OMG/JK: iCloud, gWallet, and tPhotos

And I’m MG Siegler.
First thing we’re gonna talk about
this week is what’s coming
up next week, which is WWDC, Apple’s big developer conference.

I know you’re very excited because there are some big developments coming up, right?

There are from the software side of things
not hardware.
That is going to be a big change.
So you don’t get to go with a new iPhone?
No, there is going to be
no new iPhone no other big hardware.
No surprises from what we’re hearing right now.
So this is a, you know?
This is a big change, but they have
three key major things that they’re going to announce from the software side.

They actually pre-announce them iCloud, right?

Yeah, so, iCloud is the brand
new thing which is, their
new cloud services presumably totally
replacing MobileMe.
And then of course they’re going
to preview further OS10 Lion
which is the new version of OS10,
and the new version of IOS which is the fifth version of it.

So, the thing that, I
think that all of these are
sort of tied together which is
why it’s kind of hard to talk
about one without talking about the others.
The thing that most intriguing to
me This is actually something
I saw described in a hacker news thread somewhere.
It wasn’t just this notion of storing your files on a cloud or whatever.

It was something where developers would
effectively get cloud storage.

Access, yeah.

And then they’d be able to sync their application data between devices.
So you could have an iPhone app that’s hooks up to your app that’s on OSX Lion.

Right.

Which would be just like a
seamless experience where you don’t
have to deal with a firewall version, it’s all there.

That’s something that’s really needed.
Apple puts out there that they want people to upgrade all the time.
Upgrade devices, once a year
they have a new iPhone, they have
a new iPad once a year,
but it’s not that great
of an experience when you do
upgrade because then you have a
game for example, you have
to start over from scratch where you were.

Well, I don’t think it’s just like upgrading.
I think it’s just moving between devices.
These days many people own
an iPhone, an iPad…

Right.

…a laptop and a desktop.

Right.

They have four.

And you want to just use whatever’s in front of you at that point.

Exactly and just having your data available there.
So, I think the question at this
point is will users have
to pay to use the
service to develop have to pay
to store the data…

Yeah, so
that’s, those are two really interesting questions.
Because right now of course a lot
of developers use Amazon’s cloud
services for IOS
apps and for web apps, obviously.
Will Apple cut a better
deal, if they say that they’re going to build just IOS apps?
Is that included in the $99
yearly developer fee that
they already paid to enter into that thing?

And then, from the consumer side, what’s the cost going to be?
There’s a lot of talk that there
will be some base level things
that are free.
And I think that’s important,
because you know,
whether or not you think it’s worth it.
It’s just, there’s way too big
a barrier to entry that
most people will not use it because…

Right.

…why would you pay $100 even if
you do have a free trial for a limited amount of time?

Speaking of which, I have an
unused MobileMe box sitting
in my apartment that I just ever got to use.

Nice.
Well, so there you go.

I can put that on Ebay.
It’s an antique they haven’t given
you enough incentive, I guess, to sign up for it.
But, if they add some of these
other things like we’re talking about now, of course, like the music service.
That’s supposedly going to be a big thing that they talk about.

So let’s talk about
what the reports are as
far as what’s gonna wash, because
it sounds like they will
have this notion of wide ring matching.
Where unlike Google and Amazon,
where you have to upload every
single file in your library…

Right this would be mirroring it.

Apple will look at the
songs you already have downloaded and say, “All right you have these.”
And then it just puts something.

And that’s what Lala did.

That’s what Lala did.
But, apparently, I can’t remember
who reported this, that it’s only going to be for songs you purchased through iTunes.

yes.
So, C-Net had that report.
So, there were two kind of
conflicting reports yesterday which are
the latest about what’s going on.
One says that it will
only be music that
you’ve downloaded through iTunes so far.
So that means, it doesn’t include,
not only obviously pirated music,
but music that you either rip
from a CD or
you get through other legal music stores like Amazon.

It sounds like it would actually be more frustrating than anything.

Yeah.

If I look in my online
library and I’ve only got
a quarter, a third of my
songs…

Right, where, oh, this song yes.
I forgot.

Are people,I mean, that sounds like a
worse experience than what Google
and Amazon are offering…

Well, so, supposedly.

because you have, you don’t haveyou know, and again,
this is all just from these reports right now.
Apple has been negotiating to try
and make it so there’s almost
like an amnesty deal where they

can, at one point, bring in all the music you have.
And then, maybe from this point forward,
it’s only the music that you
buy through iTunes, something like that.
But, supposedly those deals are
not in place right now, and they may try and launch.
And they’re probably not going to actually launch this next week.

OK.

But when they do launch they might try and just launch with iTunes music only.

I would, I mean, I, like
I said I think that would actually
be a worse experience than uploading your entire library.

Yeah, I’m pretty surprised by that.

The whole promise of this
cloud experience is that
all your music is there as
opposed to some of
it and then you’ve got to look through which albums did you buy through iTunes because if you…

Right.
I’m pretty surprised if Apple is actually going along with that.
Obviously, it’s the music labels
that want them to do that because they’re so concerned about piracy.

Right .

But, I mean, it, so,
Lala actually worked out
the deals where it would still,
if you had a song on your computer…

Right.

…regardless of how you obtained it,
it would still be up in
the cloud and the argument is
that if you already have
the song you’re not gonna go buy it.
And yes that incentivizes them going
out and downloading the songs, and
then it mirrors them and they whatever.

But.

I think the labels are just
so concerned because Apple is such a big player, they’re such a major player.
Lala was a small start up at the time.
Apple’s the huge player and
they’re or two other players that
they can kind of leverage or play
off of one another with the Google and Amazon stuff.
So, you know, it
doesn’t sound like the
greatest thing in the world if they do launch that way.

But, you know, we’ll have to see.
I had initially heard that
they were not even trying to
launch anything until the fall music
event which is where they do all the music stuff usually.
But I think that Google and
Amazon kind of force their hand a little bit.

Right.

So, so this will be out there now.

OK.
So, let’s move on to
the next topic which is we
went to an event last this week in New York.

Yep.

And it was the launch of Google Wallet.
And Google Wallet is something
that we coming for some time.
Eric Schmidt actually demoed something to this back in October.

To be clear this is the NFC stuff.

NFC stuff where right now there’s only
one phone does this just
ask where you pull out your
Android phone, you associate a
credit card with it and
then you can tap to pay at
hundreds of thousands of, whatever,
venues around the country.

Right.

And all and Google’s got
partnerships with people, and it’s increasing the people it’s working with.
Did you find it impressive?

I think that it’s
the idea is certainly impressive.
The execution remains to be
seen right now because it is very limited.
I think the main partner
was Mastercard, so it’s
only like certain cards that
you can actually enter into the system right now.

Well the way Google is getting
around that is there’s actually a
prepaid Google card that you can use any credit card you have money on.

Yeah, but that’s another, you know,
level that you have to go in to get.

I thought it was pretty, it’s a smart idea.

It’s a smart idea and I especially love the thing you wrote about the sticker idea.

Right, so it’s actually a little unclear as far as how that’s gonna work.

Right.

But, immediately after the event,
I was running up to the
people who were talking about stuff
that, because I wanted to
figure how it worked for phones that
didn’t have NFC because, obviously, the vast majority of phones don’t.

Right.

And, what I was told is
that there were already these
stickers, that can be,
have their NFC encoded with a single credit card.
You can actually go out and buy this from your credit card company.
Google is apparently going to
be allowing people to order
one these credit cards, and then
it’s going to do some stuff with
the Cloud where you slap it
on your phone and then
when you’re at a point
of sales place you show the
sticker and it routes
around and it still hooks into your phone, using cloud.

That is really interesting.

If it works, that’s awesome.

I mean there’s no way
that, obviously someone like Apple
can block you from putting
a sticker on your phone so, but there’s the app side of things.

The application, right.
And Apple can certainly block it
and actually I’d be very surprised if it
could work with the iPhone because
Android revolves around this notion
of being able to, like, kind of trigger an event, right?

Do you think though there’s a
way that they could come up with
a web app though that did
that where it, you know, kind
of routed over the cloud and then ported into the web app?
I don’t know if that would be
secure enough for that to
even to happen or if there
needs to be something on the
device itself, like a communication between them.

I think in order for it
to work with the iPhone you would
have to you already have the application open on your phone.

Okay.

Which would be sort of a pain.

Yeah.

In other words, I don’t know if
Apple allows anyway for this
sort external source to launch an app on your phone.

Right.
Yeah that’s a little bit murky at this point.

Android has intents, I
believe they’re called, that let you
do that.
that’s a discussion because Apple’s
going to eventually have their
own NFC operation in
place that may or
may coming in the
coming fall when they have
the iPod 5, or it
may be coming next year, but eventually they’re going to do something like this.

It seems like everyone is moving toward this.
And, one of the really
interesting things, I thought, maybe
the most interesting thing about this
whole thing, was how mad PayPal is at Google.

Right.

Because they basically, they took
their main executive who
was in charge of this stuff and
now he’s in charge of it for the Google Wallet team.
And they have the older executive who’s
been there for a while, Stephanie Tilenius,
who’s been there for a
long time and supposedly maybe helped recruit this guy over to Google.

Right.

But they’re really mad.
I mean, the lawsuit was announced the day of.
So, obviously people had been working on it for some time.
Whether or not it was a
coincidence, it happened the same day
as the Google Wallet launch The
really interesting stuff there is the documents.
I read over those court documents
talking about how they were negotiating
deals for Android, to get PayPal payments included.
And then right when they’re during that this guys interviewing for this job.

So, going back to the wall, lets
talk a little bit I think
the question is will users want
this right and so the promise
of the phone wallet
isn’t just that you can tap the pay.
But, that you can have multiple
credit cards on your phone
and then you can also automatically have
deals, which is actually one of Right, loyalty.

the other things that launched as part of this was offers.

Very limited trial it just launched in
Portland right now and
it’s going to come to San Francisco soon.

And the idea is that you
want to search on Google,
maybe it’s for shoes it says
hey an offer at the shoe
store down the street from
you and then you send that offer to your phone.

Right.

So, that you don’t have to
think about where you have an
offer you just go to pay
then your phone knows that you got an offer there.

nd that’s pretty cool I mean
that potentially will get
a lot of people using this you
know, it’s kind of like, well you
get one element that’s group
on, you get kind of one
element that’s sort of like what foursquares is trying do now.
And that’s, but the fact that
Google is in control of this
phone or the phone operating system,
they can really do some interesting things with that.

I think the bottom line for the wall step though is that it still.It
‘s going to be quite a
while before it’s ubiquitous enough that your going to rely on.

Right, I think they were smart to do
the partnership with MasterCard because
they have so many of those
point of sale things all ready
installed, I forget what the
number was, there’s thousands though over the United States right now.

And so that will be able to work pretty much right away.
Obviously it still reliant on
you having the Nexus S, in
particular, and having, you
know, the deals open in your
city if you want to use the deals for that.
But that’s a pretty smart
thing to be able to do it
gets around them having to ship
these point of sale units
to like every single retailer in the United States.

Which somehow that’s going
to have to happen eventually for this to really take off.

Well, I think the partnerships with the
credit cards, the credit cards
have, like, an incentive to work with Google on this.

Yeah, sure.

So.

Sure.

And the final thing we’re going to talk about now is Twitter photos.
This is pretty controversial actually
which is kind of funny that it’s
controversial but it’s yet
another hole that Twitter is filling in their product.

Right.

So when we found out
that this was launching actually like I
was at the Twitter event last year,
and they definitely talked about how this could be coming.

So I read over those statements again.
They sort of implied it, they
claimed that it could be coming,
like it’s something that we’re interested in.
we’re not 100% sure that it
will be coming Like when I
heard Twitter was filling holes
with photo, that’s a big hole.
That’s like the bigges.t

But, you know, like at
least what they’re saying, TwitPic
which is the biggest ecosystem player
actually like, for the photo’s, they’re really mad about this.

Right.

I mean, they supposedly feel like
they were blind sided, and from
what we’ve heard, Twitter did
reach out to a number of
other players, notably YFrog and
Plixi, I think was the other
one which were the two or three players.
But, they didn’t reach out to Twitpic.

I think that some of
the comments on the post on
this were that Twitpic,they
had an issue with licensing photos.
Twitter probably wasn’t such a fan of it.

That was a black eye.
Yeah, yeah, yeah.

Going back to what Twitpic
did, I think it just said,
they are allowed to license and make money off of them.

Yeah, yeah, yeah.

And Twitter made it very clear
now with their new system that
you’re in control of your pictures.
And the most interesting thing
about this to me is that they teamed up with Photobucket.
It’s not like they’re doing it by
themselves, or they are even using
Amazon cloud services or something hosted.

They teamed up with another player, which is really kind of interesting.
Why Photobucket?

I honestly can’t even give
speculation on that other than
to say that maybe they just
wanted to focus on building
out the core product and let people
who have all really handled all the.

Right.
That’s what PhotoBucket said more
or less that they’ve spent so
much time dealing with scaling of photos.

Right.

And they have so much expertise in this space.
The other thing we’ve heard is that
they may have gotten a better
deal from PhotoBucket, in terms
of having to pay for
the storage versus what they would have done with Amazon or something like that.

Because Twitters going to be, as
soon as they put the switch
on this, given the fact
that it ‘s going to be integrated in all the official clients.

Right.

They’re going to be zero to a lot of photos.

So, they’re going to, so, that’s another thing.
So, it’s live right now
for Twitter employees which doesn’t really matter that it’s 500 people.
But starting next week they’re
going to roll it out to,
beginning with all the users,
it’s going to take a few weeks to roll it out.
But it’s going to start on just twitter.com.

You ‘ll be able to click
the little button, and upload a
picture, and like you’re saying that will take over.
Eventually it will become one
of the mobile clients and that will
become the obvious defecto
of Twitterphoto integration.

So, I mean, as far as the
developer uprising, I thought
this one was fairly obvious that it was coming.
Easy for me to say in hindsight.

Right.

I have no money invested in any of these companies.

Right.

But I’m sort of
curious to, there’s a lot of
talk about how once again
Twitter has pissed off the developer community.

Right.

Like, are there any other obvious holes that Twitter is going after?

Well, so first of all, let
me just say about the photo
thing specifically because I think
this is such a controversial
one because this is really
one of the first major third
party eco-system plays that anyone did.
TwitPick was one of the
first ones and, this
was just, like, oh my god,
they’re helping out Twitter so much
because they’re really adding
value to it by adding these photos.

And even if Twitter did
give them little hints of that
something was coming a year ago, what’re they going to do?

Right.

They can maybe do
a white label service and partner
with some major content players or something like that.
But they really are kind of getting screwed by this.
And I mean Twitter’s in
a bad position too because they
have to do what’s best for them
from a product perspective and from
a monetary perspective whether or not this plays into that at all, photo integration.

But that’s the place they’re in.
And so, what they do
next, what other things they
have to fill in, there’s a
lot of things out there still that they could.

Analytics.

Right.

Analytics is an obvious one.

It keeps talking about moving up the value chain or something.

Right.

I was like, well, how much
further up the value chain do
you have to go before Twitter eventually
is going to get there in a year or two?

Yeah.
I don’t know why
people are still kind of in this eco-system at all.
Why third party developers are in this eco-system at all playing?
It’s just too dangerous.
It’s too dangerous to try and build a company.
If you’re doing a weekend side project, that’s fine, that’s great.
You have some fun.

Twitter’s pretty easy to work with in that regard, I think.
But if you’re trying to build a real company, yeah.

It’s a little scary.

Yeah.
All right.

So, I think that does it for this week of OMG/JK.
Thank you for tuning in.
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