Archives for August 2010

Music and technology have long been willing bedmates.

Now the band Arcade Fire has jumped in with search giant Google to create an interactive video for the song We Used To Wait aimed at answering the question "What would a music experience designed specifically for the modern web look like?"

Aaron Koblin said that Google Creative Lab's answer was to devise a "project built with the latest web technologies [which] includes HTML5, Google Maps, an integrated drawing tool, as well as multiple browser windows that move around the screen".

Billed as the Wilderness Downtown, you are asked to insert your childhood address. As the video plays, a window pops up zooming into the area if it has been mapped by Google Street View.

"These modern web technologies have helped us craft an experience that is personalised and unique for each viewer, as you virtually run through the streets where you grew up," said Thomas Gayno, Google Creative Lab.

No sitting back and just absorbing the music, then.

Is this the future of music video? As an artistic endeavour, it is fun and compelling and clearly illustrates what is possible with HTML5 technology.

The director behind the mash-up is Chris Milk.

Google recommends you watch the video on Chrome, but it worked fine for me on other browsers. I watched on both Safari and Firefox.

And if you're minded, don't forget to "write a letter of advice to the younger you" that lived wherever it was all those years ago.

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• - What's this?

A couple of months ago Facebook was up to its ears in trouble over the way it was treating users' information and privacy. It led to a crisis meeting at the company's California HQ.

Politicians in Washington even got wind of the stramash (good Scottish word for uproar) and told the company get its act together.

Europe weighed in. So did privacy officials in Canada. Advocacy groups had a field day as Facebook seemed to get it so wrong as it made its play to rule the web as it becomes more social.

There was even a kind of Facebook revolt with plenty of people talking about quitting the world's biggest social network. That clearly didn't come to pass given that since the April/May debacle, Facebook has announced it has over 500 million users.

Of course, it wasn't Facebook's first tangle with privacy problems. And it probably won't be its last.

But back in April/May it seemed there was a kind of perfect storm around the issue and four enterprising students saw their moment and grabbed the spotlight.

Maxwell Salzberg, Daniel Grippi, Raphael Sofaer and Ilya Zhitomirski got together to create an alternative to Facebook that would be a "privacy aware, personally controlled, do-it-all distributed open source social network".

At the time they told the BBC "this is not just about Facebook. Facebook is not what we are going after.

"We are going after the idea there are all these centralised services where people are giving up their personal information. We want to put users back in control of what they share. "

But the Facebook backlash helped the enterprising students raise over $200,000 on Kickstarter, the highest amount ever raised on the site. And get this - they were originally only after $10,000. Such was the furore over Facebook's missteps that the money just poured in.

Over the last few months, the boys have been coding like mad. In an update on their blog, the team announced when they will roll out their product.

"We have Diaspora working, we like it, and it will be open-sourced on September 15th.
 
"We are spending a good chunk of time concentrating on building clear, contextual sharing. That means an intuitive way for users to decide, and not notice deciding, what content goes to their coworkers and what goes to their drinking buddies."

So what kind of web world will greet Diaspora when it is launched next month?

The fevered atmosphere towards Facebook has eased somewhat after the company made some adjustments to its privacy policy.

While privacy remains a serious issue that users care about, people have not fled the site as many threatened back then. It is just too useful to their lives.

All this will affect Diaspora to some degree but I don't think these changes will sideline interest. I do think Diaspora will be more than just a passing curiosity. The four students just have to deliver on their promises and come up with some ideas that will challenge the space.

Sure, as the New York Times notes, Diaspora became something of a media darling at the time, but I think there will be a lot of people watching to see just what the team come up with. Not least from Facebook founder and ceo Mark Zuckerberg who did express support for what the boys where doing at the time. Perhaps he might even offer them a job.

It's a big test for the foursome but Maxwell, Daniel, Raphael and Ilya will clearly worry about all of that later as they prepare to kick up their heels for a hedonistic getaway at the world famous Burning Man Festival in California.

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• - What's this?

PayPal's ambitions are clearly impressive.

One of their goals is to become such an accepted everyday form of payment that instead of offering up your Visa card or Mastercard at a till, you will opt to use your PayPal account. And most likely you will do it by swiping your phone across a reader.

This plan to grab a share of the reported $2.4 trillion market dominated by credit card companies, surely underlines the self confident air of a company that has already changed the way people pay for things over the internet in its 12 short years.

Its big success was of course helping buyers and sellers on eBay conduct financial transactions easily and securely.

"We started on eBay and ventured into off eBay businesses but it was all e-commerce and that was where our focus was," said PayPal president Scott Thompson, who formerly worked for Visa.

"Now the focus is not just e-commerce, it is online transactions. What fits into that that wasn't in there before is everything from payments to not for profits, charities and government agencies and even, in my case, my son's school accepts PayPal. Those are just some useful cases for you as a consumer and it just keeps going and going."

Mr Thompson believes as more and more devices become connected to the internet, they also become payment vehicles. This includes everything from the TV to the cellphone and from a dvd player to a car.

"These new point of sale devices are about being at the end of a network and you being able to connect and any payments occasions in there are best suited for us. Eventually we [PayPal] will be everywhere that is online.
 
"If you are a customer of ours you should be able to use us anywhere on the internet and around the world."

More specifically, Mr Thompson said PayPal's future strategy going forward is simple.

"Where are we going next is anything that is mobile, anything that is digital and lots and lots of e-commerce online payments."

When Mr Thompson says "lots and lots" he means hundreds of millions. At the moment PayPal has 87m active customers and 8m active merchants. He noted that while there are over 1bn people online, there is something like 5bn cell phones in the world.

The new offerings include smartphone applications, partnerships with Facebook and Google, micropayment solutions and a number of third parties that have integrated PayPal into their applications. Reports abound that the firm is also in talks to embed its payments platform on Android, Google's mobile operating system.

A major priority is to turn phones and connected devices into "digital wallets" that can be used by shoppers to buy merchandise, collect coupons, and store loyalty program information using electronic funds. The software is to be introduced by PayPal at their developer conference in October.

Another big play for the company is micro-payments. All those 25 cents and $1 transactions add up to lots of profit.

"This is going to be big, really big for us," said Mr Thompson.

"I believe what is happening here is the subscription based economy where I want to pay for it when I use it. I want to pay for it when I consume it. And I only want to pay for what I use, not pay for 100 of something and use 10.
 
"This is going to lower the overall transaction size but there are going to be millions and millions more transactions. And if we are the most convenient and most secure way of doing that, you won't do tens of transactions with us over the course of the year, you will do thousands of transactions but they will be much smaller."

One example of that "pay for what you use scenario" is easily illustrated when you think of parking said Mr Thompson.

"At the moment you pull up to a parking meter and put all this money in and worry about 'Oh I put in too much and I don't use it or get the value or I didn't put in enough and I get a traffic violation'.
 
"Why not when the car pulls up to the meter, because it is a connected device, it clocks in and when you pull it out it knows how much you owe. You have that money exchange with the automobile through your PayPal account embedded and capable of paying that transaction. Think of all the useful cases where that will happen, all those small transactions."

Visa also agrees micropayments offer a lucrative future. At a recent technology conference called Techonomy Visa's North America president Bill Sheedy was understated in his assessment.

"When we look at micro transactions, we see that as a growth area."

PayPal's Mr Thompson believes the company's ability to grab market share from established players is down to their approach which puts technology at the heart of everything.

"The secret sauce of PayPal? Strip it all away and what do we do that no-one else does is risk and fraud management and its completely proprietary and it is all tech based.
 
"If you wandered around to a lot of legacy companies or those that have been around for a long time. When you talk about technology, they view it as a cost to the business. 'Yeah we have a few of those tech guys around and they cost us a lot of money' or they outsource it.
 
"We would never do that. This is the life blood of what we do. Every great disruptive innovation that we have seen and done has been through the use of software and technology."

Mr Thompson asserts technology has enabled the company to remain flexible and nimble to customer demands and it is what will ensure its future as it continues to take on the established players in the game and perhaps even change the rules of the game:

"We are big today but I would tell you that we are more innovative today than in the last five years. It is through innovation we will be more disruptive moving forward.
 
"Where we are in the growth of this business is we are just getting started. This is year one again."

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• - What's this?

There is little doubt that Apple's App store started a phenomenon that has spawned an industry and changed the way we all use our mobile phones.

In the early days, stories of developers hitting the jackpot with a winning app seemed almost commonplace. Today, with increased competition, that crown is harder to win.

But at the same time as the App store continues to grow with over 4 billion downloads, so do other app stores. There is Nokia's Ovi store, BlackBerry, Windows, Google's Android and of course the independent app store operated by Getjar which recently hit a billion downloads.

With around 5 billion handsets in the world, and an estimated 20% of them smartphones, the market looks pretty robust for some time to come. Recent research gives two sides of the same story.

ABI showed that downloads of mobile applications from "app stores" will peak in 2012-13, then begin a slow decline in numbers.

But Juniper Research reported that the "combined revenues from apps funded by pay-per-download (PPD), value-added services (VAS, including freemium and subscription) and advertising is expected to rise from just under $10bn in 2009 to $32bn in 2015".

Matt Murphy runs the iFund at Kleiner Perkins Caufield & Byers, one of the most respected venture capital firms in the country.

The iFund is aimed specifically at developers who create apps for Apple's App store. It was recently increased from $100m to $200m ahead of the launch of the iPad.

"When we started the fund it felt like a greenfield site for every category and today there are over 250,000 apps. It's gotten very very competitive and in some ways that is good and in some ways that is challenging."

Mr Murphy said their focus is on a number of areas including location based services, social networking, mCommerce (including advertising and payments), communication, health care, education, and entertainment.

To date the iFund has put its money behind 14 ventures from the first iPhone-only gaming publisher ng:moco to social gaming giant Zynga and from music discovery service Shazam to Cooliris which offers a 3D interface for browsing vast amounts of rich media.

"I think the analogy of the gold rush where anybody could show up and make a ton of money - I don't now that it's over but it's harder."

He said the fact there are many more players will require a different mindset.

"I think it will create a discipline among entrepreneurs who will say I want to build a big company. I think there will still be a lot of successful one-off apps, where any mom and pop can create an app and monetise it well and do well but to a certain scale.

"They are not going to get rich on it, well they might depending on their definition of rich. But they are not going to build the next Google, Amazon, eBay or Netscape of the mobile internet. As a venture capitalist, we are looking for opportunities that have more of that potential to really break out and be one of the companies you talk about in ten years time.

"I would say everybody can show up and make a little to a good amount of money but it's getting harder for people who say I want to be that really big company. But that's how these platforms shake themselves out."

From Mr Murphy's point of view, those companies who are on the path to becoming big and have set the standard for others to attain include Zynga, ng:moco, Pinger, Shazam and GOGII.

"Take ng:moco. It's really a pure play around iPhone gaming right now and they are the leader in that category," said Mr Murphy.

"This all came from one guy who walked into our office two years ago and said I really want to be this greenfield category. Then people were thinking of gaming and apps as a one off and he said 'let's build a network'. That's an example of what I am talking about."

From Mr Murphy's point of view the ingredients to success include simplicity, attention to detail and having fun.

"Start off really simple with something that every user can resonate with and then over time provide more in the app that makes it stickier - more functionality, more social things. That is what we are seeing with Shazam right now and GOGII which is moving from free texting into groups and communities.

"No one has really nailed chatting communities on the iPhone so that is a greenfield opportunity. But you have to nail them initially with that simple-use case. The people that try to do too much too soon are the ones we have seen struggle."

The iPad has presented a whole new opportunity for developers and for the iFund which was boosted by $100m ahead of its launch.

But Mr Murphy said for those with an eye to developing apps for the iPad, the important thing to remember is that it offers a very different user experience compared to the iPhone.

"If the iPhone is all about the five to ten minute snack, the the iPad is all about heavy media consumption of an hour or an hour plus. Developers and companies that master that are going to do really well."

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• - What's this?

For many of Silicon Valley's chief executives, the name Neelie Kroes was one that surely made them quiver in fear.

As the former competition chief for Europe, Ms Kroes, sometimes referred to as Steelie Neelie, took tech giants like Intel, Microsoft, Oracle and Sun Microsystems to name a few, to task for their anti-competitive behaviour.

"I felt my role was to be the referee and in every game you need a referee to ensure the teams conform to the rules. If not it is no fun. No fun for the game, for the public watching and for your counterpart," Ms Kroes told me during the Techonomy conference in Lake Tahoe, Northern California where the marriage of technology and economics was discussed.

These two are subjects very dear to Ms Kroes' heart, especially now she has a new job driving Europe's digital agenda.

"It is extremely important for Europe to get back in the driving seat. There are still digital virgins, as I am always saying. From 2013 every European should be digital whatever your age, nationality, background.
 
"There shouldn't be digital virgins anymore and anyone should be able to enjoy this great step forward in technology."

Ms Kroes noted that 30% of Europe falls into this category.

It's a situation Ms Kroes is clearly not happy about as she told an audience at the conference that "this is my political life now" to make this digital vision a reality for every European.

America is also championing a similar mission with its own broadband plan [12.1MB PDF] which aims to deliver a high speed internet connection to every US citizen by 2020. The Federal Communications commission (FCC) has noted that 100 million Americans do not have a broadband connection.

Of course it has had quite a bit of challenge of late with the thorny issue of net neutrality, the principle where all web data is treated equally and no traffic is given preferential treatment over another.

The FCC last week called off backroom talks with internet service providers and internet companies after it failed to reach a consensus on the issue.

That didn't stop search giant Google and telecom titan Verizon coming up with their own suggestion for the FCC to consider. Their seven principles have been royally criticised because they map out different positions for wireline and wireless.

Ms Kroes told me she is watching that debate very closely given that she is set to face a lot of the same issues.

"We face the same battles as the US. While we are not so far ahead we will be following what the consequences are."

While Ms Kroes noted that Europe and the US are embarking on similar digital paths, she also noted quite a few cultural differences.

She acknowledged that the strict labour laws in Europe do not make it easy for start-ups but that change is afoot as the economic recession forces progress.

"We are on the move," said Mr Kroes.

When quizzed about privacy, where Europe is seen to have stricter laws, Ms Kroes said it remained central to getting people online and trusting doing business on the internet.

"Everybody should be online with the feeling of trust and that I am backed by my privacy. We have to take that into account and yes there is a difference in culture here but the government is taking a bigger role to play in privacy action in Europe."

While Ms Kroes would not be drawn on what that means for a company like Facebook, which has had its share of issues over privacy, she did agree that regulating Facebook like a big telecom company was perhaps something that will come to pass.

And when it came to differing cultures between the US and Europe in terms of the approach to business, Ms Kroes said that "doesn't mean we are less talented."

However she agreed that unlike America, and Silicon Valley in particular, the belief that failure is good does not carry over in Europe and that it tends to follow you around.

"What I get from the US is it is even more that is positive - you were a survivor and when you start again that's great.
 
"Talking about myself, I have learned more from my mistakes than my successes... and my list of mistakes is much longer."

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• - What's this?

Perhaps you tweet like a fiend, all day and every day. You are followed by hundreds, nay thousands of people. You appear pretty popular - but how much influence do you really have?

According to research by HP Labs, not as much as you might think.

"High popularity numbers does not necessarily add up to high influence and vice versa," says Dr Bernardo A Huberman, director of the Social Computing Lab.

He and his fellow researchers devised an algorithm to measure tweets with the aim of measuring why and how some posts get more attention and "bubble to the top".

In a paper called Influence and Passivity in Social Media [502.29KB PDF], the algorithm assigns a relative influence score and a passivity score to every user. The labs examined nearly 3 million public tweets.

"There is an immense amount of passivity on Twitter with its 105 million users," says Dr Huberman.

"Everybody tweets thinking that everyone is going to learn about your tweets but in order for that to happen someone has to read them, find them interesting and pass them on."

Dr Huberman says the algorithm "notices how messages from a user propagates. You could be tweeting and have 50,000 followers but if they don't retweet your stuff, it doesn't go anywhere and that is where the measure of influence is." The team tracked how far up the food chain a retweet goes to understand influence.

So what is the value of all this? The lab's analysis of tweets to predict whether a movie will be a box-office hit suggests some possible practical applications:

"Imagine when you are discussing or pushing products, trends, public policy or say politics. We can discover the two people who are making an impact there and not just target those who have millions of followers.
 
"These people, these influentials inside a network are responsible for bubbling stuff up to the top and that is how we become aware of certain things."

The $64,000 question is: how do you become a person of influence on Twitter? Dr Huberman says it's down to the content of your tweet. Make it interesting, novel, fun, off the chart and surprising - and, mostly, make sure it resonates with the audience:

"This has a lot do with the fact that humans are very social people.
 
"You have all these people who say look at me, read me, see me, download me, buy me. And what is it that finally captures your attention and the attention of millions? That it elicits an emotion."

So who makes the grade?

• @mashable - Social media blogger
• @jokoanwar - Film director
• @google - Search giant
• @aplusk - Actor
• @syfy - Science fiction channel
• @smashingmag - Online developer magazine
• @michellemalkin - Conservative commentator
• @theonion - News satire organisation
• @rww - Tech/social media blogger
• @breakingnews - News aggregator

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• - What's this?

Techonomy, a conference discussing the marriage between technology and economy here in Lake Tahoe in Northern California, has seen a fair number of tech gods in attendance.

There's been Google co-founder Larry Page, its CEO Eric Schmidt, Sun Microsystems co-founder and so-called "Edison of the Internet" Bill Joy, Amazon founder Jeff Bezos, inventor Dean Kamen and Facebook co-founder Chris Hughes.

A pretty impressive bunch. But when former Microsoft boss Bill Gates arrived, it was like a rock star entering the room. Even Larry Page jostled for some one-on-one and the pair chatted about - what else but technology?

As well as catching up with his peers, Mr Gates spoke to a host of other attendees and to the students who have been helping out here all week.

Among them was 15-year-old Talia Leman, to whom Mr Gates paid particular attention; the day before he had played bridge with her grandparents. The fourth player was the sage of Omaha, Warren Buffet.

Mr Gates had also come with a note from Talia's gran, Evelyn Mintzer. "That is so typical of my mom," said Talia's mother Dana.

But this wasn't Talia's first encounter with Mr Gates. When she was 12, she heard him speak at Harvard where her father graduated. (The same cannot be said of Mr Gates who dropped out to start a small software company.)

His commencement address had an effect on Talia:

"He said the barrier to giving is not too little caring - it's too much complexity. That means when we see suffering in the world and we don't know how to help, we look away."

"It was such a reassuring message that people do care - but it's our job to make it simple for them to find a way to make a difference," said Dana. "Mr Gates is the one that liberated Talia to understand that complexity is her only enemy. It's not apathy. That is a very liberating thing to realise."

Talia used the quote in speeches to stump for her non-profit start-up Random Kid, which aims to use the "power of anyone to solve real problems" - that is, to help children help other children.

The first project was raising money for Hurricane Katrina. Her organisation has gone on to provide funding for water-pumping projects around the world, refurbished schools, provided play centres and anti-malarial nets for Africa and crutches and artificial limbs for those injured in the Haiti earthquake.

Random Kid has raised over $10m and counting. Not bad for a 15-year-old. Talia has also been appointed Unicef's first known National Youth Ambassador and has amassed a slew of national and international awards.

Over her short career to date, she has harnessed the energy of over 4,000 school districts. It sounds like she could give Mr Gates a run for his money in the "over-achieving" stakes.

While Talia clearly regards the software mogul as an inspiration, she said he also comes across as "a real down-to-earth person. He's very real and very legit and I hope to learn some of his wisdom."

Talia said she has been soaking up the conference atmosphere and learning as much as she can:

"Everybody here has something to offer and everybody comes from a phenomenal background with amazing resources we can bounce off.
 
"I feel everyone is interconnected in some way, which is really cool. I feel like I am listening in on something I am not supposed to - like I am part of this cool new present and like I'm not supposed to be listening because it is all the most intelligent people in the world discussing the biggest issues that we are facing."

Talia is planning a big site relaunch in the next couple of weeks. Her mum Dana is also looking for a mentor for her because "there's only so much a mum can do. She needs someone to help her to the next level."

For the moment, Talia is concentrating on spreading the world about Random Kid:

"You realise that coming from rural Iowa, you can be part of something that is so much bigger - and that's incredible. Also that the small efforts matter most not just that they matter.
 
"I'm in it for the real deal, for the long term."

And the outcome of that bridge game between Talia's grandparents and Messrs Gates and Buffet? Dana said that Mr Gates told her he couldn't remember.

Dana noted that last year her parents won.

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• - What's this?

Here amid the lush mountains of Lake Tahoe in Northern California, technologists have been discussing what has been billed as "a new philosophy of progress" at the first ever Techonomy Conference.

The organisers are hoping the name will soon become common parlance but for the moment they are quite happy to explain their thinking behind the event as one that discusses the role that technology has in solving some of the world's thorniest problems from climate change to education to innovation.

"Society's problems are so grave that we have to really work to solve them more wilfully and consciously using technology in all of its guises," said conference co-founder David Kirkpatrick.

Fellow cohort Brent Schlender told attendees that because of our "constant connection to people and our inventions 24/7" the desire is there to turn this "notion of a cumulative IQ into a collective intelligence".

Mr Schlender admitted that "we are on the verge of something here though I am not quite sure what."

That is what the conference will try to define over the coming days with a little bit of help from some heavy hitters like Google CEO Eric Schmidt, Amazon founder Jeff Bezos, T Segway inventor Dean Kamen and Sun co-founder and so-called "Edison of the internet" Bill Joy.

Bill Gates is due at the end of the week to wrap things up.

At the heart of everything here is the role of technology and its ability to solve problems.

While Kevin Kelly, co-founder of Wired Magazine, said that "technology is the most powerful force in the world", Google's Mr Schmidt countered this with the comment that "I spend most of my time assuming the world is not ready for the technology revolution that is happening."

Mr Kirkpatrick said those that don't get on board the technology train risk being left behind and losing out to the rest of society.

Over dinner, under a sky of glittering stars, Mr Bezos said that thanks to technology the "balance of power is shifting away from companies to the consumer."

In a discussion about building an internet treasure he said that "the key ingredient is extraordinary luck. Planetary alignment - that's the big one," explained Mr Bezos.

He also added that hiring top-notch operators was crucial and that "teams win".

Mr Schmidt agreed and said for him it was about hiring "young people who are willing to challenge things."

But he also noted that more needs to be done to attract young talent which should be regarded as "a national treasure".

John Doerr of venture capital firm Kleiner Perkins Caufield Byers which has invested in all the big Silicon Valley names including Amazon and Google said that "there has never been a better time to be an entrepreneur" and that President Obama's "agenda should be an innovation agenda".

Dean Kamen pointed to energy as the next big thing for entrepreneurs to get involved in and noted that banning all passenger cars would result in 2% of energy savings.

Suggestions for this high-flying crowd to take to public transport raised a few laughs.

Here in Lake Tahoe, the gondola is proving a popular mode of transport.

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• - What's this?

"Ask any question you like" was the instruction from the boss of the world's most powerful internet company.

Clearly Eric Schmidt, chief executive officer for Google was in convivial mood when he sat down with a gaggle of reporters following a panel he did at an industry conflab called the Techonomy conference in Lake Tahoe, California.

Mr Schmidt was in an expansive mood as he chewed the cud for 40 minutes discussing Android, the company's social ambitions, net neutrality, China, Google's buying spree and StreetView.

That doesn't mean to say that he didn't dodge a few issues.

Microsoft was one topic that Mr Schmidt admitted he had learned it was better to steer clear of. The same goes for the competing search engine Bing, which has been garnering praise and an increase in traffic of late.

He was equally circumspect on reports that Google and Verizon have hatched a deal over net neutrality: the principle of ensuring that all web traffic is treated equally.

"We have been talking to Verizon for a long time about trying to get an agreement on what the definition of what 'net neutrality' is.
 
"We are trying to find solutions that bridge between the hard core 'net neturality or else' view and the historical telecom view of no such agreement."

The Google boss explained what the company means by net neutrality:

"[I]f you have one data type like video, you don't discriminate against one person's video in favour of another but it's OK to discriminate across different types.
 
"You could prioritise voice over video and there is general agreement with Verizon and Google on that issue."

The Federal Communications Commission recently had its authority thrown into question following a court ruling that stipulated it did not have the power to sanction Comcast when it throttled some traffic.

That has led to the FCC considering changing how it treats internet traffic and reclassifying it. The move has resulted in a fierce battle with internet service providers and telecoms who fear a reclassification will mean agency meddling when it comes to rates and service.

On the side the FCC has been trying to find some accord on the issue to the distaste of many net neutrality supporters and consumer groups.

The Google/Verizon deal has resulted in theFree Press declaring the deal as "a bold grab for market power by two monopolistic players".

"Such abuse of the open Internet would put to final rest the Google mandate to 'do no evil'", says the organisation's Josh Silver.

Another thorny issue for the search giant has been its recent stumble over Street View.

The company admitted that it had collected snippets of information that leaked out over unsecured networks which had been stored in a data server.

While interest groups have raised issues about privacy and security, Mr Schmidt revealed that the total sum of data it wrongly gathered fitted on a "500 gigabyte drive which happens to be in a safe".

He said that he hadn't actually seen the contents; a number of governments have asked for the destruction of the data.

The lessons learned are very clear, said Mr Schmidt:

"From my perspective, it is a one-time event. We learned: don't do this. We learned to make sure in these areas that are sensitive to have several people checking code - sounds pretty obvious because it appears to be the action of a single individual.
 
"I wish I could tell you we won't make such mistakes in the future but I suspect we will make more mistakes. We are not perfect."

Mr Schmidt was more loquacious on the topic of Android which, according to research firm NPD, for the first time beat Research in Motion's Blackberry platform as the top mobile OS sold to US consumers in the second quarter.

He said around 200,000 Android devices are being sold every day and that two months ago the figure was 100,000.

"It looks like Android is not just phenomenal but incredibly phenomenal in its growth rate," said Mr Schmidt.

Also growing is Google's slate of acquisitions which average around two a month.

While Mr Schmidt would not comment directly on reports that the company has bought social games developer Slide for $182m, he did talk about the firm's social ambitions and whether or not it is going head-to-head with Facebook.

"The media as a group is obsessed with Facebook versus Google," he said:

"We are not trying to do what Facebook does. Facebook does a perfectly fine job and the world doesn't need another Facebook, it needs the technology around friends and relationships to be applied to everything."

Mr Schmidt did acknowledge that the social graph is important to its future.

"We have always believed that our products would be better with more social signals."

On gaming, a mainstay of Facebook's success, Mr Schmidt admitted that "historically Google has not been a gaming platform" and that "I suspect we will do more casual things. I would doubt we would get into significant gaming, but you never know."

Indeed.

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