I now see how it all fits together. Through inside information, Color found out about Facebooks new photo sharing app, which will render them obsolete. The board decided to transform Color into a patent troll, to leverage at least something. Peter Pham disagreed with this direction, and left Color.
This has an uncanny similarity to Color, even that custom tab bar has the same exact icon placement. To me this looks more like a new version of Color with tight facebook integration... or perhaps FB got Color to to the dev for this while they are floundering right now.
I also find it odd that FB would spin out a separate app when all along they've been going for a unified experience in the iPhone app.
Be a tough challenge. Although Instagram has done well to build up a community (5 million users now: http://techcrunch.com/2011/06/13/instagram-five-million-user...) . Facebook places didn't kill Foursquare, Gowalla etc, this may not necessarily kill established players like Instagram but it will make it harder for new entrants and those struggling to get established like Color.
though deep down i agree that this probably means big trouble for a lot of other companies in the photo sharing space, there are some innate differences that could keep other companies afloat (even COLOR!)
one of the big differences i can think of off the top of my head at 3am is that FB still isn't really about discovering new friends. You meet people in real life, then you friend them on Facebook. Not vice versa.
As far as I can tell, something that Color is expanding into is creating this "temporary" social network where you share photos with anybody within a certain location. It isn't as much about sharing photos with friends that you already have, as it is about discovering new people and the photos they're taking around you.
Based on widespread privacy concerns that Facebook has had to deal with, I'd say it's unlikely that this app involves social discovery. It's probably another friend, photo-sharing app, with the permissions of sharing mirroring what happens on the Facebook webapp.
Well the differentiation will come from having better control over who sees what.
Facebook is a collection of all your friends/family/people you kinda know and so fouth. We still need services that are specialized and cater to certain groups within your social circle and I can totally see Color/Path/Instagram/Whatever take and prosper from holding that position.
But then again Im not really a fan of Facebook and perhaps Im missing some core functionality that actually already exists within Facebook.
I think the main advantage is that people already see photos as one of Facebook's killer features. It's different than when they launched Places and Offers; photos is the reason a lot of people register for Facebook in the first place.
If you're building any kind of social app you'd be a fool not to think about the possibilities of the big players integrating your features into their platform, and what your long-term gameplan is going to be.
FB could be sitting on a goldmine with all these photos. Could be.
As computers get faster and software more sophisticated, we might see things like automatic manipulation of photos to change the branding on peoples clothing (in a fun, opt-out sort of way preferebly). Or detecting the brands that people wear then selling aggregation of that data to market researchers (bit easier and more likely).
I'll need to look into that - haven't seen this option surfaced anywhere in the mobile or desktop sites.
Edit: I can see it in desktop upload - I must not have used that for a while.
I uploaded a big image as 'high resolution' (actually, you can't select high resolution because the photo is already being uploaded by the time this radio button becomes available for clicking) and facebook shrunk it down to a paltry 720x480. The UI blows it up to larger than this, so it looks more blurry.
The basic uploader has no 'high resolution' option, but didnt shrink the uploaded photo down as much.
I checked a 640x434 photo that I'd uploaded via API. As you said, they did recompress it, with a noticeable difference in quality. I had already set a reasonable web compression level. Their recompression reduced it only from 88KB to 84KB.