Yesterday, Google CEO Eric Schmidt sat down with a group of reporters after his panel at the Techonomy conference in Lake Tahoe, CA. He said he was open to taking any questions, so I decided to ask him about Foursquare.

It’s a particularly interesting question for Schmidt because back in 2005, Google bought Dodgeball, the company Foursquare co-founder Dennis Crowley previously started that was similar to Foursquare. Crowley and Dodgeball co-founder Alex Rainert famously left Google in a huff in 2007. A couple years later, Foursquare was born.

“Yes, I remember it quite well,” Schmidt said of Dodgeball with a smile. “Shockingly, founded by the same two people [as Foursquare],” he continued. That’s not technically true, Crowley co-founded both, but he started Foursquare with Naveen Selvadurai, who wasn’t involved in Dodgeball. That said, Rainert is now with Foursquare as well and was a seed investor, so we’ll cut Schmidt some slack there.

“Dodgeball was a good company,” Schmidt said defending Google’s purchase. He also praised the co-founders, saying that “the market proves how clever they are.”

“Would Google have built Foursquare earlier? I don’t know. Those are always sort of missed opportunities,” Schmidt continued.

“Foursquare and Gowalla are pretty impressive. They show you the power of mobile/social/local,” Schmidt said. “Google will play in that market in a lot of ways.”

That’s a particularly interesting comment when you look back at the note Crowley left on his 2007 Flickr picture when he and Rainert quit Google:

It’s no real secret that Google wasn’t supporting dodgeball the way we expected. The whole experience was incredibly frustrating for us – especially as we couldn’t convince them that dodgeball was worth engineering resources, leaving us to watch as other startups got to innovate in the mobile + social space.

So, if Crowley is to be believed, he tried to convince Google about the importance of that same mobile/social/local space back in 2005. But they wouldn’t listen.

“I think it’s going to be a very large business for us,” Schmidt said yesterday referring to the space. Perhaps it could have already been.

Schmidt affirmed Google’s strong commitment to both Places and Latitude. And he noted that the location capabilities built into Google’s website on smartphones such as Android phones and the iPhone “will freak you out. That’s how accurate it is.”

He also said that thanks to the success of Foursquare and Gowalla there will be 20 new similar companies that get venture funding. And I’m going to bet Google is a big player in snatching up some of those. Foursquare seems off the table given the Dodgeball history. But I’m going to go on record here with a prediction:

I bet Google is going to buy Gowalla at some point in the future. This isn’t based on anything concrete (well, I guess other than Schmidt bringing it up a few times). But that team’s commitment to design, gaming, and location seems to be a great fit for what Google is looking for.

Expect a lot of gloating if I’m right, and no further mention if I’m wrong.

Below, find the full video of Schmidt talking Dodgeball/Foursquare.

More from Schmidt:

• Google’s Schmidt Doubts Company Will Get Into “Significant” Gaming
• Schmidt: Google Now Activating 200,000 Android Units A Day [Video]
• Schmidt Talks Wave’s Death: “We Celebrate Our Failures.” [Video]
• Eric Schmidt: Every 2 Days We Create As Much Information As We Did Up To 2003

Rainert was a seed investor in the location based social network, and has been working part time with the team over the past two months on product development. Of course, this is also a reunion between Rainert and Foursquare CEO and co-founder Dennis Crowley. They both founded Dodgeball together. The location based service was acquired by Google in May of 2005. Rainert and Crowley subsequently left Google. Dodgeball was shut down buy Google in January of last year.

Rainert has been running his own product development consultancy, Tinker Studio. According to Rainert’s post, he’s wrapping projects and will not take on any new jobs for now. He alluded to some new features he’s working on with Foursquare, so it should be interesting to see what the startup has up its sleeve.

In a post today on the Panoramio blog, co-founder Eduardo Manchón, says that after four and a half years working on the service, it’s time to leave. Google acquired Panoramio in mid-2007 and Manchón has been there ever since, running the service. He notes that, “Acquisitions can be complicated, and the private nightmare of a founder is the site not surviving the process, but after some time Panoramio feels very comfortable at Google.”

Panoramio has certainly gained a lot of exposure thanks to Google. It’s heavily featured not only in Google Earth, but also in Google Maps. The service claims to have over 20 million high quality photos in Google’s databases, which makes it much smaller than Flickr, Facebook, or even Google’s own Picasa, but the difference is that all Panoramio photos are geolocated, which makes them very useful for Google’s mapping projects. Under Google, the Panoramio photo collection has growth from about 2 million to this 20 million number.

Manchón’s exit seems to more closely mirror that of Jyri Engeström, the co-founder of Jaiku, who left Google last October. Even though Jaiku was another service Google managed to run into the ground, Engeström claimed that he enjoyed his time at Google but simply wanted to make new meaningful products. This is similar to Manchón’s stated reason for leaving, which is to join the “new hyperlocal Q&A site Askaro.com,” he writes to us.

Another Googler, Gerard Sanz, formerly of the Blogger team, will take over running the Panoramio community.

I’m sure some of them would counter that because location data is fairly standard right now, and moving easily between services, all of them will win. But that’s not true either. While location, as a whole, will win, there will be individual companies that end up ahead of others in the space. More to the point, there will be one or two services that people will go to for their social location data. That’s what we’re moving towards. And the bigger companies are starting to realize it. That’s why today we saw what may be the first maneuver in an upcoming rush to secure the location landscape, with Twitter snatching up Mixer Labs, the team behind GeoAPI.

Twitter co-founder Evan Williams writes today that “We will be looking at how to integrate the work Mixer Labs has done with the Twitter API in useful ways…” and notes that they’ll be working on adding contextual local relevancy to tweets. But those vague statements don’t mean a whole lot. Here’s what likely really went down, based on what we’re hearing: Twitter scooped up some solid talent in the location space, on the cheap (in the mid-seven figure range, we’re hearing from multiple sources). Mixer Labs CEO, Elad Gil, for example, was the original product manager for Google Mobile Maps. Four of the other six Mixer Labs employees are also former Googlers, including co-founder Othman Laraki.

What Twitter likely won’t be doing is getting into the core location platform business anytime soon. Though GeoAPI says it has “no plans to retire the current GeoAPI” that seems quite likely to happen as Twitter will just cherry-pick whatever they want from it and merge those elements into its own location APIs. But again, this was mainly a talent acquisition. Twitter is unlikely to compete with what a company like SimpleGeo is doing (and what GeoAPI was doing) because their main goal is to attach location to tweets, for now. SimpleGeo wants to provide general location information to startups, tweets or not. “Unless Twitter was to change their policies regarding distribution of location tagged tweets (or there was a disparity in the availability of aggregated location data), the acquisition doesn’t change our approach at all. We’re still going to continue working with SimpleGeo,” Hot Potato’s Justin Shaffer tells us.

Going forward, however, Twitter is likely to try and position itself as the main syndicator of location. That’s likely to put them up against Foursquare, Gowalla, and yes, eventually, Facebook and Google.

Again, right now Twitter, Foursquare, Gowalla, and many of the other smaller players in this field play very nicely with one another. That’s because they all have a common goal: Getting location to take off. And it’s working. But the problem that the Foursquares and the Gowallas have is that their core product is based around location. If people decide that they’re getting sick of the gaming elements, or someone like Twitter or Google moves in to secure better local coupons based on location, the location-only players could feel the heat. Of course, both are also likely to be very pretty acquisition targets in their own right next year. And guess who will be buying? Twitter, Google, and Facebook.

In my mind, this is how this is shaping up. The companies with the clout (because they do other things) are going to start scooping up the smaller location-only services. Of those bigger players, Twitter is by far the smallest and weakest, but they’re smart to get started in the buying spree early with the GeoAPI purchase. Don’t be surprised if they scoop up another location service sooner rather than later.

Meanwhile, Facebook has been dragging its feet (to say the least) getting into the location game. We’ve been hearing for months that they’ve been at work on their location solution, and at one point were even racing Twitter to beat them to it. Obviously, that didn’t happen. And last we heard, they were still a few months out mainly because of the privacy implications. But you can bet Facebook will enter the location space in a meaningful way in 2010. And if whatever they’re working on doesn’t get traction. Look for them to start making acquisitions in the field quickly.

The third big player, Google, has Latitude, but they may be too far ahead of the curve with their thinking there. So far, the check-in model has proven to be the one people are gravitating towards. Latitude employs the “always updating” model. That may be the future, but we’re not ready for it yet, and it’s hurting Google in the location space. Again, a quick aquisition could solve that. Of course, Google had a perfect chance to be way ahead of the game when it bought Foursquare co-founder Dennis Crowley’s previous startup, Dodgeball, in 2006. But it badly dropped the ball (pardon the pun) with that one, letting the service die, as Crowley left in a huff. Because of that, a Google/Foursquare marriage may look to be out of the picture — but money heals all wounds, so never say never.

Location, as a trend, remains on fire. Startups are getting funding from big name investors left and right. And you can expect that to continue into 2010. And you can expect the big players to step up their game in the space as well, as they all look to connect the social online world with the real world — a real world that has also has a lot of money potentially tied to location.

I asked SimpleGeo co-founder Matt Galligan for his thoughts on Twitter’s move today. “I think it validates the Geo space in a very, very big way. One of the hottest companies just made a major bet on it,” he says. As he went on, his sentiments echoed mine, “I don’t think it’s far behind that we see similar plays from other big companies.” With its biggest rival now neutralized, that could include SimpleGeo down the road. Consider every location player now on acquisition watch.

Game on.

[photos: flickr/Serge Melki]

Using your phone to create or enhance real world interactions is a killer application, but no one has cracked the nut yet. The reason is that the network is useless until it achieves a critical mass of users who are online and using the application via their mobile phone. If no one else is online, there’s little point in you being online, either. And presence detection is another (technical) problem. Even if people have joined the network, how do you know when they are near you?

But once it does happen, look out. You could be in a bar and see who’s single, who thinks you’re cute, who wants to talk to you, etc. (if they choose to share that information). Forget meeting via an online dating site and then organizing an awkward in person meeting that usually falls flat. Instead, you can do the online an real world thing simultaneously.

We’ve kept an eye on the new startups launching in this space. Check out Rummble, Mig33, ZYB, Mocospace, Aka-Aki, Nokia Sensor, Dodgeball, Mobiluck, MeetMoi and Imity, just to get warmed up. But none of them yet have critical mass (Mig33, however, is turning into a very large cheap VOIP provider on the side).

LimeJuice now joins the group with a unique product. Users can actually join on the fly, via SMS. And the company is sponsoring party after party at bars and clubs in San Francisco to get users to try out the product with lots of others at the same time. The test results are encouraging – people are using it. A lot.

How It Works

The goal is to allow people in a bar or other social gathering to learn a little about the people around them, and flirt via the mobile network as a way to break the ice. The details are what makes LimeJuice interesting. It’s dead simple to join and use.

First, users can register for the service via SMS. That means if just one person in a bar is a member or even knows about the service, they can tell others and quickly get a core group to join. When you create an account, you tell it something distinctive about yourself (tall blonde, red dress!) so that people searching will be able to quickly know who you are. When you go to another event later on, you simple update the description for the evening).

Second, all of the key interaction (for now) happens via SMS. So every phone is ready to go. No need to download a java app or even go to a web page. Just send a text message to the service along with the identifier of the person you want to talk to (which you can get via search), and the message is sent to them.

Third, even though people are using the service to send text messages back and forth, phone numbers are not exchanged. LimeJuice sits in the middle, and you can block someone easily.

Beta Events

LimeJuice has seen a good level of participation at the handful of events they’ve sponsored. An average of 40-50 people participate per event. They spend about 1.5 hours each using the service over the course of the evening and average ten text messages sent per person (some people send as many as 180 text messages). At one event, over 2,500 messages were sent to the service from participants.

For now the company will continue to sponsor events in San Francisco, hopefully building up a core user base that will begin to spread out and get others to join. If/when they get a lot of people in San Francisco to use the service, they’ll then expand to other cities.

The company, founded by Tobin Van Pelt and John Garrett, is based in San Francisco and has four employees. They’ve self funded to date with $100,000 and are currently pitching for a Series A round of funding.

Earlier this week, Google Mobile, which is Google’s search engine for cell phones, revealed public testing of Google Ads in their search results. Google is obviously getting all their ducks in a row as they get serious about tackling local advertising and expanding their advertising services to other platforms, particularly mobile devices. dodgeball.com is the perfect service for both local and national advertisers to get in front of people at the point of purchase (whether it’s beer, liquor, local bar happy hour specials, or local Italian restaurants).

Since purchasing the company, Google has done relatively nothing with dodgeball.com, other than provide it with its own 5-digit SMS shortcode. Prior to the shortcode, they were operating using cell phone email addresses, which is a cost-effective (free!) method that a mobile-based start-up can use to get off the ground. Alternatively, text messages being sent through a SMS gateway can cost a mobile-based company anywhere from $0.03 – $0.05 per inbound (“MO”, mobile originated) and outbound (“MT”, mobile terminated) text message. Unfortunately, most users don’t understand that they can send/receive emails as text messages using their cell phone and only incur standard text messaging fees, without any added data fees from their cell carrier. I believe the high costs required for a company to operate a standard 5-digit SMS code has attributed to why the U.S. has lagged in mobile text messaging adoption behind Europe and Japan. I am unsure of how many cell phone models and cell carriers can send/receive emails as standard text messages, but would sure be curious to know.

Marshall Kirkpatrick reviewed a number of other SMS services last month.

More on this story at TailRank and a very interesting post by Chris Messina.

The DEMO conference is wrapping up here in San Diego and unlike when it began 16 years ago the conference wasn’t dominated by mobile launches. None the less, there were some very interesting mobile services here like ScanR and Realeyes3D image scanning by mobile photo, Flurry‘s simple email and RSS on Java phones and Grand Central (which I’ve written about at length).

3Jam and Pinger both launched multiperson SMS services at DEMO. Probably first popularized by Dodgeball, multiperson SMS is a feature (or a company – your call!) that quite a few people are coming out with all at once lately. The following are some short descriptions of eight companies offering multiperson SMS and a table displaying which services offer particular features.

The List

• Jyngle is a web based service that has voice support, just launched and got a review over on CrunchGear today.
• 3Jam is funded, relatively straight forward and launched here at DEMO.
• Pinger lets users quickly respond to messages by voice and received $3 million from Kleiner Perkins in 2005.
• Swarmteams does a whole lot of things, though we weren’t able to get it to work well in testing for our original review. You might have better luck, and if so then this Irish service could well be worth using.
• Loopt is a location aware service funded by YCombinator and Sequoia. We reviewed it at launch.
• Dodgeball is old school and was acquired by Google in 2005.
• Twitter is for groups of friends who want varying levels of instant, automatic updates on each others’ activities. It’s a product of podcasting company Odeo.
• Moblabber is a mobile social network that users can receive topical messages from automatically.

There are undoubtedly more companies that offer multi-person SMS, or at least there will be by the time I click publish on this post – but I hope that comparing these seven company’s by feature set will help flesh out a vision of the landscape and where we stand today.

The Features