Category Archives: Mobile Fix

Mobile Fix – April 11

Mobile Innovation at risk?

I am currently rereading Burn Rate, Michael Wolf’s excellent book on his adventures running a content business in the early days of the web. Starting in 1996, his stories of VCs and startups still sound quite contemporary. The figures are amazingly small though – he talks of Excite having a $40million warchest.

But the thing that resonates most is the description of the shift taking place from AOL, Genie, Delphi and Prodigy towards the web – and the huge excitement as people moved from a controlled environment to the free web, where anyone could do what they want.

I’m old enough to remember that era – we had just started Poppe Tyson in London – and many prospective clients were still investing marketing budget in AOL and Compuserve.

As we discussed last week, the web seems to be taking a back seat on mobile and the rise of apps is arguably taking us back to that controlled era. Chris Dixon of VC firm Andreessen Horowitz points out;

Apps have a rich-get-richer dynamic that favors the status quo over new innovations.

VC Fred Wilson agrees that the dominance of apps is stifling innovation and looking at the top 200 apps sees very few that are recent venture backed businesses.

GAFA are crucial in the discovery and distribution of apps and we all know that without a substantial budget for Facebook app install ads (etc) it’s nearly impossible to get an app to scale. And the appstore tax of 30% is a major factor too. Are the Vertical Stacks the new Walled Gardens?

The Net Neutrality arguments are designed to give similar status to the Mobile Networks – which, as we know, stifled innovation in mobile prior to the GAFA era. This is a good summary of the various points of view on apps and the threat to innovation.

Yet the combination of the mobile web and mobile search are still low cost options – and therefore great opportunities for innovation. And in our research we find that people think of apps as the icons on their home screen; click on them and something happens. Few know or care about them being native apps or bookmarks for mobile websites. If it solves a problem, it will probably earn its place.

So in our projects we usually advise that a blend of mobile web and native apps is the right way to go – together with smart thinking on how to use search and social to drive discovery and get than icon on the home screen.

As Ben Evans points out, the mobile opportunity is still wide open and current trends are no real indicator of where we might end up. The size of the mobile opportunity means that everyone needs to get involved and invest smartly in learning what works and what doesn’t for your business.

Reading Burn Rate you remember that those early days were just the start of the digital switch that has changed how millions of people live their lives and transformed every business sector.

We are now just at the start of the Mobile switch where billions of people are going to have their lives changed. And every business sector is going to get transformed again.

It’s time to experiment.

Social Evolution

A very experienced smart marketer slightly stumped us this week when he posed the question Why should I spend any effort on Facebook? He totally saw it was a valid media channel for ad buys, but with a modest number of followers he wonders why he should invest in time and content to grow his likes, when there is now little benefit in free reach. Of course as part of a social strategy of ubiquity, the effort in Facebook improves results on Twitter, Google+ etc as some content can be reused. And knowing what content resonates with fans does help improve ad performance.

But as the Facebook Feed evolves we see both users and brands frustrated with the experience. This TechCrunch piece gets into the details on how the Feed is now constructed and looks at the various complaints, but we don’t see a solution yet. John Batelle argues – quite convincingly – that Facebook should let the user take control.

It is essentially the same challenge that Twitter potentially has. Twitter is a hugely valuable service but you always have the nagging doubt that you may have missed some good stuff if you haven’t checked for a while. But I prefer that to a feed that Twitter have decided is the right one for me. Again we thinks lists are an underused asset for Twitter; setting up some specific lists allows for an occasional browse of a certain set of Twitterers, without needing to have those feeds in your timeline.

With a whole swathe of new ad formats on the way, Twitter is  ramping up their advertising push and by redesigning profile pages potentially make them much more usable. Some think that these profile pages could evolve to be someones main profile on the web; you may have a blog and a LinkedIn page but an improved Twitter profile would probably be a better representation of you.

Just as Facebook and Twitter share similar problems – and similar ad formats – the new profile pages makes Twitter look a lot like Facebook.

A couple of other useful bits on social;

This is a good roundup of thinking on what the ideal length of a Facebook, Twitter or Google+post is. We were told a while back by Facebook that the average brand message is much much longer than the average users posts – the challenge for a brand is finding a way to convey their character in as few words as possible. It has always amazed us that brands often leave their most important language – search ads and social – to inexperienced media buyers and project managers. There is wealth of copywriting talent that should be employed for these crucial tasks; the easiest way to double response to both search and social is great creative.

Twitter have shared why people follow brands; people want to hear from these brands – especially with promotions and special offers

Social Revolution

It’s clear that messaging is going to change social and Facebook are keen to stay ahead of the curve. They demonstrated this when they bought WhatsApp, but many questioned the role for their own Messenger service. They are now stripping out the Messenger functionality from the Facebook app, so users have to download the separate app – continuing the single purpose app strategy they showed with Paper.

This is a good take on Facebook messaging and the new Asian competitors; Line, WeChat and Kakao

Ex Facebook exec Christian Hernandez has a good look at these new apps in this piece on the pros and cons of relying on someone else’s platform. Well worth reading.

Hardware – Cheap & Useful

Working on an ebooks project a few years ago, we recommended the backers ( a number of publishers and a major retailer) to ignore the siren call of developing their own hardware and instead develop for the nascent tablet market as well as smartphones. As it turned out that was sound advice. Then

Now it is possible to develop hardware that is cheap enough and good enough to differentiate your business. Tesco are making a pretty good job of it with Hudl and Google are having a lot of success with Chromecast (we are less convinced about the Chromebooks).

Amazon have done a brilliant job with the Kindle, straddling both hardware and software, and Fire seems to have started well – it’s the bestseller in electronics on Amazon.com.

Their latest piece of hardware is really intriguing. Dash lets users scan a barcode of any product to add it to their shopping list – and it can also work with voice too. It is only available to customers of AmazonFresh – their grocery home delivery service currently in Seattle, Los Angeles and San Francisco.

The biggest problem for people like Ocado and Tesco is online grocery basket size tends to be smaller than a shopper in store as the impulse buys don’t happen. But once on the list they tend to be reordered again and again.

So for Amazon to have a tool that people can use around the kitchen to reorder should be great for both retention and revenue. And as a physical object it should also help with customer acquisition as people see it in their friends’ houses.

Most of the smart people we know in the Grocery business are convinced that its only a matter of time until Amazon launch Fresh in the UK. This is a good look at the US market for home delivered grocery and it reminds us that dotcom casualties like Webvan actually did have market impact – it was just way too early.

Interestingly Dash has dotcom ancestry too. Does anyone remember CueCat? Launched in 2000 this barcode scanner needed to be plugged into a PC before it could read a code on a product or in an ad. Called one of the 25 worst tech products of all time, it didn’t last long. But as we see with Dash, these ideas have real potential once you unlock them from the desktop and define the problem that needs solving.

Marc Andreessen says;

“All the dot-com ideas were correct,” “They were all too early. They are happening now.”

We’re looking for content ideas in Burn Rate to reimagine for today.

Quick(ish) Reads

Dropbox is looking to play a bigger role in its millions of users lives, with new apps for email and photo sharing.

The Music business isn’t in as bad a state as many think. This profile of Lucian Grainge suggests streaming will soon turn into a major revenue stream

The New York Times has an interesting new app called NYT Now and it’s getting good reaction. With a subscription model and native ads, the key question is whether it differentiated enough from the Times itself?

There is a lot of interest in news content at the moment, with a focus on niche plays. But the business model is in question; as the writer of Burn Rate points out, the ad business wants scale.

When Google sold Motorola it kept the bit that is designing a modular phone. This is a sneak peak of Ara. And you can sign up to help design the project by doing Special Missions

A good look at Yahoo mobile ambitions and the thinking behind their excellent Aviate app.

Finally.. a couple of our agency friends questioned our take last week that the Agency world hasn’t embraced tech yet.

But this week Agency bible Campaign is running a story saying;

Confidence in creating digital and mobile campaigns is still low among marcoms and media professionals in the UK

Another survey suggests many Marketers don’t really get the idea of ROI and hence struggle to demonstrate the true value of marketing to their board.

And client de jour Bonin Bough suggest Creative agencies aren’t necessarily the best partners for brands

Creative agencies used to manage 100% of our communications; now they manage 60% or 50%. As that happens, we keep adding agencies which is not sustainable,” 

Now obviously this is a generalization and there is some great talent within Agencies producing great work. For smart clients who really do get it.

But nearly 20 years into the Digital Switch it’s still a little patchy and you have to ask yourself if you are getting the right thinking on mobile, social and content from your existing partners.

Or do you need some provocative Big Picture thinking?

(No Fix next week as we will be eating Chocolate in St Ives. If you fancy a change from Eggs check out our friends at CocoaRunners who can send you a box of fabulous artisan chocolate. If you use this link and use ADDICTIVE as the code you get a £3 discount and we get a free bar. Enjoy.

If you would like to get Mobile Fix by email each week you can sign up here.

And if you need help profiting from Mobile, Social and Content get in touch.

Mobile Fix – April 4

Mobile  - Problem or Opportunity?

We spoke on a good Adweek panel organized by Weve this week. Along with other sessions across the event, we were left with the feeling that there is quite a lot of friction holding mobile back. Lack of clarity of measurement , lack of creativity, dissatisfaction with formats etc.

And a couple of smart people in the US make similar points this week. Ian Schafer of Deep Focus suggests the digital ad economy is heading for a correction as the stuff that works on desktop doesn’t translate to mobile.

And Barry Lowenthal of The Media Kitchen points out many mobile focused businesses are rejecting advertising as a business model – which is a problem for those who need to reach consumers when they are on mobile.

Now we probably don’t need reminding just how big the mobile opportunity is (but these 5 charts do a great job) but if the ad industry doesn’t make the most of this others will.

The CMO of Walmart is a big believer in adtech and is bringing in engineers to help solve the problem.;

“There are so many choices on where you can put your precious investment. It’s a software problem.”

And here in the UK a Tesco exec talks about the lack of expertise around mobile;

“Lack of expertise is a big challenge, not just in our company, but a lot of agencies don’t get it. They claim they do, but if you scratch the surface they don’t.”

Whilst tech and mobile have disrupted many sectors – retail, money, publishing, transport etc the changes in marketing are less apparent. Someone from any of these sectors 50 years ago would struggle to recognize their business now.

Yet as MadMen proves, someone from a 1965 agency would feel fairly at home in an Agency today. Which either means we’re immune to disruption. Or it just hasn’t happened. Yet.

Mobile is a huge opportunity. Embracing the possibilities of mobile, social and content can be the way we change the way Agencies add value for clients. Or we can leave it in the too hard box and let the consultancies eat our lunch.

It’s time to experiment.

Apps vs Browsers

A perennial question on mobile is whether brands should focus on apps or moble web. Various studies have shown that most brands apps struggle to get users and even once downloaded often languish on the last screen before being deleted. And the surge in mobile search  - along with huge mobile use of email and social – means a mobile optimized site in a must have.

But new research from Flurry suggests that the vast majority of time spent in mobile is spent in app – as much as 86%in the US.

Data from Comscore suggests  a similar profile – and shows  mobile app usage now accounts for more time than desktop. 

We still believe the mobile web is vital; the fact that half of searches are now mobile underlines this, as does anecdotal evidence.

If your brand doesn’t have a mobile optimized site you are at a serious disadvantage. Not having an app is much less critical. 

“TV is just an app”

A big week for newTV – the term we use for the fusing of digital video and traditional TV. BT have thrown their weight behind the Chromecast with all their sports available this way to their Broadband customers – potentially reducing their reliance on Sky – their main rival. It also has the potential to reduce their reliance on YouView where other partners include the main free to air broadcaster. The C4 CEO is skeptical about Chromecast calling it; 

one of “a plethora of devices that will trickle into homes”.

Dixons are more positive – saying they sold one every 4 seconds on first day of sales – and it’s still the top seller on Amazon.

Amazon now have their own streaming device; the Amazon Fire.  At $99 it looks good and they make a point of comparing it to Chromecast and Apple TV where its higher spec may justify the higher price. No word on when it will be available in the UK – but we would expect it to be soon and with some UK partners – like BT and BBC iPlayer.

  

Another piece in the Vertical Stack and another device to support, if you are a content player.

A US presentation on the future of TV is worth looking at – and this quote is interesting;

“As you unbox the cable box and allow other devices to become the TV experience, you’re going to get much better consumer experiences,” Mr. Greenfield said. “On the flip side of that, TV is just an app.”

The charts from this presentation are available here.

As we said when talking about Disney last week, this game is about creative transformation rather than revolution, as the money involved is huge – old school traditional media companies that sell video are hugely profitable

So they want to protect their business and new media companies want a share.

As a further incentive for brands and agencies to move TV budget to online video YouTube will now guarantee audiences for big spenders – and reserve them space in top shows. Sounds a lot like TV.

Yahoo have ambitions here too. Already a big player in online video Yahoo are rumoured to be planning a YouTube rival and looking to poach some of the YouTube stars. There is some latent dissatisfaction with YouTube but the lack of a viable alternative has meant there has been little churn yet.

Ben Evans has written a really good piece on TV too

Twitter & TV

One area where TV is embracing digital is through social. New research from Twitter shows the symbiotic relationship – evidenced by 4.2 million tweets using the Brits hashtag. And one very interesting snippet is the finding that being retweeted is strong social capital.

Building on this, Twitter are buying 2screen analytics firms in Europe – SecondSync in the UK and Mesagraph in France. Both have strong relationships with broadcasters in their markets.

So we should expect more lame use of #hashtags in the end frames on TV ads, but smart brands will find better ways of unlocking the social element. We think that brands could have a role as curators on Twitter – maybe using Lists an underexploited asset of Twitter.

For example could a Champions League sponsor direct fans to a curated Twitter list for each match – featuring the players and pundits who are likely to add value for that particular game?

This is good thinking around the potential for curation.

Net Neutrality

One key issue around TV switching from cable to broadband is capacity. In a turkey not voting for Christmas type surprise, EU Mobile network operators have come out against Net Neutrality.  The EU believe there is a compromise to be had;

“If we all agree on the need to end blocking and throttling, and we agree on the need to manage specialised services carefully, then the debate that we are having is about how we achieve this, not about being for or against the open Internet,”

But MNOs are not keen on building the fatter pipes that YouTube, Netflix etc need, without some way of profiting

As BT looks to re-enter the mobile market with a quad play – landline , broadband, TV and now mobile – we have a complicated ecology.  And it is possible BT will emulate the strategy of French ISP Free where their extensive broadband network – coupled with Femtocells – could give them an advantage in coverage.

The one thing MNOs lack is content, so will we see BT extend their content strategy to mobile? With all that TV money at stake, the idea of your enemies enemy is your friend springs to mind. There are still rumours of a tie up between Vodafone and BSkyB.

Mobile Money

Whilst the various mobile wallet initiatives struggle to get traction, mobile banking has really taken off for existing banks. Over 12 million people have downloaded banking apps and usage has doubled to 18.6 million transactions a week.

The downside of this for the banks is that footfall in their branches has dropped dramatically – down 30% at RBS/NatWest over 4 years.

As new services launch  – like PayM which enables people to make payments to anyone whose mobile number you know –, this is a one way trend.

PayPals David Marcus has shared their view on how this is going to play out – and with news that MPesa, the African money success story is coming to Europe, disruption is going to continue.

The question is whether new players can drive the change or do existing banks – along with Visa and Mastercard – have enough as incumbents to win?

(Looking even further ahead this futurology piece imagines money in 2040)

Quick Reads

The move to omni channel is not just a western phenomenon. Chinese ecommerce giant Alibaba is investing in Chinese department stores.

IBM is investing in their services division to build what is essentially a global digital agency. IT giant. Cognizant are aggressively growing their consulting business and Accenture have made a really big hire too. Tough competition for agencies.

A good look at the ingredients of a successful social campaign – #Selfie

After Apple potentially reshape the marketing world with low energy Bluetooth and beacons are they about to do the same with Multipeer Connectivity and Mesh networks?

It’s 10 years since Gmail launched

Are we getting over excited about Big Data?  This good FT piece makes the case for Big Insight and points out the flaws in some of most discussed examples of Big Data success

Tesco are getting into adtech Can we expect Tesco to use their big data to target ads for the products they stock?

Finally ….As we have mentioned before, no-one has told the Chinese that the QR code is over. Nor, it seems, that local newspapers are dead. So they are combining the two to create portable online shopping catalogues

We think there is real potential to connect local press with digital via the mobile. This is worth watching.

Mobile Fix – March 28

Virtual Reality & Facebook

This has been a busy week for deals and flotations. Each of which has some significance for brands. The one with the most press is the Facebook acquisition of Virtual Reality headset maker Oculus. Shelling out $2bn – close after the WhatsApp deal – has unnerved some on Wall Street with the stock price now 18% off its high of 72 which was reached a few weeks ago.

“Mobile is the platform of today, and now we’re also getting ready for the platforms of tomorrow,” said Facebook founder and CEO, Mark Zuckerberg. “Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate.”

It’s clear that Virtual Reality has the potential to change how people play games and experience content but the time when Daft Punk style headsets will be commonplace is some time away. So we don’t see this as a really significant move – at least for brands – right now. 

(Some other news was revealed on the Investor call about the Oculus deal – Facebook now has 1 billion mobile users – and Instagram has 200 million users.)

Disney & newTV

Disney bought Maker Studios for almost $1bn – so one of the oldest brands in TV has bought one of the youngest. Maker have around 55,000 different channels on YouTube  and this is a good guess at why they have made the deal – talent, product promotion, new types of ad deals and preparing for Cord Cutters.

In London this week the Disney TV President Anne Sweeney talked eloquently about TV content becoming immersive more fully interactive and on demand via the internet – and says all these things are being worked on right now. Well worth watching the full video.

Doing some research around football and video, we looked at the key players on YouTube; Sky has 53K subscribers and ESPN has 12k. But the biggest YouTube channel focused on football, in terms of subscribers, is Copa90. One of the new channels to emerge with from producers partnering with YouTube Copa90 has 562k subscribers.

Add Chromecast the mix and, to paraphrase Disneys’ Sweeney, there is a Creative Transformation happening in newTV.

Gaming

The other significant moves were in gaming. UK success story King IPOd giving the company a value of $7.6bn  – although the share price dropped over the first days trading . This reflects concerns that the company is too dependent on Candy Crush – which accounts for nearly 80% of revenues

An interesting look at the numbers says;

So the question boils down to can King hold on to existing users and keep them spending. I would argue that other, similar games, like Clash of Clans from SuperCell, have proven that they can do this. It is getting very hard (and expensive) to launch a new title in mobile app stores.  Consequently, the longevity of existing titles is improving somewhat. This speaks to the way in which the App Store model has some serious flaws, but does provide something of a moat protecting Candy Crush.

This is a really good look at the King story and what it can teach other  British entrepreneurs  from VC Christian Hernandez.

The other interesting deal is in Asia. Continuing our interest in BAT (Baidu, Alibaba, Tencent) we thought the Tencent purchase of a stake in Korean game company CJ Games was interesting. At $500m for 28% this is a big deal. It’s another layer in their Vertical Stacks but given that gaming can inspire so much loyalty can we expect GAFA to be more explicitly involved in games?

They are all making lots of money indirectly from games – largely through sales and advertising (see below for a look at Facebook and app installs) 

We think that content will increasingly be used as a differentiator for platforms and devices, so could Google or Apple transplant the games that are big in Asia over to the West? Given how successful Flappy Bird was, it’s clear good games can work in different cultures.  So could someone import a big game from Asia and make it only available on their platform? Or could a Samsung – or a Huawei – preload a hit game to help sell their devices?  Or could a smart brand license an Asian game and introduce it in the West?

Intel made a big deal about wearables at CES this year and have followed through with the purchase of BASIS for $100m.  The other big news in wearables was the deal that Google struck with Italian sunglasses giant Luxottica – the maker of Ray-Ban, Oakley and Persol. It is vital that Glasses avoid the Bluetooth Headset prejudice and getting this talent on board should help.

5 things you should do before thinking about VR. 

The Oculus deal is interesting, but we think it’s going to be about gaming and home entertainment for the foreseeable future. And whilst your Agency’s Digital Prophet ( they all have one but few with haircuts this bad) may want to demo this in the Agency lab, there are probably better things that you could be focusing on.

Whether you subscribe to the McKinsey 80/20 rule for boosting the return on marketing investment or the 70/20/10 model Coke use to drive innovation, we believe there are lots of ways brands can unlock real value, right now.

* Make sure you are really FitforMobile – with mobile optimized sites for all your brands and a mobile approach on search, social and email

Get your digital metrics right

* Identify the top 5 YouTube channels covering the content areas your brand has an interest in and start a discussion about how you might collaborate. For example there are huge opportunities for smart product placement in these channels.

* Review how you are getting the most from GAFA – getting search and social right, understanding what Apple products you could experiment with (Passbook is on millions of peoples home screens) and looking at whether your brands could be sold through Amazon.

* Audit the integration between the different strands of your marketing- how could mobile add an extra dimension? Add Shazam to your TV and/or develop a Two screen search strategy. Test what happens if you use AR and QR codes cleverly in your press ads. Use responsive creative so your digital ads are perfectly optimized whatever screen they appear on.

If that sounds a little dull, look at what the smartest Brands are doing and saying. The partnerships that Start Ups that Mondelez have pioneered bring in companies across mobile and digital with solutions that can solve problem at scale, right now. The same with the Unilever Go Global programme.

All the companies chosen use digital as a tool rather than a toy.

Which, without being rude, is what Oculus is right now. Albeit a rather expensive toy aimed at geeks and gamers.

App downloads

In the piece on King the author says it is getting very hard (and expensive) to launch a new title in mobile app stores. A big part of this is that the appstores just dont work. Discovery is huge problem. So advertising is the only solution

@ChetanSharma tweeted a comment from M&CSaatchi saying they were putting 50% of their mobile ad money on Facebook but it is getting expensive  – and that the only thing that works on Facebook is App installs. He then retweeted someone else saying they put all their ad spend on Facebook app installs – but reach is decreasing and costs are skyrocketing.

Quick Reads

More interesting thinking from Mondelez- one of their top marketers thinks the Agency of Record is an outdated concept

The video of the Larry Page interview we mentioned last week is now available. Well worth watching

Ex Googler Hugo Barra talks about Xiaomi in this new interview – their devices will be on sale globally within 2 years.

Some good thinking around Growth Hacking

Seth Godin has some typically smart advice on marketing

If you look at every successful marketing story over the last 10 years–Airbnb, Lululemon, and work your way up or down or sideways–all of them are the same. They make something the market wants to talk about. Companies should let the market decide what they make, not the other way around.

More on Cards – the future of user experience

AOL have new tools that they hope will make them then one stop shop for buying digital media. We suspect Google may have something to say about that.

It’s been a while since we have seen a good infographic but this one on the Internet of Things is really good

Finally….We are looking forward to taking part in Adweek next week – speaking on a panel on mobile targeting and metrics, organised by Weve;  I am 67% of Female – is that OK?

It’s on Tuesday at 10.30 in the David Lean room

If you are there come and say hello.

 

Mobile Fix – March 21 – GAFA & BAT

GAFA

This was a big week for Google. Whilst everyone at SXSW was talking about wearable devices, Sunar Pichai – the head of Android said that ;

“When we think of wearables, we think of it as a platform. We see a world of sensors. Sensors can be small and powerful and gather a lot of information that can be useful for users. We want to build the right APIs for this world of sensors.”

This week they announced Android Wear – initially focused on watches. Developers can now tailor their apps to work with Android watches although many will already work well.  The new UI is focused on voice and contextual information – and right now it’s essentially Google Now on your wrist. Plus voice activation that uses the OK Google phrase as the trigger.

Within hours the first watches were announced. The Moto 360 from Motorola got most of the press but the LG G Watch looks really good too – and their experience collaborating on the Nexus phones should help them nail the experience.

When you boil this down though, the watch is little more than a second screen for your Android smartphone. A peripheral.

All the smartness and the connectivity stays with the smartphone.  Do Google plan to incorporate other data from other sensors? In his talk at SXSW Sunar Pichai talked about Mesh networking and digital tattoos – Motorola projects that are staying with Google, rather than being sold to Lenovo with the device business.

Mesh Networking is key to the Nest acquisition and we can all foresee being able to control heating, lights etc from your smartphone. But a digital tattoo – actually a sticker – could be the ultimate wearable;

The tattoo is made up of various sensors and gages, such as for tracking strain in multiple directions (how the user is flexing), EEG and EMG (electrical impulses in the skeletal structure or nerves), ECG (heart activity), and temperature, as well as light and other factors. In total, it’s a mini-lab for your arm, the side of your head, or anywhere else on the body.

Collecting that data within Android Wear enables a whole world of health apps.

The other big news this week was that the Chromecast went (back) on sale in the UK and a number of other key markets. Its already the best seller in Computer and Accessories on Amazon and we think it’s a must buy if you want to understand newTV. As can be seen from the reviews it’s well liked by buyers – and since we bought ours when they first launched in the US, we have used it lots.

And its usefulness is increased with apps for the iPlayer amongst others. The iPlayer announcement is worth reading as it shows how the BBC are thinking about newTV – one interesting point is that they are lobbying Google to get the kindle supported;

We recognize that the Kindle is an important device for BBC iPlayer in terms of usage and we have, on behalf of our users, asked Google to do what they can to support this platform.

Lets not hold our breath for that one 

It’s also been an interesting week for Google’s core business, search. At SXSW one of their people said

he “wouldn’t be surprised” if mobile search exceeded desktop queries this year

There has no official comment from Google who don’t want to get into mobile versus desktop as they (rightly) encourage people to think multiscreen and cross platform. But analysis of data from Marin – who handle around$6bn in search – suggests that mobile will be bigger than desktop in the US by the end of this year.

In terms of paid ad clicks, mobile will be over 50% by December. But the share of revenue lags  – mobile was around 34% of revenue at the end of 2013.

This data suggests something we’ve been predicting for years is getting close. If you think about Googles purpose it’s to give the user the best possible results for each search. This keeps the user happy (and loyal) and – because of the genius of the Google business model – keeps Google shareholders happy.

Over the years the results have improved through factoring in location, past search history, landing page quality score etc. But consistently Google fails to give its users the best experience in one key way – despite knowing the user is searching on their smartphone, the results include pages that are not optimized for mobile. 

How long before Google decide to make mobile optimization a key factor in the results shown? It has to happen at some time and this data shows the time is getting closer. Given the bemusing amount of sites that are still not mobile optimized, doing it too soon would make huge changes to results but as brands slowly, slowly adapt to mobile, it eventually will happen.

One thing is clear though – brands that have a mobile friendly presence can get competitive advantage through mobile search and, as one article pointed out, the Marin data suggests that is especially so in the UK;

An intriguing perspective in Marin’s report is its comparisons of different international markets. In the UK, for instance, more paid search clicks come from mobile and a greater proportion of agency spending goes to mobile search. But the cost per click on mobile is 75 percent less than in the US, which shows that the American market is already more competitive and mature.

In every case we have looked at the cost of making the site mobile friendly can be quickly recouped through the additional value unlocked through mobile.

Finally on Google, Larry Page was interviewed at TED this week and talked about the many things Google are doing – and we loved this quote

Lots of companies don’t succeed over time. What do they fundamentally do wrong? They usually miss the future. I try to focus on that: What is the future really going to be? And how do we create it?

Facebook have had a good week too. Video ads are finally here – but in a slightly muted way. The 15 seconds videos will start playing silently as they appear on screen – and stop if people scroll past. Sound will only come on if people tap the ads – when they expand to full screen and the audio starts.

The 15 seconds is interesting – that’s the most common format for US TV and some people worry that brands will just start running their TV spots on Facebook – especially as they are being sold in a TV like way with GRPs etc.  Recognising the danger Facebook are working with a firm called Ace Metrix to pre test ads – so creative is assessed for engagement;

Ace Metrix will allow us to objectively measure the creative quality of the video in the Facebook environment, and highlight performance indicators for advertisers such as watchability, meaningfulness and emotional resonance

We don’t know what happens if Ace doesn’t rate your ad – do Facebook stop you running it? – but this has to be a good thing. We are working with a smart company that is introducing this type of research for mobile advertising and it makes perfect sense that – before you spend the media money – you asses the creative to ensure  it delivers on brand metrics. 

Facebook gets a hard time from some quarters and Forrester keep suggesting that they are failing marketers. Fix friends the MagicBeanlab have refuted the claims with an interesting post – suggesting that it may be marketers are failing to us Facebook properly. And as the way brands use Facebook evolves there seems to be more agencies fighting to control this area of their clients marketing.

This week saw Facebook launch some research into digital in the UK and a key finding is that mobile is almost as big as desktop in terms of time spent and will shortly take the lead.

Amazon had a quieter week but rumours about new hardware continue. Given their push of Video – with all Prime customers now getting access with it now bundled – their strategy for TV requires a hardware play.

As we saw with Chromecast the forked version of Android they use means the Kindle isn’t supported and nor does Apple TV work for them. So the Vertical Stack ecology means Amazon need a way to ensure content bought or streamed through them is not denied access to their customers TV set.

A set top box isn’t that much of a surprise – especially as Amazon is so powerful as a retailer for TV and accessories. But suggestions they will bundle Hulu and Netflix is less expected.

To us this is probably an example of your enemies enemies are your friends. Rather than get into a fight with Netflix  – who have made a strong play in TV tech with their DIAL initiative (developed along with YouTube) – they can build their own route into customer homes

So lots going in GAFA – but not much from Apple. They have launched a cheaper phone – an 8gb iPhone 5C – but not in the US. Trouble is, it’s just not that cheap. In the UK it’s £429 – £130 more than an, arguably superior, 16gb Nexus 5.

ITunes radio still hasn’t arrived in the UK – it sounds like a good service and the advertising proposition makes sense.

Given nature abhors a vacuum and that lots of people now like to stick the boot in, Apple is getting some bad press – partly driven by the PR for the new book Haunted Empirewhich Tim Cook calls nonsense.

Business Insider has a field day with its Worst Case Scenario – hedging its bets whilst painting a future where Apple has lost its way.

But even as they list all the sectors where Apple may or may not have faltered, you are reminded just have active Apple have been.

One area where they are definitely moving things forward is ibeacons and it has been noted that the latest iPhone update turns your Bluetooth on. We think that Passbook is a hugely underused opportunity unlocked by beacons and bluetooth; on millions of peoples phones and perfectly positioned to handle the loyalty schemes and offers that iBeacons can trigger. And if they fold in the credit card details they hold for hundreds of millions of people, they could very quickly dominate the mobile wallet space.

It feels a little premature to write Apple off.

BAT

GAFA remains the key drivers for mobile social and tech around the world. But we are big fans of the William Gibson quote;

the future is already here, it’s just not very evenly distributed.

And whilst GAFA is rooted on the West Coast of the US, much of the most interesting innovation is coming from the other side of the Pacific.

The Chinese market is fascinating. The imminent IPO of Alibaba could value them at as much as $140bn and they just invested $215m in Tango, one of the few big messaging apps based in the US.

And if we think the Vertical Stack model works for GAFA we see similar strategies from BAT – the big Chinese firms Baido, Alibaba & Tencent– but played out much more aggressively.

This infographic shows how Alibaba and Tencent compete in virtually all digital sectors.

The most recent conflict has been in taxis where Didi Dache (Tencent) and Kuadi Dache (Alibaba) are battling for customers.  If you have been to Shanghai or Beijing you will know about the traffic and how crucial taxis are. The BAT strategy is to get people used to paying for taxis using their apps and migrate them to buying other products and services with their apps. The ability to offer bigger tips through these apps has made them very popular with taxi drivers, but with slightly anarchic results – if you didn’t book with an app then you just can’t get a ride. So the Shanghai government has stepped in to regulate the market.

This FT article on Mobile Wars is a really good look at the Chinese market as is this look at App Slingers

Quick Reads

Really smart thinking on media and content. We are fascinated by the thought that some media companies are

technology companies first, publishers second, because they approach content as a product first and foremost.

More data on Mobile ad spend showing that it’s a 2 horse race between Google and Facebook. Pandora and YP (Yellow Pages) are a long way behind.

Building on the news about Chromecast and the Amazon set-top box this article thinks the future of TV is pretty great.

Very smart analyst Peter Kim worked as a UberX driver during SXSW

A good summary of native advertising

Finally ……The Daily Mail – the most popular newsbrand on mobile in the UK has finally gone mobile optimized. The home page is still the same as the desktop but the story pages are now mobile friendly. What’s everyone else waiting for?

 

 

 

 

Mobile Fix – March 14

Mobile truly Mainstream?

This week we saw research suggesting that mobile ad revenue in the UK will surpass newspaper ad revenue. This year.

And over the next couple of years it will pass TV and be the biggest single medium. With 90% growth forecast this year and a total spend of £2.26billion, mobile is clearly mainstream. And given that a high proportion of this spend is with Google and a big chunk of the rest is response driven, mobile is a machine for making money.

But there is still a long way to go. With media brands seeing a huge switch in traffic from desktop to mobile, their ad revenue evaporates as mobile is sold too cheaply. Ecommerce brands see their customers migrate from desktop to mobile, but conversion falls away. Charities tell us their mobile traffic is surging, but donations drop.

IAB research shows that a quarter of the top financial service brands still don’t have a mobile presence. And over half hadn’t optimised their data capture. In many other sectors it’s even worse. And even when brands do have a mobile site its so often functional, rather than a fulfilling brand appropriate experience

We think the next step for mobile is to embrace creativity and use that to improve the user experience;

Make mobile sites more intuitive and rethink shopping carts, data capture and ways of paying.

Better ideas in better advertising formats. This is a video of the rich media responsive banners we mentioned last week – we’re keen to bring them to Europe ASAP.

Smarter thinking about tracking and research that enables brand metrics and response to be looked at across all screens – so we see the real value of mobile.

Brands must think about the digital experience first – and agencies need to get their best creative minds focused on digital. Or be prepared to cede their role as brand guardians to those that are Digital First.

Big Brands at SXSW

Austin Texas is the latest place to be adopted by the marketing community. Along with CES, MWC and Cannes, SXSW is now on the circuit for forward thinking brands and their ever protective agencies. 

The days when new services like Twitter and Foursquare blew up at SXSW and started their stellar growth with great buzz are over. It was big brands that hogged the limelight. But the reason for being there is to get closer to tech

“Some people say it’s gotten too big — but people have been saying that for ten years. Many of the most influential people and interesting people in the world of tech marketing can be found at parties and panels throughout the week.”

Whilst lots went on, for us – observing from Clerkenwell – Mondelez were the most adept brand there. It’s hard to imagine anything more on trend for SXSW than 3D printing of Oreo cookies. And this interview with their main Digital guy Bonin Bough gets into how and why some big brands are trying to use the start up world to reshape their business.

Big Brands struggle with digital

But whilst these SXSW events are high profile, it seems many brands don’t believe they can walk the walk, even if they get the talk right. A new Forrester survey says; 

While 74% of business executives say their company has a digital strategy, only 15% believe that their company has the skills and capabilities to execute on that strategy

Leaving aside the fact that 26% of execs don’t seem to think their company has a digital strategy, this lack of confidence is a big issue. Execs from General Mills, Kraft and Walgreens share their concerns here and Nestle have announced they are opening an office in Silicon Valley, to get closer to Tech.

And last week the excellent Albion Society ran an event about Intrepreneurs and the challenges of changing big business from the inside.

Further insight into how hard it is to change came at the excellent Firestarter talk from Russell Davies on how the Government is now dealing with digital. As he said It’s not complicated, its just hard. Neil Perkin who organises Firestarters has a good right up, as does our favourite Belgian blogger.

Lots of people in big brands are trying lots of ways to turn digital from a threat to an opportunity and there is a clear role for the right partners to help.   But taking a trip to Austin probably isn’t enough.

Mobile Money 

The Telegraph have a good round up of Wallet news, with another headline about how your phone is about to replace your wallet. We’re not so sure – the huge range of wallets available confuses consumers and until some clear winners emerge we think the sector will be dogged by the chicken and egg scenario.

And as some traditional cards embrace the contactless technology that mobile wallets use we find new issues. Travelling on the tube now means you hear constant announcements about Card Clash. Touching in with your Oyster whilst it’s in your wallet, risks having the transaction done by contactless card instead. Or, as well.

Mobile money is a big opportunity and we’ll keep seeing players iterate to try and get cut through and customer acceptance. But these tech gremlins slow progress down.

New features of Google Wallet show where things might be heading; the latest version now keeps track of your online purchases and delivery though looking at what comes to your Gmail account. Now its unclear whether that’s just things you bought with Google wallet or whether its anything from Amazon etc. Clearly Google can mine your Gmail for all online purchases and that data – neatly collected in your wallet  – is gold dust. The Wallet now also allows you to save loyalty programs and offers in one place – getting more and more like Apple Passbook.

We spoke at a retail round table on loyalty this week with key people from Tesco, Sainsbury, Whitbread and others. It was clear from the discussion that, so far, digital hasn’t really moved this sector on much. The plethora of offers and coupons is felt to have driven customer promiscuity rather than customer loyalty.

But with Beacons etc there is understanding that mobile could change things – if used smartly. We are more and more convinced that consumers probably want one place to manage their loyalty cards, coupons etc and Passbook and Google Wallet are well positioned. But Apple and Google probably need to do more to get these big brands on board.

Hollywood gets YouTube

Disney are about to spend $500m buying Maker Studios  – one of the key players in video, with 9 of the top YouTube channels including the top rated one PewDiePie. This channel alone has 23 million subscribers and 267 million views in January alone. Following Dreamworks buying Awsomeness TV in a cheaper deal last year this move shows that Hollywood recognize the TV world is changing and don’t want to miss out.

Casting this as a bet on the future one video site said;

Maker – and other big MCNs – underscore 3 of the biggest emerging rules: (1) that talent can now break big without the backing of the traditional media, (2) that YouTube is a bona fide new distribution platform and (3) that traditional media’s grip on millennials may be slipping.

And underlining just how powerful TV ( whether delivered by a network, Netflix, YouTube or in a Box set) this piece looks at the excess of excellence in TV these days

Quick Reads

Facebook have announced their first Developer conference since 2011. Should we expect big news for apps inside the Facebook ecology?

The clever Monday Note people think people are underestimating Apple – pointing out they spending huge amounts on R&D. Are there new products in the pipeline? The author of a new book is less confident and thinks the magic has gone. But long time Apple watcher John Gruber takes issue with the book and ends by saying;

The simple truth, regarding Apple’s continuing ability to deliver breakthrough new products, is that we have to wait.

My sense is, we may not have to wait much longer.

One more thing on Apple – How Steve Jobs got the iPhone into Japan.

Some smart thinking from John Willshire on planning  - Fracking the Social web

And some smart thinking from Ben Evans on mobile, context and discovery 

Finally.. it’s 25 years since the web was invented and but we probably need to wait until September for the  20th anniversary of most people first web experiences – the first Netscape browser.

These are some stories from the first set of digital startups over 1994 and 95.

But the best piece of nostalgia is this clipping shared by VC Saul Klein

 

 

 

Mobile World Congress – The 4Ps of Mobile

Mobile World Congress is big, really big. 80000 people and 8 huge halls – plus many off site parties and events.

It’s changed and grown over the years – this post reflects on those changes – and 2014 saw it join Cannes, CES and SXSW as a place for brands and agencies to go learn what’s happening in Tech. Advertising has been the slightly poor relation in previous years, but its now clearly centre stage as the money ramps up – and the business models focus on ad revenue as the key monitisation.

 

Our 4Ps of Mobile Framework is now virtually vintage, but we still find it a good way to sort through the mélange of news, views, announcements and trends across mobile and social. So for Mobile Word Congress it’s the perfect tool.

Starting with the Devices at the centre of everything; MWC has always been about devices – we can remember seeing the DoCoMO stand covered in the next seasons new phones, many brightly coloured or patterned depending on which fashion company they had partnered with that year.

Whilst Google and Apple don’t show up, Samsung does and this year chose to announce significant new devices. The Galaxy S5 is the latest weapon in the war between Apple and Samsung for high end customers – those paying $500+ for a phone – often through a pricy monthly contract.

The screen on the S5 is a little bigger at 5.1 inches (the iPhone 5 is 4 inches) and has fingerprint scanner for locking the phone and authenticating PayPal transactions. We’re told people were trying out the devices, locking them with their fingerprints then wandering off, leaving them useless for anyone else. Oh, and it’s now waterproof.

Its an iteration of the hugely successful S4 and not that exciting; supporting our view that smartphones are now like the TV market – it’s very hard to stand out with hardware. Just as it’s hard to differentiate an LG from a Samsung in the TV department at John Lewis, it’s now hard to differentiate a Samsung from a HTC etc in the phone section. Everyone makes the bezels as small as possible so their screens are as big as possible, and the only opportunity for ‘design’ is the rear. To be fair an iPhone remains instantly recognizable – it will be interesting to see what the iPhone 6 does to standout.

Sony launched nicely designed tablets and smartphones, like just about everything else using Android.

Even Nokia announced a new phone that uses Android – sort of. They have chosen to use a forked version (like Amazon does) that means Google isn’t baked in, which must please their new owners Microsoft. They use their own Nokia appstore (it is relatively easy for developers to teak their android apps so they will work on these devices) and a range of MS products like Skype and Outlook. The interface is similar to the tiles that Windows Phone uses.

They are cheap, but are they cheap enough? Many OEMs see the low end market as the opportunity to go after and MWC was full of Chinese companies with good Android smartphones wholesaling at around $40. Firefox announced their own phone on their own OS that would sell for $25 – general view is that Android will probably get there first.

Mashable have a good round up of the main device news.

Wearables fit into Devices too and just like CES, everyone seems to have one on their stand. Samsung announced 3 new ones and their GearFit got lots of attention. With a curved screen and a heart rate sensor and we think it could trump the Nike Fuelband etc. But it is still most useful when paired with a phone, so again wearables peripherals.

Whilst Google didn’t show up they did steal some headlines with a leak that they are developing a Nexus watch, to be announced in June. Along with the Apple entry into this space that everyone expects, we think people will wait and see. Watches are so much of a statement we don’t think many will spend money on a Samsung etc that could look very dated against an Apple or Google device.

One other interesting fact about wearable  – Ben Evans tweeted he had seen just one person Google Glass; when you have 80k mobile people it’s odd that more people aren’t wearing them. Maybe even the evangelists aren’t that convinced?

People

We have long argued that social and mobile are essentially the same thing, and having Mark Zuckerberg keynote at MWC proves this. Of course he talked about WhatsApp and made the point that their reach is complimentary to FB and a key part of internet.org, which he focused on. This is the project to get the rest of the world on the internet and Zuck sees that providing free messaging, search etc is crucial for the worlds poor.

His plea for operators to allow this free access for Internet.org – and this basket of free services designed for everyone – rests on persuading them that this acts as a gateway drug or onramp to get people using data, that they will pay for.

Well worth watching the keynote video

WhatsApp dominated the news – both as people debate the valuation – with Zuckerberg arguing he got a bargain and because of their announcement that they will add voice services later this year

Places

Location now seems like hygiene in mobile – its there and most people are finding ways to use it – but there is a long way to go. One of the first Addictive Ideas we hawked around the industry when we started was the idea of using mobile to validate credit card transactions abroad. When travelling we all get used to cards being declined because the UK fraud people decide it’s unusual you are in Seoul or San Francisco. But whilst I may not take a while to know if my card is missing or has been cloned, I know when my phone has gone almost instantly.

So we approached banks, credit cards, their agencies and anyone we could think of. Zero interest. But now Mastercard are launching a similar solution. It’s all about timing.

The Foursquare deal with Microsoft is seeing its first fruit with Cortana – the Micorsoft answer to Siri. The core use of Foursquare appears to be on the wane – of the 80k people at MWC just 2600 checked in.

Physical

Whilst QR codes are no longer fashionable, no one has told the Chinese who use them in lots of smart ways. WeChat enable people to follow someone by scanning their personal QR code and invite people to a group chat with one.

But all the energy in physical is now around beacons and Apple have announced their specs for iBeacons, as they look at impose their usual command and control on the space. Whilst at this stage they are regulating the hardware we suspect there will be some restrictions on how the service is used. Apple doesn’t want its customers to start getting spam everytime they come close to a Beacon and we think some best practice will be forthcoming.

And unsurprisingly the Internet of Things clichés were at MWC – what’s more Physical than connecting your toothbrush to your smartphone?

Promotions

Continuing the emerging markets focus, new research showed that there are 219 mobile money services in emerging markets – with 13 now having more than a million users.

Coming back closer to home Greggs now has a mobile loyalty scheme where food lovers can pay using their mobile. With Eat taking a slightly different approach working with Pouch from Weve, people are going to get more familiar with using their mobile in stores and this should drive more mobile transactions.

 

Read the rest of this weeks Mobile Fix here;

http://www.addictivemobile.com/blog/2014/02/28/get-up-stay-up.html

http://www.addictivemobile.com/blog/2014/02/28/messaging.html

http://www.addictivemobile.com/blog/2014/02/28/new-tv-mobile-fix-feb-28.html

http://www.addictivemobile.com/blog/2014/02/28/quick-reads-mobile-fix-feb-28.html

Get Up Stay Up

The key challenge for Graffiti artists in New York ( or anywhere)  is how to Get Up and how to Stay Up; how to get your art on the side of that subway train or high wall and is it good enough to Stay Up or will another artist decide they can do better and paint over your work?

It’s the same for Apps – how do you Get Up on a users home screen and how do you Stay Up, rather than being deleted or just pushed back across screens until your in the App Graveyard 7 or 8 screens back?

Just like the power laws that mean 80% of all Google traffic comes from the first page of results (with 80% of the rest from the second) and 80% of all TV viewing is from the first page of the Sky EPG, we suspect a huge amount of app usage is driven by those apps on the home screen

So the phone home screen has the same role – and we find apps can get put there then are relegated as new apps come along – over time the most useful stay there.

But we don’t know. There is very little data available on how people use apps. Apple and Google know what we have downloaded, and Apple know (?) how we have grouped apps. Facebook know through their Facebook Connect a lot of the apps we have –and some insight into how they are used. And Yahoo have a good idea on Android with their Aviate app.

The other people with really good insights into app usage are Flurry and their latest research shows the half life of apps – that is how long before the number of monthly average users hits 50% of its peak.

Half of apps lose half their peak users in just 3 months. For games the half life is 2 months whilst news apps average 7.

But for real insight you can’t beat talking to users and seeing what apps they have on their home screens is really valuable. But its not scalable. Or is it?

The clever people at Betaworks came up with a way of boosting their sample – people sharing their homescreen on Twitter and Instagram. From this they have built a fascinating report that is a must read. Our favourite fact is that 14% of people don’t have the phone ‘app’ on their home screen.

For further insight the new Deloitte report is interesting – one trend they note is that the number of apps downloaded is down by around 10%.

Quick Reads – Mobile Fix – Feb 28

Mobile Money isn’t the easy path many think. Simple was supposed to disrupt but has been bought relatively cheaply by a big bank.

As Messaging apps become central to people mobile experience, the influence of Asia becomes stronger. So this comprehensive look at social in China is worth studying.

Want proof of how big messaging is – this Chinese man hand drew instructions for WeChat so he could message his elderly parents

A great resource on design and UX from London studio UsTwo – there is even a Japanese translation.

The first big deal between a Music company and Shazam – interesting

Finally……Net Neutrality can seem a little dry and, for those in Europe, a little distant. This piece argues we need to take it really seriously.

 

 

 

Mobile Fix – February Feb 21

 Whatsapp 

When a tech acquisition is all over the newspapers and TV, you know that tech, mobile and social are truly mainstream. Ben puts it very well in his tweet.

Spending $19bn on anything will get you a lot of attention. Spending it on a service that most people don’t know that well- because its 450m users tend to be young and in emerging markets – invites some skepticism

But Facebook have the cash – they are giving away around 10% of their value to buy WhatsApp – and have a highly successful means of monetizing eyeballs, so getting a big chunk of extra eyeballs makes sense.

They also have ambitions to grow in emerging markets and this deal certainly helps there;

55 percent of those surveyed by Jana in India said they used WhatsApp the most among mobile apps; less than 1 percent said Facebook was their primary app. And it was a similar story in Brazil (63 percent favored WhatsApp versus 5.6 percent for Facebook) and Mexico (76 percent versus 5 percent).

And when Wall Street values FB at around $140 for each user, getting that extra chunk at just $35 per user make sense too.

But how is Facebook going to make the money that justifies this buy? Advertising is something that WhatsApp have never done and their ‘manifesto’ suggests they don’t want to. And blending ads with messages it less easy than mixing them into people newsfeeds.

Weve and others have shown you can monetise messaging, but WhatsApp don’t have much info on their users – but one imagines that Facebook will be using their customer audience technology to work out just how many people use both services. Linking a Facebook profile to a WhatsApp user instantly makes them more valuable –  if advertising is an option. ( You can use your Facebook profile on WhatsApp but it only uses the basic profile)

But maybe WhatsApp will become the FB lab for learning about the new business models – like stickers – that other Messaging apps are pioneering.

http://wattsjones.org.uk/post/61010619439/messagingappmonetisation

VC firm Sequoia talk of 4 numbers that explain the deal; 450m users, 32 employees, the $1 a year they charge users and the 0 marketing spend. Equally impressive is the return Sequoia are thought to make on the $60m they invested – $3.4bn

As well as being a billionaire, one of the funders will be feeling good about being bought by the firm that turned him down for a job back in 2009.

Wired have some good background on the firm and the team. And Ben Evans – now working with Facebook board member Marc Andreessen  – shares typically smart thinking.

GAFA

This deal supports our view that Google, Apple, Facebook and Amazon essentially control the tech world. They have the power and the cash to ensure future innovations get snapped up, rather than become a significant competitor. Google have done more deals than any one else over the past 3 years and whilst they have bought Waze, Nest and Robot companies, WPP – in second place – have spent a lot less buying agencies.

Twitter, Yahoo and Microsoft are all players but don’t shape the ecology like GAFA do

StartUps

Given a business with just 32 people can grow into a global leader in just 5 years and command a value of $19bn, perhaps we should retire the idea of a bubble? Marc Andreessen talked at this weeks Goldman Sachs conference about tech still being in a depression;

He argued that advances in mobile and chip-making technology signaled exponential expansion of the market. He said tech isn’t overhyped and could have “decades” of growth ahead of it. Echoing economist Carlota Perez’s research, he said world-changing technologies like the web usually settle into a more mature deployment phase after an initial period of hype and investor frenzy.

Thomas Friedman, the author of the hugely influential The World is Flat, is equally bullish on startups – suggesting they are the best hope for the US economy.

And here in London, Mobile Monday held an interesting event looking at startups finance and acceleration, which we wrote up here. Our view is that the big funding investments tend to overshadow the real innovation;

Our take is that too many people focus on the quick win of an accelerator place and funding. The reality is that these are lottery wins – great when they happen, but not something to rely on.

Smart entrepreneurs get their team right and build a business around solving a problem. Getting people to pay for your solution validates your idea and demonstrates you have the grit and persistence to make a success of your business. And that story could well open the doors to the accelerators and the funding.

Quick reads 

Really interesting look at Social & Content from @revilopark Helping Celebs to Embrace Fans in the Social Sphere

Interesting look at a UK business building a YouTube channels for brands and rights owners.

eBay have published  a fascinating report on omnichannel retail. Essential reading. 

Netflix & HBO in  “an arms race in programming.

Smart thinking on Cards from @avc Fred Wilson

Madison Avenue cool on Apple and Amazon ad opportunities

We are finding the Yahoo Aviate app a good way to manage our Android homescreen. Well worth trying.

Japanese ecommerce giant Rakuten have been busy; buying messaging app Vyber for $900m and opening a R&D centre in Paris – seeking the next big thing in ecommerce.

MIT have published a report on the 50 smartest companies. Well worth studying.

Finally….. the new Spike Jonze movie Her is about a man that falls in love with his Mobile OS – sort of Siri version 79. Who better to review it than the father of Artificial Intelligence Ray Kurzwell. He finds the whole construct quite feasible – except he sees it as more 2029 than 2025 as the film predicts.

As we started Fix with today, tech is changing things on a huge scale. And it’s not going to stop anytime soon.

 

 

new TV – Netflix & Amazon

We spoke at the Mediatel event on CES this week. Some of the debate focused more on the TV element of the show – which is huge – and there was a view that even in TV software is becoming more important than the hardware.

Results from Netflix remind us just how much things have changed in TV. Netflix have 33m customers in then US and accounts for around a third of all broadband traffic in peak times.  They have over 9 million customers outside the US. Revenue is $1.2bn and profits soared by 24% to $48m for the quarter.

Coupled with their success in content, many think Netflix will prompt Amazon to expand their TV business with rumours of an online Pay TV service – with other networks content licensed for inclusion. With huge numbers of Kindles out there this sort of move would be logical for Amazon – who are already producing exclusive content for their Prime customers. And they have been rumoured to be looking at an Amazon set-top box too.

One key difference is likely to be around advertising. Netflix say they are not considering advertising but we should expect Amazon to use all that purchase data to sell and track advertising for products they sell.

Of course TV isn’t an easy business, as Intel found; the TV business they had such big plans for has now been sold for to Verizon.

And it these big triple play companies like Verizon and Comcast who have driven the net neutrality debate – with them now winning the right to decide what content gets priority. This is a clear threat to Netflix, Facebook, Google et al as they don’t want to pay a tax to these gatekeepers. Netflix talked about the issue and say they will envcourag etheir member sto complain if / when it becomes an issue.

The point was made at the CES event that in the UK the big triple play companies like Sky, Virgin and BT have a TV focus and could shape the future of the web here. Given the proliferation of competition we’re not sure we agree, but we should watch for people looking to copy Verizons moves over here.