Turbotodd

Ruminations on tech, the digital media, and some golf thrown in for good measure.

Turbo’s Take: Mary Meeker Internet Trends 2019

leave a comment »

Mary Meeker is speaking again at this year’s Code Conference, and delivering her always highly-anticipated Internet Trends Report.

Following is a CC from Vox’s highlights.

  • Some 51 percent of the world — 3.8 billion people — were internet users last year, up from 49 percent (3.6 billion) in 2017. Growth slowed to about 6 percent in 2018 because so many people have come online that new users are harder to come by. Sales of smartphones — which are the primary internet access point for many people across the globe — are declining as much of the world that is going to be online already is.
  • As of last week, seven out of 10 of the world’s most valuable companies by market cap are tech companies, with only Berkshire Hathaway, Visa, and Johnson & Johnson making the Top 10 as non-tech companies:
  1. Microsoft
  2. Amazon
  3. Apple
  4. Alphabet
  5. Berkshire Hathaway
  6. Facebook
  7. Alibaba
  8. Tencent
  9. Visa
  10. Johnson & Johnson
  • E-commerce is now 15 percent of retail sales. Its growth has slowed — up 12.4 percent in Q1 compared with a year earlier — but still towers over growth in regular retail, which was just 2 percent in Q1.
  • Internet ad spending accelerated in the US, up 22 percent in 2018. Most of the spending is still on Google and Facebook, but companies like Amazon and Twitter are getting a growing share. Some 62 percent of all digital display ad buying is for programmatic ads, which will continue to grow.
  • Customer acquisition costs — the marketing spending necessary to attract each new customer — is going up. That’s unsustainable because in some cases it surpasses the long-term revenue those customers will bring. Meeker suggests cheaper ways to acquire customers, like free trials and unpaid tiers.
  • There are a number of problems ahead for targeted advertising, including GDPR impact and other regulation, as well as pushes for more privacy from hardware and software companies like Apple and Facebook.
  • Americans are spending more time with digital media than ever: 6.3 hours a day in 2018, up 7 percent from the year before. Most of that growth is coming from mobile and other connected devices, while time spent on computers declines. People are also getting more concerned about time spent online, as more than a quarter of US adults say they’re “almost constantly online.”
  • Innovation at tech companies outside the US has remained robust. Popular areas include fulfillment, delivery, and payments.
  • Images are increasingly the means by which people communicate, as technology developments like faster wifi and better phone cameras have encouraged a surge in image taking. More than 50 percent of Twitter impressions now involve posts with images, video or other media; Twitter used to be text-only.
  • The number of interactive gamers worldwide grew 6 percent to 2.4 billion people last year, as interactive games like Fortnite become the new social media for certain people. The number of people who watch those games — rather than participate — is swelling, too.
  • As privacy becomes a bigger selling point, expect more options to make your online communications safe. In Q1, 87 percent of global web traffic was encrypted, up from 53 percent three years ago.
  • The internet will become more of a cesspool: Getting rid of problematic content becomes more difficult on a large scale, and the very nature of internet communication allows that content to be amplified much more than before. Some issues: 42 percent of US teens have experienced offensive name-calling online, terrorists are being radicalized on sites like YouTube, and social media has encouraged increased political polarization.
  • Of the top 25 most valuable tech companies, 60 percent were founded by first- or second-generation immigrants. They employed 1.9 million people last year. New stricter immigration laws could negatively impact the tech industry and perhaps prevent our next Elon Musk from getting to the US.
  • Health care is steadily becoming more digitized. Expect more telemedicine and on-demand consultations.

My takeaways:

  • There’s lots of confusion ahead for advertising, advertisers, and advertisees. Who’s going to “own” the advertising audience moving forward with a battle royale going on between handset and other device makers, developers, third-party advertising entities, e-retailers and advertising disrupters, particularly as issues of accountability, brand safety, and privacy/data regulation get fought over. And in the U.S., expect to see more First Amendment issues get challenged.
  • Mobile has become the killer app, for both advertising and, ergo, for content consumption. While broadcast TV will continue to thrive if, for no other reason, real-time sporting events, increasingly the eyeballs that matter (Generations Y, Z, and beyond…including millennials) will be watching content on something other than a TV via a mechanism that is IP-based and on the move. Agencies, advertisers, platforms, and all points beyond must adjust if they want to stay relevant.
  • E-payments are (including mobile) are, in my estimation, still a killer app that are ridiculously underserved and undertapped in the U.S. Go to China and the whole ecosystem is about WeChat mobile payments, from street vendors to Louis Vutton, and we’re still fiddling around with credit cards in the West. Expect Facebook’s play here to challenge the banking and payment status quo, and possibly even the notion of nation-state fiat currency. They have 2+ billion potential customers. And you thought the U.S. Congress wasn’t just ready for dealing with data legislation?
  • Encryption as a panacea for our privacy ills will have to be counterbalanced by the needs of the national security and sigint apparati around the globe. Don’t expect the nation state to go dark on Facebook Messenger, WhatsApp, etc. without a fight (and who knows, maybe the encryption’s already on, but so are the virtual microphones). Remember US v Apple iPhone Encryption when President Obama was still president? Yeah, that.
  • Re: Data and antitrust legislation, this is one to keep an eye on. The U.S. so far has outsourced its privacy legislation to the EU vis a vis GDPR (save for some state-based privacy legislative initiatives from the likes of California), and so far as antitrust and tech giants are concerned, there’s such a rich target set and so little resources. Regulators are going to have to pick their battles selectively, and even then, know that their efforts could put giant balls and chains around the ankles of the very innovation they would argue keep us apace on China and ROW. Also, as IBM’s Ginni Rometty says, “Data is the next natural resource.” If China generates data like oil spouting out of the original Spindletop, and the U.S./Europe stand around twiddling their thumbs and capping their virtual wells, the West could rapidly find itself at a competitive disadvantage in the Great AI Wars of the 21st Century, if not outright handicapped.
  • At the same time, we won’t be able to completely tariff our way forward (with China and Huawei, or anybody else). Uncle Sam and the academy need to continue to focus on what made Silicon Valley (and, ergo, America) great in the first place: The embrace of intellectual and academic freedom and research, smart immigration policies that encourage the best and the brightest to come to America…and (should they so choose) stay; forward looking investments and pure R&D from Uncle Sam (not unlike the Space Race, which led to so many of the innovations we enjoy today)…and, you know, rational, enlightened thinking about the future of technology and the positive (and negative) impacts it can have.

I reserve the right to have further reactions as I more fully absorb the entirety of Meeker’s always fascinating and helpful report.

Written by turbotodd

June 11, 2019 at 12:40 pm

Posted in 2019, AI, privacy

Tagged with , ,

Apple’s Supply Chain, RapidAPI’s Boost

leave a comment »

So what happens if this U.S.-China trade war gets outta hand? What, in particular, happens to Apple, whose supply chain purposely extends throughout the Middle Kingdom?

Bloomberg is reporting that Apple has a fallback plan, that its primary manufacturing partner, Foxconn (also known as Hon Hai Precision Industry Co. Ltd), "has enough capacity to make all iPhones bound for the U.S. outside of China, if necessary."

“Twenty-five percent of our production capacity is outside of China and we can help Apple respond to its needs in the U.S. market,” said [Foxconn semiconductor division chief, Young] Liu, adding that investments are now being made in India for Apple. “We have enough capacity to meet Apple’s demand."

According to the report, Apple has not given Foxconn instructions to move production out of China…yet.

Foxconn is now running quality tests for the iPhone Xr series there and plans to begin mass production at a facility in the suburbs of Chennai. Older models are already assembled at a Wistron plant in Bangalore.

Foxconn had also committed to building a 13,000-worker facility in Wisconsin, but the fate of that plant seems to have been up and down. But Foxconn executives maintain the employment goal remains, and that "construction remains on schedule and that it will hire as many as 2,000 Americans by the end of 2020."

Meanwhile, the tech consolidation buying spree continues.

Intel is acquiring Barefoot Networks, which specializes in programmable networking chips, for $155M. Interesting to note that Barefoot’s fund raises amounted to $155M from a variety of firms, including Chinese Internet giants Tencent and Alibaba.

TechCrunch provides a backgrounder:

Based in Santa Clara, Calif., Barefoot Networks was launched from stealth in late 2016 by Dr. Craig Barratt, a former Stanford University professor whose work was critical to the development of the networking architectures that allowed Alphabet, Facebook and others to operate at the massive scale they now have.

As these companies demanded more customized hardware ranging from chipsets to enable their various machine learning algorithms to manage and monitor content (and win Go games), to the servers and routers that they’ve put up in their own internal networks Barratt realized they’d need chipsets that they could modify.

With the acquisition, Intel adds a core knowledge set around p4-programmable high speed data paths, switch silicon development, P4 compilers, drivers oftware, network telemetry and computational networking.

It’s not just speed in the chips that will transform cloud-based AI…it’s speed in the networking infrastructure and at the edge of the network.

H&R Block is acquiring Toronto-based Wave Financial, a financial planning platform for small business owners (surely you’ve seen their TV spots!) for $537 million CAD (Canadian dollars).

The acquisition, which is still subject to regulatory approval and closing conditions, expands H&R Block’s product and client portfolio with Wave’s accounting, invoicing, payroll, and payments software solutions and will also see Wave adding H&R Block tax solutions to its suite of products.

In 2014, Wave reached over 2.5 million customers worldwide, and launched its Invoice feature the following year. Last year, the company surpassed 3.5 million customers, and launched Wave Plus, launching its Receipts and Payments features the following year.

Wave provides its software for free to more than four million customers in 200 countries worldwide. Revenue is generated from Wave’s paid financial services, including Payments and Payroll by Wave. The company’s general software is free, rather than “freemium” model, meaning that its tools can be used without tiers or limitations.

Upon closing, writes BetaKit, the deal "would make one of the largest ever Canadian tech exits."

And if you’re a developer, this one’s for you: RapidAPI, which devs used to search for, pay, and connect to public APIs, has closed a Series B round of $25 million.

The funding comes at a time of decent growth for the startup. The company now counts 10,000 APIs in its marketplace, which it estimates covers 33% of all publicly available APIs globally (leaving lots of room still to grow); with developers using RapidAPI, now standing at 1 million, who now collectively make 500 billion API calls each month from a wide variety of companies big and small, including Microsoft, SendGrid, Nexmo, Telesign, Google, Skyscanner and Crunchbase.

TechCrunch reports that the funding will help bolster development of its tools, including RapidAPI for Teams, "which will help them not only manage their use of public APIs but also organse and use their own internal APIs and microservices.

If you build it (your API), they will come…but they have to find it first!

RapidAPI currently has 1 million developers and counting…I would expect somebody will take them off the board and soon. Microsoft may have first right of refusal, as RapidAPI’s Series B was led by the company’s venture arm, M12.

Written by turbotodd

June 11, 2019 at 10:00 am

Salesforce Acquires Tableau, Raytheon to Merge With United Technologies

leave a comment »

M&A Thursday has segued into M&A Monday: Salesforce is buying data visualization firm Tableau for $15.7B in an all-stock deal.

This just a few days after Google announced it was buying analytics startup Looker for $2.6B.

Somebody’s going to need a good analytics visualization tool to analyze all of these sudden big analytics M&A deals!

Also in AI news, network analysis and cyberattack AI firm Vectra has raised a $100M Series E round led by TCV, which brings the company’s total raise to $220M, according to a report from SiliconANGLE.

UK-based Privatar, a data privacy software provider for the enterprise, raised a $40M Series B round led by Accel.

Spacemaker, AI for architects, urban planners, and property developers, raised $25M in a Series A co-led by Atomico and Northzone.

And Bloomberg is reporting that Apple is preparing to do an “acquihire” of self-driving startup Drive.ai. That company has raised about $77M and last valued in 2017 at $200M.

Lest you think those are large deals, let’s not forget the giant merger in the aerospace and defense industries announced over the weekend, the combination of United Technologies and Raytheon.

Raytheon and United Technologies’ aerospace businesses produce a whole slew of aircraft and defense technologies, including Pratt & Whitney engineers, Tomahawk missiles, and the F-35 fighter jet.

If approved, the merger would become one of the biggest deals of 2019, and would leave a company with an estimated $74B in expected sales for the year…and a landscape with a much smaller short list of defense contractors (Boeing, Lockheed Martin, and Raytheon are at the top of that list).

Written by turbotodd

June 10, 2019 at 10:21 am

Looker, Scooter, Uber

leave a comment »

It’s an M&A kind of Thursday.

First on the auction block: Looker, a data analytics startup that Google has purchased for $2.6B in cash. This is the company’s first major acquisition since ex-Oracler Thomas Kurian joined the team (and replaced Diane Greene).

The value prop, as surmised by CNBC: 

The purchase of Looker will add a new analytics tool for Google Cloud’s customers. Google said the technology will help its customers analyze their data in a consistent way across different sources and help Google provide industry-specific analytics for its targeted verticals. Google said in its press release that it already shared over 350 customers through an existing partnership, including BuzzFeed, Yahoo and Hearst.

Bird is in talks to acquire scooter startup Scott, last valued at $71M. TechCrunch reports Bird scooping up Scoot would be the company’s first full acquisition. (And as an Austinite who frequents LadyBird Lake trail frequently, I’ll just say this: “Enough with the scooters, already.”)

And Step, a mobile-based banking service aimed at teenagers in the U.S., raised $22.5M in a round led by Stripe.

“Schools don’t teach kids about money,” CJ MacDonald, the CEO and co-founder, said in an interview. “We want to be their first bank accounts with spending cards, but we also want to teach financial literacy and responsibility. Banks don’t tailor to this, and we want to be a solution teaching the next generation of adults to be more responsible with money in the cashless era. It was easy with cash to go to the mall but now everyone is using their phone for Uber and more.”

And speaking of Uber, if UberX doesn’t quite cut it for you in terms of prestige, you’ll soon be able to take Uber Copter for an 8-minute helicopter ride between Lower Manhattan and JFK for roughly $200-225/person. 

Be sure to wave at all those folks parked on the Van Wyck!

Written by turbotodd

June 6, 2019 at 12:41 pm

Posted in 2019

Tagged with , ,

Amazon’s Delivery Drone

leave a comment »

Amazon still delivers most of the stuff I order from them via truck and human.

But TechCrunch is reporting the company has a new delivery drone, and is indicating it will start making deliveries via drone in the coming months.

The drone is “chock-full of sensors and a suite of compute modules that run a variety of machine learning models to keep the drone safe.”

The drone safe? What about we customers??

I can’t wait for the first redneck video of some doofus shooting the Prime Air drone out of the sky with a .12 gauge.

FYI, the new drone can fly up to 15 miles and carry packages that weigh up to five pounds.

More deets:

There are four traditional airplane control surfaces and six rotors. That’s it. The autopilot, which evaluates all of the sensor data and which Amazon also developed in-house, gives the drone six degrees of freedom to maneuver to its destination. The angled box at the center of the drone, which houses most of the drone’s smarts and the package it delivers, doesn’t pivot. It sits rigidly within the aircraft.

It’s unclear how loud the drone will be. Kimchi would only say that it’s well within established safety standards and that the profile of the noise also matters. He likened it to the difference between hearing a dentist’s drill and classical music. Either way, though, the drone is likely loud enough that it’s hard to miss when it approaches your backyard.

Domino’s Pizza, your move!

Written by turbotodd

June 5, 2019 at 3:17 pm

Posted in 2019, amazon, artificial intelligence, drones

Tagged with ,

Apple Blah

leave a comment »

You know you’ve lost some enthusiasm about technology when the most excited you got at Apple’s “dub-dub” (WWDC) keynote was “dark mode.”

I’ve read lots of folks commentary on Twitter and parts beyond claiming this was the best keynote presentation since Steve Jobs left the stage.

Yeah, I don’t think so.

Don’t get me wrong, it was competently done, but I saw a lot of nibbling around the edges and not nearly as much new innovation I would have expected.

But I’ve been around this industry for a wee bit, maybe I’m just jaded. 

Or maybe I’m just already pretty happy with the Apple technology I have.  

I do my daily work on a 2013 MacBook Pro, I have my own personal Macbook Air (circa 2011), an iPhone 7+ with a cracked screen that still works fine, a first-gen Apple Watch, and a first-gen iPad Air. I couldn’t be more of an Apple fan boy. 

But I also don’t like doing real work on the iPad (other than email and a little writing) because I miss not having a mouse too much (although Apple intimated that mouse action would be included in the iPadOS soon, and is already in beta), and I don’t like reading books on the MBP because for me, that’s what iPads and iPhones are for!

Last year, we heard at WWDC that Project Marzipan was going to result in a harmonic convergence of iOS and MacOS apps. This year Apple announced it was forking iOS into an iPad-specific system, and now “Project Catalyst” will help port apps over to the Mac.

Catalyst, Marzipan, where and when does this convergence train end?

CarPlay, which circa 2019 I would think be more important an opportunity than ever (for safety reasons, if nothing else), seemed stalled, save for some compatibility with third-party apps like Pandora and Waze.

But if you’re looking for a new Mac Pro, Apple will sell you its top spec new model for up to $35,000!

What I was most excited about?  

Again, I think for the industry and for developers, the interesting stuff comes in with dev toolsets like ARKit 3, which provides new tools to make AR development easier and allows third-party developers to develop really cool AR apps.

The Minecraft demo was cool, but I’m not a Minecrafter, so I’ll be keeping my iPhone peeled for new AR apps I can use.

In the meantime, let’s hope Apple gets back into the inner ideation sanctum and comes up with something new, and innovative, and soon. 

Plugging a thumb drive into my iPad is supposed to be an exciting Apple keynote announce? 

Puh-leez, Steve Jobs would be turning over in his grave.

Written by turbotodd

June 4, 2019 at 12:44 pm

Posted in 2019, apple, apple watch

Tagged with ,

Apple WWDC: The China Backdrop

leave a comment »

Happy Monday.  

It’s 6/3/2019, thirty years on from 6/3/1989.

The New York Times has published an editorial explaining why China cannot erase the truth of Tiananmen. And Ian Johnson’s analysis explains that thirty years on, someone always remembers despite the government’s efforts to make them forget.

In some ways, the world is interacting with a different China in 2019. In others, the tiger hasn’t changed its stripes.

And as its annual developer conference gets going in San Jose later this morning, WIRED reminds us that Apple could be a likely target for Chinese retaliation in the increasingly chilly U.S-China trade “Cold War.”

WIRED observes that many in China view the “aggressive US measures” on trade and IP as designed to prevent China from rising further, and the multipronged campaign against Huawei “is largely perceived in China as a naked attempt by Washington to kneecap a serious competitor in everything from mobile devices to networking equipment and especially 5G.”

But China could respond in a way that could take a big bite out of Apple’s profitability:

Beijing could respond by increasing tariffs on US imports into China and by making it more cumbersome for US companies to do business in China, through such moves as permitting delays and holding up shipments in customs. But if China is truly looking for revenge, it need look no further than Apple. The Cupertino company has a vast global business, but China represents a real vulnerability.

China represents 19 percent of Apple’s worldwide sales, with the iPhone making up the bulk of that. While China is not as fruitful a market for Apple’s burgeoning services business, it is and has been a strong and generally growing market for Apple’s devices—until the past year.

Already, without the government doing anything explicit, Apple’s China sales have slowed precipitously. It had 10 percent share of the smartphone market at the beginning of 2018; it now has barely 7 percent. Almost all smartphone makers have seen shipments decline in China. The exception? Huawei, whose market share and sales have modestly increased while its competitors, ranging from Apple to Samsung to Xiaomi, have fallen.

Or, WIRED goes on, the Chinese government “could simply ban the sale of iPhones in China using the same justifications that the US is using against Huawei: national security and data security.”

But with the Google/Huawei Android license dispute looming with an August extension of the original deadline, one imagines Apple could be safe through much of the summer if, for no other reason, they serve as a viable smartphone OS hedge for the Middle Kingdom

So with that as the backdrop, what, exactly, are we hearing that could be announced, shown, unveiled, etc at Apple’s biggest developer event of the year?

Topline: Possibly a new and improved MacPro on the hardware side. macOS 10.15 and iOS 13 on the iPad, with more possible convergence between the Mac OS and iOS through Apple’s Marzipan project (including confirmed new apps that include Apple Music, Apple Podcasts, and Apple TV).

Also expect updates on tvOS and watchOS, new AR, and likely pricing on the Apple Arcade service.

And oh yeah, a Dark Mode for iPhone owners. 

Will there be an upside surprise in today’s keynote or this week’s event?

Tune in a couple of hours and find out.

Written by turbotodd

June 3, 2019 at 10:11 am

Posted in 2019, apple, china, developers

Tagged with , , ,

%d bloggers like this: