When comScore released their latest U.S. smartphone market share numbers earlier today, I was a bit confused. According to comScore, Google (Android) usage surpassed 51% last quarter. Apple (iPhone) meanwhile, was at 30.7%. Those numbers alone aren’t necessarily surprising, comScore measures overall market usage, not just new sales and Android devices (as a whole) had been outselling iPhones for much of the last couple years.

But something happened last quarter. On the nation’s two largest carriers, Verizon and AT&T, the iPhone actually outsold all Android devices — combined. The nation’s third-largest carrier, Sprint, did not give a number for total smartphones sold last quarter. But they did disclose that they sold 1.5 million iPhones, which was higher than expected. Given the numbers, it sure seems like the iPhone is the majority of their smartphone sales as well — maybe by a lot — but it’s hard to know for sure. Yet, according to comScore’s numbers, Android market share rose 3.7% versus 1.1% for the iPhone.

This leaves two distinct possibilities.

First, that T-Mobile and regional carriers (which don’t offer the iPhone) more than made of the difference between Android and iPhone sales at the big guys. Eric Slivka of MacRumors notes there are around 70 million wireless subscribers in the U.S. without access to the iPhone, so it may be possible. That assumes that basically all of those people chose Android devices, but that’s also possible given the shrinking market share of Microsoft and RIM.

Second, that comScore’s method of measuring smartphone market share is flawed.

It certainly could be the case that the first scenario is correct, but it just doesn’t feel right. I’ll concede that the people without access to the iPhone could have offset the iPhone dominating Verizon, AT&T, and Sprint, but enough for Android to see nearly 4x the growth rate of the iPhone? That seems suspect.

Then consider the numbers from NPD. As a rival to comScore, NPD has their own methods for gathering smartphone market share. In their most recent report, they had Android controlling 48% of the U.S. smartphone market versus 43% for iPhone in Q4 of last year. In the same span, comScore had Android at 47.3% and the iPhone at 29.6%. 

Forget the actual numbers, focus on the differences in the numbers. It’s pretty clear that the methods these firms are using to measure smartphone usage aren’t an exact science.

Digging deeper, you’ll find that the way comScore gets its numbers is through a service they call MobiLens. How is MobiLens calculated?

MobiLens data is derived from an intelligent online survey of a nationally representative sample of mobile subscribers age 13 and older. Data on mobile phone usage refers to a respondent’s primary mobile phone and does not include data related to a respondent’s secondary device.

A survey. 

So on one hand, we have actual, verified and legally reported public data from the three largest U.S. carriers. On the other hand, we have a survey. 

I’m not denying that Android still has the larger overall market share in the U.S. I’m just disputing comScore’s stats that it’s still growing faster then the iPhone. 

Regardless, one thing is very clear: when the iPhone is available on a carrier, it dominates. This is backed up by cold hard sales numbers, not surveys. If Android is still “winning” in some segments of the market in the U.S., it’s only because Apple is allowing it to. 

Update: comScore has written to clarify things a bit. It turns out their numbers do show iPhone subscriber growth outpacing Android on the “Big 3” carriers (13% vs. 11% from December to March). But the overall growth Android saw came mainly from other carriers (T-Mobile and regionals) where Android is dominating.

Fair enough. This reinforces the last point: that Android is dominating the areas where the iPhone isn’t competing. Yet.

In my last post, I linked to something that First Round Capital’s Josh Kopelman wrote in 2007. His post was prompted by — wait for it — a New York Times piece declaring that “Silicon Valley’s math is getting fuzzy again.” We were in a BUBBLE! Ahhhhh!!!!

Reading over that post now, it’s pretty awesome.

As Brad Stone and Matt Richtel reported in October of 2007:

Internet companies with funny names, little revenue and few customers are commanding high prices. And investors, having seemingly forgotten the pain of the first dot-com bust, are displaying symptoms of the disorder known as irrational exuberance.

No, that wasn’t written yesterday — but it sure reads like it was.

“Bubble” proof point #1 from 2007:

Consider Facebook, the popular but financially unproven social network, which is reportedly being valued by investors at up to $15 billion. That is nearly half the value of Yahoo, a company with 38 times the number of employees and, based on estimates of Facebook’s income, 32 times the revenue.

Oh that silly little Facebook with its insane $15 billion valuation. 

The company is now weeks away from going public with a market value of around $100 billion. Yahoo, meanwhile, it now worth just under $19 billion. And they’re currently suing Facebook like chickenshits who realize their time is at an end. 

Facebook’s revenue is now past a billion a quarter. Yahoo’s revenue last quarter was about $1.2 billion. Profit for the two companies is about the same. What a difference a few years makes…

“Bubble” proof point #2 from 2007:

Google, which recently surged past $600 a share, is now worth more than I.B.M., a company with eight times the revenue.

Google still happens to be right around $600 a share. It’s now worth just under $200 billion. IBM? $239 billion. Guess what? The market corrected itself. 

But — Google has closed the gap with regard to revenue. Google’s revenue is now just about half of IBM’s on a quarterly basis. And IBM’s revenue is flat while Google’s is still growing.

Crazy, I know. Such a bubble.

“Bubble” proof point #3 from 2007:

More broadly, Internet start-ups are drawing investment based on their ability to build an audience, not bring in revenue — the very alchemy that many say led to the inflation and bursting of the dot-com bubble.

Again, that sounds like it was written yesterday. Either no startup has brought in any revenues in the past 5 years, or it’s extremely silly to imply that young companies will never bring in revenue because they’re not today. You decide.

“Bubble” proof point #4 from 2007 — a quote:

“There’s definitely a lot of betting going on, and it’s not rational,” said Tim O’Reilly, a technology conference promoter and book publisher.

I’d — wait for it — bet that a lot of investors from back then would disagree. And that’s even when you include the broader economic collapse which had absolutely nothing to do with the tech scene.

“Bubble” proof point #5 from 2007:

Putting a value on start-ups has always been a mix of science and speculation. But as in the first dot-com boom and the recent surge in housing, seasoned financial professionals are seeming to indulge in some strange instinct to turn away from the science and lean instead on the speculation.

Major bonus points for calling the housing crisis what it was, but point deduction for equating the 2007 boom times with the dot-com bust and the housing collapse. Not. At. All. The. Same.

“Bubble” proof point #6 from 2007:

“The environmental factors are much different than they were eight years ago,” said Roelof Botha, a partner at Sequoia Capital and an early backer of YouTube. “The cost of doing business has declined dramatically, and traditional media companies have also woken up to the opportunities of the Web.

“That does open up the aperture for a different outcome this time,” he said.

Wait a minute, not actually a “bubble” proof point at all! A voice of reason! There may just be a reason why Botha is one of the best in the business. Perhaps he should write the next “bubble” post for The New York Times.

“Bubble” proof point #7 from 2007:

Some trace the start of the new bubble to eBay’s $3.1 billion acquisition of the Internet telephone start-up Skype in 2005. EBay’s chief executive, Meg Whitman, reportedly outbid Google for the company. This month, eBay conceded it had grossly overpaid for Skype by about $1.43 billion, and announced that Niklas Zennstrom, a Skype co-founder, had left the company.

Not a sign of a bubble, just simply a shitty deal. Big difference.

And wait, didn’t Microsoft just buy that same company last year for $8.5 billion? Yup. Some will use that as a sign that we’re actually in a “mega bubble” now, I’m sure.

“Bubble” proof point #8 from 2007:

Google’s acquisition of YouTube last year for $1.65 billion, under similarly competitive bidding, might have accelerated the transition to loftier values. Google executives and many analysts argued that YouTube was well worth the price tag if it became the next entertainment juggernaut.

It has. And it’s now a good business for Google. That didn’t stop one analyst cited in the piece from saying “We are almost going back to year 2000 types of errors.”

Right.

“Bubble” proof point #9 from 2007:

Twitter, a company in San Francisco that lets users alert friends to what they are doing at any given moment over their mobile phones, recently raised an undisclosed amount of financing. Its co-founder and creative director, Biz Stone, says that the company was not currently focused on making money and that no one in the company was even working on how to do so.

This will be used as another proof point that we’re now in some sort of “hyper bubble”. But Twitter is likely to see something in the neighborhood of $400 million in revenue in 2012. Not Facebook revenue. Not massive. But not nothing. And growing.

Need I go on? Other examples from the article include Geni (which is still around, and paved the way for Yammer, a CrunchFund portfolio company which appears to be doing quite well). And Ning, which ended up selling for around $200 million — right around its perceived (and implied crazy) valuation at the time of the NYT story. Not bad for a “bubble” company.

But here was the most interesting passage from the 2007 story:

Mr. O’Kelley, formerly of Right Media, said other entrepreneurs had begun to think that the financing game is best played by avoiding actual revenues — since that only limits the imagination of investors. “It’s a screwed-up incentive structure, just like you had in the first bubble,” he said.

Compare that with:

“It serves the interest of the investors who can come up with whatever valuation they want when there are no revenues,” explained Paul Kedrosky, a venture investor and entrepreneur. “Once there is no revenue, there is no science, and it all just becomes finger in the wind valuations.”

We’re not just recycling the “bubble” talk, we’re recycling the key arguments behind all of the talk. The dangerous thing here is the implications that the same behavior that led to the 1999 actual bubble is happening all over again. It’s not.

It wasn’t in 2004. It wasn’t in 2005. It wasn’t in 2006. It wasn’t in 2007. It wasn’t in 2008. It wasn’t in 2009. It wasn’t in 2010. It wasn’t in 2011. And it’s not now.

Sometimes it takes — gasp — time to nail a business model. Some startups (and an increasing number, I’d say) focus on this from day one, some don’t. Some take the Google route. Or the Facebook route. And those routes appear to be working out just fine despite what a certain fear-mongering post from 2007 would have had you believe.

Hindsight may be 20/20, but foresight doesn’t have to be as blind as a bat. Again. And Again. And Again.

Twitter’s decision to implement the Innovator’s Patent Agreement could not have been an easy one. While it’s refreshingly straightforward and an obvious crowd-pleaser, it potentially puts the company in a bit of a vulnerable position. What if no one else adopts the policy? They’ll stand alone with their pants partially down.

While I haven’t yet talked to anyone at the company about the decision, my sense is that they made the call using a simple principle: do the right thing.

While obvious, it seems that companies are rarely guided by simply doing the right thing. Legal departments get in the way. Or investors get in the way. Someone gets in the way. What’s right isn’t often what’s “smart”. And that’s a problem on multiple fronts.

When I tweeted about the upsides of this decision earlier, many people were quick to point out some of the practical problems. What struck me is how all the problems mentioned were derivatives of fear. Fear of others. Fear of change. Fear of dying.

The number one reason not to implement the IPA seems to be the fear that one day things could turn south and then your patent portfolio becomes your main asset — either as a commodity for sale (see: Aol) or as a weapon (see: Yahoo). 

That is such a losing mentality. I’d bet any company not willing to implement something like the IPA due to those thoughts is more likely to fail. Failure is quite literally on their minds!

With the IPA, Twitter is taking the opposite stance. They’re betting that rather than having the fallback option to sell their patents at the highest possible price or suing others with them, they’re going to continue to win. And they’re going to continue to innovate.

And if things go wrong, they’ll go down with grace, not with the cowardice that Yahoo is currently showing. But again, things are less likely to go wrong because they’re not busy dwelling on things going wrong.

I think Twitter will find that doing the right thing will pay dividends. It’s hard to imagine a better tool for recruitment in this day and age. True innovators can do what they do best at Twitter without fear that their work will be misappropriated in the future. And in an age of growing concern about the power and intentions of Google, Facebook, and Apple, the broader startup space will look more favorably upon Twitter.

This, of course, isn’t the end of software patents. But it is a practical solution to a problem that was quickly spiraling out of control. 

After the initial high-fiving is done today, the cynics will come out and say this was purely a marketing maneuver. Or that it actually won’t change anything. But that talk is a disservice to what Twitter has actually done here. They’ve gone out on a ledge that others haven’t been willing to go out on — and that some never will.

They’re doing the right thing, which isn’t nearly as easy as it sounds.

How long until Yahoo sues Twitter claiming they patented the IPA idea years ago?

— MG Siegler (@parislemon) April 17, 2012

The key aspect of Google’s earnings yesterday was the don’t-call-it-a-stock-split stock split. I say “don’t-call-it-a-stock-split” because it technically wasn’t one, but it was effectively one. There will now be double the number of Google shares outstanding. It’s just that the shares won’t all be equal. Half of them will be of a different type of class, which is important when it comes to company governance. Those shares will carry no voting power.

I’m not going to pretend to understand all of the intricacies here. But I think Felix Salmon has the most interesting take on the news. He flat-out calls the maneuver evil.

He notes that for much of the 20th century, dual-class voting shares were illegal. And even when they came back in 1986, the idea was to have protections in place. The majority of independent shareholders (so, non-management and non-directors) were supposed to approve such a move.

But Google didn’t see to that. Instead, they appointed a small committee of independent directors (so, just those that don’t actually work at Google) to make the call on the proposal. And because that committee approved it, it will now go before all the shareholders for a vote in June. And, notably, that vote will include Google’s management.

As Google itself notes:

Given that Larry, Sergey, and Eric control the majority of voting power and support this proposal, we expect it to pass.

No shit.

And it’s worth noting that it still took Google’s own self-appointed committee of their own board members 15 months to make that call on this proposal.

Why did it take so long? Probably because they knew the decision would be controversial. And why is it controversial? Because it perverts the intent of the concept to the point that it’s still not clear that Google should be doing it.

So why bother with all of this and risk looking bad as a result? Because Google’s management wants to have their cake and eat it too. They want to be able to bring in new recruits and retain top employees with the glittering lure of stock options. But they want to issue them without diluting their own shares, and as such, their control of the company.

But as Salmon notes:

It’s worth putting this theoretical fear in perspective. Common shareholders currently have just 32.6% of the voting stock at Google, with Larry and Sergei Sergey between them controlling 57.7%. If Google doubled the number of common shares outstanding, the Troika still wouldn’t lose control. And in any case, as Steve Jobs has shown, you don’t need control of the stock to have complete control of the company.

The majority of Steve Jobs’ wealth did not come from Apple stock. It came from Disney stock, which he got after the sale of Pixar. Jobs actually owned a relatively small percentage of Apple when compared to other company founders. (Which is because he sold all but one share when he was booted from the company in the 80s and was only granted new options over time when he came back.) Despite this relatively “weak” position, Jobs was clearly in full control of Apple. 

But the Google guys must be looking at Facebook about to go public and seeing how much control Mark Zuckerberg will retain even after the IPO. He planned better. With seemingly every move Google makes now increasingly criticized from the outside, the thought of losing control of the company must scare the crap out of everyone there.

I think that fear is fair. And I think Google will be in a better position to avoid the pitfalls that larger companies often fall into if the founders can retain voting control. Not everyone is Steve Jobs.

The problem is the way Google is ensuring that the founders maintain this control. It sure seems shady, if not exactly “evil”.

But perhaps that’s appropriate given many of Google’s maneuvers over the past few years. The refrain is often the same. Shady, if not exactly “evil”. 

Back in October of last year, I wrote about one of our early CrunchFund portfolio companies, Everyme. At the time, they were rethinking social networking through the lens of the original digital social network: your mobile phone address book.

They put an app out there and a lot of people were testing it, sending feedback. That’s when the team had a realization: they were onto something, but they weren’t quite there. So they went back to the drawing board and rethought their rethinking of social. The result is the Everyme app launching today.

Address book information is still key, but it’s no longer about recreating your address book to make it social. It’s now about using the connections in there to create small, private networks — called yes, Circles. By syncing your address book information with Twitter, Facebook, and LinkedIn, Everyme can automatically cluster people together and populate some key Circles for you. Your hometown, your college, your current city, your work, etc.

This is similar in concept to what Google does with Google+ Circles, but the key is that most users won’t have to set up their own. And managing them is much simpler. The concept of Google+ Circles is right, but no one is going to manage them. No one does. It’s flawed.

With Everyme, the idea is to keep the Circles very small. And again, private. There are no options to share things to Twitter and Facebook — this is on purpose.

Everyme Circles are actually closer to Facebook’s Smart Lists, which the social network also populates for you based on relationships. But for many people, Facebook has become too large. It’s a network about sharing as broadly as possible for many now. Everyme is about the people you really know and care about — again, those in your address book.

In using the app and seeing how people are using it today, they definitely have some onboarding issues they need to work out. One great thing about the service is that you don’t need to use the app to use it — you can use email or SMS to interact with Everyme. But the flipside is that people are getting pinged to sign up and have no idea what is going on. They’re undoubtedly working on this.

The fact that so many people are working on smaller, more personal networks is a good sign for Everyme. They’re clearly onto something. With investments in Path, Just.me, and Pair, we’re obviously following this whole space closely as well. 

In the age of the Facebook IPO, the smaller network resonates. And that’s especially true on mobile, which is the most personal form of computing. My hunch is that Everyme isn’t an app that will easily win over the early adopter tech crowd, but it’s something a more mainstream audience should love. 

More coverage on Everyme today from The Next Web, TechCrunch, AllThingsD, and GigaOm.

A few years ago, I got a frantic email one evening. It was from a young entrepreneur named Kevin Systrom. “Hey MG, I saw you signed up for Burbn…” is how it started. He was freaked out. Someone had told me about the service and the sign up wasn’t locked down. But Kevin did not want me to write about his fledgling idea just yet. We hopped on the phone. Of course I agreed to hold the story. I’d write when he was ready.

We broke a lot of news at TechCrunch over the years. But I was always happy about the way we treated entrepreneurs with their delicate plans. Big companies are different — they can take hits. Outing young companies before they’re ready: not cool. When in doubt, defer to the entrepreneur. Michael taught us well. 

Anyway, while I sat on the story of a hot new HTML5-based location app, I got to know Kevin and eventually his co-founder Mike Krieger. Really great guys. Idealists. Just insane enough to potentially change things. So when I saw the news this morning that Facebook was buying them for a billion dollars, I was beyond happy.

We weren’t investors — sadly, we came into existence too late — but screw that. This is just a great story about a great product, great founders, a great team, and great execution. And I feel sincerely happy for these guys because I was there pretty much the entire time watching from a distance.

Burbn, of course, eventually evolved into Instagram. Kevin and Mike watched how people wanted to use Burbn to share and saw an opening. Pictures. They decided to take it. I was one of the first users of Instagram. Number 28, if this is to be believed. I immediately knew it was the right way to go. 

A few weeks later, I believe Om broke the news of Instagram to the world. I was annoyed — I HAD BASICALLY HELD THE STORY FOR A YEAR — but I loved the app so much that I wrote a thousand word preview anyway. 

The commenters mainly took a shit on the app and the concept. Another photo-sharing app?!!! That’s why they’re commenters and not out there building things. 

A few weeks after that, the app launched. Adoption was natural. It was a thing of beauty. 

A few days later, the “another photo app” people looked like huge jackasses. Instagram wasn’t just a photo app. It was an application that was able to change the way people view the world around them. It was expression through image. It was a new form of communication.

I wasn’t a picture-taker. I became a picture-taker.

Instagram thrived because Flickr dropped the ball on mobile. Badly. Pictures on the desktop were interesting. Pictures from your mobile device are a thousands times more interesting. Instagram had perfect timing. The iPhone camera got very good. Instagram exploded.

A million users. 5 million users. Bieber. 10 million users. 20. 30. Android is going to push it to 50 million users in no time. 

People are looking at Facebook’s buy today and thinking “what the fuck?” I’m looking at it and thinking that Facebook is ingenious. They’re one of the few large companies that understands how to and when to acquire. You don’t buy at the peak. You buy on the ramp up to the peak. Instagram as it stands right now is awesome. It’s the tip of the iceberg for what they want to do. 

We’ll see if they can execute within Facebook or not. Mark Zuckerberg is saying all the right things. And again, they’ve done great with their acquisitions. I have faith. 

In some ways, this is bittersweet. Instagram is a not insignificant part of why I got into the venture capital side of things. I knew that I had a talent for picking companies that would do well, but Instagram was the first that I knew I had nailed from the get-go. By the time they had done their seed and A rounds, Kevin and I were talking about the potential of me doing this: finding the next Instagram. His thoughts helped steer me to where I am now.

I’ve talked before about the one company I wish I could have invested in (realistically) early on: Square. Instagram would be a close second. And today’s outcome proves the thought.

I know I’ve said this before, but it’s so easy to get cynical in today’s tech world. Uncapped note here, billion dollar acquisition there, IPO over there… At the end of the day, you have to bet on great entrepreneurs to do great things. You have to bet on 5 years from now, not today. You have to bet on the world evolving enough to be ready for what’s coming. 

It’s threading the needle. But it’s so goddamn exciting. That’s Instagram.

Congrats to Kevin, to Mike, to Instagram. A fantastic exit that we all hope is the beginning. 

A week ago, I came home after a long night of drinking and wanted to vomit. It wasn’t the whiskey. It was the email. 

I had been gone approximately 6 hours at an event and subsequent after-party. I didn’t check my email the entire time. When I came home, I had over 50 new emails in my inbox (this doesn’t include the ones I automatically archive thanks to Gmail filters). 50-some emails all of which I needed to take action on in some form or another.

Fuck.

Undoubtedly aided by the aforementioned drinks, I hit “Select All” and debated hitting “Delete”. Not just for those 50-some emails. But for all 50,000+ that were sitting un-archived in my inbox. Then I thought better of it. Instead, I hit “Archive”.

Best thing I’ve ever done. 

A week into my “Archive All” world, my inbox is pretty fantastic. Obviously, I’m not the first person to do this, but I was highly skeptical that it would work since I figured that after the initial purge, messages would just start piling up again.

But at least for me, it’s more of a mental thing. It’s essentially out-of-sight, out-of-mind. I should have known this would be the case since I’m also obsessed with clearing my RSS reader every night (even though I barely use it anymore) and am a slave to clearing red Push Notification dots on the iPhone/iPad. But I was still terrified to mess with the email flow I had built up over the years.

Previously, I had tried to quit email for an entire month. That was also great. But the problem was that when I got back on the wagon, nothing had actually changed. I had missed a month’s worth of email, and people got ahold of me other ways, but once I was back on email, I was right back into my old habits.

But archiving all my mail forced me to change habits. I was sure there would be something I would miss or forget. But the reality is that there was no way I was ever going to get to all 5,000 things I had starred anyway. I was kidding myself. And I was creating a sense of dread for myself on a daily basis when I looked at my inbox and saw all those goddamn stars. 

By archiving all the old mail, I have essentially turned Gmail into a big, searchable repository for email. I upgraded my account to 80 GB of storage (I was at the 30 GB limit). If there’s something I need to reference or remember, I can pull it up easily with a search. But the flow is now to archive everything at least once a week (and ideally sooner). It’s all about admitting to myself that if I don’t get to it by then, I’m never going to get to it.

Again, I was highly skeptical, but at least for now, this works. Yes, this means I’m not responding to a lot of emails that come my way. But I wasn’t anyway. Information still has a funny way of finding a way to command your attention if you need to take action.

For many, email is now the master communication channel. But it’s actually a pretty poor one in this age of mobile computing. Email needs to beaten down into just another channel of flowing information.

Read most of it. Respond to some of it. Keep all of it. But hide it. Then forget about it. And repeat. And repeat. And repeat.

When I posted my Instagram comparison shots earlier, people bitched that it wasn’t the same scene, so it wasn’t a fair comparison.

Fair enough.

John Gruber took the *exact* same shot with an iPhone 4S and a Galaxy Nexus — using the same filter. The results once again speak for themselves. 

While it looks like the Galaxy Nexus has shit on the lens. The reality is that it’s just a shittier lens. 

Yes, I was being a bit of a dick earlier about Android users “polluting” the Instagram feed, but the reality is that the shots do look worse. No point sugar coating it. That’s not the users’ fault. It’s not Instagram’s fault. It’s the quality of the cameras. It’s the OEMs’ fault, and at least partially also Google’s fault (developers constantly bitch about the camera software/APIs baked into Android).

I’m happy that my friends with Android phones now get to experience the joy that is Instagram. I can think of at least a dozen people that I personally know well who wanted this app above all others. Now they have it. And they should.

The beauty of it being cross platform to me is situations like this. Because Instagram is becoming the ubiquitous camera app, it’s a great point of comparison. (It’s something we would have used Flickr for in the past, but no one seems to use Flickr anymore — at least not in the same way.) As a result, we can see how much better an iPhone camera is than a top Android camera. A lot.

This exposes something that is otherwise hard to expose: it’s either a lack of attention to detail amongst Android OEMs or a lack of caring. “Good enough” will never be the best.

That’s what I love about Apple and the iPhone. It’s a fucking beautiful camera. And it keeps getting better. They work really hard to make it so. The Android OEMs do not. Instagram exposes this. That is all. 

Just in case my love letter last November didn’t make it abundantly clear, I’ll reiterate: I love Square. We’re not investors, but I wish we were. I love both the business and the product. And if that level of admiration makes this post biased, then color me conflicted.

Apparently well aware of my tweets and posts, the company brought me in to show me the latest thing they’ve been working on. It’s the evolution of their Card Case product to morph it into a more central part of their overall strategy. It’s technically called “Pay with Square”, but when installed, the new app simply reads “Square”.

That’s telling. Square, the card reader (now appropriately called “Square Card Reader”), has been the way most people think of the product and company. But that’s limiting because it’s so focused on merchants. It’s a great business, and an important one — but if Square is truly going to revolutionize payments, they need to get the consumers fully on board.

Enter Pay with Square. Using Card Case has been nothing short of magical. It’s one of those experiences that when it happens, you wonder how the hell they did it — and also why the hell it hasn’t been done like that before?

But there’s a flipside. Because the experience is so magical — so natural — it almost seems as if something is wrong when it happens. It simply can’t be that easy. You can’t possibly pay for something simply by saying your name and doing nothing else, right? The most common reactions I’ve seen to Card Case in public are “now what?” and “that’s it?”

That’s Square’s biggest barrier to entry with Pay with Square: they need to convince people that they don’t need to put up with the nonsense they’ve been doing for decades. You don’t have to swipe a card. You don’t have to sign anything. You pay by having your smartphone on you. And your payment is verified by your name (and face). 

With Pay with Square, Square is ditching the wallet metaphor (of Card Case) and simplifying things to just be a list of venues of interest that are close by. At first, I was a bit surprised by this change because I liked the design and the card metaphor (which is still sort of in place). But this actually makes a lot more sense. Don’t cater to the baggage of the past, replace the past.

I’ve been using Pay with Square this past weekend and it’s great. The transition from Card Case is seamless because it’s essentially the same thing, just reworked in an attempt to take it more mainstream. 

To that end, Square also put in quite a bit of work to make Pay with Square work on Android as well. Because Android doesn’t have the same geofencing capabilities native to their SDK like iOS does, this was undoubtedly a huge pain in the ass. Square essentially had to build the technology from the ground up to make their Android app work in the same way that the iOS one does. 

Thanks to this work, Square has managed to do the seemingly impossible: make Google Wallet look even worse. While Google is wasting time (and apparently employees) trying to move from a credit card swipe to a tap-to-pay by way of NFC, Square has been busy building the future. A tap is a bit more simple than a swipe, I suppose. But screw that. You should be able to pay by doing nothing at all.

As you may be able to tell from my posts on our portfolio company Highlight, I love the idea of mobile apps that work without the user have to do anything. Highlight alerts you as you move around. Pay with Square allows you to pay for things by walking into the place you wish to buy something. 

Again, magic.

The next trick is signing up more vendors to accept Pay with Square. Luckily, products like Square Register are complimentary. They just need iPad adoption to keep growing at the pace it has been. And it will.

And Square needs to convince people that the ability to pay without doing a thing isn’t actually magic, it’s just one of those things that should have always been done this way that technology now allows for. It’s a more natural way of doing payments that just happens to seem like magic because of the baggage we all carry.

It’s technology at its best.

More about Pay with Square on Techmeme.

In response to my PandoDaily post about Game of Thrones earlier, Trevor Gilbert tries his hand at parody. Not all bad, but a few quick problems:

1) You can buy an unlocked iPhone.

2) Even if you stole the iPhone, you wouldn’t actually be able to use it on a carrier’s network without paying them.

3) Pretty much everything else.

But Gilbert knows this, I have to assume. From the comments, it seems he takes issue with my “sense of entitlement”. Clearly lost on him (and plenty others!) is the point. 

The point is the very essence of piracy.

Piracy does not exist because there are evil people out there who are thieves and/or hate capitalism and/or feel entitled. Sure, there are some bad eggs, but they’re the exception, not the rule. Piracy exists because it’s often an easier way of obtaining content than the legal means. And sometimes, it’s the only way. 

HBO doesn’t care right now because they’re raking in the money. Good for them. But they’re fools if they think the status quo will be maintained indefinitely. We’re seeing the beginning stages of where this is going right now. The pirating of Game of Thrones is all about ease of access to content.

Right now, you could wait a year to pay to get the content legally, or you could get it today for free. Remove the money element. It matters, but it’s not the key. The key is that it’s today versus a year from today. That’s the problem here.

Much of the arguments in defense of HBO today have been that it’s their content and they can do what they want. True! But they’re doing so blindly as gatekeepers who have total faith in their wall. The problem is that the wall is already full of holes.

Currently, they’re pretending the wall is perfectly intact. In a year, they’ll admit it’s been breached, and they’ll try to rebuild it. But they won’t be able to. 5 years from now, hardly anyone will be using the gate. 

So why not just let everyone in now and charge them all a fee? Because admitting the wall is crumbling will mean accepting less money. Supply/demand. No one ever wants to take less money. But what they’ll have to come to terms with in the future is that less money is better than no money at all. 

And yes, perhaps that means the end of high-end content like Game of Thrones which features massive, movie-like budgets. That sucks. But it is what it is. 

My post was merely meant as a wake-up call for HBO and other content providers. Winter is indeed coming. A lot of people pirate today because it’s easier than getting the content legally. In a couple years, as younger people not accustomed to paying for cable grow up, so will the number of pirates for artificially restrained content like Game of Thrones. In five years, it’s not going to be pretty at all.

Unless HBO and the others get out ahead of this, that is. 

The cable empires are going to die. It’s just the way it is. Nothing lasts forever. The backup plan of the premium content players should be what Netflix is doing. Content everywhere at a fair price. And they should start right now. But they’re all scared shitless to even think of walking away from that cable money.

So it will have to start walking away from them.

And make no mistake, it will. It’s just a question of when.

One year? Two years? Five years? HBO and the rest just better hope that they don’t mistime the retreat because they’re drunk on the wine from a dying resource. If piracy becomes the norm rather than the fringe, they’re going to get royally screwed on the deals for someone else to bring their house back in order. See also: the music industry.

My single biggest takeaway from SXSW was all the talk about battery life. Every single person. All the time. People changing plans because they needed to recharge their phones. People walking around with chargers. People who were chargers. Mophies galore. People uninstalling apps that would drain power. People putting phones into airplane mode in areas of weak signal. People borrowing other phones so they didn’t have to waste the power on their phone.

Power. Power. Power.

This talk is nothing new of course, but it’s ramping up. As we transition into an LTE world, it’s going to be more and more of an issue, as Farhad Manjoo points out today. One of the most impressive things about the new iPad is the fact that it maintains the 9 to 10 hour battery life even with the addition of LTE. The next question is if they can do that with the iPhone as well. We’ll see. It’s gonna need a bigger battery.

To me, the most impressive thing about my MacBook Air isn’t its size, it’s the battery life. I routinely get 6 to 7 hours on one charge. Just a few years ago, this was unthinkable for a laptop (especially one this size). Part of that is better technology, but a large part is also simply a larger battery.

Manjoo is right that unlike the rest of the technology we use everyday, battery technology hasn’t evolved all that much over the past few decades. It’s constantly being refined and perfected, but it’s still largely the same. Want more battery life? Get a bigger battery.

If someone can truly disrupt this space, it will act as a lubricant that accelerates our already amazing pace of technological transformation. 

I want a laptop that lasts for a week on one charge. I want a cellphone that lasts a month. I want to be able to go to SXSW without a Mophie in each pocket. I don’t want to have to be constantly worrying about battery life every single time I leave my house.

Today’s battery technology is holding back several other advances in technology in major ways. And we are about to see just how bad the situation is in the coming months. Maybe wireless power sources that constantly charge and re-charge devices is the ultimate answer. But it just seems like battery technology is really ripe for disruption.

I understood the value of Highlight immediately. Within hours of downloading the app, I walked into a cafe and ran into someone I had met before, but only in passing. Who was he, I wondered while talking to him in vague generalities so as not to give away my poor recognition skills. It was a pretty pointless conversation that perhaps could have been a great one if I could have just remembered who the hell he was.

I sat down and pulled out my phone which had been buzzing since I entered the cafe. There, right in front of me in the form of a push notification was the name of the guy I was just talking to. I swiped it and got taken into Highlight where I could see his picture, where he worked, and our common friends. Brilliant.

Ideally, of course, I’d check the notification before I talked to the guy. But that’s my own fault. I was new to this. You get the idea. And this is just one potential value of Highlight.

The service, which CrunchFund has invested in, pushed a major app update today to gear up for SXSW. They know the potential this app has there. My first conversation with Highlight co-founder Paul Davison immediately went in that direction. “This is going to kill it at SXSW,” I believe were my words.

But as repeat offenders know, SXSW is now a very noisy time to launch an app. Twitter and Foursquare had it easier when they found success in Austin a few years ago. Thanks to that success, the event has become a launch platform for apps. Last year it was group messaging services (GroupMe, Beluga, Yobongo — all of which, coincidentally, have now been acquired). This year it’s the passive location apps, of which Highlight is one. There are many others. Several of them are also strong apps. It’s going to take an app really extraordinary to stand out in the crowd.

The truth, of course, is that passive location apps are not new. It’s the way that apps like Google Latitude started. And Loopt has been doing it for a long time. But it’s one of those situations where the initial wave was too early. The check-in apps — namely Foursquare — came in like a buzzsaw and cut down the passive apps. 

But good ideas that don’t work the first time find a way. Our technology is more advanced now than it was even just a few years ago. Back then, the iPhone couldn’t do background location (or, more accurately, Apple wouldn’t allow it to do background location due to battery concerns). Now it can. Hence, Highlight and all the competitors.

The reason why Highlight is exciting to me is because it has the potential to be a lot of things. I get the feeling that like Twitter and other social services, the users will end up determining the best use case. The Highlight team have features they’ve implemented based on how they think people will want to use it. But the truth is that no one really knows.

My initial example is one use case. I’ve used it a dozen or so times over the past several weeks as a refresher course before saying hello to someone. 

But not everyone is as bad at remembering names as I am. Instead, they might find Highlight useful simply to know when friends are nearby. You can obviously do this on Foursquare — as I have been since day one — but that puts the burden on someone else to check-in. If they don’t, you won’t know that they’re nearby. 

The check-in had to come first because it eased people into the idea of sharing their location. It’s a very explicit action. It has now been around long enough where it’s time to evolve to passive location for certain use cases. Of course, this will freak some people out. But in a couple years it will be the norm. Just like checking-in is today.

Another interesting thing I’ve noticed while using Highlight: there are people I am near all the time that I’ve never actually met. We’re in the same cafes every day but we never speak. And that’s fine — I don’t like talking to total strangers, I’m sure most people are the same way. But if we’re in the same spots often and we have several mutual friends, which Highlight tells us, it gets interesting. And maybe we have interests in common too.

In a regular social setting, if the mutual friend was present, they’d introduce us. Highlight can act as a virtual representation of your mutual friend in this case.

Still, that’s a bit weird to think about, I admit. But one of the new features that Highlight launched today — appropriately called “Highlighting” — can help nudge this notion along. You can now highlight people you think are interesting and they’ll see it (who you highlight is public on profiles, which was probably a tough call, but the right one, I think). It’s a lightweight interaction — perfect if you don’t want to message someone (which you can do as well in the app), or, god forbid, get up and go talk to them. 

Maybe this spurs interaction. Or maybe people won’t use the feature that way.

Seeing how people using the highlighting feature will be fascinating. At SXSW, you meet so many people for brief moments of time. Thousands, tens of thousands, hundreds of thousands business cards trade hands. Most people will never look at those business cards again. I never do. I hate business cards. Why not just highlight someone you met that you found interesting? The best thing is that only one of you has to do anything because again, both sides can see the highlight. 

Maybe that use case doesn’t scale at SXSW. Or maybe it does. Or maybe it just doesn’t catch on. Maybe it evolves into some sort of flirting thing. Again, the community will decide, which is exciting.

Or maybe highlighting is a niche thing that a small percentage of users end up doing. Maybe the main benefit of Highlight (the service) is simply to be passive in the background and only alert you when you want it to (a friend is nearby, for example). I love the trend we’re seeing of apps that work without you having to explicitly interact with them. Foursquare Radar is another great example of this.

My main concern for Highlight at SXSW is the noise. In San Francisco, I get maybe 10 Highlight notifications a day (they’re smart about how they do it, and don’t do it every time you’re near someone — and they’re getting smarter about it over time). In Austin, I’m worried I’ll get 1,000 notifications as every geek on the planet crams into a couple mile radius. I know they’ve thought a lot about this issue. Can’t wait to see what happens.

I also worry about the battery life of my phone. Forget privacy fears, this is the real downside of these passive location apps, in my opinion. The latest version of Highlight is the most optimized yet for battery life. It knows to rest until there’s a major location change, for example. 

I’m still bringing two Mophie battery packs with me.

I swore I wasn’t going to go to SXSW this year. I say that every year. And yet, every year I go. But this year I’m actually excited. I’m excited to see how Highlight gets used in its first big test. And I’m excited to talk to Dennis Crowley about all of this on stage at 3:30 PM Saturday in Exhibit Hall 5.

Longest promo for a talk ever.