'Color' app shares with people around you

The free app figures out if other users are close to you by using a secret blend of GPS data, ambient noise and even light.

Then your updates become available to them and you in turn see theirs.

The app, available initially on iPhones and Android-based smartphones, was created by a group of technologists led by CEO Bill Nguyen, the serial entrepreneur who sold digital music locker site Lala.com to Apple Inc. for an estimated $85 million back in December 2009.

Nguyen said the app will help people break out of the mold of their current group of friends and give them more information about the people around them - namely co-workers and neighbors.

"I talk about identity: where I work and where I live. That's a big chunk of who I am," said Nguyen, 40, who demonstrated the app to The Associated Press. "But oddly, these people aren't on my Facebook."

While your first name appears on your posts, there is no password and no friending. So unlike Facebook, the notion of limiting private content to a friend network doesn't exist.

In the future, the app will be able to intuit relationships based on whom its users spend time with regularly because it collects data constantly. You could bump into an acquaintance's co-worker and immediately know that, simply because the two were in the same place during daylight hours on weekdays.

"The days of having to say anything are done," Nguyen said. "There's no more profiles, there's no more friending, there's no more electronic dog fence created by Facebook. It's all over. This is the post-PC world. It's a brand new way of sharing."

Along with people within 50 feet, Color keeps sending feeds of people you recently were in contact with, although those contacts fade over time if you don't engage with their streams. And if you're at a concert, the app knows to string the entire group into one massive stream.

Color, with 30 employees in Palo Alto, Calif., was seeded with $41 million in capital - $25 million from Sequoia Capital, $9 million from Bain Capital, and $7 million from Silicon Valley Bank.

Mike Krupka, managing director of Bain Capital Ventures, said the site would seek to generate revenue from advertising by the end of the year. One possible way to help businesses advertise would be to enable restaurants to post photos of their specials to recent guests. Users might also be enticed by seeing pictures of what their acquaintances had ordered the last time they ate there.

"We believe that if you create a product that the consumer truly values to enhance their life experience, you'll find a way to monetize that," he said.

Gartner analyst Mike McGuire said the app was a good test to see if active social networkers were ready to take another step toward more sharing and less privacy. He noted that Nguyen is apt to change the app if people react adversely to the lack of privacy controls - noting that Lala was once a site that stored one's personal CD collection online before becoming a way to buy Web-based music.

"He's willing to start with an idea and see how people react and change it accordingly," McGuire said. "These guys have built the tools. Now it's up to the consumers to do something with it."

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