Category: Tech news

This year’s CES may have been about startups more than ever before, but over the last few years, the car industry has also increased its presence at the show. In previous years, we heard a lot about the connected car, but until now, those cars remained virtually closed to developers. In one fell swoop, that changed this year, as Ford and GM announced concrete programs with SDKs and APIs that are either already open for developers or will be available within the next few months.

The approach the two companies are taking is very different: Ford is betting on drivers bringing their own smartphones into the car and having apps run on the phone, while GM is actually setting up a framework for running apps right in the car’s built-in infotainment system. Both of those systems have their merits: Ford’s AppLink system is easy to integrate into existing apps and drivers don’t have to pay for yet another data plan. GM’s framework, on the other hand, is more deeply integrated with the car and doesn’t necessitate a smartphone.

For the car industry, betting on the developer community makes a lot of sense. Because of the long lead times between designing cars and launching them, it’s virtually impossible for the manufacturers to keep up with the fast pace that we’re used to in the world of mobile development. That’s where Ford’s system may also be an advantage. We tend to get new smartphones much more often than we buy new cars, after all, and while those will only get more powerful, a system that directly tied to the car – like GMs – will look massively underpowered in four years and the average car is now on the road is now almost 11 years old.

If the early success of these programs is any indication, developers are clearly excited about these new opportunities. Ford tells us that more than 1,000 developers have already signed up for access to its SDK since it was announced earlier this week and that it is seeing high and sustained traffic to its developer site.

What will be interesting to see now is what apps developers come up with in this new environment. While these programs were still in their private closed betas, the focus was mostly on offering radio alternatives through services like Pandora, Rhapsody and iHeartRadio. There are also some apps available already that automatically read newspaper and magazine articles to you. Other obvious choices are location-based and location-sharing apps like Glympse and turn-by-turn navigation apps like Scout. But the most exciting applications, of course, will be the ones that neither the car industry nor us pundits have thought about yet.

After news about Internet activist Aaron Swartz’s suicide on Friday started to spread across the Internet, many at least partly blamed MIT for the 26-year-old hacktivist’s death. This included his own family, which openly criticized the way MIT handled Swartz’s case after the school detected his attempts to download millions of articles from JSTOR in 2011. MIT president L. Rafael Reif today announced that he has asked Professor Hal Abelson, “to lead a thorough analysis of MIT’s involvement from the time that we first perceived unusual activity on our network in fall 2010 up to the present.”

Abelson is the Class of 1922 Professor of Electrical Engineering and Computer Science at MIT and an IEEE Fellow. He teaches, among other things, a course on the “Ethics and Law on the Electronic Frontier” at MIT. He is also a founding director of Creative Commons and Public Knowledge, as well as the Free Software Foundation.

In his letter, MIT president Reif notes that he wants Abelson’s report to summarize the options MIT had when it learned of the case and “the decisions MIT made, in order to understand and to learn from the actions MIT took.”

Here is the full letter:

To the members of the MIT community:

Yesterday we received the shocking and terrible news that on Friday in New York, Aaron Swartz, a gifted young man well known and admired by many in the MIT community, took his own life. With this tragedy, his family and his friends suffered an inexpressible loss, and we offer our most profound condolences. Even for those of us who did not know Aaron, the trail of his brief life shines with his brilliant creativity and idealism.

Although Aaron had no formal affiliation with MIT, I am writing to you now because he was beloved by many members of our community and because MIT played a role in the legal struggles that began for him in 2011.

I want to express very clearly that I and all of us at MIT are extremely saddened by the death of this promising young man who touched the lives of so many. It pains me to think that MIT played any role in a series of events that have ended in tragedy.

I will not attempt to summarize here the complex events of the past two years. Now is a time for everyone involved to reflect on their actions, and that includes all of us at MIT. I have asked Professor Hal Abelson to lead a thorough analysis of MIT’s involvement from the time that we first perceived unusual activity on our network in fall 2010 up to the present. I have asked that this analysis describe the options MIT had and the decisions MIT made, in order to understand and to learn from the actions MIT took. I will share the report with the MIT community when I receive it.

I hope we will all reach out to those members of our community we know who may have been affected by Aaron’s death. As always, MIT Medical is available to provide expert counseling, but there is no substitute for personal understanding and support.

With sorrow and deep sympathy,

L. Rafael Reif

JSTOR, the service Swartz was accused of illegally downloading articles from, published its own statement over the weekend. In it, JSTOR says that “the case is one that we ourselves had regretted being drawn into from the outset, since JSTOR’s mission is to foster widespread access to the world’s body of scholarly knowledge.” JSTOR also notes that “Aaron returned the data he had in his possession and JSTOR settled any civil claims we might have had against him in June 2011.”

A fascinating project is making the rounds this weekend that could change the way we think of 3D printers. The Filabot is a robot that can turn scrap plastic into 3D printer filament, thereby allowing an almost endless supply of material for prototyping and manufacturing.

While it’s probably not that exciting for non-hobbyists, the Filabot is essentially a way to make the raw materials used in products like Makerbot out of stuff you’d throw away. The creator, Tyler McNaney, ran a Kickstarter campaign last year and he is slowly but surely bringing the devices to market this year.

Obviously you’re going to run into problems with such a small system – the impurities in the plastic and bubbles being of primary concern – but at about $50 a spool, PVC isn’t cheap and if you’re printing quite a bit of prototype hardware there’s room for a bit of error. Kickstarter backers paid $350 for their Filabots and a “public” price isn’t yet set.

While there are problems with any recycling technology, the Filabot is a fascinating study at the potential for in-home 3D printing. Imagine, for example, printing out repair parts or toys using stuff that you would normally recycle? It’s a wonderful example of technology finally digging us – imperceptibly slowly, I’ll grant you – out of the plastic waste problem.

The Playsurface, a spin-off project from Templeman Automation that aims to provide a low-cost alternative to interactive touch table devices like Microsoft’s PixelSense (formerly known as the surface), was at CES showing off their functioning units, which the company will be shipping out to 40 or so Kickstarter backers this month. The Playsurface made headlines when it launched on Kickstarter back in May, reaching almost double its $40,000 funding goal.

Playsurface’s goal, unlike a lot of the large-sized shared touchscreen surfaces we’ve seen, is to be as affordable, open, and hackable as possible, with the aim of being a legitimate option for use in education even in situations where budget might otherwise prohibit the use of such technologies. Templeman Automation teamed up with Tufts University to help boost its education mission, and target applications for schools and students more effectively. To help with that goal, they’re looking into just what kind of “smart tangible” accessories  like the one that replicates an X-ray/microscope device seen in the video, would be most useful to K-12 educators. These accessories could be what turns the Playsurface from a great tech demo into a genuinely useful and widely used way for schools all around the world to replace not just computing devices, but a variety of expensive and hard-to-source teaching objects that might not otherwise be an option.

Just under $3,000, the goal is to get it under $1,000 and TA believes that’s entirely possible, thanks to improvements in manufacturing efficiencies and materials. The Playsurface is available for general pre-order now, with shipments to retail customers ready to begin after the first devices roll out to the company’s Kickstarter supporters.

Take a look at that “reach friends wherever they are now” image to the left. What’s missing between the iPhone and the laptop? Ding ding ding! You’re right! A tablet.

Okay, I’m sure it was obvious. In fact, many of you may have already assumed that Facebook has a version of its Messenger for iPad. Well it doesn’t, and seeing as though it took the company quite awhile to launch Facebook for iPad, the lag comes as no surprise.

This graphic might have to change next Tuesday, when Facebook is holding an event for press to “come and see what [they’re] building.” While my colleagues are hearing that this “what [they’re] building” is a “big deal” – as in a “phone” or a slew of ads and other improvements – I’m hearing that one of the products that could be announced is Messenger for iPad.

Specifically I’m hearing that Messenger for iPad, replete with all the Messenger features we’ve come to love like emoticons, photosharing, read receipts, location tagging, group messaging, and the new voice-recorded messaging feature, is ready for the public eye. And basically, it’s what exists on the iPad but in a bigger format.

According to one source, the app is “totally” ready to launch on Tuesday, and if the event is indeed a series of mobile product announcements, it could “totally” fit in conceptually. Other points that back this up: We’ve heard that Messenger head Peter Deng was “cranking” a couple of days ago and Facebook partner Microsoft is killing its Messenger service exactly a month after whatever it is is being announced.

A fully fleshed-out Messenger for iPad, eventually including video chat, VoIP, and voice messages, could be another Facebook attempt at killing your home phone. The combination of cheap VoIP with Facebook’s social graph and distribution network could be enough to get people to cut back on their home phone plans and save their mobile minutes/data.

And ”reaching friends wherever they are now” includes on the couch watching HBO’s “Girls” on their iPads. With voice and video, Messenger for iPad could become the way you have Sunday afternoon conversations with family or distant friends.

Other Facebook apps that need to be extended to the iPad include Instagram and Poke. It could be that Facebook is rebuilding its apps in preparation for a revamp of its core product on mobile and is starting with Messenger. In any case, Messenger for iPad is coming soon, so whether it’s Tuesday or not, get ready to be Messaging in a bigger format. Go iPad or go home.

As trends go, it’s been hard to miss this one: Smartphones are getting bigger. Much bigger. Samsung has been championing huge phones for well over a year, introducing its original 5.3-inch whopper — the Galaxy Note — in 2011, and firing out a 5.5-inch successor last year, going on to ship more than 5 million Galaxy Note IIs in the first two months. More recently CES was awash with whoppers – from Sony’s 5-incher to Huawei’s 6.1-inch beast (incidentally, screen size inflation also struck in the tablet space: witness this 20-incher). Even Apple hasn’t been able to stand firm against the ever-expanding waistlines of its rivals, adding half an inch to the iPhone 5’s pane last year, pushing it up from 3.5 to 4 inches.

But unlike many a flash-in-the-pan craze, the so-called phablet (phone-cum-tablet) phenomenon is, I would argue, here to stay — and I say this as a person with small hands who still uses a phone with a 3.5-inch screen because it’s the perfect size to fit into my palm. But this no longer feels normal, or, increasingly, entirely functional. The thing is, phones are getting bigger for a reason: what we use them for is changing. This is technology evolution in action.

Put simply, smartphones are turning into tablets. Being a slate to eye and interact with content is increasingly what phones are used for. Consider the meaning of the word tablet: a ‘flat surface for an inscription’. For inscription, read data, and the phablet phenomenon makes a lot more sense. Our fingers are at the helm of pocket computers, not pocket telephones – doing more and more digital stuff, be it shopping, social networking, browsing, gaming, messaging or streaming. (Meanwhile a quick glance at the PC market underlines that desktop dinosaurs continue to decline as mobile computing ramps up.)

The typical behaviour of a smartphone owner today involves a lot of eyeing and prodding at the screen, and a lot less holding the device blindly against an ear. But the swelling size of the smartphone is far more than an ergonomic consideration. Indeed, few people would argue larger phones with 5-plus- and even 6-plus-inch screens are generally easier to handle; they’re not – typically requiring both hands to get involved for tasks like typing. But any added awkwardness is outweighed by the benefits of having more glass to play with, which in turn increases the usefulness of the device in several ways, including:

• For reading: by allowing more text to be displayed legibly on screen without zooming
• For watching: by making video content more immersive/attractive to view
• For interacting: by enabling other content (e.g. apps, games) to become richer as more complex types of interactions can be supported — such as split-screen viewing; use of a larger range of gestures/inputs, etc.

There is an upper limit for smartphone screen size. The mini tablet category starts at around 7 inches and that — along with physical hand-span size – puts something of a natural break on phone screen inflation. But there is still plenty of room for plenty of phones to gain a few inches. And while there is obviously a healthy market for bona fide tablets, too, smartphones have a mobile connectivity advantage over tablets since they have cellular network access as a given, versus the many tablets that are Wi-Fi-only (and buying a 4G/3G tablet means taking out a second mobile contract which not everyone will be keen to do). So that’s another reason why smartphones are being used as tablets: They are both in our pockets and almost certainly online.

The reason phones are bulking up in the screen department comes down to our addiction to consuming data, coupled with the ever-increasing richness of data services. Higher-speed mobile networks — built to ferry data from the get-go — are also making it possible to do more on the go. Streaming video content and socially-gaming on the fly is only going to get slicker and more commonplace as networks get more capable and capacious (carriers willing).

And as services get smarter they’re also taking up more of our time – so we’re spending more time gazing lovingly into screens, rather than talking to people on the phone. In any case, talking feels very 1.0 by comparison in this age of chronic multitasking. In many instances there is no need to talk verbally in real-time when you can message someone in a bewildering variety of sophisticated ways (as Alexia pointed out way back in 2010, the phone call is dead). Data is not a simple conduit like voice. It delivers a whole network of services in its own right, which can be sliced and diced further as we tap in and out of our own personal pick and mix of apps and services.

Another factor to consider when thinking about smartphone screen-size is that app design increasingly appears to be favouring gestures rather than buttons  – as this Gizmodo post on design trends astutely observes. Gestures are great but a by-product of having your fingers on the screen is that your digits obscure some of the content. So the more screen there is to swipe and prod, the richer your gesture-based interaction can comfortably be. Slap a second, e-ink screen on the back of a smartphone — as YotaPhone is aiming to — and our mobile pocket rockets can even become our e-readers. Device convergence makes sense when convenience is the driver.

Sure, if you look far enough into the future of mobile devices the recognisable slab phone form probably disappears entirely – or rather morphs into something that we wear, whether it’s glasses, or even a pair of smart contact lenses. But until then we have to make do with slabs – and the bigger the slab, the more data we can comfortably cram in and mash up in richer and more interesting ways. Who knows, bendy, flexible screens might even make phablets (comfortably) pocketable in the not too distant future.

Beyond pocketable slabs, the future of smartphones looks likely to be becoming a layer sitting atop our lives, rather than being a box we break away to poke and stroke — existing most obviously as digital data augmenting and overlaying the real-world physical stuff we interact with on a day to day basis. And the biggest, most high-definition screen in the world is the one we see through our eyes, the one that’s all around us. Compared to that canvas, today’s phablets really are laughably tiny.

So here’s to a future of expanding horizons. But before smartphones can disappear entirely, expect them to get bigger and harder to ignore. So is that a phablet in your pocket, or are you just pleased to see me?

Contrary to the oft-repeated marketing slogan, sometimes, what happens in Vegas is videotaped for posterity and posted to the Internet for all to see. I’m talking of course about this latest edition of CrunchWeek, the weekly TechCrunch TV show wherein a few of us writers discuss the most interesting stories from the past seven days in tech.

This past week the TechCrunch TV crew was in Las Vegas for the Consumer Electronics Show, so this is a special Sin City version of CrunchWeek.

Our usual host Leena Rao sat out CES this year to help down the fort back in San Francisco, so Chris Velazco, Ryan Lawler, and I took to the TechCrunch stage at CES to discuss the latest rumor of an impending low-cost Apple iPhone, the invitation from Facebook to a big mysterious press event this upcoming week, and how startups rose above those awkward big-company keynotes to really steal the show at this year’s CES.

Salesforce.com CEO Marc Benioff is a charismatic guy for someone who leads a company that serves the stodgy world of the enterprise. He’s so well-recognized that he was put on stage this past week in Las Vegas to give a keynote at CES, the world’s largest consumer electronics show. Let me say that again: an enterprise guy gave a keynote address at the world’s largest consumer gizmo show. That has to be a first.

But there is something nagging at me abut Benioff. For all his boasting and vision of the future, Salesforce.com’s balance sheet continues to show red. And so while I consider Salesforce.com an innovator, I get hung up on what the numbers say. In part for my own benefit, I took a look at the company’s financial data and what others are saying about Benioff. I did this because I sense a certain amount of risk Salesforce.com is taking by building up its debt. Of course, the swashbucklers will say: “But matey, this is the land of pirates and scalawags — risk is just part of the sword fight. Here, have a whiskey.”

The worst thoughts I have are of Benioff’s castle crashing down if the tide does not turn and investors sense trouble. “Walk down the plank of my billion-dollar sailboat, you foolish ninny, Larry is back to buy you up. Or do you want to face the sharks? They can smell you from here. How about a dime for what’s worth a dollar?”

Creative license is not just for wise-ass journalists, it’s also a game the powerful love to play. It’s not an entirely far-fetched scenario for a company’s stock to take a beating. That’s clear. Salesforce.com, though, has lots of supporters, including Motley Fool, which is bullish on Salesforce.com. It may look ugly but all is not what it appears to be:

SalesForce.com is a battleground stock with lots of hype and even more haters. But even the haters cannot deny that SalesForce.com has provided its investors with tremendous returns over the past few years. Investors often look at the company’s earnings and wonder how the heck this stock price keeps climbing. The answer is simple: they continue to grow cash flows from operations. On the income statement, much of their revenue gets deferred over the life of the contract, while they still incur marketing and overhead costs immediately. All of that (plus their extremely high spending on Marketing), makes for an ugly income statement. But their cash flow and rapidly growing market share are beautiful.

Yes, its revenues show the success of the SaaS model, Benioff’s drive and a cohesive corporate culture. Revenues continue to climb from about $1 billion in 2009 to $2.25 billion in 2012. But in turn, Salesforce.com net income has dropped from $80 million in January 2010 to a negative of $220 million as of October 31, 2012.

Here’s a breakout from Seeking Alpha:

Salesforce.com does not expect to have profits for the foreseeable future, sccording to a 10-Q filed in the Fall as pointed out in a Forbes post by Jeff Bailey, editor of YCharts:

We have incurred net losses in each fiscal quarter since July 31, 2011. In addition, we expect our costs to increase as a result of decisions made for our long-term benefit, such as equity awards and business combinations. If our revenue does not grow to offset these expected increased costs, we will not be able to return to profitability and we may continue to incur net losses, on a U.S. GAAP basis.

Revenues do continue to increase but you also have to consider what it is costing the company to do that. Marketing costs now represent more than 50 percent of revenues. And the company keeps hiring. As of January 31, 2012, Salesforce.com had 7,785 staff up from 5,306 a year earlier. In its investor call at the end of November, Salesforce.com said it added more than 550 new employees in the third quarter, including about 250 people from its acquisition of Buddy Media. That puts its total headcount to more than 9,300, up 34 percent from the third quarter last year.

CRM data by YCharts

In the meantime, Benioff boasted on CNBC on Wednesday that the company has made $1 billion in acquisitions. Still, it now faces an even tougher battle with Oracle, which last month acquired Eloqua, a marketing automation company. Salesforce.com now has to be on the hunt for an acquisition of its own. The problem? Salesforce.com doesn’t have the cash reserves that Oracle has. Granted, Oracle is a much more established company, with $45 billion in major acquisitions over the past several years.

Salesforce.com painted a much different picture in its third-quarter earnings call. It pointed to its growth and the historical strength of its fourth quarter. The company expects revenue in the range of $825 million to $830 million for year-over-year growth of approximately 31 percent.  For the full year, Salesforce.com is in the range of $3.04 billion to $3.05 billion. Preliminary estimates for fiscal 2014 is for revenue in the range of $3.8 billion to $3.85 billion.

So What’s Wrong Here If Anything?

Las Vegas is built on the illusion that is America. It comes of the belief that the future is paved with gold. Benioff sells that dream every day. He has a command of the language about “social” and the “cloud” that resonates  with business. He talks about connecting businesses with Facebook and Twitter. How social technologies will change every business. But its CRM business is still its bread and butter, and CRM is now considered a pretty mature category. Social CRM is the new play for Salesforce.com. It sounds great but the cost of selling it is proving considerable.

I know a lot of smart people at Salesforce.com. I love its platform play and how it is building  a developer community. But as well, Benioff does not have all the answers and should be viewed with skepticism even if he is an enterprise guy who can wow a consumer electronics crowd.

This actually works. I touched it. I played with it. And I fantasized about a bubble wrap app.

Tactus Technology stopped by our CES booth for a short demo of its crazy touch-screen technology. Using microfluid technology (and a bit of magic), Tactus’s solution produces honest-to-goodness buttons that raise out of the touchscreen. And then, just as quickly as they appear, they disappear when not needed. There wasn’t another technology or gadget that drew as big a crowd at our booth. Not the Pebble Watch, not the Oculus Rift, not the Razer Edge. All of our staff had to touch what we all hope will eventually become standard in touchscreens — real buttons.

In the video above, Tactus’ CEO and Founder, Craig Ciesla, explains the technology better than I can. Here’s a white paper (PDF) on the subject, too. But never mind how it works. What’s special at this point is that it works. And it works well, too.

When, in this case, Android calls for a keyboard, the buttons raise out of the screen nearly instantly. They have a small amount of resistance, just enough to survive the occasional accidental touch. Then, when Android no longer needs a keyboard, the buttons instantly melt back into the screen. Ciesla states that it can be configured into any design; it’s not limited to just a QWERTY keyboard form. For instance, these buttons could be used for a gaming pad configuration, too.

Tactus is aiming this system at OEMs rather than producing Tactus-branded tablets and smartphones itself. Ciesla assured me both on and off the camera that his company already has partnerships in place, and the world will see gadgets with this technology by the end of the year. No word on a bubble wrap app, though.

Editor’s Note: Semil Shah is a contributor to TechCrunch. You can follow him on Twitter at @semil.

Every week, it seems, a new marketplace or services business is born. Some of the hottest companies of 2012 — after photo-sharing apps, of course — were online and mobile marketplaces and services-based companies, pioneered by the likes of Uber, for instance, and all the way to a newer company (with a common investor) to help you find someone to watch your four-legged friends while you’re away from home.

Cherry, the service to book a car wash for your four-wheeled friends, fit in this category. In December 2012, Cherry announced it would shut down its service after raising venture funding. I used Cherry a few times throughout the year and it worked great for me. I know Cherry was, at one point, booking a lot of car washes in and around the Bay Area, and I always assumed that, eventually, the purpose of raising venture capital was to expand their labor force and upsell other car-related services to become a more diversified business. This makes sense particularly in urban areas, where the real estate and infrastructure needs of a physical car wash operation aren’t practical. So, why not bring the wash to the car instead? (I’m not sure what Cherry’s future plans are as they raised a good chunk of money, but I hope they find a new angle and keep going.)

When TechCrunch’s Anthony Ha reported on Cherry’s shutdown news last month, I was surprised at the negativity in the comments section, a place typically reserved for a congratulatory chorus. Forget about the fact they’re coordinating car washes for a minute, and Cherry is not all that different than many of the other emergent services companies to pop up in this golden, overstuffed age of startups. That said, they provided more of a service rather than a marketplace, and that is a big distinction.

The demise of Cherry’s car washing operation is a failure that the Bay Area ecosystem can draw many valuable lessons from, which is important to the ecosystem right now given the sheer number of startups trying to harness the web and mobile to provide services or build new marketplaces. Companies such as Postmates, Exec, Lyft, Sidecar, TaskRabbit, Zaarly, Instacart, SWIG!, and so many more all fit into this broad category.

The lessons from Cherry listed below are written from a “venture-scale lens” because the company did raise institutional funding and others will as well, but of course, venture capital is certainly not a prerequisite to starting a new service business or marketplace and not all new endeavors need to be at venture-scale to be valuable. With that disclaimer and context, here are the three key “venture-scale” lessons we can draw from Cherry:

• Transaction Volume: Cherry customers probably didn’t need a car wash every day. Maybe every week, at best. Therefore, to maximize revenue in the Bay Area, where they started, Cherry would have had to either begin to upsell other car-related services to be delivered at the time of a car wash and/or to maximize the number of bookings made through its service. Now, on the other hand, a marketplace for town cars like Uber is something users could do daily, or even multiple times a day, assuming they have the budget. Uber’s transaction volume is high on two dimensions: repetitive use and high-ticket sales. Companies in these categories looking at venture-scale opportunities will most-likely need to show robust figures in at least one of these two dimensions.
• Profits Margins: Revenue may be en vogue again, but all revenue isn’t created equal. The real metric of interest is the profit margin. Venture-scale businesses need to have tremendous leverage in their revenue models. Consider the crown jewel: Google. Each Google search is a mini-auction for advertisers to bid against that search, lining Google’s pockets with $100M+ revenue….per day! By contrast, many of today’s new services have models which require the organization of excess labor supply, training that labor, and supplying it with materials and/or information in order to carry out the mission. Each step between point-of-sale and point-of-completion puts more and more pressure on the model and most likely compresses any margin. Through this lens, we may see why Cherry couldn’t justify their financial model. In venture-scale businesses, investors will want to model out the likelihood that any business could apply leverage on the revenue to extract margins, which creates the real economic value they seek.
• Scaling In The Real World: Suppose Cherry worked so well in the Bay Area that they began a plan to expand to other cities. My sense is that in the SF Bay Area right now, and for the past year or so, many folks around here have a tendency to assume “scaling offline” is complex but as controllable as “scaling online.” While scaling an infrastructure and system online is certainly difficult, I would say right now it’s much harder, more expensive, and more time-consuming to scale these types of business offline and into new locations. Each company in these categories would need to build their own playbook in their test market (usually the Bay Area) and then execute against that plan to expand their reach while maintaining quality. And, even if these conditions are met, a VC may be reluctant to invest given the minefield of operational risks any team will surely endure. Pulling of a business like this takes serious time and effort. There may be a Starbucks in every town in America, but keep in the mind the company was founded in 1971.

It’s easy to mock Cherry as a small idea, but I give them credit — and hey, they could still do something new and interesting. They went out, delivered a service, and while there were some hiccups, their shutdown creates a learning opportunity for the ecosystem which is especially timely given the companies I’ve mentioned above, and the venture capital (and time) needed to make these things spread offline with real margins. In the past few months, I’ve grown concerned that these offline, non-technical, and operational elements aren’t taken into humble consideration or waved off as being “easy” to execute on. Too many people think to themselves, “Hey, we’ll do what Uber did, no problem.”

Well, what Uber did and is doing is really, really hard, and they still have a long way to go. It’s also important to recognize that Uber is mostly a marketplace and doesn’t handle labor as much as some of the other companies. Managing and training labor is time-consuming and expensive, and can negatively impact all three dimensions listed above. When Uber was raising their early venture and growth rounds, some investors still passed on the deal because while they liked the transaction volume and offline scaling proof points, some questioned the robustness of margins. To each his/her own. That said, if Uber had such a tough time and fought through it, I’d imagine everyone else in this broad category will go through as much pain or more in order to get a peek to the promised land in the horizon. Yes, it’s a fight worth fighting for, but as we see with a company like Cherry, which probably had enough cash to keep going for a bit longer, there should be no illusions in how hard it will be to get there.

Photo Credit: knottboy / Flickr Creative Commons

Facebook has a big launch event on Tuesday. Here are nine things I think it may be working on, or at least should be. We’ve heard tips that some of these are already in development and may be released soon, while the rest could fill big holes in Facebook. Even if none of them hit the stage on Tuesday, they probably will eventually, and the list offers a deep look at what Facebook could improve right now.

What this list doesn’t include is wildly forward-thinking products. Facebook should definitely still be trying to blow people away with revolutionary innovation. But right now there are cracks in the infrastructure, business deficiencies, and huge opportunities to apply its data set that need to be taken care of.

Facebook Search — For Businesses, Posts, And People

Mark Zuckerberg explained at TechCrunch Disrupt that Facebook already had a team working on search, and that it’s uniquely suited to answer questions like “What’s a good sushi restaurant in San Francisco?” by using data about your friends. Search could help Facebook apply the information to help users. It’s also critical to the future of Facebook’s bottom line because when you search for something, you’re showing purchase intent. Facebook could make big bucks selling sponsored placement to advertisers who want to reach you right before you decide what to buy.

Facebook took a big step in this direction by launching Nearby within its mobile apps. The local business search helps you find places your friends recommend. But the feature is buried as a tab on mobile and doesn’t exist on the web. A web interface for Nearby or a standalone mobile app could bring it a lot more usage.

Searching updates from friends or public posts by the rest of the world is also very clumsy now. Facebook could add a new channel for content discovery by improving this and adding Twitter-style trending topics.

Then there’s people search. Despite Facebook knowing all the intimate details of your friends or people you’d want to connect with, its people search feature is pretty terrible. The Find Friends browser is buried several tiny links deep within the Friend Requests interface and doesn’t exist in its mobile app. That makes it very tough to track down real-life contacts you want to friend unless you know their full names. Helping people forge these connections locks users into Facebook and delivers them more content so they visit more frequently.

It’s also tough to sort your existing friends. You’d think it’d be easy to search for all your friends who currently live in a certain city so you could contact them while you’re in town. It’s not. Facebook gives you a mix of strangers and friends. You can also only sort existing friends by location, education, and work place. That means there’s no way to search for friends in New York who Like Mumford & Sons so you could find people to go to their concert with. You also can’t just look up all your single friends in your city when you’re feeling lonely. A major revamp of Facebook’s internal people search might not bring tons of new monetization opportunities, but it would sure make the service better.

An Easier Way To Find Things On Timeline

Timeline is pretty, but it’s inadequate from a usability standpoint despite being one of Facebook’s core products.

While we’re on the subject, Facebook definitely needs a search engine for Timeline. It should be simple as pie to pull up your old posts by keyword, location, or which friend you tagged. Right now you have to comb through your whole Timeline month by month. That’s kind of ridiculous. If it’s worried about making it too easy for employers or other sensitive people to dredge up your embarrassing moments, make it so we can only search our own Timelines. This would help us with privacy so we could keep things visible to the right people, as well.

Beyond search, a big gripe I hear from developers is that people don’t know where their non-Facebook app activity ends up on their Timeline. A more predictable layout of what you’ve done across the web and your mobile apps on your Timeline could make Facebook feel even more like the center of your digital life.

Finally, I still feel like my Timeline is too rooted in reverse chronological order. I wish I could pin my favorite links, photos, and status update to the top. The Timeline Cover could host a collage of these things, or it could just sit above my recent posts. Facebook could surface my posts that got the most Likes and comments to make it easy for me to grab my best content. Flexibility in what I show on my Timeline would let me give a more accurate representation of my identity to those who come to my profile.

Friend Management So I Can Hide People I Don’t Care About

Over the years, most people have added friends they aren’t really friends with — at least not anymore. This clogs up your news feeds with irrelevant stories and makes Facebook feel impersonal. It’s also opening Facebook up to disruption by more intimate social networks and communication apps like Path and Snapchat.

Facebook’s attempts at a solution include Groups, Friend Lists, and micro-sharing privacy controls. Groups work for specific topics or established sets of people, but aren’t flexible enough and notify the members of their inclusion. Friend lists are tough to manage over time and are too buried. Micro-sharing through privacy controls is unintuitive, easy to screw up, and easier to forget about entirely.

Suggestions of who you probably don’t care about and an option to mass-hide them from your news feed (but not defriend them) would be great. The current option to hide people one at a time is a chore and requires too much thinking. Facebook should just tell you who you don’t Like posts from, chat with, get tagged with, or live nearby and let you banish them from the feed.

Sharing to different sub-sets of friends is a tough design problem, but there’s got to be a way to remind you that you can do this so you share more intimate or interest-related things more frequently but to fewer people.

Facebook For Cars

Cars are getting connected, at least according to the slew of major automobile makers who at CES announced developer platforms and other technology in their new models. Getting embedded in vehicles ahead of other social networks could create a moat for Facebook. If it really succeeds on the road, it could look to own the way drivers communicate. Yet Facebook’s presence in vehicles has mostly been handled externally, with Ford and GM reportedly experimenting with integrations over the years.

That could change soon. Last week Facebook added voice messaging to its standalone Messenger app. When I asked what it could be useful for, the two examples Facebook gave me would assist drivers.

One was recording a voice message and sending it to a friend nearly hands-free instead of typing a message or SMS to them, which would certainly be helpful while driving. The other was the ability to send long, complicated messages such as driving directions via voice instead of text, which drivers could listen to rather than having to take their eyes off the road to read. Facebook also began testing VoIP in Canada, which could let people have full, two-way conversations via Messenger with friends they might not have the phone number of instead of making a standard voice call. Drivers could use this to chat while on the road.

Facebook could release either a version of Facebook Messenger for cars, such as through the Ford developer program. Alternatively it could use some Bluetooth system to tap Messenger into your car’s technology and speaker system. We received an anonymous, unverified tip that Facebook was working on this, possibly for an upcoming launch.

Standalone Feeds For Different Content Types

The news feed mashes up content of all types, from friends’ status updates and photos to music, news articles, videos, e-commerce, and more. But the cognitive switching required to digest them all in a mix can be exhausting. Making sure there’s always something new to discover on Facebook is important to its ability to maintain a high time-on-site/app that gives it chances to show ads.

Standalone feeds for different content verticals could aid discovery for whatever you’re in the mood for and open up vertical-related advertising opportunities.

Facebook launched an underdeveloped Music feed in late 2011 that shows listening activity by friends and top songs in your network, and it now displays “Recently Released Albums” and “New Music From Artists You Might Like,” thanks to an update a few weeks ago. It also recently launched a dedicated Pages feed that only shows updates from Pages you Like.

Facebook could revamp and extend these standalone feeds for desktop and mobile. Industry sources confirm that Facebook has hired contractors who are working on a version of the Music feed for mobile. A better version for both the web and mobile feeds could create big advertising opportunities for the music industry, which might pay to feature new albums or hawk concert tickets.

More ambitious would be a slew of new standalone feeds for news articles, videos, and e-commerce. Now that a prohibitive old privacy law has been swept away, Facebook could create a feed of what friends are watching on Netflix, Hulu, Amazon Video, and other sites. A “news” feed could compete with services like Circa and Prismatic, and an e-commerce feed could challenge Pinterest for product discovery. For mobile, these could come as tabs in the navigation of the already bloated Facebook for iOS and Android apps, or they could be bundled into a standalone “Feeds” app. Either way, they’d attract advertisers from these verticals looking to reach a hardcore audience.

A Revamp Of Notes To Take On Tumblr

Facebook has basically abandoned its blogging feature Notes since it launched Timeline. Notes lets you write long-form posts that include links and photos, and innovatively uses friend tags to let you notify people who you want to read your little masterpieces. In the old profile they were much more visible thanks to a tab or pinned box. Now if you don’t select to show Notes as one of your four Timeline Views tiles, friends might never see them after they’re published.

This is a big problem, as Tumblr has grown wildly successful over the past few years, especially with teens. Some have suggested Facebook should buy the blogging platform. But if Facebook provided a better home for Notes on the Timeline, made publishing them more lightweight, and allowed easy reblogging of others’ Notes, it would have less of a need to make the costly acquisition.

The social network’s goal is to host all the ways you share, and more and more people are getting into blogging. Facebook needs to convince them they shouldn’t set up a separate website where they start with zero audience. They already have a graph of friends to share with.

A Real Video Chat Competitor To Google Hangouts

When two people aren’t together, the most vivid form of communication is video chat. Facebook needs to control these intimate interactions. It has a video chat feature it built through a partnership with Skype, but it hasn’t been updated in 17 months and is pretty bare-bones. That’s absurd considering how fast Facebook typically moves. Despite promises made at launch, there are still no options for group video chat or audio-only chat, and it doesn’t support mobile.

In the time since, Google Hangouts has constantly iterated, and now is leagues ahead of what Facebook offers. Direct streaming to YouTube might not be possible, but Facebook could certainly work out how to let people screenshare, simultaneously consume content online like videos, or overlay cutesy stickers like pirate hats. If it added video chat to Messenger or its primary smartphone apps, its ability to access your real social graph, not just your Google+ contacts, could let Facebook give Hangouts a run for its money.

New Advertising Channels To Show It’s All Grown Up

When Facebook makes changes to its ads platform, they’re typically very quiet. It held the big Facebook Marketing Conference last February where it announced the launch of mobile ads, real-time marketing insights, and Timeline for brand Pages. But otherwise, it just makes the changes silently, or briefs a few members of the press. Now that it’s a public company, showing Wall Street it thinks better advertising deserves a launch event could help get the $FB share price up above the $38 IPO price.

One thing sources say Facebook is working on is a better automated ad rotation algorithm. This would ensure people see fresh and different ads from a company rather than Facebook showing the same ad over and over, which makes it easy to ignore.

Facebook’s hottest ad product right now is FBX, its cookie-based retargeted ads system that shows you ads for products on websites you recently browsed. They’re highly relevant, so in some ways FBX ads are less intrusive and better for the user experience (though some find them creepy). Retargeted FBX ads are only shown in the desktop sidebar right now — Facebook’s worst-performing ad unit.

The extension of retargeted ads to the desktop news feed or even the mobile news feed could lure in lots of ad dollars. Since Facebook maintains a unified view of your identity across the web and mobile, it could use your web browsing habits to target you with mobile ads in ways other sites can’t. This could make the shift to mobile easy for Facebook to weather than its competitors in advertising.

A Facebook Phone (Or Maybe It Shouldn’t)

For the last few years, Facebook has desperately tried to purport itself as a social layer for mobile, not a competitor to iOS, iPhones, Android, or smartphone OEMs. But multiple sources say Facebook may in fact be launching a phone on Tuesday. If it tried to build its own premium smartphone hardware by itself, it could be a ruinously expensive boondoggle. It’s too small of a company to be taking such a big swing in a business it knows little about.

Let me be clear: Facebook should not try to build an entirely new operating system or its own high-end phones. If it does, Wall Street should be weary. And for what it’s worth, my inside sources haven’t heard anything about Facebook launching a phone this week, and some industry sources outside, though close to Facebook, deny it. Facebook didn’t hold an f8 conference this year, so it may have built up a stockpile of smaller announcements for this week rather than one giant one.

There is one big opportunity for Facebook mobile hardware, though — the emerging markets. That’s where its next billion users are going to come from, but first Facebook has to get them online. This demographic can’t afford premium smartphones. They might not even have the cash to pay for data plans for cheap phones. What they want is voice, text, and Facebook.

The social network could strike deals with international carriers similar to its Facebook Zero program. Facebook would be able to offer Facebook Phone users free or extremely cheap limited data connectivity to power basic Facebook features such as the news feed, friending, messages, status updates, or maybe even low-res photo sharing. The carriers would get an advertising revenue share, or display of promotions encouraging people to upgrade to a real data plan.

The strategy could bring hundreds of millions of people into the mobile world and onto Facebook simultaneously, and help it achieve its goal of connecting the world. There have been plenty of Facebook Phone rumors before.

But as MG Siegler detailed for TechCrunch yesterday, all those people “crying wolf” about a Facebook Phone may be proven right Tuesday, or eventually.

Editor’s note: Ross Rubin is principal analyst at Reticle Research and blogs at Techspressive. Each column will look at crowdfunded products that have either met or missed their funding goals. Follow him on Twitter @rossrubin.

Bikes and tech go back a long way. During his first stint at Apple, Steve Jobs would talk about how, when one compared the efficiency of various animals in advancing a kilometer, humans fared poorly, a distant species from the class-leading condor. But when you did the same comparison with a human on a bicycle, humans blew away the pack. The idea of computers as a “bicycle for the mind” was a theme he would repeat, and “Bicycle” was even floated as a name for the Macintosh.

Jobs, of course, was not the only adult enamored by bicycles; the two-wheeled wonders are prized by a huge community of enthusiasts ripe for the pedal peddlers at Kickstarter. Whether your New Year’s resolution was to tone up under the premise of “two wheels good, four wheels bad” or are looking to match your attraction to being ecologically green with limited-edition Kickstarter green, a number of recent projects have offered new takes on urban mobility.

Backed: Bicymple. Capable of riding in a straight line with its rear wheel parallel as well as ultra-tight turning radii, the compact and nearly symmetrical Bicymple is distinguished by the lack of a chain and the placement of pedals on the rear wheel. However, Bellingham, MA-based designer Josh Bechtel admonishes that it’s not a “two-wheeled unicycle,” citing the ride as very different (and hopefully more favorable to the balance-challenged) and ignoring that such a thing would be an oxymoron.

Reward tiers to bag a Bicymple of one’s own range from $800 for the fixed-gear model up to $2,700 for a two-gear model, which may be as many as you can get away with while trying to stress simplicity. Despite the pricey merchandise, the project beat its $20,000 funding goal by more than half with about 40 days left to go in the campaign.

In a rare and welcome move, Bechtel has set the delivery date at December 2013 but notes that he’s giving himself room to wiggle as much as the Bicymple’s wheel and expects to fulfill orders well before that.

Whacked: NexiBike. It may seem like a bold statement to say that your invention will be “a game changer that will revolutionize human-powered transportation.” That statement, though, comes from Scott Olson, who, with his brother, developed the Rollerblades that Olson also claims revolutionized human-powered transportation. It may not have done that, but it did revolutionize the roller skate.

Olson’s latest pursuit, a 25-lb. foldable bike that you can carry with you onto public transportation, looks a bit like a steampunk project folded up. Unfolded, it’s characterized by its small wheels and the seeming promotion of a comfortable, un-hunched riding posture. More portable but less attractive than the Bicymple, the NexiBike needed $100,000 for its production. And while the bike’s puncture-proof tires may resist flattening out, the campaign could not. With about 17 days to go, it has collected less than $3,000.

Whacked: Zuumer. The NexiBike revolution may have to wait, but at least two folding bike projects did make their funding goals in years past: the Brooklyn-born CMYK Folding Electric Bike and what would become the Model Ue curve-framed electric bike (now slated for delivery this year). There’s also been at least one electric scooter, the sleek but whacked JAC< from the Netherlands.

The Zuumer (not to be confused with the Honda Scooter or Palm-developed PDA sold by Casio and Tandy Corp. in 1994) adds a second rear wheel to the electric scooter, and “lean-in” steering that allows 300 lbs. of flesh and cargo to travel up to 20 mph before being recharged. Most of the 23 early-bird Zuumers, priced at $2,300 each, are still left, with the next reward tier jumping $500 for the same thing. But one may need to wait a while to find out who’s zooming whom. With 20 days left, Zuumcraft has attracted only about $17,000.

Editor’s note: Robert J. Moore is the co-founder of RJMetrics, a company whose software helps online businesses make smarter decisions using their own data. He also previously served on the Investment Team of Insight Venture Partners. Follow him on Twitter @robertjmoore.

At RJMetrics, we believe in data-driven decisions, which means we do a lot of testing. However, one of the most important lessons we’ve learned is this: Not all tests are worth running.

In a data-driven organization, it’s very tempting to say things like “let’s settle this argument about changing the button font with an A/B test!” Yes, you certainly could do that. And you would likely (eventually) declare a winner. However, you will also have squandered precious resources in search of the answer to a bike shed question. Testing is good, but not all tests are. Conserve your resources. Stop running stupid tests.

The reason for this comes from how statistical confidence is calculated. The formulas that govern confidence in hypothesis testing reveal an important truth: Tests where a larger change is observed require a smaller sample size to reach statistical significance. (If you’d like to dig into why this is the case, a good place to start is Wikipedia’s articles on hypothesis testing and the binomial distribution.)

In other words, the bigger the impact of your change, the sooner you can be confident that the change is not just statistical noise. This is intuitive but often ignored, and the implications for early-stage companies are tremendous.

If your site has millions of visitors per month, this isn’t a big deal. You have enough traffic to hyper-optimize and test hundreds of small changes per month. But what if, like most start-ups, you only have a few thousand visitors per month? In these cases, testing small changes can invoke a form of analysis paralysis that prevents you from acting quickly.

Consider a site that has 10,000 visitors per month and has a 5 percent conversion rate. The table below shows how long it will take to run a “conclusive” test (95 percent confidence) based on how much the change impacts conversion rate.

Data assumes a Bernoulli Trial experiment with a two-tailed hypothesis test and all traffic being split 50/50 between the test groups.

As you can see, your visitors are precious assets. Too many startups will run that “button font” test, expecting full well that in a best-case scenario it will only impact conversion by a quarter of a percent. What they don’t appreciate up-front is that this may block their ability to run certain other tests for a year and a half (assuming they don’t end the test prematurely).

When you can’t run many tests, you should test big bets. A homepage redesign. A pricing change. A new “company voice” throughout your copy. Not only will these tests potentially have a bigger impact, you’ll have confidence sooner if they do.

I found myself making this argument a lot recently, so I developed a free tool, available at Test Significance, to calculate the required population size for a significant test. Just input your current conversion rate and your desired confidence interval and it will generate a table like the one above.

We hope this tool helps a few companies out there learn the lessons we have about when to test and what to expect in terms of finding a conclusive result.

Editor’s note: Derek Andersen is the founder of Startup Grind, a 35-city event series hosted in 15-countries that educates, inspires, and connects entrepreneurs. He also founded Commonred (acquired by Income.com) and is ex-Electronic Arts.

I spoke with a robotics engineer and PHD from Stanford this week about looking for a job. He’s not the type of guy that easily joins your startup but he described two recent attempts. One was an email from a recruiter that as he described used “plenty of buzz words”, while another email came from an engineering team lead on the special projects group. Can you guess who he went to meet with and who he didn’t? When interviewing Kleiner Perkins Partner Mike Abbott at a recent Startup Grind event in Mountain View, this is one of the critical elements that Mike points out when it comes to hiring the best engineers. Engineers close engineers.

Mike has plenty of experience, having taken Twitter’s engineering team from 80 to 350 in 18 months and building the team that engineered WebOS at Palm. Hard to find many people who have been directly responsible for hiring as many software engineers in the last five years. Here are a few of the top strategies and insights pulled from Mike on how to get great engineers to join your startup. Some insights are edited for length.

Getting Coffee Is The First Win

“For that first reach out, the goal, the win, is just getting that coffee. I think you should always pay, I mean they’re doing you a favor and if you give me your time I really appreciate that. The other recommendation is to not do that meeting at your office. There’s something about making it more informal that people are more willing to go with and this is particularly important for various senior hires. Now I say this but at the same time I’m saying it’s not that you don’t need recruiters. Recruiters are very helpful to fill the top part of that pipeline to help manage that process so it’s a good experience for the candidate and it gives the candidate another person for he or she to talk to. Especially when you’re negotiating or competing with other companies, which is often times the case.”

Create Internal Competitions For Leads and Referrals

“This is something that we really tried to focus on, how are you going to recruit? You make a competition. How many names can you get on a board from LinkedIn? How many names can you get on from GitHub? Especially if they’re on a certain open source project, how do we think through who is the right person to go reach out to that engineer?”

Even If You’re Small, Don’t Hire Just Anyone

“There are a lot of considerations when you’re under 10 people. You always want to get the best engineer. As a percentage when you’re two people every person has such a large percentage and I would argue that most cultures in companies are set after the tenth employee and then you can very slightly change those, but for the most part you’re pretty set in terms of, is this an engineering centric or design centric company or where you sit in that area of gravity. So you have to be thoughtful about that so it’s not a common saying you lowered your bar, but think about who you’re hiring for. For example you know you can find great self-taught computer scientists that maybe are not far along in their career, but are so ambitious they are willing to sacrifice so much to get your company going. That’s awesome and you know maybe they didn’t do the best on the mobile sort problem or whatever, but you’re willing to take that bet and I think you have to have a balance and be pragmatic about it too.”

Make Sure The Interview Process Is Very Difficult

“If it’s easy or perceived as easy by an engineer he or she will not want to join your company because they’ll say, ‘Wait a second if this is the interview, I don’t know if anyone here is the caliber of engineer that I actually want to work with.’”

Create A Questions List For Your Company

“Not everyone has as much experience interviewing as other people. If you hire 300 engineers and on average you talk to 30 people for every person you hire, that’s 900 people that’s a lot of interviews and you know we had a lot of folks (at Twitter) that had never done that many interviews. So how do you train people to interview? Do we do pair interviews and at least having a common list of questions you ensure that there is a degree of consistency. ‘A’ that the same question wasn’t asked every candidate, and ‘B’ how do you actually train up people to go hire? That was something that we still could probably still do a better job at but it was something that we thought about.”

Engineers Close Engineers

“An engineer pulls another engineer out of a company. I mean look, in this day any great engineer is very gainfully employed it’s unlikely they’re looking (for a job). So let’s look at two different email scenarios. You get an email from Joey recruiter — hey maybe they spelled your name wrong or right, best job ever. Or you get an email from the woman engineer saying, “Hey I’m working on some really great projects let’s go grab some coffee.” I think in those two scenarios most people say, “I’ll listen, this sounds interesting.” Step back and think what does an engineer really want? It’s I want to work on tough problems, I want to work around great engineers, and I want them to have an impact around me. You get those three things, everything else kind of falls in place.”

Focus On Experience Candidates  Can Achieve To Succeed Down The Road

“One of the questions I had asked is, “What do you want to do after Twitter?” People go, “Huh?” “What do you want to do after Twitter?” “Oh I want to go start a company.” ”Okay, let me walk through with you different things or experiences that you might be able to do here at Twitter to learn to go increase your probability of succeeding when you go do that.” I always found that a really helpful exercise and I think it helped the candidate too because then it’s like oh — and it’s not that I want that person to go join Twitter and then leave immediately, but let’s face it, everyone is going to leave. And like I’ve told every team I’ve ever lead, the strength of this Valley is the people in this room, it’s the network and it’s not any particular company.”

Acqui-Hires Can Work But Be Careful

In The Lord of the Rings, when Sauron’s forces capture Gollum, they torture him in Mordor but are only able to get two things out of him: “Shire” and “Baggins”. Over the past few days, we’ve had similar frustrations in trying to track down the content of the Facebook event taking place this coming Tuesday. Despite hounding a number of people who might be in the know, the only discernible things we were able to come up with was: “big deal” and “mobile”.

Interesting, but way too vague. But we endured. And now we have a bit more information. And that information points to a Facebook Phone …of some sort.

I know, I know. The Facebook Phone is so often rumored that it’s reaching “Apple Tablet” or “Apple Phone” levels at this point. And while those devices did eventually manifest themselves, the Facebook Phone not only has not, but it has been directly denied by everyone at Facebook — including Mark Zuckerberg himself — several times.

And yet, all kinds of things in tech have this funny way of only being false until they’re true. (See iPad mini or the “Google Phone“, for example.)

And so, with that in mind, multiple sources have told us that they expect some sort of Facebook Phone to be on display on Tuesday.

Now for the caveats (and they’re important). It’s not entirely clear if this will be an actual piece of Facebook branded hardware or if they will simply use hardware from a phone maker to show off some sort of new Facebook OS for mobile. That is to say, it could very well be that the “Facebook Phone” is more about a Facebook OS running on a phone (or a few phones).

This has always been a point of contention in the Facebook Phone saga. When Facebook has denied working on a phone in the past, they’ve typically been careful to say that they weren’t building a phone — as in, hardware. It’s just the type of non-denial denial that allows politicians to weasel their way out of sticky situations.

No, Facebook probably doesn’t have employees in some secret factory in Asia building mobile hardware (though I wouldn’t be surprised if they’ve been tinkering quite a bit back here in the U.S.). Instead, if there is any hardware, they undoubtedly partnered with an OEM to actually make it.

Or again, maybe they focused on the software and added it to some existing phone in the last mile. Given how prevalent OEM leaks are and that there hasn’t been any word in months (since HTC was last rumored to be building the Facebook Phone), this may be the most likely scenario.

Also complicating matters is all the chatter that Facebook has both publicly and privately told partners such as Google and Apple that they had no intention to build their own phones. Again, maybe it’s semantics. Or maybe Facebook simply changed their minds. Or maybe this phone/OS isn’t meant to compete head-on with the iPhone and the Android phones that Google focuses on. Perhaps this is meant solely for emerging markets.

This is all total speculation, but given Facebook’s charge to reach developing countries (where expensive smartphones capable of running Facebook’s apps are far less prevalent), perhaps they decided to help create their own low-end and low-cost smartphone — something one step up from a feature phone, but nothing like the quality/caliber of the iPhone or something like the Nexus devices.

Facebook has always said they want to enable the entire world to share. And that’s why projects like Facebook Zero were created. But a low-end smartphone with Facebook baked into everything could truly be a game-changing device in the third world. But again, that’s all speculation.

What about the OS itself? How would Facebook do it? Details are slim here as well, but the obvious answer would be a fork of Android. This would allow the OS to run hundreds of thousands of apps already out there. With Amazon seeing some success doing this with their Kindle Fire tablets (and soon their own phone as well), this could have emboldened Facebook to make the move now.

Another possibility is webOS. That OS won rave reviews as an elegant counter to iOS and Android when Palm released it several years ago. Then HP acquired the company, promising that they would “double down” on webOS. Then HP started playing a deadly game of musical chairs with their leadership and webOS was basically taken out back behind the shed. But HP did go out of their way to open-source the OS recently. So… I suppose it’s possible. But probably far less likely than Android simply because the ecosystem is already there and that OS is much more mature.

Probably even less likely is Facebook building their own OS from scratch. It’s simply a lot of work to do so. And again, without an ecosystem to support it, adoption could be rough (though maybe Facebook cares less about that if they’re targeting the emerging markets).

We do know that Facebook has previously had projects underway to see what they could do with Android. When we initially reported on the Facebook Phone project over two years ago, this was a big part of it. From our understanding, that team ultimately moved on and the project was stopped. But experimentations with Android continued. A new project surfaced later under the name “Project Buffy”, as AllThingsD reported in 2011.

That project was said to be under the direction of CTO Bret Taylor — but he left the company in June of last year. That report also singled out HTC as the partner Facebook was working with. Given HTC’s financial hardships while trying to play in the regular Android ecosystem, this could make sense even now. But who knows.

Another report, by The New York Times right before Taylor left, suggested the scope of the Facebook Phone project had been expanded. That report claimed Facebook was ramping up the hiring of engineers (particularly ex-Apple ones) including those who had worked on hardware.

We do know is that as recently as this past September at our TechCrunch Disrupt conference, Zuckerberg told my CrunchFund partner Michael Arrington that a Facebook Phone has “always been the wrong strategy for us.” “It’s a juicy thing to say we’re building a phone, which is why people want to write about it. But it’s so clearly the wrong strategy for us,” he went on to say. And just to drive the point home: “Let’s say we built a phone… hypothetically — we’re not, by the way.”

All pretty damning for a Facebook Phone project, right? Maybe. But again, all of that could technically be weaseled into a denial of a hardware project. Which is essentially what Zuckerberg denied to us in 2010 as well. (You’ll note that he specifically denied making an operating system at the time there as well, but there’s still wiggle room with forking Android, and that was over two years ago.) We later heard that news of the leak of the project made Zuckerberg as angry as some employees had ever seen him, so… One could imagine Zuckerberg getting up on stage on Tuesday, laughing, and saying something like “well we didn’t actually build the phone!”

Facebook is fairly good at keeping things close to the vest these days. And the truth is that there are a number of things the company could announce on Tuesday. But speculation that is something smaller, like a new app, doesn’t jibe with the multiple sources telling us this is going to be “a big deal”.

Also the fact that Facebook has called in the press from all over the world for this event is telling. Facebook isn’t just holding an event at their headquarters in Silicon Valley, they’re simultaneously holding an event in London as well.

So yes, this is us getting you all excited about a Facebook Phone project yet again. And given our record of success with these stories, you’ll be forgiven if you chalk this up to us once again “crying wolf”. But that doesn’t mean we’ve been wrong in the past. And that doesn’t mean we’re wrong here. Eventually, we’re going to be right on this. Promise*.

Now, as to whether or not anyone actually wants a Facebook Phone, that’s another matter…

*fingers may be crossed behind my back for now.

[Disclosure: I own shares of Facebook in the public market because I’m a genius with impeccable timing. Also, handsome. CrunchFund, where I’m a general partner, also owns some shares of Facebook by way of an acquisition. Sadly, these shares don’t give me any special insight into things like Facebook Phones. CrunchFund is also an investor in GoPollGo, which I link to above. I used it to make the poll because it’s the most kickass, simple polling software out there. And because I was trying to subtly leak news of the Facebook Phone — though that didn’t work out too well that last time I tried to do that — hence, the preceding 1,500 words. More disclosure fun here.]