Connect with us

Uncategorized

This Week in Apps: Facebook Gaming skips iOS, TikTok goes shopping, Apple One bundles arrive

Published

on

Welcome back to This Week in Apps, the TechCrunch series that recaps the latest OS news, the applications they support and the money that flows through it all.

The app industry is as hot as ever, with a record 204 billion downloads and $120 billion in consumer spending in 2019. People are now spending three hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.

Top Stories

Here Comes Apple One

Thanks for all the market research, app developers.

Image Credits: Apple

Apple issued a slight beat on earnings this week, despite the COVID pandemic and a 20% decline in iPhone sales year-over-year, including a drop in China.

But for app developers who already have a large install base to serve across Apple’s mobile devices, it’s Apple’s expansion into the services market that may draw more attention. Apple continues to edge its way into nearly every category that has proven popular on mobile devices. Streaming music? Apple Music. Streaming TV and movies? Apple TV+. Paid news and magazine subscriptions? Apple News+. Cloud storage? iCloud. Payments? Apple Card and Apple Pay. Gaming? Apple Arcade. And so on.

Its latest effort, launching on October 30, is Apple One — a way for users to pay for multiple Apple services in a single bundle.

At launch, the $14.95 per month Individual bundle includes Apple Music, Apple TV+, 50GB of iCloud storage and Apple Arcade. The same thing as a Family Plan (up to six people) is $19.95 per month and ups the iCloud storage to 200GB. And for $29.95 per month on the Premier plan, you get 2TB of iCloud storage, and add in Apple News+ and the new Fitness+, which arrives later this quarter.

Image Credits: Apple

While each plan saves a little money than if paying individually, the most value can be found at the higher end. Which means Fitness+ could immediately gain an influx of new subscribers, even if the user primarily opted for the Premier plan because of its access to News+. That means Fitness+ doesn’t even have to try that hard to compete with third-party membership-based fitness apps. Instead, Fitness+ acquires users by its association with other known and valued Apple services.

As Apple stretches itself into new services markets — say, AirTags subscriptions, or something we haven’t thought of yet — like subscription medications (Health+?), financial news (Stocks+?), ridesharing (Car+?) social (FaceTime+?) — it will have a head start on user acquisition.

For app developers finding themselves having done the job of proving the market for a subscription-based business in their category, they’ll then be thrust into the role of trying to value add on top of a baseline product that offers a deeper integration with the iOS operating system than they’re allowed.

Cloud gaming’s unknown future on iOS

Image Credits: Facebook Gaming featuring Asphalt Legends

Speaking of services…this week Facebook launched its cloud gaming service that offers free-to-play games that Facebook users can play without leaving the social app.

The games are streamed from the cloud (meaning, Facebook’s servers), instead of requiring users download the titles locally.

This format for mobile gaming makes sense in mature markets that are now steadily moving to 5G. However, Facebook’s new service is only available on desktop and Android — not on iOS.

Facebook excluded Apple devices from the launch, citing Apple’s “arbitrary” policies around third-party apps. Though Apple recently updated its guidelines, it still doesn’t allow applications to act like third-party app stores where games are bought, used and streamed from within the main app directly. Instead, it’s permitting the model GameClub pioneered as a means of working around Apple’s rules last year. That is, there is a main app where users can subscribe and browse a catalog, but each individual game has to be listed on the App Store individually and be playable in some way — even if it’s just a demo.

There’s one school of thought (a point Facebook keeps pushing) that says Apple’s rules here are losing it money.

After all, Facebook says its avoidance of iOS is not about the 30% commission — it’s paying that on Android, in line with Google Play policies. Oh, why oh why doesn’t Apple want its 30%, too?, Facebook cries.

The answer is because Facebook’s iOS snub is part of its long-term strategy. To say it’s not about the money is disingenuous. Facebook at launch is already taking the 30% when in-app purchases are made on the web version of its cloud gaming services.

What’s really happening is that Facebook is making a calculated risk. It’s betting that regulators will ultimately force Apple to permit third-party app stores on iOS and maybe even end Apple’s requirements around in-app purchases, allowing alternative payments. If that comes to pass, the 30% goes back in Facebook’s own pocket.

Even if regulators only push Apple to allow third-party payment systems in addition to the Apple Pay requirement, Facebook could still make money when users picked the Facebook payment option. And it’s ready. Facebook has already built out Facebook Pay infrastructure and it’s now encouraging Facebook Pay usage by redesigning Facebook and Instagram as online shopping platforms.

This all makes the near-term loss of cloud gaming users on iOS worth the risk. Instead of catering to the iOS base, Facebook is raising a stink about “Apple’s rules” to make it look like Apple is harming the market and stifling competition. In reality, Facebook could very easily list its handful of gaming titles separately, if it desired, as per Apple’s current rules — especially because many are more casual games than those found on xCloud or Stadia.

But that wouldn’t help its larger goal: to see Apple’s App Store regulated.

It’s not even like Facebook is being shy about its motives here. CEO Mark Zuckerberg has publicly stated that Apple’s control of the App Store “deserves scrutiny.”

“I do think that there are questions that people should be looking into about that control of the App store and whether that is enabling as robust of a competitive dynamic,” he said in an Axios interview. “…I think some of the behavior certainly raises questions. And I do think it’s something that deserves scrutiny.”

TikTok Goes Shopping

Image Credits: Shopify

Remember how Walmart angled in on that TikTok acquisition (whose status is still unknown) and everyone was wondering what the heck Walmart was doing? Well, it was thinking ahead.

TikTok this week partnered with Shopify on a social commerce initiative. The deal aims to make it easier for Shopify’s moer than 1 million merchants to reach TikTok’s younger audience and drive sales, by creating and optimizing TikTok campaigns from their Shopify dashboard.

The ad tools allow merchants to create native, shareable content that turns their products into In-Feed video ads that will resonate with the TikTok community. Merchants will be able to target their audiences across gender, age, user behavior and video category (see, TikTok does have SOME data on you!), and then track the campaign’s performance over time.

As a part of this effort, Shopify merchants can also install or connect their “TikTok Pixel” — a tool that helps them to more easily track conversions driven by their TikTok ad campaigns.

The campaigns’ costs will vary, based on the merchant’s own business objectives and how much they want to spend.

The partnership will eventually expand to include other in-app shopping features, as well.

The TikTok-Shopify partnership could help the video platform better compete against other sources of social commerce, including the growing number of live stream shopping apps as well as efforts from Facebook and its family of apps.

Weekly News Round-Up

Platforms

  • Epic says Apple has “no right to the fruits of Epic’s labor” in its latest court filing. “Consumers who choose to make in-app purchases in Fortnite pay for Epic’s creativity, innovation and effort—to enjoy an experience that Epic has designed,” the filing said. The company is making the point that it did the work to create an in-game marketplace for its players to use. The App Store and its payments system are not necessary — they’re forced upon Epic so Apple can ” maintain its monopoly,” Epic’s lawyers said.
  • Adoption of iOS 14 reaches 46.36% six weeks after launch, according to Mixpanel data.
  • Apple releases App Store server notifications into production. The notifications provide developers with real-time updates on a subscriber’s status, allowing app makers to create customized user experiences.
  • Facebook provides new guidance for partners on iOS 14 SKAdNetwork. The company said it will release an updated version of the Facebook SDK by early Q1 to support the upcoming iOS 14 privacy feature requirements, noting that “guidance from Apple remains limited.” The new version of the Facebook SDK will provide support for Apple’s SKAdNetwork API and conversion value management.
  • Google tests a new “app comparison” feature on Google Play that lets you analyze multiple apps across metrics, like ease of use, features, downloads and star rating. Google confirmed the test was live, but downplayed it saying it was “small” and the company had no plans for a broader rollout at this time.
  • Apple search crawler activity could be pointing to Apple’s plans to build its own search engine to rival Google. In iOS 14, Apple can now display its own search results when users type in queries from its home screen, bypassing Google.
  • ExxonMobile embraces Apple’s App Clips. The fuel company will bring the lightweight App Clips and Apple Pay to more than 11,500 Exxon and Mobil gas stations across the U.S., allowing consumers to scan a QR code on the pump to pay via an App Clip version of the ExxonMobil app.

Policies

  • Search engine app makers tell the European Commission that the Android choice screen isn’t working to remedy antitrust issues. Ecosia, DuckDuckGo, Lilo, Qwant and Seznam signed the letter to the Commission.
  • Big technology platforms asked the E.U. to protect them from legal liabilities over removing hate speech and illegal content, reports Bloomberg, citing a paper from Edima, an association representing Alphabet’s Google, Facebook, ByteDance and others.

Trends

Image Credits: Sensor Tower

  • U.S. home improvement brand app adoption doubled over 2019 since March, per Sensor Tower. As COVID stuck people at home, first-time installs of top home improvement brand apps in the U.S. from March to September 2020 doubled year-over-year, climbing 103%. MAUs grew 35% during that time.
  • U.S. Adoption of Food & Drink apps climbed 30% during COVID-19, also per Sensor Tower. Worldwide, these apps saw a slowdown in download growth in Q3 with a +14% growth rate — slower than other previous third quarters.
  • Samsung reclaims the No. 1 spot in the Indian smartphone market, beating Xiaomi. The new data from marketing research firm Counterpoint conflicts with a report last week from Canalys, making it a close race.
  • Facebook is losing users in the U.S. and Canada. The company reported during its Q3 earnings that user growth in these key markets was slowing after the COVID surge. The company now has 196 million users in North America, down from 198 million in Q2, and it expects the decline to continue. DAUs and MAUs in these markets were also flat or down slightly in the quarter.

Services

Security/Privacy

  • True, a social networking app that promised to protect user privacy, found to be exposing private messages and user locations.
  • A massive analysis of the COVID-19 tracing app ecosystem tracks the permissions the apps require, SDKs in use, location-tracking abilities and more.
  • PUBG Mobile to terminate all service and access to users in India on October 30, after the country banned the game from the world’s second largest internet market over cybersecurity concerns due to its China ties. PUBG already tried cutting ties with its Chinese publishing partner, Tencent Games, but critics called this a Band-Aid if Tencent still had a hand in game development.

App News

  • Sony’s PlayStation app gets an upgrade before the PS5 launch on November 12. The updated app introduced a completely redesigned interface, with a home screen where you can see what friends are playing, voice chat support for up to 15 people, integrated messages and PS Store and news. When, the PS5 arrives, the app will allow users to remotely launch their games, manage storage and more.
  • Instagram extends time limits on live streams to four hours, the same as Facebook live streams on mobile. It will also soon support archiving of live video content.
  • YouTube revamps its mobile app with new gestures, video chapter lists and others changes. The video chapter lists expand the feature introduced in May, and now turn chapters into scrollable lists, each with their own video thumbnail.
  • Tinder roll outs Face To Face, its opt-in video chat feature, to users worldwide. The dating company was pushed to accelerate its virtual options due to the pandemic.
  • Microsoft Office apps add mouse and trackpad support for iPadOS, meaning you can now use Apple’s new Magic Keyboard with apps like Word, Excel and PowerPoint.
  • Cryptocurrency exchange Coinbase is launching a debit card in the U.S. later this year. The Visa debit will work with Visa-compatible payment terminals, online checkout interfaces and ATMs. A mobile app will allow you to control how you want to spend your cryptocurrencies.
  • Eko asks court to freeze Quibi assets related to its turnstyle tech. Even though Quibi is shutting down, Eko’s case against the mobile streaming service continues. Eko wants a payout of at least $96.5 million for infringing on its intellectual property.
  • Netflix engineers detail the studio apps shift to Kotlin Multiplatform in new blog post.
  • TikTok countersues Triller. The China-based, ByteDance-owned video app asks a U.S. judge to rule on Triller’s patent infringement allegations. Triller had filed a suit in late July,
  • TikTok parent ByteDance launches a smart lamp with a camera, display and virtual assistant. The device works with a mobile app and its aimed at helping kids with homework, in an education push.
  • TikTok expands its in-app Election Guide to include Election Day resources like information about polling locations and hours, services that can help people having voting difficulties and those offering other details how the voting process works, as well as live election results from the AP.

Funding and M&A

  • Corsair acquires EpocCam. Gaming peripheral maker bought smartphone app EpocCam, a top video app that lets users turn their iPhone or iPad into a high-def webcam for their Windows or Mac PC. The app grew in popularity due to the pandemic, and its wide support for major video apps includes Zoom, Skype, OBS Studio, Google Meet and Microsoft Teams. Under Corsair’s Elgato subsidiary, the app has been relaunched to fit into the company’s expanded ecosystem of content creation tools.
  • Digital health startup Nutrium raises $4.9 million led by Indico Capital for its service and app which links dietitians and their patients.
  • Bay Area-based Jiko raises $40 million Series A from Upfront Ventures and Wafra Inc. for its mobile banking startup.
  • Helsinki-headquartered app management startup AppFollow raises $5 million Series A led by Nauta Capital. The company now has 70,000 clients on its platform, including McDonald’s, Disney, Expedia, PicsArt, Flo, Jam City and Discord.
  • Mobile device management startup Kandji raises $21 million Series A in a round led by Greycroft. The startup’s MDM solution helps larger companies manage their fleet of Apple devices and keep them in compliance.
  • SimilarWeb raises $120 million for its AI-based market intelligence platform for websites and mobile apps. The company counts more than half of the Fortune 100 as customers, including Walmart, P&G, Adidas and Google.
  • Phone forensics company Grayshift, a startup that helps feds break into iPhones, raises $47 millionThe round was led by PeakEquity Partners, for the company that claims to have doubled adoption, revenues, and employees in the last year.
  • Intelligent visual assistance startup TechSee raises $30 million to automate field work with AR and computer vision.
  • Betty Labs, parent company to Locker Room, a new social audio app connecting sports fans for live conversations, raised $9.3 million in seed funding led by Google Ventures.
  • Mobile gaming company Scopely raises $340 million at a $3.3 billion valuation. Scopely had just raised $200 million last year. Unlike other gaming giants, Epic and Unity, the company doesn’t make tools for gaming, it focuses on keeping players engaged. Today, those users spend 80 minutes per day on games like its Star Trek Fleet Command, MARVEL Strike Force, Scrabble GO and YAHTZEE with Buddies.

Recommended Downloads

Filtertune

Image Credits: Lightricks

From the makers of Facetune, this new iOS app lets influencers create custom filters that can be shared across social media along with their photos, allowing fans to snap a screenshot of the photo — which includes a QR code on a banner — into order to import the custom preset photo filter into the app’s library. The filter can then be used to edit photos, and further personalized by the end user.

Clips 3.0 eyes TikTok with its biggest update ever

Image Credits: Apple

Apple rolled out an updated version of its casual video creation app, Clips. Before, the app only supported Instagram-like square video, but the new version, Clips 3.0, expands to include support for vertical and horizontal video, making it easier to export videos to apps like TikTok.

The new app also features a refreshed interface on iPhone and iPad, HDR recording with iPhone 12, support for a mouse, trackpad and keyboard cases on iPad, along with other smaller changes, like new stickers, sounds and posters. There are eight new social stickers (like “Sound On” for Instagram Stories), 24 new royalty-free soundtracks (bringing the total library to 100), and six new arrows and shapes, as well as a set of poster templates to use within videos.

Backbone

Image Credits: Backbone

The Backbone app works with the new $99 Backbone One mobile gaming controller for iPhone that lets you play games like Call of Duty: Mobile, Minecraft, Asphalt 9: Legends, hundreds of Apple Arcade titles and other iPhone games that support game controllers.

The controller also includes a Capture Button that lets you record gaming clips to share directly to social platforms like Instagram Stories and iMessage.

Read the TechCrunch review here.

New Releases in iOS 14 Widgets

Image Credits: Pinterest

  • Pinterest: The pinboarding app jumps into widgets with an update that lets you put either a small or large widget on your home screen that pulls photos from a Pinterest board — either one you follow or one you created. This allows you to set up a widget that rotates through a set of photos from an online resource, instead of requiring you to keep an on-device photo gallery.
  • TikTok: The short form video app updated this week to include three different widgets from small to large that allow you to easily access trending videos and sounds right from your iOS home screen.
  • Widgit: This new widget lets you put GIF-like animated images on your iOS 14 home screen (in-app purchases).

Lyron Foster is a Hawaii based African American Musician, Author, Actor, Blogger, Filmmaker, Philanthropist and Multinational Serial Tech Entrepreneur.

Continue Reading
Comments

Uncategorized

How the US, UK and China are planning to roll out vaccines

Published

on

The vaccines are coming. The UK became the first country in the West to approve a covid-19 vaccine for emergency use on December 2, specifically the Pfizer and BioNTech vaccine, which has completed Phase 3 trials. But the US, EU, and many other countries are expected to follow suit in the following days and weeks. The imminent arrival of vaccines not only means that countries face a huge logistical challenge to distribute them—which is complicated by the fact the two most promising vaccines require ultra-cold temperatures—but they also have to grapple with hard choices over who gets them first. 

Here’s how different countries are making their decisions on distributing vaccines to their populations. 

United States

How many doses will be available? Up to 40 million doses are expected to be on offer in the US by the end of 2020—25 million of which will come from Pfizer-BioNTech, and 12.5 million from Moderna, according to Reuters. Since the vaccines each require two doses spaced several weeks apart, this will be enough to vaccinate 20 million people—but not all shipments will come at once. The first shipment will reportedly cover 3.2 million people, with 5-10 million more doses delivered each week after that.  

Who will get it first? In the US, individual states are responsible for creating their own vaccine distribution plans. They are meant to follow general guidance from the CDC’s Interim Playbook for Covid-19, which was shaped by the Advisory Committee on Immunization Practices (ACIP) with input from the National Academies of Sciences, Engineering, and Medicine.

ACIP met on December 1, and voted on the recommended first phase of the distribution plan. This is known as 1a, and will prioritize 21 million health care workers and 3 million adults in long-term care facilities, like nursing homes, who are particularly vulnerable. 

USA vaccine covid-19

MS TECH | PIXABAY

The following phases will add other people to the list: 1b will prioritize other essential workers, such as school staff, while 1c prioritizes adults older than 65 and others with other medical issues that increase the risk of serious complications from covid.

Phase two would cover people who work in schools, transportation, congregate housing facilities, like nursing homes, and other places with high concentrations of people. Phase three includes young adults and children—in an attempt to stop super spreading events—as well as other essential workers not previously covered. Phase four would include everyone else. 

But the CDC guidelines leave a lot for state and local governments to interpret and implement. 

Even in phase 1, different states have different definitions for essential workers, for example. ACIP has yet to discuss anything beyond phase 1, leaving many open questions about how to prioritize the rest of the population. One analysis of 47 published state plans by the Kaiser Family Foundation found that about half explicitly mentioned race and health equity as a factor for prioritization. 

China

How many doses will be available? Chinese scientists say the country will have 600 million doses ready this year, the South China Morning Post reports. Wang Junzhi, a member of the nation’s vaccine task force, told journalists on December 4 that the doses of inactivated vaccines will be ready for launch before the end of the year. He said a “major announcement”on vaccine trials was expected in the coming weeks. 

China vaccine covid-19

MS TECH | PIXABAY

China has five vaccine candidates from four manufacturers in phase three clinical trials, including the frontrunners from Sinopharm and Sinovac Biotech. While none have yet been approved for commercial use, they have been administered in so-called “pre-tests” in China, where coronavirus numbers are low, and are also undergoing phase three trials in 15 countries abroad. 

Who will get it first? That question’s already been answered. Emergency authorization was granted to the two leading candidates earlier this year: Since June, an unknown number of People’s Liberation Army members have received shots, and essential city workers started getting vaccinated in July. All in all, roughly one million people have received emergency authorization vaccines so far, including employees of state-owned enterprises, Huawei employees in 180 countries, and Chinese diplomats. 

“An emergency use authorization, which is based on Chinese vaccine management law, allows unapproved vaccine candidates to be used among people who are at high risk of getting infected on a limited period,” said Zheng Zhongwei, the director of the Science and Technology Development Center of China’s National Health Commission, in an interview with China’s state television channel on August 22.

President Xi Jinping has vowed to make the vaccine available around the world as a“global public good.” In October, China joined the Covax Facility, a global alliance of 189 countries that have pledged to equitably distribute vaccines. The US is not part of that group. 

The countries prioritized for distribution of the five Chinese vaccine candidates are primarily those which have hosted trials, which in turn is shaped by China’s strategic interest.  These include Brazil, Indonesia, and Turkey, which have signed deals for 46 million, 50 million, and 50 million Sinovac doses respectively; and Mexico, which has a deal with CanSino Biologics for 35 million doses. 

Little is known about how the Chinese government is prioritizing vaccine distribution domestically, though local reports suggest that individual provinces are making their own plans to buy vaccine doses, which will cost 200 RMB per dose (roughly $30.) The state insurance plan will not cover the cost. 

UK

How many doses will be available? The UK approved the Pfizer/BioNTech vaccine for emergency use in the general public on December 2. It will start inoculating its population of 67 million people through the state-run National Health Service, with the first vaccinations to be given to the highest-priority individuals from December 7. The UK bought 40 million doses of the Pfizer vaccine; since each person requires two doses, so it has enough to vaccinate about a third of the population. It has also purchased 100 million doses of the AstraZeneca/Oxford vaccine, 7 million doses of the Moderna vaccine, and smaller quantities of other vaccine candidates, bringing the total it has bought to 355 million—in short, more than enough to vaccinate everyone. 

Who will get it first? The UK’s decision relied on a group called the Joint Committee on Vaccination and Immunisation (JCVI), an independent committee of academics and medical experts responsible for advising government ministers. For its phase one delivery, it divided the population into nine different groups, recommended vaccinating them in this order of priority, which the government has adopted:

  • Residents and staff working in elderly care homes
  • Everyone over 80 years old plus health and social care workers
  • Everyone over 75 years old
  • Everyone over 70 years old plus “clinically extremely vulnerable” individuals, which does not include pregnant people or those under the age of 18. 
  • Everyone over 65 years old
  • Adults aged 18 to 65 years in an at-risk group. This includes people with chronic diseases, diabetes, learning difficulties, morbid obesity or severe mental illness.  
  • Everyone over 60 years old
  • Everyone over 55 years old
  • Everyone over 50 years old

The JCVI has publicly explained its thinking in a 25-page document stating that “current evidence strongly indicates that the single greatest risk of mortality from covid-19 is increasing age.” It has not yet announced plans beyond phase one.

Elsewhere

Russia: Russia became the first country anywhere to approve a vaccine back in August 2020. President Vladimir Putin himself announced its Sputnik V vaccine had been granted authorization on August 11, before phase 3 trials had even started. Those are still underway, but the country is already preparing to start mass immunizations, with Putin ordering officials to start making the necessary preparations just hours after the news of the UK’s approval came in. Vaccinations will reportedly begin with healthcare workers and teachers. They will be free of charge, and the Kremlin says they will be carried out on a voluntary basis. Russia also says it will have up to 500 million doses ready for export. 
Other countries: The options are limited for many lower and middle income countries, since the world’s richest nations—including the 27 member-states of the EU as well as Canada, the United States, United Kingdom, Australia, and Japan—have already pre-ordered half of the world’s expected available supply. Ninety two of these countries have joined the Covax Facility, which has secured 700 million doses and aims to cover 20% of the population of lower and middle income countries by the end of 2021.

Continue Reading

Uncategorized

3 ways the pandemic is transforming tech spending

Published

on

Ever since the pandemic hit the U.S. in full force last March, the B2B tech community keeps asking the same questions: Are businesses spending more on technology? What’s the money getting spent on? Is the sales cycle faster? What trends will likely carry into 2021?

Recently we decided to join forces to answer these questions. We analyzed data from the just-released Q4 2020 Outlook of the Coupa Business Spend Index (BSI), a leading indicator of economic growth, in light of hundreds of conversations we have had with business-tech buyers this year.

A former Battery Ventures portfolio company, Coupa* is a business spend-management company that has cumulatively processed more than $2 trillion in business spending. This perspective gives Coupa unique, real-time insights into tech spending trends across multiple industries.

Tech spending is continuing despite the economic recession — which helps explain why many startups are raising large rounds and even tapping public markets for capital.

Broadly speaking, tech spending is continuing despite the economic recession — which helps explain why many tech startups are raising large financing rounds and even tapping the public markets for capital. Here are our three specific takeaways on current tech spending:

Spending is shifting away from remote collaboration to SaaS and cloud computing

Tech spending ranks among the hottest boardroom topics today. Decisions that used to be confined to the CIO’s organization are now operationally and strategically critical to the CEO. Multiple reasons drive this shift, but the pandemic has forced businesses to operate and engage with customers differently, almost overnight. Boards recognize that companies must change their business models and operations if they don’t want to become obsolete. The question on everyone’s mind is no longer “what are our technology investments?” but rather, “how fast can they happen?”

Spending on WFH/remote collaboration tools has largely run its course in the first wave of adaptation forced by the pandemic. Now we’re seeing a second wave of tech spending, in which enterprises adopt technology to make operations easier and simply keep their doors open.

SaaS solutions are replacing unsustainable manual processes. Consider Rhode Island’s decision to shift from in-person citizen surveying to using SurveyMonkey. Many companies are shifting their vendor payments to digital payments, ditching paper checks entirely. Utility provider PG&E is accelerating its digital transformation roadmap from five years to two years.

The second wave of adaptation has also pushed many companies to embrace the cloud, as this chart makes clear:

Similarly, the difficulty of maintaining a traditional data center during a pandemic has pushed many companies to finally shift to cloud infrastructure under COVID. As they migrate that workload to the cloud, the pie is still expanding. Goldman Sachs and Battery Ventures data suggest $600 billion worth of disruption potential will bleed into 2021 and beyond.

In addition to SaaS and cloud adoption, companies across sectors are spending on technologies to reduce their reliance on humans. For instance, Tyson Foods is investing in and accelerating the adoption of automated technology to process poultry, pork and beef.

All companies are digital product companies now

Mention “digital product company” in the past, and we’d all think of Netflix. But now every company has to reimagine itself as offering digital products in a meaningful way.

Continue Reading

Uncategorized

The fragmentation of everything

Published

on

The rise of technonationalism. Diverging regulatory regimes. The spread of “walled gardens.” Polarization like nothing we’ve seen before. The confluence of several trends is poised to completely fragment our real and digital worlds. For companies, this raises a host of new risks, from cybersecurity threats to reputation risk—which, in turn, will require new responses and approaches.

The techonomic cold war

A “techonomic cold war” is already under way—an ongoing, often-invisible state of conflict at the intersection of technology and geopolitics.

Competition to dominate the next generation of technology infrastructure—such as electric vehicles, 5G networks, and quantum computing—is becoming increasingly heated. It’s a high-stakes contest and the countries setting the rules for these technologies could secure significant economic advantage, much as the United States benefited over several decades from pioneering the personal computer and the internet.

At the same time, populist and nationalist leaders have been ascendant in much of the world. These leaders have protectionist and interventionist instincts, and a willingness to buck established norms. It’s a combination which has resulted in the deployment of unconventional tools to favor domestic companies—not just tariffs and trade wars, but company bans and new forms of cyberattacks such as weaponized disinformation.

All of this is leading to the partitioning of both the real world (e.g., trade, labor mobility, and investment) and the digital world (e.g., tech platforms and standards). In this fragmented future, companies once used to operating on a global stage will instead find themselves restricted to operating within the spheres of influence of their home states. (For more, see “Techonomic Cold War” in EY’s Megatrends 2020 report and MIT Technology Review’s “Technonationalism” issue).

Regulators aren’t the only ones fragmenting the digital world. To a large extent, tech companies have been doing it themselves.

Divergent social contracts

Technology platforms are today’s basic infrastructure, increasingly inseparable from the economies and societies in which they exist. These platforms are increasingly where citizens get news, engage in political debate, network professionally, and more.

But while tech companies might seek to create seamless, integrated global platforms, they in fact deliver their offerings in vastly different societies. The social contract of the US is fundamentally different from that of China, Saudi Arabia, or even the European Union (EU). So, governments and regulators in different markets have been moving to recast tech platforms in the image of their social contracts. An early example was China, which developed its own platforms that better align with its social contract than do US-developed offerings.

Meanwhile, the EU has become increasingly active and visible in regulating technology. The most prominent recent example, the General Data Protection Regulation (GDPR), is a precursor of things to come. The GDPR tackles privacy and data protection, but much bigger regulatory issues loom, from the explainability of algorithms to the safety of autonomous vehicles (for more, see EY’s Bridging AI’s trust gaps report). As these technologies come of age and become more prominent in the lives of citizens, expect governments in different regions to become more active in regulating them. Over time, increasingly complex regulatory issues and divergent ideologies will create either separate platforms, or platforms that ostensibly have the same name but deliver fundamentally different user experiences in different geographies.

Walled gardens

Regulators aren’t the only ones fragmenting the digital world. To a large extent, tech companies have been doing it themselves. Walled gardens—closed, self-contained tech platforms or ecosystems—have endured because they are good for the bottom line. They allow companies to extract more value from customers and their data while offering a more curated user experience. In recent months, there has been a growing fragmentation of “over-the-top” media streaming services, with individual studios and networks developing their own subscriber platforms. Instead of streaming platforms that hosted content from a wide variety of creators, platforms will offer exclusive access to their own content—fragmenting the streaming media experience.

Hyperpolarization

It’s no secret that political polarization has been growing at an alarming rate and that social media platforms—while not solely responsible—have been fueling the trend. Filter bubbles in social media platforms have enabled the spread of misinformation, leaving platforms with the tricky and unenviable task of policing the truth.

Worrying as it may be, everything we have seen so far may be nothing compared with what lies ahead. As social media platforms become more active in stemming the flow of misinformation, its purveyors are starting to seek new homes free from policing. In the weeks since the recent US Presidential election, a growing number of Trump voters have started leaving mainstream social media platforms for alternatives such as Parler and Telegram. By the time the next Presidential election rolls around, it’s not farfetched to anticipate that we could see today’s social media filter bubbles replaced by entirely separate social media platforms catering to conservatives and liberals.

At that point, we will have moved from an era of polarization to one of hyperpolarization. For anyone worried social media platforms are doing too little to curb misinformation, imagine how much worse things will be with platforms that don’t even try.

Risks and challenges

The techonomic cold war necessitates a new approach to cybersecurity. “Companies need to guard against not just malware and phishing attacks, but weaponized disinformation,” says Kris Lovejoy, EY’s global consulting cybersecurity leader. “We’ve seen disinformation used to attack elections, but there’s no reason it couldn’t be used to target companies. Most companies today do not have the safeguards and protections they will need in the next frontier of cybersecurity.”

A second challenge is lack of transparency. Commerce thrives on transparency, yet instruments such as company bans are opaque and seemingly arbitrary. To the extent these instruments undermine transparency, they create uncertainty for businesses.

The regional fragmentation of platforms by regulation and divergent social contracts increases the complexity of regulatory compliance and the risk of regulatory noncompliance. Beyond mere compliance, companies face significant brand and reputation risk if consumers perceive platforms to be misaligned with societal values.

A hyperpolarized future will create some of the most significant challenges of all. Losing the last tenuous bridges between our divergent echo chambers would threaten everything from social stability to the future of democracy and the very existence of a shared reality.

This content was produced by EY. It was not written by MIT Technology Review’s editorial staff.

Continue Reading

Trending