The First Instagram Ad Has Been Spotted In The Wild

About a month after Instagram announced that it would start running Sponsored Photos and Sponsored Videos, and about a week after it published previews of those ads, it looks like Instagram ads have arrived.

The first ad comes from designer Michael Kors, and as promised, it's a regular Instagram photo, but it's also showing up in the feeds of users who don't follow the Michael Kors account, albeit with a “Sponsored” label. Instagram has said that users will be able to tap a button with three dots under the ad to hide it and provide feedback.

I've emailed Instagram to confirm that this is indeed the very first ad to go live, and I'll update if I hear back, but that seems to be the consensus.

PLAiR 2 Launches To Take On Chromecast With Netflix, Hulu Plus, Spotify, And Pandora Apps For $49

What do you do when your startups launched a product in a nascent category and then a behemoth like Google enters the space and validates it? And eats your lunch in the process?

If you're video streaming startup PLAiR, you go back to the drawing board and start from scratch.

To review, PLAiR had built a dolphin fin-shaped streaming video dongle that plugged into a user's TV and allowed him or her to stream video to it. The first iteration of PLAiR was priced at $99 and was designed to compete with streaming boxes like Apple TV, even providing an AirPlay-like ability to find content on your laptop, smartphone, or tablet and send it to the big screen.

Then a funny thing happened: Google came out with Chromecast, a little dongle of its own that did roughly the same thing - but cost a third as much as PLAiR's device. At just $35, Chromecast became one of the fastest-selling devices in a category that hadn't really had a clear winner beforehand.

Perhaps more importantly, Chromecast has seen a ton of developer support - with a number of the biggest streaming video providers integrating support for Google's device into their apps.

For PLAiR the writing was on the wall - the company had to come up with something radically new and competitive to Google's product, and it had to do so quickly.

It didn't hurt that PLAiR had a board meeting scheduled for the day after the Chromecast announcement, according to PLAiR CEO Saad Hussain. So the team came up with a plan to build the next iteration of its device - which would be cheaper and support more streaming music, game, and video apps. With the blessing of the board, it went back to work on making a device that fit the bill.

In addition to board support, PLAiR got a lot of help from changing economics in the supply chain. Based on its cost of materials for the first PLAiR, there was little it could do to lower the price. But according to Hussain, after Google's Chromecast announcement, the cost of building similar devices changed almost overnight.

Under the hood, PLAiR 2 has a 1GHz ARM Processor, 1 GB DDR3 RAM, 802.11n wireless, and a built-in GPU/VPU for full 1080p streaming.

After rethinking the components it would use and the design of the hardware, the company also took a look at how it could add more content more quickly. While the old PLAiR device required video to be streamed from the mobile device to the TV, the new device would have apps residing on the dongle itself.

And since PLAiR 2 is built to support Android TV and Amazon App Store apps, it has a wide range of content that's up and ready to go.

The end result is a device that looks similar to the old PLAiR, but costs half as much and has a much larger offering of content than the old device - and a lot more than what Chromecast currently offers. That's because, unlike Chromecast, which requires developers to add code to their apps to beam content to the TV, all PLAiR apps reside on the device itself.

PLAiR 2 supports Netflix, VUDU, HULU+, Spotify, Pandora, and games such as Angry Birds, as well as cable apps like the Comcast Xfinity App. Users simply bring up the app on the TV, and control the experience from their mobile device or tablet just like a remote control.

While the device still costs about $15 more than the Chromecast, at $49, the hope is that the additional content and better user experience will hook more potential customers than its first go-round. For those who want to give it a try, the product is available for pre-order at Amazon.com, Newegg.com, or PLAiR.com, and will ship by November 8th.

Bezos, Amazon And Refusing To Act Your Age

In early 1998, Amazon founder Jeff Bezos and CFO Joy Covey co-authored a letter to shareholders discussing the previous year's accomplishments. That letter has become holy writ inside the company, and is re-published every year in its annual report.

The letter and its contents struck me as incredibly prescient, or perhaps simply potent, as I read through Brad Stone's excellent The Everything Store: Jeff Bezos and the age of Amazon . It's no surprise that the letter has continued to be viewed as a touchstone for the company and its employees. The tenets set out in it are clearly represented by the way that the company develops and releases products, and the view that it takes to every day business.

One of the most commonly discussed aspects of Amazon's business is its attitude towards profit margins. The company famously makes a ton of money every year and manages to spend most of it, ending up with slim or no profits shown on its quarterly balance books. For some folks, obsessed with the way numbers look in a column, this is endlessly frustrating. How can a company that makes so much money, and continues to be such a darling of the stock market, end up with so little profit to show for it?

The letter holds the answer, and makes Amazon's, and Bezos', views incredibly clear. Here's the relevant passage:

We believe that a fundamental measure of our success will be the shareholder value we create over the long

term. This value will be a direct result of our ability to extend and solidify our current market leadership position.

The stronger our market leadership, the more powerful our economic model. Market leadership can translate

directly to higher revenue, higher profitability, greater capital velocity, and correspondingly stronger returns on

invested capital.

Our decisions have consistently reflected this focus. We first measure ourselves in terms of the metrics most

indicative of our market leadership: customer and revenue growth, the degree to which our customers continue to purchase from us on a repeat basis, and the strength of our brand. We have invested and will continue to invest aggressively to expand and leverage our customer base, brand, and infrastructure as we move to establish an enduring franchise.

The letter follows that up with a nine-point layout that describes Amazon's decision making approach. You can view the letter here to read the points, but if you look at recent Amazon moves, almost all of them are consistent with the tenets set out there. Some of them, such as "when forced to choose between optimizing the appearance of our GAAP accounting and maximizing the present value of future cash flows, we'll take the cash flows," speak directly to Amazon's desire to remain a lean company.

Stone's book paints a crisp portrait of Bezos as a man leaning into it at every turn. A key example of this in the book is an anecdote about then marketing executive Mark Breier bringing Bezos the results of a survey that showed that the majority of customers didn't use Amazon and would probably never do that because they didn't read books.

At the time, all Amazon sold was books. This was not great news.

Bezos' response? "I brought him very bad news about our business, and for some reason, he got excited," said Brier.

Instead of seeing the news as a major roadblock to Amazon's continuing success, especially right after IPO, Bezos saw it as the perfect time to start exploring other categories of products that were under-served in brick-and-mortar establishments. After research, some of it performed by future Amazon cloud exec Andy Jassy and future Hulu CEO Jason Kilar, Amazon expanded into DVDs and Music. And the rest, well, you know how the saying goes.

What the anecdote says about Bezos' handling of Amazon is very simple, and I believe is overlooked a lot when people think about why the company does one thing or another.

Put simply, Jeff Bezos views Amazon as a young company.

As a survivor of the dot-com boom and bust, and a nearly 20-year-old company, Amazon is often viewed by tech writers and analysts as a venerable pillar of Internet business. An aging superpower that trades blows with everyone from Apple to Google these days. But that's not the way Bezos sees it, and that's not the way he wants his employees to see it. In the eyes of the people running Amazon, it's still focused on growth, still becoming whatever it wants to be. When you look at it through that lens, decisions to re-invest nearly everything it makes into expansion and new products like the Kindle Fire, even though those decisions negatively impact the balance books make a lot more sense.

In this time of massively high valuations for companies with seemingly little intrinsic value and no revenue to speak of, we're comfortable talking about billion-dollar sums. But when Amazon is concerned, we feel reluctant to use the same frameworks to discuss it, simply because of its ‘maturity'. But, viewed as a company still in its infancy - re-framed that way - it actually becomes a lot easier to understand. The age of Amazon? Younger than you'd think.

The Amazon presented in Stone's book is still uncomfortable with its own success, and the Bezos depicted there is still just getting started. It's a fascinating read, I highly recommend it for students of the company or those simply interested in a ripping business yarn.

Google's Barge Likely A Modular, Floating Retail Space, CBS Reports

Google caught some attention this past week for mooring a huge barge in SF Bay for mysterious purposes. Rumors have been flying about what that barge could be used for, with some suggesting it's a floating data center, which Google does indeed have a patent for. But reports from a Bay Area local CBS affiliate and CNET suggest it's a retail play, and now CBS is reporting (via 9to5Google) that as confirmed from multiple sources.

CBS affiliate KPIX 5 says that the barge will eventually include luxury showrooms for gadgets such as Google Glass, as well as a party deck, and provide hands-on experiences to select potential clients by invitation only. It's the brainchild of Google X, the skunkworks at Google designed to build some of that company's more experimental products and services, including Google Glass and self-driving cars, and it's overseen by Google co-founder Sergey Brin. Brin is reportedly the driving force behind this retail barge experiment, and the purpose of the plan is to compete with Apple's dominating retail presence, according to the CBS report.

While the barge doesn't look like a luxury showroom at the moment, it's built out of modular 40-foot shipping containers and is designed to be quickly torn down and put back together easily. It's not a strictly seaborne affair, either – Google could reportedly assemble it on trucks or on freight trains, too, adding new meaning to the term “road show.”

CBS says that the barge's launch has been delayed because of how it's been designated by the U.S. Coast Guard, which is so far complying with Google's apparent request that its purpose be kept secret.

Earlier this year, reports surfaced that suggested Google would begin opening its own retail stores in time for this year's holiday season. A splashy launch of a naval retail outlet aimed at high-value clientele would definitely be an interesting way to kick-off wider retail efforts, and this will help Google do more to evangelize established lines of business like Chrome OS and Nexus devices, as well as more experimental projects like Google Glass, which will need plenty more consumer exposure if it ever hopes to be a more broadly appealing device.

Image credit: CBS KPIX 5

iFixit's iPad Air Teardown Reveals Tightly Packed Innards Dominated By A Big Battery

Apple's iPad Air goes on sale today – it's easily the best iPad Apple's put out so far, but we're waiting with bated breath for the iPad mini with Retina display. Until then, however, the Air is also the most remarkable feat of engineering in any tablet device in terms of what goes on under the hood, or at least that's what it looks like based on iFixit's traditional day one teardown of the brand new device.

As it does with every new Apple product release, iFixit has managed to get its hands on one of the first shipping units available anywhere in the world, and they've immediately broken it open to see what makes it tick. In short, what makes it tick is a battery. It's a huge one, and it takes up most of the space within the case – but it's also actually still smaller than the battery of the iPad 4th generation, despite the fact that it's a much more powerful machine.

This battery has only two cells, and is rated at 32.9 WHr capacity, while the last iPad held a three cell, 43 WHr unit. The new slimmed down lithium ion power source is supplying energy to the same screen as on the iPad it replaces, which is a 9.7-inch display. That means the increased battery efficiency is coming from somewhere else; it also probably means decreased component costs for Apple.

Other highlights from the teardown include a look at the A7 chip (which is actually a slightly different version to the one in the iPhone 5s), confirmation that it does have 1GB of RAM, and the RF components that include a Qualcomm LTE processor with 1GB of dedicated RAM itself, which helps account for the iPad Air's magical range of LTE band connectivity.

iFixit concludes by saying that the iPad Air achieves a repairability score of just 2 out of 10, which is in line with the repairability score of Apple tablets in general. If you're looking for something modular, however, you're probably not looking for an extremely thin and light tablet that's as portable as possible while still boasting impressive display and battery life. I'd never pop the case on one of these myself, but it's definitely fun to take a peek inside courtesy of someone who's brave enough to attempt it.

Groupon Redesigns Web And Mobile Apps To Focus On Personalization, Local And Search

Groupon hasn't had a great go of things since becoming a publicly traded company; founder and CEO Andrew Mason was ejected earlier this year, and its so-called “third-party” or daily deal revenue seems to be in a state of continuing decline as more customers shy away from or ignore those emails offering flash sales. But under current CEO Eric Lefkofsky, the focus has shifted to a place where users go to search for deals, which is why the redesigns of its mobile and web presences announced today make a lot of sense.

On mobile, Groupon now has a “Local Explorer” feature, which automatically bubbles up content in the city in which a user is currently located (it used to serve this via a ‘Nearby' tag only). It detects location changes in the background and sends targeted deals via push notifications, too, which is clearly designed to remind users that the app exists when they're on holiday and perhaps more likely to be in need of discounted meals at restaurants, etc.

There's now a search bar at the top of every screen on mobile, emphasizing that new focus under Lefkofsky, and users are also greeted with personalized deal collections unique to each when they launch the app, instead of just a generic layout based on their hometown location. Groupon also moves into 12 new markets on the iPad with this update, which is key if the company is targeting travelers.

On the web, there's likewise a personalized homepage with “curated collections of deals based on the customer's interests, previous purchases, [and] purchases by other customers with similar interests,” and there's a new persistent search bar on every page of the site, which also features autocomplete suggestions. Those, too are designed to increase discoverability.

Also new on the web are results that cross all of Groupon's lines of business, spanning local deals, travel, restaurants and more, which is clearly aimed at generating some generative cross-market sales from users who are looking for more than one thing at once. Search also gets new filters that are designed to help users pinpoint their own specific areas of interest much more clearly.

Groupon may not be doing as well as some would've anticipated five years ago on its birthday, but these redesigns are the surest recent sign that it's turning the prow of what has become a rather large and lumbering ecommerce ship towards new waters. A lot of these changes seem obvious in light of the current trends among online businesses and startups, but that doesn't mean they can't still have significant impact on Groupon's average level of user engagement. Sadly, Groupon still requires an email to sign up for its website, which is perhaps the single most annoying thing about its platform. Bay steps, I suppose.

Filesharing App Airlike Is Bump Without The Clashing Of Fists

This is a pretty cool new iOS app from Russia's Displair, maker of the Minority Report-styled Multi-Touch “air” display.

Similar to Google-acquired Bump, using an iPhone's various sensors in combination with its own cloud-powered algorithms, Airlike lets you share photos, videos and contacts with other iPhone users in close proximity, but with one key difference: There's no need to bump phones or fists. Instead, you flick content through the “air” from one phone to another.

Shunning Bluetooth or WiFi for peer-to-peer networking, the app uses a combination of GPS, and each phone's gyroscope, compass and accelerometer sensors, and relays that information to its own servers to know when two phones are pointing at each other. You then each confirm a connection and can begin flicking content from phone-to-phone - an experience the company describes in Arthur C. Clarke fashion as “absolutely magic”.

And in our quick testing, the iPhone app works as advertised.

Along with trumping Bump's need for physical contact, Displair is also talking up Airlike's functionality over Apple's own AirDrop phone-to-phone filesharing offering. That's because AirDrop requires iOS7, whilst Airlike works on iOS6 and upwards, meaning that it supports a greater number of Apple's older devices.

In addition, and crucially longterm, Displair plans to release Android and Windows Phone versions of the app, making Airlike, just like Bump before it, truly cross-platform.

One thing lacking for now, however, is an Airlike API that other developers can tap into, though I'm told that this is on the roadmap and could be one way the company hopes to monetize the technology.

Interestingly, the ability to transfer money between contacts peer-to-peer is also currently in development, thus taking another page from the Bump playbook.

Meanwhile, the longer term business model revolves around the way Airlike will tie into the Russian startup's Displair Digital Signage product to enables users to grab content from advertising displays. So, for example, you could walk into a mall, see interesting ad-related content on Displair (or even a standard LCD screen) and have it sent to your smartphone using a simple gesture, much in the same way as the Airlike app works for phone-to-phone content sharing.

TechCrunch's Darrel Etherington contributed to this article