It’s a shame that the $41m funding of Color Labs has dominated the news about Color, a radically different type of mobile app, because that’s what’s interesting.

Color shares photos with everyone around you that has the app on their iPhone or Android device. There are no privacy settings and you don’t need to “friend” or “follow” anyone — it automatically creates an ad hoc social network within 50 yards of your location.

How will people use it?

Color Labs doesn’t know — it did no user studies, no focus groups, beyond letting 30 staff and family members use it. Which is very bold.

When you download Color there isn’t much to do, there’s likely no other Color users around you so the app is blank and useless. But fire it up in a club or a party and then things get interesting — which is what I did Thursday evening.

I popped into “Twestival”, a charity event in North Beach. There was only two other Color users there, which was surprising given that this was a tech crowd and very much aware of the huge amount of publicity Color has had this week.

Later that evening I stopped into the launch party for Podio, a Danish startup. There were about 10 Color users there, again a very small number considering there were hundreds of digerati there.

But soon there were more of us especially since Stowe Boyd and myself persuaded others around us to download it and check it out.

It was easy to download it on the iPhone but a friend using an Android phone was having problems finding and downloading the app and she finally gave up.

First impressions:

– The interface takes some getting used to, it’s a bit confusing but manageable.

– It’s slow. It takes a while to take a photo and then decide if you want to post it or retake it. You can’t whip it out to take a photo of something that’s happening quickly — you’ll miss it completely by the time it’s loaded, and ready to shoot and share.

– It’s fun to see other people’s pictures and the messaging component is intriguing and deserves more exploration.

– Is it more than a novelty? It’s too early to tell, I’m looking forward to using it more.

[Cross-posted at Silicon Valley Watcher]