Quibi: a short-form streaming service to keep an eye-on

A passing reference at IBC 2019 was the first we had heard of Quibi, but it certainly looks like an interesting proposition which could add further disruption to the content world.

Imagine a cross-over between Netflix and Snapchat and you’ll have something close to Quibi. Although there isn’t a huge amount of information out there about the business, it looks to be a mobile-based, short-form video subscription service designed for millennials. Content will be designed for mobile-format, and only viewable through the app.

This might sound like a bit of a fad but looking at the content it already has lined-up, the first-step towards success has been made.

Firstly, you have a yet to be named thriller starring Oscar winner Christoph Waltz alongside Liam Hemsworth, where a terminally-ill man is hunted by contestants, as he attempts to provide long-term for his wife. Secondly, you have a Stephen King horror series which can only be watched at night. Another title is “Action Scene” which stars Kevin Hart.

These are only a few of the titles which Quibi has floated through the press. Despite there not being a huge publicity push for the service, Hollywood stars seem to be convinced by the concept.

Although it was only a passing comment on-stage at IBC 2019, All3Media CEO Jane Turton and UK MD of Production for BBC Studios Lisa Opie also suggested they had both been commissioned for content on the platform. Turton also said her parent company Liberty Global was an investor in the business.

Interesting enough, the Quibi business seems to have attracted interest from some of the worlds’ most recognisable technology businesses without making a significant splash in the publicity pond. Walt Disney Company, 21st Century Fox, NBCUniversal, Sony Pictures Entertainment, WarnerMedia, and the Alibaba Group complete the list.

Once again, we are relying on third-party sources, but it does seem to be priced reasonably fairly. For $5 a month, or $8 for an ad-free service, the platform might well gain some traction should the content live-up to the expectation.

Another interesting aspect of this business is the leadership team. Jeffrey Katzenberg, a vastly experienced executive in the firm industry with tenures at Paramount and DreamWorks, has been brought on-board to work alongside CEO Meg Whitman. If Whitman sounds like a familiar name, she was previously CEO of Hewlett Packard, leading the business through the restructuring period which created HP Inc and Hewlett Packard Enterprise.

While Whitman’s tenure at HP was not exactly the most successful, her background in the technology industry married to Katzenberg’s experience in the content world dovetails quite well. It’s technology pragmatism alongside content creativity; both barrels will have to be firing if the Quibi business is going to be a success.

This is the other side of the business which the team is yet to discuss; technology. Digital natives are not very tolerable of poor service, so Quibi will have to be on-form if it is going to be a long-term success. Creating a new, disruptive service is difficult, just look at YouTube’s experience last year.

As Paolo Pescatore of PP Foresight pointed out to us, streaming the Champions League Final on YouTube was not the greatest of successes. It was an interesting move, setting the scene for potentially a new field for YouTube, but the team did not necessarily nail the experience.

“YouTube had decoding issues dealing with the huge demand from the live streaming event. There were no problems with the stream to the BT Sport app,” said Pescatore.

“Key to the success of Quibi will be distribution as it has a strong growing slate of content. It should strong consider forging tie ups with telcos who are crying out for great content to drive connections and usage on fibre broadband and 5G networks.”

We like the idea. It is a novel-concept which could potentially form a completely new kind of content delivery model. The audience is likely to be curious as well.

If the last few years have shown us anything, it’s that the millennials and generation Z are open to new ideas. And they are willing to pay for it. $5 a month is a price point which many will tolerate as an experiment.

Assuming the content lives up to the blockbuster names it is attracting, the technology fulfils the experience which digital natives demand, and the marketing team is clever enough to cut through the noise in a very crowded space, this could well be a success.

Quibi isn’t exactly shouting about itself at the moment, but it is an idea which we really like the look of.

Google continues to tap into the power of Maps

Ask any Android user and you’ll hear a glowing reference for Google’s mapping features, and the power of investing in the future is on show once again.

This is perhaps one of the most admirable aspects of Google Maps. This is a product which would have cost a lot of money and time to develop, at least to ensure it is the most useful of its kind, while there was little immediate return on investment. Now Google is reaping the commercial benefits of Maps, but it is still keeping an eye on new features, improved experience and, eventually, additional revenues.

“Not only does Google Maps help you navigate, explore, and get things done at home, but it’s also a powerful travel companion,” Rachel Inman wrote on Google’s blog.

“After you’ve booked your trip, these new tools will simplify every step of your trip once you’ve touched down–from getting around a new city to reliving every moment once you’re home.”

Google is not a company which makes money by accident. It might be the most popular search engine worldwide, but every time there is a hint of a glass ceiling, new ideas seem to emerge.

The acquisitions of Android and DeepMind certainly added new elements to the business model, its smart speakers and push into the connected car offer more engagement points moving away from traditional user interface, and Maps is an on-going project which seems to never get old.

This latest push forward from Google makes the mapping product more useful for those who are going on holiday.

Starting with the simplest add-on, reservations for both flights and hotels can be stored in the Maps app, allowing users to horde all relevant details into the same place irrelevant to whether the user has connectivity at that point. For those who have smartphone compatible with the ARCore and ARKit, navigation becomes simpler with pop-up directional graphics on the screen, while AI has been introduced to improve restaurant recommendations. Finally, a timeline has been introduced which can link experiences and content to places.

These are not necessarily revolutionary, but very few Google Maps features are. These are little additions which makes the mapping product easier to use and more useful. The incremental gain is quite evident through every feature which is adding every couple of months, and this is why so many people use Maps as a default application.

As with much that Google does, the features have been introduced to improve user experience and add extra value. However, there is also a great opportunity to commercialise these features without being intrusively commercial.

Looking at the restaurant recommendations, like with the search engine, some establishments will likely be able to pay for more prominent positioning. The same could be said for local landmarks and attractions in cities across the world. Although Google does create useful products, it never does anything for free. The user might not have to pay, but there is commercial element to everything which is being done.

However, what Google does very well is not to over commercialise the platform or product. As soon as something become offensively commercial, users are turned off. Just look at what happened to the core Facebook platform over the last few years. Facebook forgot what the core objective of the platform was, to connect friends and family, and it has started to impact engagement as well as the acquisition of new users through its commercial activities.

Facebook is still the leader when it comes to the social media segment, though other platforms seem to be better at engaging younger audiences, the demographics critical for sustainable revenues in the long-run. Snapchat, Instagram (admittedly a Facebook business), Twitter or Pinterest are not attracting the same experience criticism as Facebook has been over the last few years.

With Google Maps, the team seem to have struck the right balance. It’s a very useful application for numerous reasons and makes money for the search giant.

Another example of improved functionality with no-immediate financial benefit is focused on public transport. At the beginning of July, a new feature which will tell users how busy public transport is likely to be and whether users should anticipate delays on a journey was introduced. This is useful to have but has no immediate commercial benefit. However, when Google also suggests alternative means of transport, Uber for instance, and helps the user make a booking, there will be some sort of commercial benefit.

In helping customers with their travel plans, hotels and airlines can be partners, features and prompts introduced, and money can be made. Booking a restaurant through the Google Maps feature is another way, while the promotion of local tourist attractions is a third. It’s the traditional referral business with a slightly different twist.

Mapping is not a cheap business to enter into, there is a lot of data which needs to be acquired and managed after all. And when you start adding in additional features as Google constantly seems to do, the application becomes increasingly expensive and harder to deliver the promised experience. But this is where Google is a very admirable business; it never skimps when investing in creating a product to meet expectations.

It might have taken years to start to see the profits, but Google is now reaping the benefits of patience.

Snapchat looks like a real business after all

We don’t understand it, but perhaps we’re not supposed to. We do understand numbers though, and the Snap financials are looking stronger each year.

For those who getting a bit ‘longer in the tooth’, Snapchat might look like nothing more than a reel of confusing inside jokes which the younger generations are keeping well beyond arms’ length. It seems like nothing more than a messaging app for the paranoia filled narcissists, but few investors will care about perceptions if the numbers keep heading in this direction.

“We’re proud of the results that our team delivered this quarter,” said CEO Evan Spiegel. “We added 13 million daily actives users, our highest net adds since the second quarter of 2016, bringing our daily active users to 203 million.

“The average number of Snaps created every day grew to more than 3.5 billion this quarter, and average time spent per user was over 30 minutes per day.

“Our revenue growth rate accelerated both quarter-over-quarter and year-over-year to 48%, yielding $388 million in total revenue for the quarter. This growth in our community, engagement and revenue is the result of several transitions we completed over the past 18 months.”

Total revenues reached $388 million for the three months ending June 30, growth of 48% compared to same period in 2018, while net gain on subscribers exceeded numbers expected by analysts. Snap might not be in profit just yet, operating loss totalled $304 million, but the numbers are all heading in the right direction. Snap does seem to be following the traditional route of Silicon Valley in this sense, and profit might not be that far away anymore.

Those who invest in Silicon Valley certainly have to be brave. The latest generation of businesses to emerge insist on significant backers to pump in huge amounts of capital with the vague hope of profits on the very-distant horizon. The early years are focusing on growth, doubling-down on product innovation to cut through the noise in a very competitive segment. Profits are an afterthought, but the likes of Google, Facebook, Amazon, Netflix and Twitter prove an oasis can emerge after years of traipsing through the baron deserts.

In fairness to the Snap team, its innovations are often stolen by other platforms, somewhat of a complement in today’s world. The product itself does not much resemble the app which hit the market in 2011, and while there might have been complaints about updates forced on the user last year, there do seem to be rewards.

Daily Active Users (DAUs) over the last three months increased to 203 million, up from 190 million in the previous quarter and 188 million in the same period of 2018. The average number of Snaps created every day also grew, this time totalling more than 3.5 billion on average over the three months.

Perhaps most importantly however is retention is increasing. There have been fears in the past that Snapchat would be nothing more than a passing fancy, though the team saw more than a 10% increase in the retention rate of people who open Snapchat for the first time.

The appeal of this app to the younger generations is unquestionable, Spiegel claims 75% of the 13 to 34 year-old population in the US is active on Snapchat, but questions remain over the commercial viability of the platform but also retention rates for older generations.

On the advertising side, this is an area which has certainly improved. Like Twitter last year, Snap has made it easier for advertisers to create content for the platform but also manage campaigns. This might sound simple, but for developers who have traditionally focused on user engagement this could have been an afterthought. It appears there is becoming a much healthier mix of user engagement and advertising appeal on the platform to ensure revenues can continue to grow.

The team is also making encouraging progress on augmented reality, a technology which promises a lot from both engagement and revenue perspectives. Few have been able to make this technology work to its full potential, but the Snap team have proven numerous times over the last few years they are leaders when it comes to innovation.

The Snapchat app might be an enigma when it comes to the older generations, they might not understand why it is appealing, but who are they to second-guess why. Numbers speak for themselves, and while Snap is a long-way from profit, the trends are certainly heading in the right direction.

Snap Q3 2019

Google is a social media addict and it has fallen off the wagon again

Googlers just don’t know when to give up when it comes to social media as the internet giant attempts to crack the market once again with Shoelace.

It’s been almost six months since the team decided to shut-down Google+ but the search behemoth hasn’t given up just yet. We’ve lost track at how many times Google has attempted to crack this lucrative market, and the latest attempt will put much more of a hyper-local twist on the social networking euphoria.

“Shoelace is a mobile app that helps connect people with shared interests through in person activities,” the team has written in the new platforms FAQs. “It’s great for folks who have recently moved cities or who are looking to meet others who live nearby.”

Coming out of Google’s Area 120, an experimental group within the R&D business, the team will look to create a platform which will focus on uniting people in local communities and neighbourhoods depending on their interests and experiences. It is a slightly different twist to and the Google team will be hoping its fifth time lucky as it attempts to crack the code.

Starting in New York with an invite-only private test, the platform will hope to push events out to users and encourage them to create their own. This might be as simple as checking to see if anyone within a five-minute walk would want to join a kick-about in the park, or it could be to promote a comedy-night in the local pub.

On the commercial side, it makes sense. Should Google be able to scale adoption to a suitable level there will certainly be demand from advertisers, from small pubs hoping to promote bingo to larger music venues hoping to sell tickets. However, if Google can’t convince enough users to engage with the platform, what’s the point.

This is where Google has struggled before; user adoption. Google+, Google Buzz and Google Friend Connect are all examples of platforms which failed because no-one actually used them aside from Google employees. Shoelace is the latest act of defiance from a company which does not know when to quit, and it is presenting a niche idea.

Users will be able to make use of a mapping feature to browse the local area for events, yoga in the park for instance, irrelevant as to whether they are connected to an individual who is attending or not. This is where it is slightly different from other platforms, it is activity driven not connection driven. This might sound like a good USP, but it relies on the assumption users will be OK spending their time with strangers.

Each time Google has attempted to crack the social media world, there seems to be a groan from the cynics and unimaginative who have decided there are enough social media platforms already. Google does not want to give up the potential gold-mine which is social media and the fortunes of competitors demonstrate why.

Alongside Google, Facebook is recognised as a leader in the world of online advertising. The core platform, as well as Instagram and WhatsApp, are making billions for Zucks and his cronies, but they are not alone. Twitter is starting to hoover up profits while Snap is looking like a genuine business and over in China, WeChat is perhaps the most complete offering around, combining social, communication, payments and eCommerce all in one place. You can see why Google has such a fascination with social media.

Matrix themed virus infects 25 million smartphones

A new variant of mobile malware, dubbed ‘Agent Smith’, which re-directs advertising funds to cybercriminals, has been identified and its infected 25 million smartphones already.

Discovered by Check Point, this is a sneaky virus to deal with. Like ‘Agent Smith’ in the Matrix trilogy, the virus has the ability to consume a downloaded app and assume control.

Right now, the user is not being exploited in a direct manner. The presence of the virus does present dangers in terms of eavesdropping or credit fraud, but currently, the cybercriminals are using the virus to collect cash off advertisers through various trusted applications. The application is forced to display more adds than designed with the attackers collecting the additional credits.

“In this case, “Agent Smith” is being used to for financial gain through the use of malicious advertisements,” Check Point said on its blog.

“However, it could easily be used for far more intrusive and harmful purposes such as banking credential theft and eavesdropping. Indeed, due to its ability to hide its icon from the launcher and impersonate existing user-trusted popular apps, there are endless possibilities for this sort of malware to harm a user’s device.”

Check Point estimate that 25 million devices have been infected to date, the majority are in India and other Asia nations, although there have been identified devices in the US, UK and Australia. Although Check Point has not directly stated it, some have suggested the virus can be traced back to Guangzhou, China.

Agent Smith VirusThe virus itself works in three phases. Firstly, the user is encouraged to download a simplistic, free app (usually a minimal function game or sex-app) which contain an encrypted malicious payload. At this point, the malware searches the user’s device for any popular apps on a pre-determined list which can be targets at a later date.

During the second phase, the malicious payload is decrypted into its original form and then abuses several known vulnerabilities without giving any clues to the user. Finally, the malware then attacks the pre-determined applications, extracting the innocent application’s APK file and then patches it with extra malicious modules.

‘Agent Smith’ was first detected in 2016 and the cybercriminals have seemingly been laying the groundwork for a larger attack for some time. It has certainly evolved over this period, and although Check Point has reported the malicious apps to the Google Security team, who is to say there are not more. The danger of ‘Agent Smith’ is that it is incredibly difficult to identify in the first place.

Perhaps this is an oversight in the security world which we will have to address before too long.

As it stands, numerous parties around the world are constantly on the look out for nefarious activity, however, in most cases the assumption is that it will be a state-sponsored attack. This does not seem to be the case here and perhaps why it is very difficult to detect the malware in the first place; everyone is looking for the wrong clues.

In this example, Check Point seem to have caught the suspect firm ahead of time, informing the Google Security team before any genuine damage has been done. That said, 25 million devices is still a substantial number but with the source identified it should be limited.

Researchers point to 1,300 apps which circumnavigate Android’s opt-in

Research from a coalition of professors has suggested Android location permissions mean little, as more than 1,300 apps have developed ways and means around the Google protections.

A team of researchers from the International Computer Science Institute (ICSI) has been working to identify short-comings of the data privacy protections offered users through Android permissions and the outcome might worry a few. Through the use of side and covert channels, 1,300 popular applications around the world extracted sensitive information on the user, including location, irrelevant of the permissions sought or given to the app.

The team has informed Google of the oversight, which will be addressed in the up-coming Android Q release, receiving a ‘bug bounty’ for their efforts.

“In the US, privacy practices are governed by the ’notice and consent’ framework: companies can give notice to consumers about their privacy practices (often in the form of a privacy policy), and consumers can consent to those practices by using the company’s services,” the research paper states.

This framework is a relatively simple one to understand. Firstly, app providers provide ‘notice’ to inform the user and provide transparency, while ‘consent’ is provided to ensure both parties have entered into the digital contract with open eyes.

“That apps can and do circumvent the notice and consent framework is further evidence of the framework’s failure. In practical terms, though, these app behaviours may directly lead to privacy violations because they are likely to defy consumers’ expectations.”

What is worth noting is while this sounds incredibly nefarious, it is no-where near the majority. Most applications and app providers act in accordance with the rules and consumer expectations, assuming they have read the detailed terms and conditions. This is a small percentage of the apps which are installed en-mass, but it is certainly an oversight worth drawing attention to.

Looking at the depth and breadth of the study, it is pretty comprehensive. Using a Google Play Store scraper, the team downloaded the most popular apps for each category; in total, more than 88,000 apps were downloaded due to the long-tail of popularity. To cover all bases however, the scraper also kept an eye on app updates, meaning 252,864 different versions of 88,113 Android apps were analysed during the study.

The behaviour of each of these apps were measured at the kernel, Android-framework, and network traffic levels, reaching scale using a tool called Android Automator Monkey. All of the OS-execution logs and network traffic was stored in a database for offline analysis.

Now onto how these apps developers can circumnavigate the protections put in place by Google. For ‘side channels’, the developer has discovered a path to a resource which is outside the security perimeters, perhaps due to a mistake during design stages or a flaw in applying the design. With ‘covert channels’ these are more nefarious.

“A covert channel is a more deliberate and intentional effort between two cooperating entities so that one with access to some data provides it to the other entity without access to

the data in violation of the security mechanism,” the paper states. “As an example, someone could execute an algorithm that alternates between high and low CPU load to pass a binary message to another party observing the CPU load.”

Ultimately this is further evidence the light-touch regulatory environment which has governed the technology industry over the last few years can no-longer be allowed to persist. The technology industry has protested and quietly lobbied against any material regulatory or legislative changes, though the bad apples are spoiling the harvest for everyone else.

As it stands, under Section 5 of the Federal Trade Commission (FTC) Act, such activities would be deemed as non-compliant, and we suspect the European Commission would have something to say with its GDPR stick as well. There are protections in place, though it seems there are elements of the technology industry who consider these more guidelines than rules.

Wholesale changes should be expected in the regulatory environment and it seems there is little which can be done to prevent them. These politicians might be chasing PR points as various elections loom on the horizon, but the evolution of rules in this segment should be considered a necessity nowadays.

There have simply been too many scandals, too much abuse of grey areas and too numerous examples of oversight (or negligence, whichever you choose) to continue on this path. Of course, there are negative consequences to increased regulation, but the right to privacy is too important a principle for rule-makers to ignore; the technology industry has consistently shown it does not respect these values therefore will have to be forced to do so.

This will be an incredibly difficult equation to balance however. The technology industry is leading the growth statistics for many economies around the world, but changes are needed to protect consumer rights.

Google Maps to start predicting crowdedness on public transport

Google Maps is already one of the most popular ways to plan the comings and goings of daily life, but a new update makes it just a little bit better.

Launched at the end of last week, Google Maps will now tell users how busy public transport is likely to be and whether users should anticipate delays on a journey. It’s a simple upgrade, but this extra little bit of information is an example of why Google Maps is such a popular application around the world.

“On days when everything runs smoothly, taking public transit is one of the best ways to get around town,” Google stated in a blog post. “Not only is it cost-effective and efficient, but it also lets you stay hands-free, so you can sit back, relax and maybe even read a few chapters of your favourite book.

“But unexpected delays or overcrowded vehicles can quickly turn your ride from enjoyable to stressful. Starting today, Google Maps is rolling out two new features to help you better plan for your transit ride and stay more comfortable along the way.”

There are two new snippets of information which are being introduced here. Firstly, users will be told whether there are any delays on the bus to be aware of. Many estimates on time of arrival are based on the average time in which it takes the bus to get from point A to point B, not taking into account the conditions at that time. To counter this problem, Google will introduce live traffic updates.

Secondly, the Maps application will begin to tell users whether they are likely to snag a seat on an up-coming bus, train or underground journey. This section is more guesswork than anything else, using data collected on journeys through the last two years to figure out the current situation. That said, these guesses are usually correct and might be useful for anyone who gets a bit fidgety during the busy periods of travel.

These two features will be rolled out in 200 cities across the world, including numerous locations in the UK such as Cardiff, London, Nottingham and Reading.

Google Maps is turning into a wonderful money maker for the team, and this is perhaps the very reason why. Numerous features are being introduced without necessarily tying them to the bottom line. Google is not necessarily going to make money from these updates, but more people might use the product. It’s the built it and they will come attitude, focusing on nailing experience before turning to profits.

Niantic’s Harry Potter launches but remains in Pokémon Go’s shadow

Harry Potter: Wizards Unite is up-and-running, but its dash from the starting line is no-where near as fast as Niantic’s gold standard, Pokémon Go.

Few would have predicted the roaring success of Pokémon Go. Most would have assumed it would have done well, but the sustained acceleration of downloads and revenues came as a surprise to most. Even now, almost three years after the launch of the game, Niantic is still hoovering up the cash; the first quarter of 2019 brought in an estimated $205 million; it left a lot for Harry Potter to live up to.

But if you are expecting new records to be broken, you might feel a little bit underwhelmed.

This is not to say Harry Potter: Wizards Unite is not doing well. Most app developers would sell their left leg for the numbers being reported over this weekend. According to estimates from Sensor Tower, Harry Potter: Wizards Unite was downloaded three million times over the opening weekend, bringing in $1.1 million in player spending. Projections for the first month stand at roughly $10 million.

For a single title, most developers would be thrilled by this, but Niantic will always have the Pokémon Go comparisons to deal with.

During the first four days of Pokémon Go, Niantic boasted 24 million downloads and player spending of $28 million. In the first month, player spending reached $206 million and downloads were almost 173 million. Realistically, Harry was always going to struggle to meet these expectations. But that is not to say it won’t be a success.

Your correspondent downloaded the game over the weekend and has been playing around with it over the last few days, and it is pretty good. The experience is better than Pokemon Go, the AR is closer to what many would expect and there is more of a story involved.

There are a few issues, though many of these would have been expected. Heavy data consumption should be expected, your correspondent used 636 MB in the first two days and wasn’t using it as much as most would. Battery life also takes a notable kick, five hours was knocked off what was to be expected on the device in question. Both of these factors might have a notable impact on how much users are using the game in the long-run.

But why has Harry Potter: Wizards Unite fallen short on the lofty goals? We suspect the nostalgia factor is the biggest contributor.

Firstly, lets have a look at the audience. Pokémon came into existence in 1996 primarily targeted at children, however even in the early days there was popularity with those in their 20s. Those who played the original games are 23 years older, though the TV series also proved to be incredibly popular across the world, running from 1997 through to today. There will be millions who are in their 20s, 30s and 40s who would have watched the show and felt the nostalgia bug when the game was launched almost three years ago.

The first Harry Potter title was released in 1997, though perhaps did not reach the peak of its fandom for a decade. During the 00s, the final books were being released and the films were taking the franchise to new audiences. Harry Potter remains popular today, but the core audiences are younger due to the longer period of time it took the spark to grow into a flame.

In short, the nostalgia bug bit for more people in control of credit cards for Pokémon Go than with Harry Potter: Wizards Unite. Many of those downloading the Harry Potter title today will have to ask permission from parents to make purchases, whereas we suspect a much higher proportion of those with Pokémon Go can make their own financial decisions.

Looking at statistics revealed by Survey Monkey a few months after Pokémon Go was released, 71% of players were aged between 18 and 50. The comparative numbers have not been revealed for Harry Potter: Wizards Unite just yet, but we suspect they will be a lot younger. For the final two films of the Harry Potter series, 56% and 55% were over the age of 25, but the books are designed for teenagers.

Secondly, we are going to have a look at the global appeal of both titles.

Although both are incredibly popular throughout the world, one originated in the UK and the other in Japan. Due to the fact the Pokémon TV series was animated, dubbing into new languages would have been much simpler, increasing the accessibility of the content. The TV series is available in 169 countries around the world, while the Harry Potter book series has been translated into 80 different languages.

Harry Potter is very popular in the likes of Japan, South Korea and China, though we suspect it does not exceed the popularity of Pokemon at its prime. This will have a translation into the nostalgia effect which drove the initial adoption of Pokémon Go and the continued success today. Let’s not forget, the US and Asia are the two biggest regions for gaming revenues and perhaps these markets favour the Pokemon brand over Harry Potter.

We confident the Harry Potter game will be a success, but it isn’t able to tap into the nostalgia effect of the right audiences. With the brand continuing to be more relevant than Pokemon is today, see the theme parks and sustained popularity of the movies, it will bring in revenues but perhaps not on the same scale in the short- to mid-term as Pokémon Go.

What we are less confident about is the impact this will have on the normalisation of AR in the entertainment world as a direct result. Yes, it will have an incremental impact and open the eyes of some, but we doubt this will be a watershed moment for the technology.

That said, we do not believe there will ever be a watershed moment for AR. This is likely to be a technology which gathers momentum slowly, gradually being introduced as additional features in every day life. Before we know it, AR will be everywhere, and we’ll wonder where it came from.

Maine gets tough on telcos over data economy

Maine Governor Janet Mills has signed new privacy rules into law, demanding more proactive engagement from broadband providers in the data-sharing economy.

While the rules are tightening up an area of the digital world which is under-appreciated at the moment, it will have its critics. The law itself is targeting those companies who delivering connectivity solutions to customers, the telcos, not the biggest culprits of data protection and privacy rights, the OTTs and app developers.

The rules are applicable to broadband providers in the state, both mobile and fixed, and force a more proactive approach in seeking consent. Telcos will now be compelled to seek affirmative consent from customers before being allowed to use, disclose, sell or permit access to customer personal information, except in a few circumstances.

As is on-trend with privacy rules, the ‘opt-out’ route, used by many to ensure the lazy and negligent are caught into the data net, has been ruled out.

There are also two clauses included in the legislation which block off any potential coercing behaviour from the telcos also:

  • Providers will not be allowed to refuse service to a customer who does not provide consent
  • Customers cannot be penalised or offered a discount based on that customer’s decision to provide or not provide consent

This is quite an interesting inclusion in the legislation. Other states, California for example, are building rules which will offer freedoms to those participating in the data-sharing economy if the spoils are shared with those providing the data (i.e. the customer), though the second clause removes the opportunity to offer financial incentives or penalties based on consent.

This is not to say rewards will not be offered however. There is wiggle room here, zero-rating offers on in-house services or third-party products for example, which does undermine the rules somewhat.

It is also worth noting that these rules only pertain to what the State deems as personal data. Telcos can continue to monetize data which is not considered personal without seeking affirmative consent, unless the customer has written to the telco to deny it this luxury. Personal data is deemed as the following categories:

  • Web browsing history
  • Application usage history
  • Geolocation
  • Financial
  • Health
  • Device identifiers
  • IP Address
  • Origin and destination of internet access service
  • Content of customer’s communications

What is worth noting is this is a solution to a problem, but perhaps not the problem which many were hoping would be addressed.

Firstly, the telcos are already heavily regulated, with some suggesting already too much so. There are areas which need to be tightened up, but this is not necessarily the problem child of the digital era. The second point is the issue which we are finding hard to look past; what about the OTTs, social media giants and app community?

The communications providers do need to be addressed, though the biggest gulf in regulation is concerning the OTTs and app developers. These are companies which are operating in a relative light-touch regulatory environment and benefiting considerably from it. There are also numerous examples of incidents which indicate they are not able to operate in such a regulatory landscape.

Although it is certainly a lot more challenging to put more constraints on these slippery digital gurus, these companies are perhaps the biggest problem with the data-sharing economy. Maine might grab the headlines here with new privacy rules, which are suitably strict in fairness, but the rule-makers seem to have completely overlooked the biggest problem.

These rules do not add any legislative or regulator restraints on the OTTs or app developers, therefore anyone who believes Maine is taking a notable step in addressing the challenges of the data-sharing economy is fooling themselves. This is a solution, but not to the question which many are asking.

Supreme Court opens the legal floodgates on Apple

Apple is potentially on the verge of facing a tidal wave of lawsuits as the Supreme Court agrees the iLeader is allowed to be challenged on a potential abuse of power in the app economy.

The pivotal case the Supreme Court has been ruling on is Apple vs. Pepper. Robert Pepper and other plaintiffs, various iPhone owners, filed an antitrust lawsuit against Apple claiming the firm monopolised the app market through the App Store, with developer licence fees and the 30% commission ultimately driving the price up for consumers.

One the other side of the argument, Apple suggested iPhone owners were actually customers of the developers, while the developers were customers of Apple. This nuanced argument leans on legal precedent set in doctrine known as Illinois Brick where ‘indirect purchasers’ of a product don’t have the power to file antitrust cases. In distancing itself from the end-user in the app economy, Apple was hoping to protect itself.

In the first instance, the district court ruled in favour of Apple, dismissing the case, while the Ninth Circuit Court reversed the decision, ruling that consumers are purchasing from Apple not the developers. The fight was then escalated up to the Supreme Court, with the highest legal battleground in the US ruling 5-4 in favour of the iPhone owners.

What is worth noting is this is not a ruling which states Apple’s App Store is a monopoly, but a decision which allows users to file antitrust lawsuits against the iLeader. It’s a step towards another legal headache but is by no means a sign of guilt.

For Apple, this will come as an unwanted distraction as it attempts to scale it software and services business, in which the App Store is a key cog. The last few years have seen the Apple team attempt to create a more balanced business, with less of a reliance on the staggering hardware segment and reaping the rewards of the blossoming software world.

This decision from the Supreme Court might not assign guilt to Apple, but it certainly creates a monumental migraine. Such is the lawsuit culture in the US it won’t be long before miffed customers just on the bandwagon in pursuit of compensation.