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;
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
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
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 Empire – which 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.
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.
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
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?