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Yesterday — January 25th 2020Your RSS feeds

Vine reboot Byte officially launches

By Josh Constine

Two years after Vine’s co-founder Dom Hofmann announced he was building a successor to the short-form video app, today Byte makes its debut on iOS and Android. Byte lets you shoot or upload and then share six-second videos. It comes equipped with standard social features like a feed, Explore page, notifications, and profiles. For now, though Byte lacks the remixability, augmented reality filters, transition effects, and other bonus features you’ll find in apps like TikTok.

What Hofmann hopes will differentiate Byte is an early focus on helping content creators make money — something TikTok, and other micro-entertainment apps largely don’t offer. The app plans to soon launch a pilot of its partner program for offering monetization options to people proving popular on Byte. When asked if Byte would offer ad revenue sharing, tipping, or other options to partners, Hofmann told me that “We’re looking at all of those, but we’ll be starting with a revenue share + supplementing with our own funds. We’ll have more details about exactly how the pilot program will work soon.”

Many creators who’ve grown popular on apps like TikTok and Snapchat that lack direct monetization have tried to pull their audiences over to YouTube where they can earn a steady ad-share. By getting started paying early, Byte might lure some of those dancers, comedians, and pranksters over to its app and be able to retain them long-term. Former Vine stars turned TikTok stars like Chris Melberger. Joshdarnit, and Lance Stewart are already on Byte.

very soon, we'll introduce a pilot version of our partner program which we will use to pay creators. byte celebrates creativity and community, and compensating creators is one important way we can support both. stay tuned for more info.

— byte (@byte_app) January 25, 2020

Staying connected with Byte’s most loyal users is another way Hofmann hopes to set his app apart. He’s been actively running a beta tester forum since the initial Byte announcement in early 2018, and sees it as a way to find out what features to build next. “It’s always a bummer when the people behind online services and the people that actually use them are disconnected from one another, so we’re trying out these forums to see if we can do a better job at that” Hofmann writes.

Byte founder Dom Hofmann

Byte is a long time coming. To rewind all the way, Hofmann co-founded Vine in June 2012 with Colin Kroll and Rus Yusupov, but it was acquired by Twitter before its launch in January 2013. By that fall, Hofmann had left the company. But 2014 and 2015 saw Vine’s popularity grow thanks to rapid-fire comedy skits and the creativity unlocked by its looping effect. Vine reached over 200 million active users. Then the unthinkable happened. Desperate to cut costs, Twitter shut down Vine’s sharing feed in late 2016 so it wouldn’t have to host any more video content. The creative web mourned.

By then, Hofmann had already built the first version of Byte, which offered more free-form creation. You could pull together photos, GIFs, drawings and more into little shareable creations. But this prototype never gained steam. Hofmann gave Vine fans hope when he announced plans to build a successor called V2 in early 2018, but cancelled it a few months later. Hofmann got more serious about the project by then end of 2018, announcing the name Byte and then beginning beta testing in April 2019.

Now the big question will be whether Byte can take off despite its late start. Between TikTok, Snapchat, Instagram, and more, do people need another short-form video app? Winning here will require seducing high quality creators who can get bigger view counts elsewhere. Considering there’s already a pile of TikTok competitors like Dubsmash, Triller, Firework, and Facebook’s Lasso available in the US, creators seeking stardom on a less competitive network already have plenty of apps to try. Hofmann may have to rely on the soft spot for Vine in people’s memories to get enough activity on Byte to recreate its predecessor’s magic.

Before yesterdayYour RSS feeds

Most tech companies aren’t WeWork

By Walter Thompson
Shin Kim Contributor
Shin Kim is working on a new SaaS startup and is also chief of staff to entrepreneur Elad Gil . Previously, Shin was at Oak Hill Capital and J.P. Morgan and earned a Master’s in EECS (data science) from UC Berkeley.

With the recent emphasis on Uber and WeWork, much media attention has been focused on high-burn, “software-enabled” startups. However, most of the IPOs of the last few years in tech have been in higher capital efficiency software-as-a-service startups (SaaS).

In the last 30 months (2017 2H onwards), a total of 21 U.S.-based, VC-backed SaaS companies have gone public, including Zoom, Slack, Datadog and others1. I analyzed all 21 companies to understand their fundraising and revenue-generating trajectories. A deep dive into the individual companies’ trajectories can be found in this Extra Crunch article.

Here are the summary takeaways from this data set:

1. At IPO, total capital raised2 was slightly ahead of annual run-rate revenue (ARR)3 for the median company

Here is a scatterplot of the ARR and cumulative capital raised at the time each company went public. Most companies are clustered close to the diagonal line that represents ARR and capital raised matching each other. Total capital raised is often neck-and-neck or slightly higher than ARR.

For example, Zscaler raised $148 million to get to $146 million of ARR at IPO and Sprout Social raised $112 million to get to $106 million of ARR.

It is useful to introduce a metric instead of looking at gross dollars, given the high variance in revenue of the companies in the data set — Sprout Social had $106 million and Dropbox had $1,222 million in ARR, a 10x+ difference. Total capital raised as a multiple of ARR normalizes this variance. Below is a histogram of the distribution of this metric.

The distribution is concentrated around 1.00x-1.25x, with the median company raising 1.23x of ARR by the time of its IPO.

There are outliers on both ends. Domo is a profligate outlier that had raised $690 million to get to $128 million of ARR, or 5.4x of ARR — no other company comes remotely close. Zoom and Datadog are efficient outliers. Zoom raised $161 million to get to $423 million of ARR and Datadog raised $148 million to get to $333 million of ARR, both representing only 0.4x of ARR.

2. Cash burn is a more accurate measure of capital efficiency and may diverge significantly from capital raised (depending on the company)

How much capital a company raised tells only half of the story of capital efficiency, because many companies are sitting on a significant cash balance. For example, PagerDuty raised a total of $174 million but had $128 million of cash left when it went public. As another example, Slack raised a total of $1,390 million prior to going public but had $841 million of unspent cash.

Why do some SaaS companies end up seemingly over-raising capital beyond their immediate cash needs despite the dilution to existing shareholders?

One reason might be that companies are being opportunistic, raising capital far ahead of actual needs when market conditions are favorable.

Another reason may be that VCs that want to meet ownership targets are pushing for larger rounds. For example, a company valued at $400 million pre-money may only need $50 million of cash but could end up taking $100 million from a VC that wants to achieve 20% post-money ownership.

These confounding factors make cash burn — calculated by subtracting the cash balance from total capital raised4 — a more accurate measure of capital efficiency than total capital raised. Here is a distribution of total cash burn as a multiple of ARR.

Remarkably, Zoom achieved negative cash burn, meaning Zoom went public with more cash on its balance sheet than all of the capital it raised.

The median company’s cash burn at IPO was 0.77x of ARR, quite a bit less than the total capital raised of 1.23x of ARR.

3. The healthiest SaaS companies (as measured by the Rule of 40) are often the most capital-efficient

The Rule of 40 is a popular heuristic to gauge the business health of a SaaS company. It asserts that a healthy SaaS company’s revenue growth rate and profit margins should sum to 40%+. The below chart shows how the 21 companies score on the Rule of 405.

Among the 21 companies, eight companies exceed the 40% threshold: Zoom (123%), Crowdstrike (119%), Datadog (76%), Bill.com (56%), Elastic (55%), Slack (52%), Qualtrics (44%) and SendGrid (41%).

Interestingly, the same outliers in terms of capital efficiency as measured by cash burn, on both extremes, are the same outliers in the Rule of 40. Zoom and Datadog, which have the highest capital efficiency, score the highest and third highest on the Rule of 40. And inversely, Domo and MongoDB, which have the lowest capital efficiency, also score lowest on the Rule of 40.

This is not surprising, because the Rule and capital efficiency are really two sides of the same coin. If a company can sustain high growth without sacrificing profit margins too much (i.e. score high on the Rule of 40), it will over time naturally end up burning less cash compared to peers.

Conclusion

To apply all of this to your favorite SaaS business, here are some questions to consider. What is the total capital raised in multiples of ARR? What is the total cash burn in multiples of ARR? Where does it stack compared to the 21 companies above? Is it closer to Zoom or Domo? How does it score on the Rule of 40? Does it help explain the company’s capital efficiency or lack thereof?

Thanks to Elad Gil and Denton Xu for reviewing drafts of this article.

Endnotes

1Only includes U.S.-based, VC-backed SaaS companies. Includes Quatrics, even though it did not go public, as it was acquired right before its scheduled IPO.

2Includes institutional investments prior to the IPO. Does not include founders’ personal capital investment.

3Note that this is not annual recurring revenue, which is not a reporting requirement for public companies. Annual run-rate revenue is calculated by annualizing quarterly revenue (multiplying by four). The two metrics will track closely for SaaS businesses, given that SaaS revenue is predominantly recurring software subscriptions.

4This is a simplified definition as it will capture non-operational uses of cash such as share repurchase from founders.

5Revenue growth is calculated as the growth rate of the revenue during the last 12 months (LTM) over the revenue during the 12 months prior to that. Profit margins are non-GAAP operating margins, calculated as operating income plus stock-based compensation expense divided by revenue over the last 12 months (LTM).

Facebook’s dodgy defaults face more scrutiny in Europe

By Natasha Lomas

Italy’s Competition and Markets Authority has launched proceedings against Facebook for failing to fully inform users about the commercial uses it makes of their data.

At the same time, a German court has today upheld a consumer group’s right to challenge the tech giant over data and privacy issues in the national courts.

Lack of transparency

The Italian authority’s action, which could result in a fine of €5 million for Facebook, follows an earlier decision by the regulator, in November 2018 — when it found the company had not been dealing plainly with users about the underlying value exchange involved in signing up to the “free” service, and fined Facebook €5 million for failing to properly inform users how their information would be used commercially.

In a press notice about its latest action, the watchdog notes Facebook has removed a claim from its homepage — which had stated that the service “is free and always will be” — but finds users are still not being informed, “with clarity and immediacy” about how the tech giant monetizes their data.

The Authority had prohibited Facebook from continuing what it dubs “deceptive practice” and ordered it to publish an amending declaration on its homepage in Italy, as well as on the Facebook app and on the personal page of each registered Italian user.

In a statement responding to the watchdog’s latest action, a Facebook spokesperson told us:

We are reviewing the Authority decision. We made changes last year — including to our Terms of Service — to further clarify how Facebook makes money. These changes were part of our ongoing commitment to give people more transparency and control over their information.

Last year Italy’s data protection agency also fined Facebook $1.1 million — in that case for privacy violations attached to the Cambridge Analytics data misuse scandal.

Dodgy defaults

In separate but related news, a ruling by a German court today found that Facebook can continue to use the advertising slogan that its service is “free and always will be” — on the grounds that it does not require users to hand over monetary payments in exchange for using the service.

A local consumer rights group, vzbv, had sought to challenge Facebook’s use of the slogan — arguing it’s misleading, given the platform’s harvesting of user data for targeted ads. But the court disagreed.

However, that was only one of a number of data protection complaints filed by the group — 26 in all. And the Berlin court found in its favor on a number of other fronts.

Significantly, vzbv has won the right to bring data protection-related legal challenges within Germany even with the pan-EU General Data Protection Regulation in force — opening the door to strategic litigation by consumer advocacy bodies and privacy rights groups in what is a very pro-privacy market.

This looks interesting because one of Facebook’s favored legal arguments in a bid to derail privacy challenges at an EU Member State level has been to argue those courts lack jurisdiction — given that its European HQ is sited in Ireland (and GDPR includes provision for a one-stop shop mechanism that pushes cross-border complaints to a lead regulator).

But this ruling looks like it will make it tougher for Facebook to funnel all data and privacy complaints via the heavily backlogged Irish regulator — which has, for example, been sitting on a GDPR complaint over forced consent by adtech giants (including Facebook) since May 2018.

The Berlin court also agreed with vzbv’s argument that Facebook’s privacy settings and T&Cs violate laws around consent — such as a location service being already activated in the Facebook mobile app; and a pre-ticked setting that made users’ profiles indexable by search engines by default

The court also agreed that certain pre-formulated conditions in Facebook’s T&C do not meet the required legal standard — such as a requirement that users agree to their name and profile picture being used “for commercial, sponsored or related content,” and another stipulation that users agree in advance to all future changes to the policy.

Commenting in a statement, Heiko Dünkel from the law enforcement team at vzbv, said: “It is not the first time that Facebook has been convicted of careless handling of its users’ data. The Chamber of Justice has made it clear that consumer advice centers can take action against violations of the GDPR.”

We’ve reached out to Facebook for a response.

Elections Globally Are Under Threat. Here's How to Protect Them

By Paris Martineau
A new report calls for safeguards to reduce the dangers posed by misinformation, online extremism, and social media manipulation.

Meet the B2B videoconferencing startup that’s gone crazy for online dating

By Natasha Lomas

Founder Andreas Kröpfl has spent almost a decade hard-grafting in the b2b unified communications space, building a videoconferencing business with a patented single-stream system and a claim of no ‘drop-offs’ thanks to “unique low-bandwidth technology”.

His Austria-based startup’s current web-based videoconferencing system, eyeson (née Visocon), which launched in 2018, has had some nice traction since launch, as he tells it, garnering a few million customers and getting a nomination nod as a Gartner Cool Vendor last year.

Eyeson’s website touts ‘no hassle, no, lag, no downloads’ video calls. Pricing options for the target b2b users run the gamut from freelance pro to full-blown enterprise. While the business itself has pulled in a smidge less than $7M in investor funding over the years.

But when TechCrunch came across Kröpfl last December, pitching hard in startup alley at Disrupt Berlin, he was most keen to talk about something else entirely: Video dating.

That’s because last summer the team decided to branch out by building their own video dating app, reusing their core streaming tech for a consumer-focused social experiment. And after a period of internal beta testing — which hopefully wasn’t too awkward within a small (up-til-then) b2b-focused team — they launched an experimental dating app in November in India.

The app, called Ahoi, is now generating 100,000 video calls and 250,000 swipes per day, says Kröpfl.

This is where he breaks into a giggle. The traction has been crazy, he says. 

In the staid world of business videoconferencing you can imagine eyeson’s team eyeing the booming growth of certain consumer-focused video products rather enviously.

Per Kröpfl, they had certainly noticed different desires among their existing users — which pushed them to experiment. “We saw that private people like the simple fun features (GIF reactions, …) and that business meetings were more focused on ‘drop-off’ [rates] and business features,” he tells us. “To improve both in one product was not working any more. So eyeson goes business plus SaaS.”

“Cloning eyeson but make it social,” is how he sums up the experiment. 

Ahoi is very evidently an MVP at this stage. It also looks like a pretty brave and/or foolish (depending on your view) full-bore plunge into video dating, with nothing so sophisticated as a privacy screen to prevent any, er, unwanted blushes… (Whereas safety screening is an element we’ve recently seen elsewhere in the category — see: Blindlee.)

There’s also seemingly no way for users to specify the gender they wish to talk to.

Instead, Ahoi users state interests by selecting emoji stickers — such as a car, cat, tennis racket, games console or globetrotter. And, well, it goes without saying that even if you like cars a lot you’re unlikely to change your sexual orientation over the category.

There are no generic emoji that could be used to specify a sexual interest in men or women. But, er, there’s a horse…

Such limits may explain why Ahoi is generating so many early swipes — and rather fewer actual calls — in that the activity sums to (mostly) men looking for women to videochat with and being matched with, er, men.

And frustration, sexual or otherwise, probably isn’t the greatest service to try and sell.

Still, Kröpfl reckons they’ve landed on a winning formula that makes handy reuse of their core videoconferencing tech — letting them growth hack in a totally new category. Swipe right to video date.

“People are disappointed by perfect profiles on Tinder and the reality when meeting people,” he posits. “Wasted time. Especially women do not want to be stalked by men pretending to be someone else. We solve both by a real live conversation where only after a call both can decide to be connected or never see each other again.”

Notably, marketing around the app does talk rather fuzzily about it being a way to “find new pals”.

So while Kröpfl frames the experiment as dating, the reality of the product is more ‘open to options’. Think of it as a bit like Chatroulette — just with slightly more control (in that you have a few seconds to decide if you don’t want to talk to the next in-app match).

The very short countdown timer (you get just five seconds to opt out of a matched video chat) is very likely generating a fair number of unintended calls. Though such high velocity matching might appeal to a certain kind of speed dating addict.

Kröpfl says Ahoi has been seeing up to 20,000 new users added daily. They’re bullishly targeting 3M+ users this year, and already toying with ideas for turning video dates into a money spinner by offering stuff like premium subscriptions and/or video ads. He says the plan is to turn Ahoi into a business “step by step”.

“Everyone loves to make his profile better,” he suggests, floating monetization options down the line. Quality filtering for a fee is another possibility (“everyone is annoyed by being connected to the wrong people”).

They picked India for the test launch because it has a lot of people on the same timezone, a large active mobile user-base and cheap marketing is still “easily possible”. He also says that dating apps seemed popular there, in their experience. (Albeit, the team presumably didn’t have a great deal of relevant experience in this category — given Ahoi is an experiment.)

The intent is also to open Ahoi up to other markets in time too, once they get more accustomed to dealing with all the traffic. Kröpfl notes they had to briefly take the app off the store last month, as they worked on adding more server capability.

“It is very early and we were not prepared for this usage,” he says, admitting they’ve been “struggling to work on early feedbacks”. “We had to make it invisible temporarily — to improve server capacity and stability.”

The contrast in pace of uptake between the stolid (but revenue-generating) world of business meeting-fuelled videoconferencing and catnip consumer dating — which is money-sucking unless or until you can hit a critical mass of usage and get the chance to try applying monetization strategies — does sound like it’s been rather irresistible to Kröpfl.

Asked what it feels like to go from one category to the other he says “crazy, surprised and thrilling”, adding: “It is somehow also frustrating when all the intense b2b work is not as closely interesting to people as Ahoi is. But amazing that it is possible thanks to an extremely focused and experienced team. I love it.” 

TechCrunch’s Manish Singh agreed to brave the local video dating app waters in India to check Ahoi out for us.

He reported back not having seen any women using the app. Which we imagine might be a problem for Ahoi’s longer term prospects — at least in that market.

“I spoke with one guy, who said his friend told him about the app. He said he joined to talk to girls but so far, he is only getting matched with boys,” said Singh. “I saw several names appear on the app, but all of them were boys, too.”

He told us he was left wondering “why people are on these apps, and why they have so much free time on a weekday”.

For ‘people’ it seems safe to conclude that most of Ahoi’s early adopters are men. As the Wall Street Journal reported back in 2018, India’s women are famously cool on dating apps — in that they’re mostly not on them. (We asked Kröpfl about Ahoi’s gender breakdown but he didn’t immediately get back to us on that. Update: We’re told the app’s male to female ratio is 85:15. “India is challenging,” Kröpfl admits.)

That market quirk means those female users who are on dating apps tend to get bombarded with messages from all the lonely heart guys with not much to swipe. Which, in turn, could make a video dating app like Ahoi an unattractive prospect to female users — if there’s any risk at all of being inundated with video chats.

And even if there are enough in-app controls to prevent unwelcome inundation by default, women also might not feel like they want their profile to be seen by scores of men simply by merit of being signed up to an app — as seems inevitable if the gender balance is so skewed.

Add to that, if the local perception among single women is that men on dating apps are generally a turn-off — because they’re too eager/forward — then jumping into any unmoderated video chat is probably not the kind of safe space these women are looking for.

No matter, Kröpfl and his team are clearly having far too much fun growth hacking in an unfamiliar, high velocity consumer category to sweat the detail. 

What’s driving Ahoi’s growth right now? “Performance marketing mainly,” he says, pointing also to “viral engagement by sharing and liking profiles”.

Notably, there are a lot of reviews of Ahoi on Google Play already — an unusual amount for such an early app. Many of them appear to be five star write-ups from accounts with European-sounding names and a sometimes robotic grasp of language.

“Eventhough Ahoi has been developed recently, it had high quality for user about calling, making friends and widing your knowlegde [sic],” writes one reviewer with atrocious spelling whose account is attached to the name ‘Dustin Stephens.’

“Talking with like minded people and same favor will creat a fun and interesting atmosphere. Ahoi will manage for you to call like condition above,” says another apparently happy but not entirely clear user, going by the name ‘Elisa Herring’.

There’s also a ‘Madeleine Mcghin’, whose profile uses a photo of the similarly named child who infamously disappeared during a holiday in Portugal in 2007. “My experience with this app was awesome,” this individual writes. “It gives me the option to find new people in every country.”

Another less instantly tasteless five-star reviewer, ‘Stefania Lucchini’, leaves a more surreal form of praise. “A good app and it will bring you extra income, I would say it’s a great opportunity to have AHOI and be a part of it but it’s that it will automatically ban you even if you don’t show it. Marketing. body part, there are still 5 stars for me,” she (or, well, ‘it’) writes.

Among the plethora of dubious five-star reviews a couple of one-star dunks stand out — not least because they come from accounts with names that sound like they might actually come from India. “Waste u r time,” says one of these, who uses the name Prajal Pradhan.

This pithy drop-kick has been given a full 72 thumbs-up by other Play Store users.

Wikipedia now has more than 6 million articles in English

By Manish Singh

Wikipedia has surpassed a notable milestone today: The English version of the world’s largest online encyclopedia now has over six million articles.

The feat, which comes roughly 19 years after the website was founded, is a testament of “what humans can do together,” said Ryan Merkley, Chief of Staff at Wikimedia, the non-profit organization that operates the omnipresent online encyclopedia.

The 6 millionth article is about Maria Elise Turner Lauder, a 19th-century Canadian school teacher, travel writer, and fiction writer. The article was written by Rosie Stephenson-Goodknight, a long time editor of Wikipedia.

Wikipedia is available in dozens of languages, but its English-language version has the most number of articles. Following English edition, which hit 5 million articles in late 2015, are German version, with about 2.3 million articles, and the French version that has about 2.1 million articles.

The English edition is also the most visited project on the website. According to publicly disclosed figures, the English version of the website averages about 255 million pageviews a day. According to web analytics firm SimilarWeb, Wikipedia overall is the eighth most visited website.

Over the years, Wikipedia has conducted seminars in many nations to encourage more people to become contributors in their own local languages, and has also improved its tools to make it easier for them to write, publish, and cite items.

Congratulations to English @Wikipedia for hitting the six million article mark today! The landmark page — created by @Rosiestep of @WikiWomenInRed — is a biography of Marie "Toofie" Lauder, a well-traveled and philanthropic 19th century writer: https://t.co/LZ0iacsQly pic.twitter.com/N87CsDQvdH

— Wikimedia (@Wikimedia) January 23, 2020

When Jimmy Wales founded Wikipedia, he said his goal was to provide “free access to the sum of all human knowledge.” According to one estimate, the sum of human knowledge would require 104 million articles — and we will need 20 more years to get there.

NBC partners with Snapchat on four daily shows for 2020 Tokyo Olympics

By Sarah Perez

Snapchat and NBC Olympics are again teaming up to produce customized Olympics content for users in the U.S. — this time, for the 2020 Tokyo Olympics this summer. The companies had previously worked together during the Rio 2016 and PyeongChang 2018 Olympics. The PyeongChang Olympic Winter Games in 2018 reached over 40 million U.S. users, up 25% from the 2016 Rio Olympics.

In addition, 95% of those users were under the age of 35.

This younger demographic is getting harder to reach in the cord-cutting era, as many people forgo pay-TV subscriptions and traditional broadcast networks in favor of on-demand streaming services, like Netflix. That limits the reach of advertisers, impacting NBC’s bottom line.

The Snap partnership helps to fix that, as it offers NBC Olympics a way to sell to advertisers who want to reach younger fans who don’t watch as much — or any — TV. Snapchat today reaches 90% of all 13 to 24 year-olds in the U.S., and 75% of all 13 to 34 year-olds. 210 million people now use Snapchat daily.

NBC Olympics says it’s the exclusive seller of all the new customized content associated with the Games, working in partnership with Snap.

This year, it’s also putting out more content than before.

The company plans to release more than 70 episodes across four daily Snapchat shows leading up to and during the Games. That’s triple the number of episodes it offered in 2018.

For the first time, it’s creating two daily Highlight Shows for Snapchat, which will be updated in near real-time. The shows will include the must-see moments from the day in Tokyo.

In addition, two unscripted shows will air during the Games, each with two episodes per day. One, “Chasing Gold,” which first debuted during PyeongChang 2018, will follow the journeys of Team USA athletes. The second show is new this year, and will be a daily recap of the most memorable moments curated especially for Snapchat users. Both are being produced by The NBCUniversal Digital Lab.

The deal will also see Snap curating daily Our Stories during the Games, as it has done in previous years. The stories will include photos and videos from fans as well as content from the NBC Olympics.

“We know the audience on Snap loves the Olympic Games,” said Gary Zenkel, President, NBC Olympics, in a statement. “After two successful Olympics together, we’re excited to take the partnership to another level and produce even more content and coverage from the Tokyo Olympics tailored for Snapchatters, which also will directly benefit the many NBC Olympics advertisers who seek to engage further with this young and active demographic.”

Snapchat isn’t the only digital destination for Olympics content, however. NBC and Twitter teamed up to stream limited live event coverage, highlights and a daily Olympics show from the Tokyo Games. It was unclear at the time the deal was announced if NBC had opted for Twitter over Snapchat. Now we know that’s not the case — in fact, Snap’s deal with NBC is even bigger than before.

NBCU had said earlier, it expected to exceed $1.2 billion in ad sales for the 2020 Games, which are also presented on NBC, NBCSN, Olympic Channel: Home of Team USA, and NBC Sports’ digital platforms.

Some tech I loved is getting worse and I’m mad

By Alex Wilhelm

Time is supposed to make technology better. The idea is simple: With more time, humans make newer, better technology and our lives improve. Except for when the opposite happens.

Google is a good example of this. I’ve been harping on the matter for a while now. Google mobile search, in case you haven’t used it lately, is bad. It often returns bloated garbage that looks like a cross between new Yahoo and original Bing.

Here’s how it butchered a search query for “Metallica” this morning:

Remember when that interface was simpler, and easier to use, and didn’t try to do literally every possible thing for every possible user at once?

It’s not just Google’s mobile search interface that makes me want to claw my eyes out and learn how to talk to trees. Everyone now knows that Mountain View has effectively given up on trying to distinguish ads from organic results (Does the company view them as interchangeable? Probably?). TechCrunch’s Natasha Lomas covered the company’s recent search result design changes today, calling them “user-hostile,” going on to summarize the choices as its “latest dark pattern.”

Google, once fanatical about super-clean, fast results is now trying to help you way too much on mobile and fool you on Chrome.

Chrome itself kinda sucks and is getting worse. But we all know that. Of course, that all this is shaking out around the same time that the company’s founders left is, you know, not shocking.

I’d also throw TweetDeck into the mix. It’s garbage slow and lags and sucks RAM. Twitter has effectively decided that its power users are idiots who don’t deserve good code. Oh, and Twitter is deprecating some cool analytics features it used to give out to users about their followers.

Chrome and TweetDeck are joined by apps like Slack that are also slowing down over time. It appears that as every developer writes code on a computer with 64,000 gigs of RAM, they presume that they can waste everyone else’s. God forbid if you have the piddling 16 gigs of RAM that my work machine has. Your computer is going to lag and often crash. Great work, everyone!

Also, fuck mobile apps. I have two phones now because that’s how 2020 works and I have more apps than I know what to do with, not to mention two different password managers, Okta and more.I’m so kitted out I can’t breathe. I have so many tools available to me I mostly just want to put them all down. Leave me alone! Or only show me the thing I need — not everything at once!

Anyhoo video games are still pretty good as long as you avoid most Battle Royale titles, micropayments, and EA. Kinda.

Twitter DMs now have emoji reactions

By Natasha Lomas

Twitter is pouring a little more fuel on the messaging fire. It’s added a heart+ button to its direct messaging interface which lets users shortcut to a pop-up menu of seven emoji reactions so they can quickly express how they’re feeling about a missive.

Emoji reactions can be added to text or media messages — either via the heart+ button or by double tapping on the missive to bring up the reaction menu.

The social network teased the incoming tweak a few hours earlier in a knowing tweet about sliding into DMs that actually revealed the full line-up of reaction emojis — which, in text form, can be described as: Crying lol; shocked/surprised; actually sad; heart; flame; thumb-up and thumb-down.

So instead of a smilie face Twitter users are being nudged towards an on-brand-message Twitter heart, in keeping with its long-standing pick for a pleasure symbol.

The flame is perhaps slightly surprising for a company that’s publicly professed to wanting to improve the conversational health of its platform.

If it’s there to stand in for appreciation a clap emoji could surely have done the trick. Whereas flame wars aren’t typically associated with constructive speech. But — hey — the flame icon does catch the eye…

Say more with new emoji reactions for Direct Messages!

To add a reaction, click the ❤➕ icon that appears when you hover over the message on web or double tap the message on mobile and select an emoji from the pop-up.

For more about DM reactions: https://t.co/sdMumGDBYl https://t.co/QxMVmGt8eY

— Twitter Support (@TwitterSupport) January 22, 2020

Twitter is late to this extroverted party. Rival messaging platforms such as Apple iMessage and Facebook Messenger have had emoji reactions for years, whereas Twitter kept things relatively minimal and chat-focused in its DM funnel — to its credit (at least if you value the service as, first and foremost, an information network).

So some might say Twitter jumping on the emoji reaction bandwagon now is further evidence it’s trying to move closer to rivals like Facebook as a product. (See also: Last year’s major desktop product redesign by Twitter — which has been compared in look and feel to the Facebook News Feed.)

But if so this change at least is a relatively incremental one.

Twitter users have also, of course, always been able to react to an incoming DM by sending whatever emoji or combination of emoji they prefer as a standard reply. Though now lazy thumbs have shortcut to emote — so long as they’re down with Twitter’s choice of icons.

In an FAQ about the new DM emoji reactions, Twitter notes that emoting will by default send a notification to all conversation participants “any time a new reaction is added to a message”.

So, yes, there’s attention-spamming potential aplenty here…

Adjust your notification and DM settings accordingly.

You can only choose one reaction per missive. Each symbol is displayed under the message/media with a count next to it — to allow for group tallies to be totted up. 

While clicking on another symbol will swap out the earlier one — generating, er, more notification spam. And really annoying people could keep flipping their reaction to generate a real-time emoji streaming game of notification hell (hi growth hackers!) with folks they’ve been DMing with on Twitter. So that’s another good reason to lock down your settings.

Twitter users still running older version of its apps which don’t support message reactions will see a standard text emoji message per reaction sent — which kinda confusingly makes it look like the reaction sender has actually been liking/flaming their own stuff. All the more reason to not be spammy about emoji.

Dfinity launches an open-source platform aimed at the social networking giants

By Mike Butcher

When Dfinity raised $102 million in funding in 2018 at a $2 billion valuation in a round jointly led by Andreessen Horowitz and Polychain Capital, it was thought of as a step change in the world of blockchain technology. In an area that was  synonymous generating a lot of headlines around cryptocurrency speculation, this was a shift in focus, looking instead at the architecture behind Bitcoin, Ethereum, and the rest, and how it could be used for more than just “mining”, distributing and using new financial instruments — with a major, mainstream VC backing the idea, no less.

Dfinity launched with a very lofty goal: to build what it called the “Internet Computer”: a decentralized and non-proprietary network to run the next generation of mega-applications. It dubbed this public network “Cloud 3.0”.

Now, looks like this Cloud is now about to break.

In Davos this week, Dfinity launched the Bronze edition of its Internet Computer, a limited release that takes the startup one step closer to its full commercial release, expected later this year.

And to prove out the concept of how an application would run on its new network, Dfinity today demonstrated an open social network called LinkedUp.

The start-up has rather cheekily called this “an open version of LinkedIn,” the Microsoft-owned social network for professional. Unlike LikedIn, LinkedUp — which runs on any browser, is not owned or controlled by a corporate entity.

LinkedUp is built on Dfinity’s co-called Internet Computer, its name for the platform it is building to distribute the next generation of software and open internet services.

The software is hosted directly on the internet on a Switzerland-based independent data center, but in the concept of the Internet Computer, it could be hosted at your house or mine: the compute power to run the application — LinkedUp, in this case — is coming not from Amazon AWS, Google Cloud or Microsoft Azure, and is instead based on the distributed architecture that Dfinity is building.

Specifically, Dfinity notes that when enterprises and developers run their web apps and enterprise systems on the Internet Computer, the content is decentralised across a minimum of four or a maximum of an unlimited number of nodes in Dfinity’s global network of independent data centers.

And while the company initially was described as a blockchain-based system, that’s also had some refinement. A spokesperson describes the Internet Computer as a “next-generation distributed computing system — similar to its Mainframe, Client Server, and Public Cloud predecessors” that is based on cryptography.

“While DFINITY is not building a traditional blockchain/smart contract platform, it uses advanced cryptography in its consensus layer [of the Internet Computer stack] to ensure apps and workloads have the same security guarantees as Bitcoin or Ethereum,” the spokesperson added, “but its network of independent data centres ensures the speed and scale required by corporates and entrepreneurs.” The Internet Computer also has governance tokens to ensure the ownership of the technology is distributed, he said.

LinkedUp is a test case for all of this, and so Dfinity is open-sourcing LinkedUp for developers to create other types of open internet services on the structure it has built.

This ‘open social network for professional profiles’ suggests that, on Difinity’s model, one could create an ‘Open WhatsApp’, ‘Open eBay’, ‘Open Salesforce’, or ‘Open Facebook’.

(Good news, since LinkedIn might not be so happy about a lookalike service with a name and layout that also looks very familiar, where it to go much further as a commercial endeavor. “While we can’t comment specifically on any proposed trademark, LinkedIn does monitor and take action as necessary to protect our trademarks,” a spokesperson said.)

“Big tech has hijacked the internet and stifled innovation by owning the proprietary infrastructure and user relationships,” said Dominic Williams, Founder and Chief Scientist at Dfinity in a statement. “As a result, a handful of for-profit companies have created a monopolistic and closed internet. The Internet Computer provides a means to rebuild internet services in open form.”

So perhaps what we should be calling this is not LinkedUp, but more a new sort of “Linux for the cloud”.

Dfinity claims the application was built by “1.5 engineers in three weeks,” thus demonstrating how easy the infrastructure is to use.

The tools include a Canister Software Developer Kit and a simple programming language called Motoko that is optimized for Dfinity’s Internet Computer.

“The Internet Computer is conceived as an alternative to the $3.8 trillion dollar legacy IT stack, and empower the next-generation of developers to build a new breed of tamper-proof enterprise software systems and open internet services. We are democratizing software development,” Williams said. “The Bronze release of the Internet Computer provides developers and enterprises a glimpse into the infinite possibilities of building on the Internet Computer — which also reflects the strength of the Dfinity team we have built so far.”

Dfinity says its “Internet Computer Protocol” allows for a new type of software called autonomous software, which can guarantee permanent APIs that cannot be revoked. When all these open internet services (e.g., open versions of WhatsApp, Facebook, eBay, Salesforce, etc) are combined with other open software and services it creates “mutual network effects” where everyone benefits.

We quizzed Dfinity a little more on all this and asked whether this was an actual launch.

A spokesperson told us: “Since our first major milestone of launching a terminal-based SDK and new programming language called Motoko — by the co-creator of WebAssembly — on 1 November, DFINITY has released 13 new public versions of the SDK, to our second major milestone [at WEF Davos] of demoing a decentralized web app called LinkedUp on the Internet Computer running on an independent data center in Switzerland. Subsequent milestones towards the public launch of the Internet Computer will involve (1) on-boarding a global network of independent data centers, (2) fully tested economic system, and (3) fully tested Network Nervous Systems for configuration and upgrades.”

It also looks like Dfinity will not be raising more money just yet.

But the question is how they plan to woo people to it? “Dfinity has been working with a select group of Fortune 500 companies, strategic consultancies, systems integrators, venture capitalists, and universities,” the company said.

We are not sure that will quite suffice to take out Facebook, LinkedIn and all the other tech giants, but we’re fascinated to see how this plays out.

Yo Facebook & Instagram, stop showing Stories reruns

By Josh Constine

If I watch a Story cross-posted from Instagram to Facebook on either of the apps, it should appear as “watched” at the back of the Stories row on the other app. Why waste my time showing me Stories I already saw?

It’s been over two years since Instagram Stories launched cross-posting to Stories. Countless hours of each feature’s 500 million daily users have been squandered viewing repeats. Facebook and Messenger already synchronized the watched/unwatched state of Stories. It’s long past time that this was expanded to encompass Instagram.

I asked Facebook and Instagram if it had plans for this. A company spokesperson told me that it built cross-posting to make sharing easier to people’s different audiences on Facebook and Instagram, and it’s continuing to explore ways to simplify and improve Stories. But they gave no indication that Facebook realizes how annoying this is or that a solution is in the works.

The end result if this gets fixed? Users would spend more time watching new content, more creators would feel seen, and Facebook’s choice to jam Stories in all its apps would fee less redundant and invasive. If I send a reply to a Story on one app, I’m not going to send it or something different when I see the same Story on the other app a few minutes or hours later. Repeated content leads to more passive viewing and less interactive communication with friends, despite Facebook and Instagram stressing that its this zombie consumption that’s unhealthy.

The only possible downside to changing this could be fewer Stories ad impressions if secondary viewings of peoples’ best friends’ Stories keep them watching more than new content. But prioritizing making money over the user experience is again what Mark Zuckerberg has emphasized is not Facebook’s strategy.

There’s no need to belabor the point any further. Give us back our time. Stop the reruns.

Octi launches a social network built around augmented reality

By Anthony Ha

Octi has created a new social network that uses augmented reality to connect the act of seeing your friends in real life with viewing digital content like their favorite YouTube videos and Spotify songs.

When I wrote about the startup in 2018, it was building AR technology that could do a better job of recognizing the human body and movement. Last week, co-founder and CEO Justin Fuisz (pictured above) told me that this was “a really cool feature,” but that Octi’s investors pushed him “to do more, go deeper.”

Speaking of those investors, the startup says it’s now raised $12 million in funding (including a previously announced seed round of $7.5 million) from Live Nation, Anheuser-Busch InBev, Peter Diamandis’ Bold Capital Partners, Human Ventures, I2BF, Tom Conrad, Scott Belsky and Josh Kushner.

Last week, Fuisz demonstrated what he now sees as Octi’s “mic drop” moment — opening the new app and pointing his iPhone camera at a colleague. The app quickly recognized her, allowing Fuisz to send her a friend request. And once the request was accepted, could Fuisz look at her through the camera again, where she was surrounded by a floating “belt” of virtual items that she’d created with videos, songs and photos.

Octi app

Octi also allows you to include fun effects and stickers. Your friends can change your profile too, making you wear a funny hat or giving you a rousing theme song for the day.

To create a facial recognition experience that’s fast and simple, Fuisz said that Octi’s powered by a “neural network on the edge,” allowing the app to process images on the device (rather than uploading them to the cloud) in a privacy-friendly way.

He said the company has taken other steps to optimize the process, like prioritizing friends-of-friends rather than searching through the faces of everyone in the network, resulting in an app that can identify a friend in as little as 20 milliseconds.

While Octi allows you to view friends’ profiles remotely, it’s worth emphasizing that the core experience is meant to be in-person. In fact, the company provided a statement from analyst Rich Greenfield in which he described the app as “an impressive technology that gives teens a compelling reason to be present and communicate with their phones, while gathered with their closest friends.”

Octi app

I wondered whether a new social dynamic also provides new opportunities for harassment and bullying, but Fuisz noted that for now, Octi profiles and belts are only visible to friends that you’ve approved. So if one of your connections is doing something you don’t like, “You just say goodbye. That’s it. That’s a simple way of dealing with it.”

Fuisz added that this initial version provides a foundation for many more experiences: “There’s endless opportunity for games and other fun things you can do.”

Ultimately, he’s hoping to turn this into a WeChat-style platform for outside developers to build social tools and content. And since Octi works on iPhone 7 and above (with plans for an Android version later this year), it can potentially reach an enormous audience out of the gate, rather than facing the scale issues of a more specialized AR or VR hardware platform.

UK watchdog sets out ‘age appropriate’ design code for online services to keep kids’ privacy safe

By Natasha Lomas

The UK’s data protection watchdog has today published a set of design standards for Internet services which are intended to help protect the privacy and safety of children online.

The Information Commissioner’s Office (ICO) has been working on the Age Appropriate Design Code since the 2018 update of domestic data protection law — as part of a government push to create ‘world-leading’ standards for children when they’re online.

UK lawmakers have grown increasingly concerned about the ‘datafication’ of children when they go online and may be too young to legally consent to being tracked and profiled under existing European data protection law.

The ICO’s code is comprised of 15 standards of what it calls “age appropriate design” — which the regulator says reflects a “risk-based approach”, including stipulating that setting should be set by default to ‘high privacy’; that only the minimum amount of data needed to provide the service should be collected and retained; and that children’s data should not be shared unless there’s a reason to do so that’s in their best interests.

Profiling should also be off by default. While the code also takes aim at dark pattern UI designs that seek to manipulate user actions against their own interests, saying “nudge techniques” should not be used to “lead or encourage children to provide unnecessary personal data or weaken or turn off their privacy protections”.

“The focus is on providing default settings which ensures that children have the best possible access to online services whilst minimising data collection and use, by default,” the regulator writes in an executive summary.

While the age appropriate design code is focused on protecting children it is applies to a very broad range of online services — with the regulator noting that “the majority of online services that children use are covered” and also stipulating “this code applies if children are likely to use your service” [emphasis ours].

This means it could be applied to anything from games, to social media platforms to fitness apps to educational websites and on-demand streaming services — if they’re available to UK users.

“We consider that for a service to be ‘likely’ to be accessed [by children], the possibility of this happening needs to be more probable than not. This recognises the intention of Parliament to cover services that children use in reality, but does not extend the definition to cover all services that children could possibly access,” the ICO adds.

Here are the 15 standards in full as the regulator describes them:

  1. Best interests of the child: The best interests of the child should be a primary consideration when you design and develop online services likely to be accessed by a child.
  2. Data protection impact assessments: Undertake a DPIA to assess and mitigate risks to the rights and freedoms of children who are likely to access your service, which arise from your data processing. Take into account differing ages, capacities and development needs and ensure that your DPIA builds in compliance
    with this code.
  3. Age appropriate application: Take a risk-based approach to recognising the age of individual users and ensure you effectively apply the standards in this code to child users. Either establish age with a level of certainty that is appropriate to the risks to the rights and freedoms of children that arise from your data processing, or apply the standards in this code to all your users instead.
  4. Transparency: The privacy information you provide to users, and other published terms, policies and community standards, must be concise, prominent and in clear language suited to the age of the child. Provide additional specific ‘bite-sized’ explanations about how you use personal data at the point that use is activated.
  5. Detrimental use of data: Do not use children’s personal data in ways that have been shown to be detrimental to their wellbeing, or that go against industry codes of practice, other regulatory provisions or Government advice.
  6. Policies and community standards: Uphold your own published terms, policies and community standards (including but not limited to privacy policies, age restriction, behaviour rules and content policies).
  7. Default settings: Settings must be ‘high privacy’ by default (unless you can demonstrate a compelling reason for a different default setting, taking account of the best interests of the child).
  8. Data minimisation: Collect and retain only the minimum amount of personal data you need to provide the elements of your service in which a child is actively and knowingly engaged. Give children separate choices over which elements they wish to activate.
  9. Data sharing: Do not disclose children’s data unless you can demonstrate a compelling reason to do so, taking account of the best interests of the child.
  10. Geolocation: Switch geolocation options off by default (unless you can demonstrate a compelling reason for geolocation to be switched on by default, taking account of the best interests of the child). Provide an obvious sign for children when location tracking is active. Options which make a child’s location visible to others must default back to ‘off’ at the end of each session.
  11. Parental controls: If you provide parental controls, give the child age appropriate information about this. If your online service allows a parent or carer to monitor their child’s online activity or track their location, provide an obvious sign to the child when they are being monitored.
  12. Profiling: Switch options which use profiling ‘off’ by default (unless you can demonstrate a compelling reason for profiling to be on by default, taking account of the best interests of the child). Only allow profiling if you have appropriate measures in place to protect the child from any harmful effects (in particular, being fed content that is detrimental to their health or wellbeing).
  13. Nudge techniques: Do not use nudge techniques to lead or encourage children to provide unnecessary personal data or weaken or turn off their privacy protections.
  14. Connected toys and devices: If you provide a connected toy or device ensure you include effective tools to enable conformance to this code.
  15. Online tools: Provide prominent and accessible tools to help children exercise their data protection rights and report concerns.

The Age Appropriate Design Code also defines children as under the age of 18 — which offers a higher bar than current UK data protection law which, for example, puts only a 13-year-age limit for children to be legally able to give their consent to being tracked online.

So — assuming (very wildly) — that Internet services were to suddenly decide to follow the code to the letter, setting trackers off by default and not nudging users to weaken privacy-protecting defaults by manipulating them to give up more data, the code could — in theory — raise the level of privacy both children and adults typically get online.

However it’s not legally binding — so there’s a pretty fat chance of that.

Although the regulator does make a point of noting that the standards in the code are backed by existing data protection laws, which it does regulate and can legally enforceable (and which include clear principles like ‘privacy by design and default’) — pointing out it has powers to take action against law breakers, including “tough sanctions” such as orders to stop processing data and fines of up to 4% of a company’s global turnover.

So, in a way, the regulator appears to be saying: ‘Are you feeling lucky data punk?’

The code also still has to be laid before parliament for approval for a period of 40 sitting days — with the ICO saying it will come into force 21 days after that, assuming no objections. Then there’s a further 12 month transition period after it comes into force — to “give online services time to conform”. So there’s a fair bit of slack built in before any action may be taken to tackle flagrant nose-thumbers.

Last April the UK government published a white paper setting out its proposals for regulating a range of online harms — including seeking to address concern about inappropriate material that’s available on the Internet being accessed by children.

The ICO’s Age Appropriate Design Code is intended to support that effort. So there’s also a chance that some of the same sorts of stipulations could be baked into the planned online harms bill.

“This is not, and will not be, ‘law’. It is just a code of practice,” said Neil Brown, an Internet, telecoms and tech lawyer at Decoded Legal, discussing the likely impact of the suggested standards. “It shows the direction of the ICO’s thinking, and its expectations, and the ICO has to have regard to it when it takes enforcement action but it’s not something with which an organisation needs to comply as such. They need to comply with the law, which is the GDPR [General Data Protection Regulation] and the DPA [Data Protection Act] 2018.

“The code of practice sits under the DPA 2018, so companies which are within the scope of that are likely to want to understand what it says. The DPA 2018 and the UK GDPR (the version of the GDPR which will be in place after Brexit) covers controllers established in the UK, as well as overseas controllers which target services to people in the UK or monitor the behaviour of people in the UK. Merely making a service available to people in the UK should not be sufficient.”

“Overall, this is consistent with the general direction of travel for online services, and the perception that more needs to be done to protect children online,” Brown also told us.

“Right now, online services should be working out how to comply with the GDPR, the ePrivacy rules, and any other applicable laws. The obligation to comply with those laws does not change because of today’s code of practice. Rather, the code of practice shows the ICO’s thinking on what compliance might look like (and, possibly, goldplates some of the requirements of the law too).”

Organizations that choose to take note of the code — and are in a position to be able to demonstrate they’ve followed its standards — stand a better chance of persuading the regulator they’ve complied with relevant privacy laws, per Brown.

“Conversely, if they want to say that they comply with the law but not with the code, that is (legally) possible, but might be more of a struggle in terms of engagement with the ICO,” he added.

Zooming back out, the government said last fall that it’s committed to publishing draft online harms legislation for pre-legislative scrutiny “at pace”.

But at the same time it dropped a controversial plan included in a 2017 piece of digital legislation which would have made age checks for accessing online pornography mandatory — saying it wanted to focus on a developing “the most comprehensive approach possible to protecting children”, i.e. via the online harms bill.

How comprehensive the touted ‘child protections’ will end up being remains to be seen.

Brown suggests age verification could come through as a “general requirement”, given the age verification component of the Digital Economy Act 2017 was dropped — and “the government has said that these will be swept up in the broader online harms piece”.

The government has also been consulting with tech companies on possible ways to implement age verification online.

However the difficulties of regulating perpetually iterating Internet services — many of which are also operated by companies based outside the UK — have been writ large for years. (And are now mired in geopolitics.)

While the enforcement of existing European digital privacy laws remains, to put it politely, a work in progress

Spotify’s new test lets influencers post Stories to introduce their own playlists

By Sarah Perez

Spotify is testing a new Stories feature that will allow select influencers to incorporate video elements into their public playlists, TechCrunch has learned and Spotify confirmed. The first influencer to test the feature is makeup and fashion YouTube star Summer Mckeen, who currently has a social media fan base that includes 2.33 million YouTube subscribers, 2.1 million Instagram followers, and 126,455 Spotify followers. Mckeen is using the new feature to introduce a playlist of her all-time favorite songs, which she’s titled her “all time besties.”

Like other Stories’ products found on social media apps, the Spotify version offers a similar experience that includes short video clips that users can tap on to advance to the next screen. There are also horizontal lines at the top that indicate how many screens still await them ahead.

Above: where Stories are found on playlists

Meanwhile, the entry point for the Spotify Story is a circular icon right found above the playlist’s title. This has also been designed to catch your attention with an animated preview of the video you’ll see if you tap through.

Above: Mckeen introduces her playlist of favorite songs

Once in the Story, the clips will play and advance automatically and the playlist where you found the Story is featured at the top. You can also tap the “X” to exit at any time.

Spotify’s unique take on the Stories format involves its use of music, of course.

In the new Stories feature, the influencer can also share video clips that contain small song snippets and the album art as a way of previewing the songs in the playlist. In Mckeen’s case, a few of these follow her introduction of the new playlist.

Above: Song clips in Stories

Mckeen is the first influencer to go live on Spotify Stories, but we understand the company is also planning to roll this out to other notable names across the entertainment, lifestyle and music industries in the near future. This initial group of testers is being determined by a variety of factors — including follower count, how engaged their followers are, and how active the influencer in question is on Spotify. Mckeen was selected because she’s someone who likes to make playlists on her own and has many user-generated playlists she shares with fans.

Spotify isn’t rolling out the feature to its artists, however, as it’s meant to be more a tool for music discovery, rather than one for promotional purposes. Artists, instead, can reach fans creatively using Canvas — the recently launched looping videos product that can take the place of album art when a song plays.

Despite the similarity with other Stories found on apps like Instagram, Facebook, Snapchat and YouTube, Spotify’s goal isn’t to turn its app into another social media platform. Instead, it will rely on the influencers to get the word out to fans themselves using their existing accounts found elsewhere. Mckeen, for example, posted to her Instagram Stories with a deep link directly to the playlist in question.

Above: Mckeen’s IG Story

Currently, the Spotify Stories product can only be seen on iOS and Android, not desktop. (Mckeen’s is here.) And it’s available to all Spotify users — free and paid — although that could one day change. Spotify considers the product just a test for now, but is open to considering a broader rollout in the future.

Spotify confirmed the test to TechCrunch and offered a short statement.

“At Spotify, we routinely conduct a number of tests in an effort to improve our user experience. Some of those tests end up paving the path for our broader user experience and others serve only as an important learning,” a Spotify spokesperson said. “We have no further news to share on future plans at this time,” they added.

This is not the first time Spotify has dabbled with a Stories format, however. Last year, Spotify was spotted testing a Stories-like product called Storyline that was similar to “Behind the Lyrics,” but instead allowed artists to share their own insights, inspiration, and other details more directly. This can still be found on Spotify on select songs, but hasn’t become broadly available.

Shadows’ Dylan Flinn and Kombo’s Kevin Gould on the business of ‘virtual influencers’

By Eric Peckham

In films, TV shows and books — and even in video games where characters are designed to respond to user behavior — we don’t perceive characters as beings with whom we can establish two-way relationships. But that’s poised to change, at least in some use cases.

Interactive characters — fictional, virtual personas capable of personalized interactions — are defining new territory in entertainment. In my guide to the concept of “virtual beings,” I outlined two categories of these characters:

  • virtual influencers: fictional characters with real-world social media accounts who build and engage with a mass following of fans.
  • virtual companions: AIs oriented toward one-to-one relationships, much like the tech depicted in the films “Her” and “Ex Machina.” They are personalized enough to engage us in entertaining discussions and respond to our behavior (in the physical world or within games) like a human would.

Part 2 of 3: the business of virtual influencers

Today’s discussion focuses on virtual influencers: fictional characters that build and engage followings of real people over social media. To explore the topic, I spoke with two experienced entrepreneurs:

  • Dylan Flinn is CEO of Shadows, an LA-based animation studio that’s building a roster of interactive characters for social media audiences. Dylan started his career in VC, funding companies such as Robinhood, Patreon and Bustle, and also spent two years as an agent at CAA.
  • Kevin Gould is CEO of Kombo Ventures, a talent management and brand incubation firm that has guided the careers of top influencers like Jake Paul and SSSniperWolf. He is the co-founder of three direct-to-consumer brands — Insert Name Here, Wakeheart and Glamnetic — and is an angel investor in companies like Clutter, Beautycon and DraftKings.

TechCrunch’s Top 10 investigative reports from 2019

By Josh Constine

Facebook spying on teens, Twitter accounts hijacked by terrorists, and sexual abuse imagery found on Bing and Giphy were amongst the ugly truths revealed by TechCrunch’s investigating reporting in 2019. The tech industry needs more watchdogs than ever as its size enlargens the impact of safety failures and the abuse of power. Whether through malice, naivety, or greed, there was plenty of wrongdoing to sniff out.

Led by our security expert Zack Whittaker, TechCrunch undertook more long-form investigations this year to tackle these growing issues. Our coverage of fundraises, product launches, and glamorous exits only tell half the story. As perhaps the biggest and longest running news outlet dedicated to startups (and the giants they become), we’re responsible for keeping these companies honest and pushing for a more ethical and transparent approach to technology.

If you have a tip potentially worthy of an investigation, contact TechCrunch at tips@techcrunch.com or by using our anonymous tip line’s form.

Image: Bryce Durbin/TechCrunch

Here are our top 10 investigations from 2019, and their impact:

Facebook pays teens to spy on their data

Josh Constine’s landmark investigation discovered that Facebook was paying teens and adults $20 in gift cards per month to install a VPN that sent Facebook all their sensitive mobile data for market research purposes. The laundry list of problems with Facebook Research included not informing 187,000 users the data would go to Facebook until they signed up for “Project Atlas”, not receiving proper parental consent for over 4300 minors, and threatening legal action if a user spoke publicly about the program. The program also abused Apple’s enterprise certificate program designed only for distribution of employee-only apps within companies to avoid the App Store review process.

The fallout was enormous. Lawmakers wrote angry letters to Facebook. TechCrunch soon discovered a similar market research program from Google called Screenwise Meter that the company promptly shut down. Apple punished both Google and Facebook by shutting down all their employee-only apps for a day, causing office disruptions since Facebookers couldn’t access their shuttle schedule or lunch menu. Facebook tried to claim the program was above board, but finally succumbed to the backlash and shut down Facebook Research and all paid data collection programs for users under 18. Most importantly, the investigation led Facebook to shut down its Onavo app, which offered a VPN but in reality sucked in tons of mobile usage data to figure out which competitors to copy. Onavo helped Facebook realize it should acquire messaging rival WhatsApp for $19 billion, and it’s now at the center of anti-trust investigations into the company. TechCrunch’s reporting weakened Facebook’s exploitative market surveillance, pitted tech’s giants against each other, and raised the bar for transparency and ethics in data collection.

Protecting The WannaCry Kill Switch

Zack Whittaker’s profile of the heroes who helped save the internet from the fast-spreading WannaCry ransomware reveals the precarious nature of cybersecurity. The gripping tale documenting Marcus Hutchins’ benevolent work establishing the WannaCry kill switch may have contributed to a judge’s decision to sentence him to just one year of supervised release instead of 10 years in prison for an unrelated charge of creating malware as a teenager.

The dangers of Elon Musk’s tunnel

TechCrunch contributor Mark Harris’ investigation discovered inadequate emergency exits and more problems with Elon Musk’s plan for his Boring Company to build a Washington D.C.-to-Baltimore tunnel. Consulting fire safety and tunnel engineering experts, Harris build a strong case for why state and local governments should be suspicious of technology disrupters cutting corners in public infrastructure.

Bing image search is full of child abuse

Josh Constine’s investigation exposed how Bing’s image search results both showed child sexual abuse imagery, but also suggested search terms to innocent users that would surface this illegal material. A tip led Constine to commission a report by anti-abuse startup AntiToxin (now L1ght), forcing Microsoft to commit to UK regulators that it would make significant changes to stop this from happening. However, a follow-up investigation by the New York Times citing TechCrunch’s report revealed Bing had made little progress.

Expelled despite exculpatory data

Zack Whittaker’s investigation surfaced contradictory evidence in a case of alleged grade tampering by Tufts student Tiffany Filler who was questionably expelled. The article casts significant doubt on the accusations, and that could help the student get a fair shot at future academic or professional endeavors.

Burned by an educational laptop

Natasha Lomas’ chronicle of troubles at educational computer hardware startup pi-top, including a device malfunction that injured a U.S. student. An internal email revealed the student had suffered a “a very nasty finger burn” from a pi-top 3 laptop designed to be disassembled. Reliability issues swelled and layoffs ensued. The report highlights how startups operating in the physical world, especially around sensitive populations like students, must make safety a top priority.

Giphy fails to block child abuse imagery

Sarah Perez and Zack Whittaker teamed up with child protection startup L1ght to expose Giphy’s negligence in blocking sexual abuse imagery. The report revealed how criminals used the site to share illegal imagery, which was then accidentally indexed by search engines. TechCrunch’s investigation demonstrated that it’s not just public tech giants who need to be more vigilant about their content.

Airbnb’s weakness on anti-discrimination

Megan Rose Dickey explored a botched case of discrimination policy enforcement by Airbnb when a blind and deaf traveler’s reservation was cancelled because they have a guide dog. Airbnb tried to just “educate” the host who was accused of discrimination instead of levying any real punishment until Dickey’s reporting pushed it to suspend them for a month. The investigation reveals the lengths Airbnb goes to in order to protect its money-generating hosts, and how policy problems could mar its IPO.

Expired emails let terrorists tweet propaganda

Zack Whittaker discovered that Islamic State propaganda was being spread through hijacked Twitter accounts. His investigation revealed that if the email address associated with a Twitter account expired, attackers could re-register it to gain access and then receive password resets sent from Twitter. The article revealed the savvy but not necessarily sophisticated ways terrorist groups are exploiting big tech’s security shortcomings, and identified a dangerous loophole for all sites to close.

Porn & gambling apps slip past Apple

Josh Constine found dozens of pornography and real-money gambling apps had broken Apple’s rules but avoided App Store review by abusing its enterprise certificate program — many based in China. The report revealed the weak and easily defrauded requirements to receive an enterprise certificate. Seven months later, Apple revealed a spike in porn and gambling app takedown requests from China. The investigation could push Apple to tighten its enterprise certificate policies, and proved the company has plenty of its own problems to handle despite CEO Tim Cook’s frequent jabs at the policies of other tech giants.

Bonus: HQ Trivia employees fired for trying to remove CEO

This Game Of Thrones-worthy tale was too intriguing to leave out, even if the impact was more of a warning to all startup executives. Josh Constine’s look inside gaming startup HQ Trivia revealed a saga of employee revolt in response to its CEO’s ineptitude and inaction as the company nose-dived. Employees who organized a petition to the board to remove the CEO were fired, leading to further talent departures and stagnation. The investigation served to remind startup executives that they are responsible to their employees, who can exert power through collective action or their exodus.

If you have a tip for Josh Constine, you can reach him via encrypted Signal or text at (585)750-5674, joshc at TechCrunch dot com, or through Twitter DMs

Instagram drops IGTV button, but only 1% downloaded the app

By Josh Constine

At most, 7 million of Instagram’s 1 billion-plus users have downloaded its standalone IGTV app in the 18 months since launch. And now, Instagram’s main app is removing the annoying orange IGTV button from its home page in what feels like an admission of lackluster results. For reference, TikTok received 1.15 billion downloads in the same period since IGTV launched in June 2018. In just the US, TikTok received 80.5 million downloads compared to IGTV’s 1.1 million since then, according to research commissioned by TechCrunch from Sensor Tower.

“As we’ve continued to work on making it easier for people to create and discover IGTV content, we’ve learned that most people are finding IGTV content through previews in Feed, the IGTV channel in Explore, creators’ profiles and the standalone app. Very few are clicking into the IGTV icon in the top right corner of the home screen in the Instagram app” a Facebook company spokesperson tells TechCrunch. “We always aim to keep Instagram as simple as possible, so we’re removing this icon based on these learnings and feedback from our community.”

Instagram users don’t need the separate IGTV app to watch longer videos, as the IGTV experience is embedded in the main app and can be accessed via in-feed teasers, a tab of the Explore page, promo stickers in Stories, and profile tabs. Still, the fact that it wasn’t an appealing enough destination to warrant a home page button shows IGTV hasn’t become a staple like past Instagram launches including video, Stories, augmented reality filters, or Close Friends.

One thing still missing is an open way for Instagram creators to earn money directly from their IGTV videos. Users can’t get an ad revenue share like with YouTube or Facebook Watch. They also can’t receive tips or sell exclusive content subscriptions like on Facebook, Twitch, or Patreon.

The only financial support Facebook and Instagram have offered IGTV creators is reimbursement for production costs for a few celebrities. Those contracts also require creators to avoid making content related to politics, social issues, or elections, according to Bloomberg‘s Lucas Shaw and Sarah Frier.

“In the last few years we’ve offset small production costs for video creators on our platforms and have put certain guidelines in place,” a Facebook spokesperson told Bloomberg. “We believe there’s a fundamental difference between allowing political and issue-based content on our platform and funding it ourselves.” That seems somewhat hypocritical given Facebook CEO Mark Zuckerberg’s criticism of Chinese app TikTok over censorship of political content.

Now users need to tap the IGTV tab inside Instagram Explore to view long-form videoAnother thing absent from IGTV? Large view counts. The first 20 IGTV videos I saw today in its Popular feed all had fewer than 200,000 views. BabyAriel, a creator with nearly 10 million Instagram followers that the company touted as a top IGTV creator has only post 20 of the longer videos to date with only one receiving over 500,000 views.

When the lack of monetization is combined with less than stellar view counts compared to YouTube and TikTok, it’s understandable why some creators might be hesistant to dedicate time to IGTV. Without their content keeping the feature reliably interesting, it’s no surprise users aren’t voluntarily diving in from the home page.

In another sign that Instagram is folding IGTV deeper into its app rather than providing it more breathing room of its own, and that it’s eager for more content, you can now opt to post IGTV videos right from the main Instagram feed post video uploader. AdWeek Social Pro reported this new “long video” upload option yesterday. A Facebook company spokesperson tells me “We want to keep our video upload process as simple as possible” and that “Our goal is to create a central place for video uploads”.

 

IGTV launched with a zealotish devotion to long-form vertical video despite the fact that little high quality content of this nature was being produced. Landscape orientation is helpful for longer clips that often require establishing shots and fitting multiple people on screen, while vertical was better for quick selfie monologues.

Yet Instagram co-founder Kevin Systrom described IGTV to me in August 2018, declaring that “What I’m most proud of is that Instagram took a stand and tried a brand new thing that is frankly hard to pull off. Full-screen vertical video that’s mobile only. That doesn’t exist anywhere else.”

Now it doesn’t exist on Instagram at all since May 2019 when IGTV retreated from its orthodoxy and began allowing landscape content. I’d recommended it do that from the beginning, or at least offer a cropping tool for helping users turn their landscape videos into coherent vertical ones, but nothing’s been launched there either.

If Instagram still cares about IGTV, it needs to attract more must-see videos by helping creators get paid for their art. Or it needs to pour investment into buying high quality programming like Snapchat Discover’s Shows. If Instagram doesn’t care, it should divert development resources to it’s TikTok clone Reels that actually looks very well made and has a shot at stealing market share in the remixable social entertainment space.

For a company that’s won by betting big and moving fast, IGTV feels half-baked and sluggish. That might have been alright when Snapchat was shrinking and TikTok was still Musically, but Instagram is heading into an era of much stiffer competition.

Jack Dorsey Says You Really Won't Get an Edit Tweet Button

By Paris Martineau
“When you send a text, you can’t really take it back,” the Twitter CEO says. “We wanted to preserve that vibe and that feeling in the early days.”

Where FaZe Clan sees the future of gaming and entertainment

By Jonathan Shieber

Lee Trink has spent nearly his entire career in the entertainment business. The former president of Capitol Records is now the head of FaZe Clan, an esports juggernaut that is one of the most recognizable names in the wildly popular phenomenon of competitive gaming.

Trink sees FaZe Clan as the voice of a new generation of consumers who are finding their voice and their identity through gaming — and it’s a voice that’s increasingly speaking volumes in the entertainment industry through a clutch of competitive esports teams, a clothing and lifestyle brand and a network of creators who feed the appetites of millions of young gamers.

As the company struggles with a lawsuit brought by one of its most famous players, Trink is looking to the future — and setting his sights on new markets and new games as he consolidates FaZe Clan’s role as the voice of a new generation.

“The teams and social media output that we create is all marketing,” he says. “It’s not that we have an overall marketing strategy that we then populate with all of these opportunities. We’re not maximizing all of our brands.”

44% of TikTok’s all-time downloads were in 2019, but app hasn’t figured out monetization

By Sarah Perez

Despite the U.S. government’s concerns over TikTok, which most recently led to the U.S. Navy banning service members’ use of the app, TikTok had a stellar 2019 in terms of both downloads and revenue. According to new data from Sensor Tower, 44% of TikTok’s total 1.65 billion downloads to date, or 738+ million installs, took place in 2019 alone. And though TikTok is still just experimenting with different means of monetization, the app had its best year in terms of revenue, grossing $176.9 million in 2019 — or 71% of its all-time revenue of $247.6 million.

Apptopia had previously reported TikTok was generating $50 million per quarter.

The number of TikTok downloads in 2019 is up 13% from the 655 million installs the app saw in 2018, with the holiday quarter (Q4 2019) being TikTok’s best ever, with 219 million downloads, up 6% from TikTok’s previous best quarter, Q4 2018. TikTok was also the second-most downloaded (non-game) app worldwide across the Apple App Store and Google Play in 2019, according to Sensor Tower data.

However, App Annie’s recent “State of Mobile” report put it in fourth place, behind Messenger, Facebook and WhatsApp — not just behind WhatsApp, as Sensor Tower does.

Regardless, the increase in TikTok downloads in 2019 is largely tied to the app’s traction in India. Though the app was briefly banned in the country earlier in the year, that market still accounted for 44% (or 323 million) of 2019’s total downloads. That’s a 27% increase from 2018.

TikTok’s home country, China, is TikTok’s biggest revenue driver, with iOS consumer spend of $122.9 million, or 69% of the total and more than triple what U.S. users spent in the app ($36 million). The U.K. was the third-largest contributor in terms of revenue, with users spending $4.2 million in 2019.

These numbers, however, are minuscule in comparison with the billions upon billions earned by Facebook on an annual basis, or even the low-digit billions earned by smaller social apps like Twitter. To be fair, TikTok remains in an experimental phase with regards to revenue. In 2019, it ran a variety of ad formats, including brand takeovers, in-feed native video, hashtag challenges and lens filters. It even dabbled in social commerce.

Meanwhile, only a handful of creators have been able to earn money in live streams through tipping — another area that deserves to see expansion in the months ahead if TikTok aims to take on YouTube as a home for creator talent.

When it comes to monetization, TikTok is challenged because it doesn’t have as much personal information about its users, compared with a network like Facebook and its rich user profile data. That means advertisers can’t target ads based on user interests and demographics in the same way. Because of this, brands will sometimes forgo working with TikTok itself to deal directly with its influencer stars, instead.

What TikTok lacks in revenue, it makes up for in user engagement. According to App Annie, time spent in the app was up 210% year-over-year in 2019, to reach a total 68 billion hours. TikTok clearly has users’ attention, but now it will need to figure out how to capitalize on those eyeballs and actually make money.

Reached for comment, TikTok confirmed it doesn’t share its own stats on installs or revenue, so third-party estimates are the only way to track the app’s growth for now.

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