ePayments Week: Facebook’s focus on mobile

The social network gets hyperlocal, data privacy promises abound, and mobile app revenues could triple.

Mobile, hyperlocal, privacy, and a PayPal departure topped the list of notable topics in the payment space this week.

Mobile is Facebook’s top priority

FacebookFacebook’s forays into mobile commerce are all around this week, as the social leader begins to tie together the elements that would make its Places app and other mobile functions into significant earners. On Tuesday, CTO Bret Taylor was at the Inside Social Apps conference in San Francisco explaining that it was all about mobile this year for Facebook. Electronista has a good write-up, saying mobile is Facebook’s fastest growing segment and that mobile users are twice as active as others. Given its prominence as the primary messaging system for so many people, expect to see Facebook increasingly integrated in mobile operating systems (as in Windows Mobile 7′s interface) and not just as a stand-alone app. From a developer’s perspective, it will be interesting to see how much of the action happens inside the Facebook app and how much of the Facebook-supporting activity happens out in the third-party app-mosphere.

On Wednesday Facebook said it had bought Seattle start-up Rel8tion, which (according to All Things D’s Tricia Duryee) has been working on hyperlocal advertising. That term means different things to different people, but at its best, hyperlocal aims to deliver ads and coupons based on geolocation data accurate to three feet or less. As in, you’re standing right in front of what a company wants you to buy. Facebook characterized the purchase as a “talent acquisition.”

Finally, rumors are still churning that Facebook will close the loop with Facebook-branded phones, manufactured by handset maker HTC. All Things Digital’s Ina Fried reminded us that these rumors have been around for a while and that with Facebook’s prominence on some mobile interfaces, one wonders why it would bother with a hardware deal.

Straight faces, please, for Data Privacy Day

In a week that leads up to Data Privacy Day, we see so many conflicting signals that it’s hard to know whether to be disgusted or just slightly nervous. On Wednesday, The Facebook Blog featured a post by one of the company’s engineers detailing things Facebook is doing to improve security (e.g. opt-in to always connect using HTTPS, and new CAPTCHA system that verifies with friends’ faces rather than passwords). But this came the same week that Facebook announced a plan to recycle your likes and check-ins as paid ads delivered to your friends’ pages. Worse, there appears to be no way to opt-out — though I suspect that, as it has done before when it crossed lines that teed off members, Facebook will retreat from that position. The launch of a Groupon-style buying program on Wednesday, based on purchases made with Facebook credits, is certain to confuse the issue just a bit more.

Meanwhile, after 15 years playing first the heavy and then the waning superpower, Microsoft must certainly enjoy taking the high ground on the privacy issue. It released a report on Wednesday showing that as more users become aware of how much location data they are sharing, they are becoming increasingly worried.

Like buildings and politicians, perhaps even old software leviathans can gain respectability if they endure long enough.

Gartner: Mobile app revenue could triple in 2011

App Store iconMarket research firm Gartner predicts revenues from mobile app stores will triple over the next year. Revenue is projected to go from $5.2 billion in 2010 to $15 billion this year and on to $58 billion by 2014. Gartner bases the numbers — which include paid downloads and advertising — on growth trends, as well as expectations in the smart phone and tablet markets. The sum includes numbers from Google’s Android Market, Nokia’s Ovi, RIM, Microsoft, and Samsung … but most of that revenue is attached to Apple. Gartner says Apple’s App Store, which celebrated its 10 billionth app download recently, delivered 90 percent of last year’s downloads and will continue to dominate in the near future.

PayPal platform lead departs

In its recent report on 2010 numbers, eBay emphasized the rising value of mobile, as it nearly tripled its gross mobile payments to $2 billion in 2010. The growth of that stream will continue to depend on the integration of PayPal with third-party apps built atop PayPal’s open development platform.

That platform is changing leadership this week as Osama Bedier, who has led PayPal’s efforts to develop the open platform, leaves for Google. PayPal’s CTO Scott Guilfoyle made the announcement on Wednesday. Bedier will be replaced by Matthew Mengerink, a 10-year veteran of PayPal, who has led a variety of PayPal’s architecture and development teams.

[Disclosure: O'Reilly works with PayPal on the PayPal X Developer Network.]

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  • http://essaytips.org Ajeet

    I remember the time when people used to say that FaceBook has no business model at all. Things have come a full circle and now, I think, focusing on ePayments might be the savior and other dotoms.

  • http://billday.com Bill Day

    Facebook and Google have both drunk the mobile koolaid this year it seems. I wonder how closely Apple’s paying attention?

    There are definitely some interesting opportunities here for developers using PayPal, Facebook, and Google technologies. In fact we write a lot about that intersection vis-a-vis PayPal X Platform, Facebook APIs, and Android in particular on the PayPal X DevZone. My latest series of posts in fact is on what I’m calling “MoSoLo” (mobile+social+local) and I’m kicking it off with a four part look at Facebook’s technologies and APIs. You can check it out if interested via: https://www.x.com/community/ppx/devzone/blog/authors/billday