worse. PaidContent reports that two class action lawsuits — one from Missouri and the other from Illinois — have been filed against the Mountain View-based company for supposedly violating the Federal Wiretap Act.

They’re not the only ones either: handset manufacturers HTC and Samsung have also been named as defendants in one lawsuit each.

For those that have missed the drama until now, Carrier IQ is a “mobile intelligence” firm that provides logging software for carriers and devices OEMs for use in their devices. Carrier IQ claims that they deliver information “on the performance of mobile devices and networks to help the Operators provide optimal service efficiency,” but Android security researcher Trevor Eckhart discovered that CarrierIQ was capable of tracking data that’s more fine-grained than what would be expected for simple diagnostic feedback.

The lawsuits allege that the defendants “intercepted, recorded and collected information concerning the substance, purport, or meaning of the electronic communications transmitted without the authorization of the parties to those communications.” Carrier IQ (obviously) doesn’t agree with this statement; they issued an updated statement last night that states the software “does not record, store or transmit the contents of SMS messages, email, photographs, audio or video.”

And what is it that the plaintiffs of these class action suits want? Cold hard cash for all users who have Carrier IQ’s logging software installed on their devices. The text of the Missouri suits filing calls for Carrier IQ and HTC to pay statutory and punitive damages that would reach into the millions.

Meanwhile, Carrier IQ continues to deny that they have violated any laws — according to the company’s updated media release, “Carrier IQ is aware of various commentators alleging Carrier IQ has violated wiretap laws and we vigorously disagree with these assertions.”

To wit, one of those commentators was Senator Al Franken (D-MN), who yesterday called on Carrier IQ to answer a number of questions regarding what they are and aren’t able to monitor on users’ devices. It seems like Carrier IQ’s claims of being beholden to the whims of the carriers has struck a chord with the senator, as he also issued the same set of questions to AT&T, Sprint, HTC, and Samsung. Senator Franken has given each company in question until December 14 to issue a response, and we’re looking forward to seeing what they come up with.

Strangely, none of the carriers involved were named in either of the lawsuits, though I expect that will soon change. If you want to find out if you your device has Carrier IQ installed on it, check out our article on how to find it and what to do with it.

How Zynga Stacks Up To Japan’s Social Gaming Giant, GREE (Hint: It Is Less Profitable)

Posted: 02 Dec 2011 08:25 AM PST

social game profits

With Zynga launching its IPO road show today, all eyes are on the social gaming goliath Mark Pincus built on the Web. But the future of social gaming, as with so many things these days, is mobile, where Zynga admits (in its S-1) that it has “limited experience.” All you have to do, however, is look to Japan’s social mobile gaming companies like GREE and DeNA to see how much more lucrative social gaming could be once it goes mobile. I was just in Japan this week for a TechCrunch Tokyo conference, where I interviewed GREE founder and CEO Yoshikazu Tanaka (see video clips below). GREE is publicly traded in Japan with a market cap of about $7.6 billion, so we can compare its financials to Zynga.

Zynga has many more users worldwide than Gree (227 million monthly actives for Zynga versus about 27 million for GREE), but GREE’s economics are much more favorable.  GREE’s revenues are actually higher than Zynga’s (about $400 million in the September quarter versus $300 million for Zynga) and it is much more profitable. The slides in this post, which I obtained from Gumi,  a hot Japanese mobile gaming startup, illustrate the stark difference.  The slide below compares quarterly sales between Zynga, GREE, and DeNa (it is missing the last two quarters for Zynga, which would keep going up along the same trajectory at $279 million for June and $307 million for September). GREE expects annual sales to hit $1.7 billion this fiscal year.

The slide at the top of this post, though, is the real eye-opener. It shows how much more profitable mobile social gaming is in Japan than Zynga’s predominantly Web-based social gaming.  Again, the slide misses the last two quarters for Zynga, when profits were $1.4 million and $12.5 million, respectively.  Both GREE and DeNa are smoking Zynga on profits, with about $200 million each in the last quarter.

How can this be when Zynga has so many more users than either of the Japanese companies? Only 6.7 million of those 227 million monthly active  users (54 million daily active) are paying customers. For mobile social games, at least in Japan, it is much easier to extract revenue from users (mostly through the sale of virtual goods, leveling up, etc). The monthly average revenue per user for both GREE and DeNa is between $4 and $5, which is more than three times as high as Zynga’s (see slide below).  Those are averages across all users.  The average among paying users is about $50 in Japan, with some addicted users paying twice that much.

GREE shifted from PC games to mobile four years ago. Zynga has a few popular mobile games already, and it is a major growth area for the company.  But can they successfully make the shift? “They have big success already,” notes Gumi CEO Hironao Kunimitsu, “so they think their way is perfect. As a social gaming company, Zynga is most successful. Most of their gaming is for the PC.  But mobile is the future of the Internet.”

The caveat to all of these numbers is that so far they are true only for the Japanese market, which may or may not foreshadow what will happen in the rest of the world. If they are a precursor of things to come, then Zynga’s future profits could very well hinge on the extent to which it can bring its social games to mobile. Bulls might want to buy Zynga at the IPO.  Bears might want to invest in GREE.

TextOnly App Only Gives You The Good Part Of Most Websites

Posted: 02 Dec 2011 08:04 AM PST

nytimes-screenshot4

Textonly is, on its surface, a gussied up RSS reader. However, unlike similar “read later” and newsfeed services, this app allows you to read sites in their text-only form, reducing the time it takes to load and view nearly everything. While it won’t do you much good on shopping and media sites, it could help in reading long, image heavy web pages on slow connections.

The service is now available as an Android app that allows you to read only the text of nearly any website. You can try it here for free.

Like ShortMail, this service doesn’t make much sense unless, well, it does. There are plenty of folks out there without high speed wireless data and to strip a site down to its bare essentials is invaluable.

It’s a noble goal and while I’m not impressed with the implementation, the idea seems solid.

Microsoft Goes After Dads In New WinPho Commercial

Posted: 02 Dec 2011 06:05 AM PST

Kids send the strangest things over 3G networks! In this new commercial for Windows Phone 7, poor old pops is doing the shopping while consulting a list that has been helpfully shared via One Note. Suddenly, cola appears on this list alongside a pound of candy and some huge suckers. Who is hijacking pops’ reverie with their crude hacking? I’ll let you watch to find out. It’s hi-larious!

But what does this commercial mean?

Microsoft has a hard row to hoe, but it’s ads like this that highlight the technology quite admirably. Because the control both the desktop and the phone OS, commercials showing the functionality versus talking up specs make much more sense and are, in turn, much more compelling (remember that Verizon commercial where the geek goes into the store and the salesperson rattles off an Android tablets’ technical specifications? How funny was that?)

There is a certain subset of phone buyer who doesn’t want to go, as it were, mainstream. WinPho is nearly perfect in that respect, dropping stealthily in between Android and iOS like a hale and well-met friend and eating both sides’ market share. While you probably won’t be performing many jackanapes with your Windows 7-powered kids this hardware iteration, I could see a day when Windows 8 and WinPho 7 become the standard in business and, increasingly, at home. Here’s hoping.

via AppBoy