A new front in the war against online advertising has opened up with the official release of Apple’s latest mobile operating system, iOS 9. The most contentious feature was the ability for the mobile version of Safari to allow extensions to block ads. Not only was there ad blocking software ready for installation on the day of the launch, but one application, Peace, became the top downloaded paid app on the iTunes App Store. The developer, Marco Arment, justified the need for ad blocking because online ads were engaging in excessive tracking and taking up space, data allowance and generally making the mobile browser experience worse for everyone. But then, barely a day later, Arment pulled the app from the App Store, declaring that he didn’t “feel right” profiting from blocking other peoples’ ability to make money from ads. On Twitter, Arment went from being “immensely proud” of his app hitting the number one spot on iTunes to announcing that he was pulling it from the store. I’ve pulled Peace from the App Store. Why: http://t.co/ir8FMr1qEO — Marco Arment (@marcoarment) September 18, 2015 Although Arment hasn’t elaborated on the precise technical reasons for pulling the app, it seems that the people behind Ghostery, the ad blocking technology that underpinned the app, decided that his implementation was not how they imagined their software being used. Ghostery advocated for users of ad blockers to be “empowered” to decide for themselves what ads and trackers to block rather than the preemptive blocking that had been implemented in the initial version of Peace. The public makes its views crystal clear Since Peace has capitulated, another ad blocker, Crystal has taken the vanguard as the most downloaded paid app on iTunes. Setting aside the arguments for or against online advertising, one thing is absolutely clear: the public do not want advertising to be part of their web browsing experience. So it really doesn’t matter whether web sites see this as the only way that they can find to provide free content. The argument that this is all about bad vs good ads is also clearly not an issue any more. Ad blockers could render all ads obsolete, regardless of their perceived quality. Nobody is going to spend any time worrying about whether they should unblock particular ads. Ghostery may have had laudable ambitions for an honest dialogue about ad tracking and ad quality, but it isn’t a conversation that the general public is interested in having. They simply want a total victory over online advertising. The fallacy of the implied contract of ads for content In the debate about the role of advertising, advocates have argued that it enables the supply of free content. If not for advertising, people would have to pay for the content through subscriptions. So, in essence, there is an “implied contract” between consumers of a site and those providing the free content: web site visitors get access to the content in exchange for being subjected to ads and providing private information through tracking their use of the site. The problem with this argument is that visitors are never given the explicit choice to make that informed decision. The “contract” also conveniently leaves out the fact that, in addition to the loss of privacy and the visual experience of ads, their data allocation is going to be used, web pages will load slower, and overall, their experience of the site will be diminished. The argument for the need for advertising is a weak one. There are plenty of businesses that have shown that people are willing to pay for content if it is packaged such that they can easily see value for money. Netflix and Hulu are examples of services that people are prepared to pay for in exchange for both the content and it being advertising free. In fact, many companies see the annoyance that customers feel with ads as a way of driving them to pay for versions of their apps that get rid of them. The ad wars will continue The war on advertising is far from over. Google, Apple and others are still going to provide ads in the protected environments of their apps, and in Google’s case, its videos. Advertisers will continue to sell ads to clients who will, in turn, hope that they can get their ads in front of the remaining people who don’t use ad blocking software. What the enormous popularity of ad blocking software has shown is that, if there is an “implied contract” for access to content in return for viewing ads, the public clearly is not willing to agree to it. This leaves content providers with a clear message that they will need to find alternative ways of supporting the provision of that content like many other businesses do, without the use of advertising. This article was first published on The Conversation.
In the early days of Web 2.0, the arrival of blogs and similar sites heralded an explosion in the number of news feeds we could follow. But such abundance also came at a price: it became increasingly difficult to keep up with all this content without having to browse at length from site to site every day. In response, a friendly acronym briefly flourished: Rich Site Summary, better known as Really Simple Syndication or RSS. Coupled with a feed reader tool, RSS enables users to quickly scan the headlines and click through only to those stories that pique their interest. Feed readers were never widely popular, though – they remain the domain of news junkies and other power users. Adding all those RSS feeds to track takes time, and often requires some technical skills. And internet user practices have changed. Reader loyalty to specific news sites has declined, and many now receive a constant stream of news from diverse sources through the social filtering activities of their Facebook and Twitter contacts instead. As a result, feed readers have fallen out of fashion. Market leader Google Reader was discontinued in 2013 as a result of its declining user base, and while other tools (such as Feedly) have replaced it, they remain speciality products by comparison. An advertising nightmare News publishers, incidentally, might have breathed a sigh of relief. Scanning the news headlines in a feed reader necessarily reduces revenues from online advertising. Feed reader users click through to the news site (and thus trigger ad impressions) only for a fraction of all headlines. But then, most modern browsers use some form of ad blocking, so even loyal website visitors no longer reliably generate ad impressions. Publisher attempts to overcome the limited returns from online ads have also involved a number of other revenue-raising approaches. These include full or partial content paywalls, or subscription- or advertising-supported apps for smartphones and tablets. Neither of these options represent guaranteed success. Unless the paid content is unique, paywalls tend to drive users to the competition (such as the news sites of public service media). News apps may look great, but often fail to offer the convenience and flexibility of reading news on the web. Plus, users may end up having to switch between half a dozen news apps from different sources. Apple loves simplicity This messy state of affairs looks set to be disrupted by Apple News, a new default app to be provided with the latest version of Apple’s mobile operating system, iOS 9, on September 16. Until Apple’s own Apple News Format standard becomes available, the new app will use RSS feeds to retrieve content from its publishing partners. It will serve, in essence, as a modern take on the feed reader, providing a standardised interface to the latest content from news and other online publishers. But while users of RSS tools can add the feeds they want, Apple News will offer only the content of those publishers it has signed up to the service. This creates a walled garden of news sources, and eventually perhaps an opportunity for Apple to request a payment from publishers seeking to be included. Pre-release information indicates that joining Apple News as a publisher is free, but there is no guarantee it will remain so. For ordinary users interested in mainstream news sources, this may not matter much, but it does position Apple as the ultimate gatekeeper of publishers. Apple will be able to censor content, as it also does in the App Store – and it remains to be seen how the company will exercise that role. Power shift Down the track, the proprietary Apple News Format is set to offer more fully featured news experiences than RSS itself is able to do. In particular, while it remains possible to click through to an original article on a publisher’s site, users can also choose to read it, reformatted to fit their screen, within the app itself. If the majority of users choose to remain within the app, this further reduces the publishers’ takings from on-site ads, of course, but in return also enables them to generate revenue from any in-app advertising they might choose to run. This, however, also means that Apple itself, through its iAd advertising service, positions itself as a quasi-monopolist advertising provider for news content delivered through Apple News – a position of considerable power if Apple News becomes widely popular. Given the popularity of iOS devices, minor publishers might even be tempted to forego the web altogether. They could push their content exclusively to Apple News, in the same way many iOS (and Android) apps are no longer scaled-down versions of desktop software, but stand-alone products designed to utilise the native affordances of these portable hardware platforms. Such exclusive content could become a major drawcard for Apple News, but also makes these publishers entirely dependent on Apple’s platform. Ultimately, Apple News constitutes a powerful play at the online news market, by a company with the resources to pull it off. At the same time, we would do well to remember that Apple’s own apps have at times failed to compete with third-party offerings. Many iOS users still haven’t forgiven the company for the disastrous shortcomings of the original Apple Maps app, for example, and are quickly replacing Apple’s own apps with more appealing alternatives as they upgrade from one iOS version to another. If Apple News can escape that fate and become popular with iOS users, though, it could thoroughly upset the prevailing but unstable balance of relationships between publishers, readers, and advertisers. Axel Bruns, Professor, Creative Industries, Queensland University of Technology This article was originally published on The Conversation. Read the original article.
Uber suffered a legal blow this week when a California judge granted class action status to a lawsuit claiming the car-hailing service treats its drivers like employees, without providing the necessary benefits. Up to 160,000 Uber chauffeurs are now eligible to join the case of three drivers demanding the company pay for health insurance and expenses such as mileage. Some say a ruling against the company could doom the business model of the on-demand or “sharing” economy that Uber, Upwork and TaskRabbit represent. Whatever the outcome, it’s unlikely to reverse the most radical reinvention of work since the rise of industrialization – a massive shift toward self-employment typified by on-demand service apps and enabled by technology. That’s because it’s not a trend driven solely by these tech companies. Workers themselves, especially millennials, are increasingly unwilling to accept traditional roles as cogs in the corporate machinery being told what to do. Today, 34% of the US workforce freelances, a figure that is estimated to reach 50% by 2020. That’s up from the 31% estimated by the Government Accountability Office in a 2006 study. Many aren’t ready for the on-demand economy that Uber represents, such as these taxi drivers in Brazil. Reuters Rise of the gig-based economy In place of the traditional notion of long-term employment and the benefits that came with it, app-based platforms have given birth to the gig-based economy, in which workers create a living through a patchwork of contract jobs. Uber and Lyft connect drivers to riders. TaskRabbit helps someone who wants to remodel a kitchen or fix a broken pipe find a nearby worker with the right skills. Airbnb turns everyone into hotel proprietors, offering their rooms and flats to strangers from anywhere. Thus far, the industries where this transformation has occurred have been fairly low-skilled, but that’s changing. Start-ups Medicast, Axiom and Eden McCallum are now targeting doctors, legal workers and consultants for short-term contract-based work. A 2013 study estimated that almost half of US jobs are at risk of being replaced by a computer within 15 years, signaling most of us may not have a choice but to accept a more tenuous future. Robot suit via www.shutterstock.com The economic term referring to this transformation of how goods and services are produced is “platform capitalism,” in which an app and the engineering behind it bring together customers in neat novel economic ecosystems, cutting out traditional companies. But is the rise of the gig economy a bad thing, as Democratic front-runner Hillary Clinton suggested in July when she promised to “crack down on bosses misclassifying workers as contractors”? While some contend this sweeping change augurs a future of job insecurity, impermanence and inequality, others see it as the culmination of a utopia in which machines will do most of the labor and our workweeks will be short, giving us all more time for leisure and creativity. My recent research into self-organized work practices suggests the truth lies somewhere in between. Traditional hierarchies provide a certain security, but they also curb creativity. A new economy in which we are increasingly masters of our jobs as well as our lives provides opportunities to work for things that matter to us and invent new forms of collaboration with fluid hierarchies. Sharing into the abyss? Critics such as essayist Evgeny Morozov or the philosopher Byung-Chul Han highlight the dark side of this “sharing economy.” Instead of a collaborative commons, they envision the commercialization of intimate life. In this view, the likes of Uber and Airbnb are perverting the initial collaborative nature of their business models – car-sharing and couch-surfing – adding a price and transforming them from shared goods into commercial products. The unspoken assumption is that you have the choice between renting and owning, but “renting” will be the default option for the majority. Idealists take another tack. Part of the on-demand promise is that technology makes it easier to share not only cultural products but also cars, houses, tools or even renewable energy. Add increasing automation to the picture and it invokes a society in which work is no longer the focus. Instead, people spend more of their time in creative and leisurely activities. Less drudge, more time to think. The “New Work movement,” formed by philosopher Frithjof Bergmann in the late 1980s, envisioned such a future, while economist and social theorist Jeremy Rifkin imagines consumers and producers becoming one and the same: prosumers. From self-employment to self-organization Both of these extremes seem to miss the mark. In my view, the most decisive development underlying this discussion is the need for worker self-organization as the artificial wall between work and life dissolves. My recent work has involved studying how the relationship between managers and workers has evolved, from traditional structures that are top-down, with employees doing what they’re told, to newer ones that boast self-managing teams with managers counseling them or even the complete abolition of formal hierarchies of rank. While hierarchy guarantees a certain security and offers a lot of stability, its absence frees us to work more creatively and collaboratively. When we’re our own boss we bear more responsibility, but also more reward. And as we increasingly self-organize alongside others, people start to experiment in various ways, from peer to peer and open source projects to social entrepreneurship initiatives, bartering circles and new forms of lending. The toughest tension for workers will be how best to balance private and work-related demands as they are increasingly interwoven. Avoiding the pitfalls of platform capitalism Another risk is that we will become walled in by the platform capitalism being built by Uber and TaskRabbit but also Google, Amazon and Apple, in which companies control their respective ecosystems. Thus, our livelihoods remain dependent on them, like in the old model, just without the benefits workers have fought for many decades. In his recent book “Postcapitalism,” Paul Mason eloquently puts it like this: “the main contradiction today is between the possibility of free, abundant goods and information; and a system of monopolies, banks and governments trying to keep things private, scarce and commercial.” To avoid this fate, it’s essential to create sharing and on-demand platforms that follow a non-market rationale, such as through open source technologies and nonprofit foundations, to avoid profit overriding all other considerations. The development of the operating system Linux and web browser Firefox are examples of the possibility and merits of these models. Between hell and heaven Millennials grew up in the midst of the birth of a new human age, with all the world’s knowledge at their fingertips. As they take over the workforce, the traditional hierarchies that have long dictated work will continue to crumble. Socialized into the participatory world of the web, millennials prefer to self-organize in a networked way using readily available communication technology, without bosses dictating goals and deadlines. But this doesn’t mean we’ll all be contractors. Frederic Laloux and Gary Hamel have shown in their impressive research that a surprisingly broad range of companies have already acknowledged these realities. Amazon-owned online shoe retailer Zappos, computer game designer Valve and tomato-processor Morning Star, for example, have all abolished permanent managers and handed their responsibilities over to self-managing teams. Without job titles, team members flexibly adapt their roles as needed. Mastering this new way of working takes us through different networks and identities and requires the capacity to organize oneself and others as well as to adapt to fluid hierarchies. As such, it may be the the fulfillment of Peter Drucker’s organizational vision: … in which every man sees himself as a “manager” and accepts for himself the full burden of what is basically managerial responsibility: responsibility for his own job and work group, for his contribution to the performance and results of the entire organization, and for the social tasks of the work community. Bernhard Resch, Researcher in Organizational Politics, University of St.Gallen This article was originally published on The Conversation. Read the original article.
Apple is about to open a new front in the ongoing war against online advertising. The new version of its mobile operating system, iOS 9, will support ad blocking by Safari, its mobile web browser. A study by Adobe and pro-advertising company PageFair finds that the popularity of ad blocking extensions in desktop web browsers is responsible for US$22 billion in lost revenue to the websites that host ads. They estimate that there are now 198 million users worldwide actively blocking ads. Amongst 400 users surveyed by the report’s authors, the main reasons cited for using ad blocking software were avoiding privacy abuse by targeted advertising as well as the number of ads encountered when browsing. A typical message from a website about the use of any ad blocking. TheGuardian.com screen grab The practice of trying to guilt users into switching off their ad blocking software when visiting sites doesn’t appear to be working and the display of messages to ad blocking users by web sites has diminished. Ad blocking apps that will be available for Safari on iOS 9 are already being made available to beta testers. One such app, Crystal, not only blocks ads but experiments by the developer has shown that using this ad blocking software speeds up web pages loading in the browser by four times. This also results in a significant reduction in data being used, which is significant on a mobile device using cellular data. Another ad blocking app Purify that is also in beta testing appears to also block ads on YouTube. The stand out, and that’s precisely why so many people block them. Pascale Kinchen Douglas/Flickr, CC BY-SA Ad blocking on mobile is not completely new Ad blocking has been available for some time on Android for users of the Firefox mobile browser and for Google Chrome. In the case of blocking ads by Google Chrome, an app needs to be installed which is not from the Google Play app store. Ad blocking has also been available on Apple devices but have worked by blocking access to certain domains that serve up the ads. AdBlock for example works by pretending to be a virtual private network (VPN) connection and filters out access to specific sites. This of course only works if the list of sites to block is up-to-date. It also doesn’t allow for “whitelists”, which are sites that are allowed through because they are deemed “acceptable”. However, the move by Apple is going to boost ad blocking on mobile dramatically because it is going to make the process of doing so that much easier. This has advertisers, and sites that make money from advertising, increasingly worried because it raises their costs in terms of creating ads that are less intrusive and deemed more acceptable (although this may still not convince the public to view them). Apple’s iOS 9 is due to be released later this year and will include content blocking. Apple For Apple, though, the move to allow ad blocking gives iPhone users a better browsing experience at no cost to Apple. Apple makes no money from online advertising through mobile browsing. And, of course, its own ads that are served up through apps are unaffected by ad blocking software. As a bonus to Apple, the company who is most affected by ads being blocked is Google, which derives 90% of its revenue from advertising. Apple is able to increase the level of privacy it offers its customers without directly getting involved itself and risking annoying companies that rely on revenues from advertising. The advertisers' dilemma Many ads can be deliberately deceptive. Create Meme It is hard to feel sorry for the advertisers and the sites that resort to displaying targeted invasive ads, such as those sold by Google, Facebook, Yahoo and others. These ads are designed to target individuals based on information gathered about them as they use the internet. So not only are they annoying, but they are exploiting people’s privacy. Adding insult to injury, the inclusion of ads slows down web page loads and potentially ends up costing end-users money by using their data allocation. The argument that content providers are only able to provide content based on the exploitation of their visitors is not a good one because it implies that those visitors signed up to an agreement to view ads in exchange for the content. Of course, users generally do no such thing. And given the explicit choice, might easily opt simply not to visit the site. Most users don’t necessarily mind being provided with information that allows them to make a reasoned choice about a product when they have decided to buy it. But advertising that tries to persuade a consumer to buy something they weren’t considering buying is a different matter. Once advertisers do more of the former and less of the latter, perhaps ad blocking will no longer be necessary. David Glance is Director of UWA Centre for Software Practice at University of Western Australia This article was originally published on The Conversation. Read the original article.
Windows 10, it seems, is proving a hit with both the public and the technology press after its release last week. After two days, it had been installed on 67 million PCs. Of course, sceptics may argue that this may have simply been a reflection of how much people disliked Windows 8 and the fact that that the upgrade was free. For others, though, it is the very fact that the upgrade is free that has them concerned that Microsoft has adopted a new, “freemium” model for making money from its operating system. They argue that, while Apple can make its upgrades free because it makes its money from the hardware it sells, Microsoft will have to find some way to make money from doing the same with its software. Given that there are only a few ways of doing this, it seems that Microsoft has taken a shotgun approach and adopted them all. The question is whether it’s really ‘free’. Microsoft Free upgrade Chris Capossela, Microsoft’s Chief Marketing Officer, has declared that Microsoft’s strategy is to “acquire, engage, enlist and monetise”. In other words, get people using the platform and then sell them other things like apps from the Microsoft App Store. The trouble is, that isn’t the only strategy that Microsoft is taking. Microsoft is employing a unique “advertising ID” that is assigned to a user when Windows 10 is installed. This is used to target personalised ads at the user. These ads will show up whilst using the web, and even in games that have been downloaded from the Microsoft App Store. In fact, the game where this grabbed most attention was Microsoft’s Solitaire, where users are shown video ads unless they are prepared to pay a US$9.99 a year subscription fee. The advertising ID, along with a range of information about the user, can be used to target ads. The information that Microsoft will use includes: […] current location, search query, or the content you are viewing. […] likely interests or other information that we learn about you over time using demographic data, search queries, interests and favorites, usage data, and location data. It wasn’t long ago that Microsoft was attacking Google for similar features it now includes in Windows 10. Internet Archicve It was not that long ago that Microsoft attacked Google for doing exactly this to its customers. What Microsoft is prepared to share, though, doesn’t stop at the data it uses for advertising. Although it maintains that it won’t use personal communications, emails, photos, videos and files for advertising, it can and will share this information with third parties for a range of other reasons. The most explicit of these reasons is sharing data in order to “comply with applicable law or respond to valid legal process, including from law enforcement or other government agencies”. In other words, if a government or security agency asks for it, Microsoft will hand it over. Meaningful transparency In June, Horacio Gutiérrez, Deputy General Counsel & Corporate Vice President of Legal and Corporate Affairs at Microsoft, made a commitment to “providing a singular, straightforward resource for understanding Microsoft’s commitments for protecting individual privacy with these services”. On the Microsoft blog, he stated: In a world of more personalized computing, customers need meaningful transparency and privacy protections. And those aren’t possible unless we get the basics right. For consumer services, that starts with clear terms and policies that both respect individual privacy and don’t require a law degree to read. This sits in contrast to Microsoft’s privacy statement, which is a 38 page, 17,000 word document. This suggests that Microsoft really didn’t want to make the basic issues of its implementation absolutely clear to users. Likewise, the settings that allow a user to control all aspects of privacy in Windows 10 itself are spread over 13 separate screens. Also buried in the privacy statement is the types of data Cortana – Microsoft’s answer to Apple’s Siri or Google Now – uses. This includes: […] device location, data from your calendar, the apps you use, data from your emails and text messages, who you call, your contacts and how often you interact with them on your device. Cortana also learns about you by collecting data about how you use your device and other Microsoft services, such as your music, alarm settings, whether the lock screen is on, what you view and purchase, your browse and Bing search history, and more. Note that the “and more” statement basically covers everything that you do on a device. Nothing, in principle, is excluded. Privacy by default It is very difficult to trust any company that does not take a “security and privacy by default” approach to its products, and then makes it deliberately difficult to actually change settings in order to implement a user’s preferences for privacy settings. This has manifested itself in another Windows 10 feature called WiFi Sense that has had even experts confused about the default settings and its potential to be a security hole. WiFi Sense allows a Windows 10 user to share access to their WiFi with their friends and contacts on Facebook, Skype and Outlook. The confusion has arisen because some of the settings are on by default, even though a user needs to explicitly choose a network to share and initiate the process. Again, Microsoft has taken an approach in which the specific privacy and security dangers are hidden in a single setting. There is no way to possibly vet who, amongst several hundred contacts, you really wanted to share your network with. There are steps users can take to mitigate the worst of the privacy issues with Windows 10, and these are highly recommended. Microsoft should have allowed users to pay a regular fee for the product in exchange for a guarantee of the levels of privacy its users deserve. David Glance is Director of UWA Centre for Software Practice at University of Western Australia. This article was originally published on The Conversation. Read the original article.
Last week some old technology reappeared, refreshed for another try at getting it right this time around. Microsoft released Windows 10 and trumpeted as its main feature the return of the Start menu. This had been infamously axed in the previous version, Windows 8. Windows 10 also brings back the desktop as the main interface, relegating Windows 8 live tiles to an extension of the Start menu. The user interface is also a major reversal of the attempt of the previous version of windows to focus on being a mobile platform supporting touch. Now that Microsoft has all but given up on its mobile phone, and its tablet doesn’t even get mentioned in the global sales leader board, the PC is still really where it dominates. Touch screens on PCs never became a thing and so supporting the traditional keyboard and mouse/trackpad arrangement makes much more sense. The other technology that Microsoft effectively killed off – or at least will try never in future speak its name – was its browser, Internet Explorer. Windows 10 introduces Microsoft Edge, a leaner, stripped down version of Internet Explorer. Internet Explorer has become, possibly unfairly, the most universally disliked browser by web developers. This was largely due to the fact that versions of the browser were tied to updates of Windows. Supporting Internet Explorer meant supporting potentially old and outdated versions long after other browsers like Chrome and Firefox had moved on and come to support new standards and features. In fact, the dependency of browser to operating system led companies to become tied to a particular version of Windows because of their reliance on particular versions of Internet Explorer to run their corporate applications. The significance of Microsoft’s move to Edge is that a range of technologies that were once the future of running software in the browser, have disappeared as well. Gone is support for Silverlight, Microsoft’s version of Flash, and a technology called ActiveX, a much earlier attempt by Microsoft to allow for sophisticated applications to be run in the browser. ActiveX, in particular, introduced security concerns and as a consequence was never really widely adopted. Their absence is unlikely to be missed. Right now, users who have rushed to upgrade will be getting the first of many bug fixes as the inevitable problems get ironed out. For companies still on Windows 7, the familiarity of Windows 10 may make it a more tempting option to upgrade, but it is not clear that there is enough of a compelling reason to do so. In the meantime of course, the PC market continues to decline, with more users increasingly relying on mobile devices instead. Google Glass relaunched as a business tool Google has apparently relaunched its Glass wearable computer, but this time aiming it at the business world and not consumers. Google is hoping that if nobody actually sees anyone wearing the devices, it will not attract the same level of “ridicule” and concerns about privacy that the original consumer version did. The new version of Glass has a faster processor and wireless and a longer battery life. It also allows the glasses to fold up which the first version didn’t. Whilst Google’s move may make the wearable attract less negative publicity, it is still hard to see what the particular benefit of Google Glass will ultimately be. The user interface’s limitations mean that it is not a great device to consume content from and its other function as a hands-free video streaming device would be much better handled by something that was portable and worn attached to clothing rather than a person’s face. By limiting the market in this way, it is also hard to imagine that it will actually be much of a revenue generator for Google. David Glance is Director of UWA Centre for Software Practice at University of Western Australia. This article was originally published on The Conversation. Read the original article.
Microsoft’s aim to make Windows 10 run on anything is key to its strategy of reasserting its dominance. Seemingly unassailable in the 1990s, Microsoft’s position has in many markets been eaten away by the explosive growth of phones and tablets, devices in which the firm has made little impact. To run Windows 10 on everything, Microsoft is opening up. Rather than requiring Office users to run Windows, now Office365 is available for Android and Apple iOS mobile devices. A version of Visual Studio, Microsoft’s key application for programmers writing Windows software, now runs on Mac OS or Linux operating systems. Likewise, with tools released by Microsoft developers can tweak their Android and iOS apps so that they run on Windows. The aim is to allow developers to create, with ease, the holy grail of a universal app that runs on anything. For a firm that has been unflinching in taking every opportunity to lock users into its platform, just as with Apple and many other tech firms, this is a major change of tack. From direct to indirect revenue So why is Microsoft trying to become a general purpose, broadly compatible platform? Windows' share of the operating system market has fallen steadily from 90% to 70% to 40%, depending on which survey you believe. This reflects customers moving to mobile, where the Windows Phone holds a mere 3% market share. In comparison Microsoft’s cloud infrastructure platform Azure, Office 365 and its Xbox games console have all experienced rising fortunes. Lumbered with a heritage of Windows PCs in a falling market, Microsoft’s strategy is to move its services – and so its users – inexorably toward the cloud. This divides into two necessary steps. First, for software developed for Microsoft products to run on all of them – write once, run on everything. As it is there are several different Microsoft platforms (Win32, WinRT, WinCE, Windows Phone) with various incompatibilities. This makes sense, for a uniform user experience and also to maximise revenue potential from reaching as many possible devices. Second, to implement a universal approach so that code runs on other operating systems other than Windows. This has historically been fraught, with differences in approach to communicating, with hardware and processor architecture making it difficult. In recent years, however, improving virtualisation has made it much easier to run code across platforms. It will be interesting to see whether competitors such as Google and Apple will follow suit, or further enshrine their products into tightly coupled, closed ecosystems. Platform exclusivity is no longer the way to attract and hold customers; instead the appeal is the applications and services that run on them. For Microsoft, it lies in subscriptions to Office365 and Xbox Gold, in-app and in-game purchases, downloadable video, books and other revenue streams – so it makes sense for Microsoft to ensure these largely cloud-based services are accessible from operating systems other than just their own. The Windows family tree … it’s complicated. Kristiyan Bogdanov, CC BY-SA Platform vs services Is there any longer any value in buying into a single service provider? Consider smartphones from Samsung, Google, Apple and Microsoft: prices may differ, but the functionality is much the same. The element of difference is the value of wearables and internet of things devices (for example, Apple Watch), the devices they connect with (for example, an iPhone), the size of their user communities, and the network effect. From watches to fitness bands to internet fridges, the benefits lie in how devices are interconnected and work together. This is a truly radical concept that demonstrates digital technology is driving a new economic model, with value associated with “in-the-moment” services when walking about, in the car, or at work. It’s this direction that Microsoft is aiming for with Windows 10, focusing on the next big thing that will drive the digital economy. The revolution will be multi-platform I predict that we will see tech firms try to grow ecosystems of sensors and services running on mobile devices, either tied to a specific platform or by driving traffic directly to their cloud infrastructure. Apple has already moved into the mobile health app market and connected home market. Google is moving in alongside manufacturers such as Intel, ARM and others. An interesting illustration of this effect is the growth of digital payments – with Apple, Facebook and others seeking ways to create revenue from the traffic passing through their ecosystems. However, the problem is that no single supplier like Google, Apple, Microsoft or internet services such as Facebook or Amazon can hope to cover all the requirements of the internet of things, which is predicted to scale to over 50 billion devices worth US$7 trillion in five years. As we become more enmeshed with our devices, wearables and sensors, demand will rise for services driven by the personal data they create. Through “Windows 10 on everything”, Microsoft hopes to leverage not just the users of its own ecosystem, but those of its competitors too. Mark Skilton is Professor of Practice at University of Warwick. This article was originally published on The Conversation. Read the original article.
The latest version of Microsoft’s Windows operating system will begin rolling out from Wednesday (July 29). And remarkably, Windows 10 will be offered as a free upgrade to those users who already have Windows 7 and 8.1 installed. That the upgrade is free is an interesting move and comes off the back of much criticism over Windows 8. Interestingly, the software giant has also skipped over any planned version 9 of Windows. So what does this mean for Microsoft and the 1.5 billion people it says use Windows every day? Can the company restore some of the consumer and user confidence it has lost in recent years? Under Satya Nadella’s leadership, Microsoft is transforming itself into a “productivity and platforms company”. This is a bold re-invention of the company as it seeks to secure its future in a market moving steadily towards cloud-based services and mobile devices powered by Google’s Android and Apple’s iOS. Nadella sees it as necessity to broaden the company’s scope of operations beyond its current family of products and conventional modes of delivery. The market does not leave him with much choice if the company is to stay in the game, if not be a leader. After Windows 10 it’s just Windows For decades, the latest release of Windows has been a major event in itself. But that is set to end. Windows 10 will be the last numbered version of the operating system. After Windows 10, it will simply be known as Windows. And you will get your updates incrementally from from the cloud via a subscription service. Many Windows users will have noticed the upgrade notification appearing on their taskbar. Microsoft In what it is calling a “platform convergence strategy”, Microsoft is creating a unified operating environment for phones, tablets, ultrabooks, laptops, desktop computers and Xboxes. All will be integrated by Windows 10, and increasingly so with the later Windows. The platform convergence strategy allows the creation of universal applications that can run on any platform with Windows 10. Surprisingly, applications that have been developed to run on Android and iOS devices will also be able to run on Windows 10, albeit once they have been converted to make them compatible. Still, this will open up a vast number of potential applications to run across Windows platforms. Focus on gaming Microsoft’s acquisition last year of the hit game Minecraft for US$2.5 billion is a measure of how seriously Nadella and his strategists take mobile gaming. Minecraft is a hugely popular open world game that gives players the freedom to create create and manipulate an on-line world made of Lego-like blocks. The move will establish Microsoft in the booming world of mobile games as well as further popularising the Xbox gaming console. But the question on many people’s minds is whether the personal computer itself is dead, and along with it Microsoft? It’s not the first time we have heard such dire predictions. It is true that PCs are today part of a more complicated personal computing environment, but it is a stretch to declare the PC dead. There is only so much you can do with a phone or a tablet. For serious work or fun, a full-spec laptop or desktop is still the machine of choice and will remain so. For example, I am writing this article using a laptop. Microsoft’s latest upgrade of Windows will be free for many users. Flickr/Eric Li, CC BY-NC The new digital economy The Internet of Things is expanding, with embedded sensors and data gatherers becoming pervasive. Open platforms and operating environments that feed data into the cloud and allow people to derive value will be an important part of the new digital economy. With traditional jobs under threat from automation and artificial intelligence, imagination and creativity will be more important than ever. Microsoft’s strategy to diversify and integrate its platform offerings and move its services to the cloud while opening itself up to using its competitor’s apps would seem to be a bold but rational response to the current challenges; one that stands a good chance of succeeding. There will no doubt be loud complaints from those who claim to speak for all of us. But in the end if a computing environment delivers value and allows people to live their lives as they please, then that platform is likely to succeed, particularly when it has the muscle and know-how of a well-established company behind it. How Google and Apple respond will be very interesting, but competition is a good thing. David Tuffley is Lecturer in Applied Ethics and Socio-Technical Studies, School of ICT, at Griffith University. This article was originally published on The Conversation. Read the original article.
This week brought news of the challenge that Apple faces with dwindling sales of the Apple Watch. Microsoft CEO Satya Nadella also pulled the plug on its smartphone business purchased from Nokia with the announcement of 7,800 job layoffs and writing off US$7.6 billion in assets. Another beleaguered CEO was Reddit’s Ellen Pao. After Reddit’s shutdown earlier this week, a petition calling for her resignation passed the 212,000 signature mark. Apple Watch sales reportedly fall sharply in the US This week Slice Intelligence reported that Apple Watch sales in the US had dropped to 15% of their levels in April, with only 5,000 watches selling per day. Selling large numbers of the Apple Watch was always going to be a big ask. Even for something that actually does function better than its competitors in this space, the price of the Apple Watch and its accessories, is going to be a disincentive for many. The generalised adoption of the smartwatch as a technological category will rely on changing behaviours that have become ingrained over the past 20 years as we have adapted to using mobile phones. The last 10 years has seen smartphones become a real general computing device on which we are prepared to spend a great deal of time. Apple has done a good job with the interface on its watch, but the small screen is always going to limit its capabilities. It will take take time before people decide what can be done on the watch and what they need to get the phone out for and ultimately that will determine the value they are likely to place on having that type of functionality on their wrist. It is early days, however, and this is only version 1 of the watch. Until Apple release worldwide sales figures, it isn’t going to be possible to decide whether this has been a financial success from Apple’s perspective. (Ed's note: AppleInsider has a good piece on the questionable nature of the Slice Intelligence research. In short: the stats also show that the Apple Watch is the most succesful smart watch by a considerbale margin.) Microsoft repeats history and writes off its smartphone business In what is the final act of the tragedy that has been Nokia’s decimation, Microsoft CEO Satya Nadella announced that Microsoft would be laying off a further 7,800 staff and writing down US$7.6 billion in assets associated with its smartphone business. It could be argued that Nokia, like BlackBerry, would have struggled to survive in the smartphone business in any event. It had already chosen the wrong side by deciding to focus on using Microsoft’s operating system for its phones instead of embracing Android. Former Microsoft CEO Steve Ballmer made an equally bad decision to buy the company in order to stop Nokia from changing its mind and abandoning Windows and adopting rival Google’s platform. Microsoft has a history of making poor acquisitions. In 2012 it booked a US$6.2 billion charge for its acquisition of digital marketing company aQuantive. Driven again by wanting to compete against Google in the online advertising space, Microsoft was unable to make its online business profitable. A year later, Microsoft took a US$900 million charge on poor sales of the Surface RT a line of devices that lost Microsoft US$2 billion in the first two years of sales. If nothing else, the experience with Nokia should have finally convinced Microsoft that it is not ever really going to succeed as a devices company. For the moment, this is what CEO Satya Nadella seems also to have accepted. It is a pity that so many people should have had to lose their jobs for Microsoft to learn that lesson. Reddit CEO Ellen (Chairman) Pao clings on to the role The shutdown of parts of Reddit earlier this week eventually came to an end. But a belated apology from CEO Ellen Pao hasn’t satisfied the moderators who took this action. Two moderators involved in the earlier action wrote in the NY Times that the company leaders still hadn’t fully explained their actions in removing staffer Victoria Taylor, a move that triggered the users’ protest. It seems a very large number of the Reddit community are also still unhappy with the CEO’s response to this crisis, and a petition asking for her to stand down has passed the 212,000 signatures mark. Ironically, the skills a CEO would need to possess to be able to recognise when they should go are similar to those that would have made them a good CEO in the first place. Bad leaders, by definition, aren’t able to take the the best decision for the sake of a company and leave when they should. So far, nobody in a position to tell Pao that it is time to move on has surfaced. In Reddit’s case, and also an indicator of poor governance, there seem to be only two board members. Alexis Ohanian, a founder of the company and arguably not any better at handling the company than Pao, and Samuel Altman, who is involved with startup incubator Y Combinator. In the absence of a board to manage the CEO, it will be left to Reddit’s users to decide if it is worth sticking around to find out what she will eventually do. David Glance is Director of UWA Centre for Software Practice at University of Western Australia. This article was originally published on The Conversation. Read the original article.
Technolog is the first in a (mostly) weekly wrap up of the highlights of the technology news and events of the week. These are the tech stories that hopefully are the most relevant to knowing what is likely to have an impact on our daily lives. Former CEO of Nokia, Stephen Elop is fired from Microsoft Microsoft CEO Satya Nadella, this week announced the departure of ex-Nokia CEO Stephen Elop and several other Microsoft executives in a reorganisation of the company that saw the creation of three groups; Windows and Devices, Cloud and Enterprise, and Applications and Services. Whilst at Nokia, Elop arguably destroyed any chances of Nokia remaining relevant in the smartphone world by insisting that all of Nokia’s smartphones move to support the Windows platform instead of Android. Nokia’s death blow came when Elop steered the sale of the smartphone business to Microsoft where Elop then presided over its inexorable journey into obsolescence and the sacking of most of the former Nokia staff. The reorganisation is a good one for Microsoft and will allow them to concentrate on their core strength, namely enterprise software. They are also having increasing success with the move of this software to the cloud. Security Password Manager provider LastPass is hacked Users of the password manager LastPass were advised this week to change their master password after hackers stole users' details including emails from LastPass servers. The hackers did not compromise users’ stored password information itself. It seems unlikely that they will be able to crack the stolen encrypted master passwords with the information they obtained because of the particular security measures LastPass uses. The hack of LastPass showed that even though almost anything can be hacked, how you handle customers afterwards can make all of the difference. LastPass’s fast response and disclosure was praised along with the extensive security measures that they had in place to protect user data in the event of this type of occurrence. Using a password manager is still seen as preferable to using the same password for every account or keeping passwords in Notepad on your computer. Finally, using two-factor authentication with the password manager would still have protected users even if their passwords were compromised and so is still seen as a must with this type of software. 600 million Samsung Phones vulnerable to being hijacked A security researcher this week demonstrated a vulnerability that exists in Samsung phones which allows hackers to send malicious code to install and run on those phones. The vulnerability is specific to Samsung phones, and comes from the way Samsung updates the SwiftKey software embedded in its keyboard on the phone. These updates are not encrypted and Samsung allows code downloaded in this way to get around the normal protections of the Android operating system. Although Samsung has issued an update for this problem, it will depend on phone carriers to actually push it out to customers, and they are typically very slow at doing that. In the meantime, there is little users can do to protect themselves, other than not connect to unprotected Wifi, and this may be a good time for them to consider switching to another brand of Android phone? E3 Game Expo 2015 E3 is the biggest electronic games expo for the games industry held each year in Los Angeles. Upcoming releases of games are announced at the expo along with new games hardware and accessories. There were simply too many announcements to summarise here, but the remake of the first-person shooter game Doom, although stunning in its detail, seemed gratuitously graphic and violent. Another anticipated release was the action role-playing open world game, Fallout 4. Set in post-nuclear apocalypse Boston, the game player can adopt a male or female role, enters a fallout shelter and after 200 years have passed, emerges to explore the world above. What will be interesting about this game is the addition of a device (Pip-Boy wrist mounted computer) that will hold a mobile phone and strap to the wrist of the player, allowing them to interact with the game through that device. Other top upcoming games include Star Wars: Battlefront, Batman: Arkham Knight, Final Fantasy XV and Assassin’s Creed Syndicate. On the console side, Microsoft announced that the Xbox One will support streaming of games to a Windows 10 PC where it will also be able to support Facebook’s Oculus Rift virtual reality headset. Microsoft’s also showed off their own augmented reality headset Hololens being used with Minecraft. The video highlights some of the amazing potential of this technology that will be available in the not too distant future. This article was originally published at The Conversation.
Australian app developer Shifty Jelly was one of six companies honoured in Google’s Material Design Awards last week for its Pocket Casts podcasting app. The award was announced last week at the Material Now session of the Google I/O developer conference, with Pocket Casts taking out the ‘Seamless Browsing’ category. Other award winners included Tumblr and the New York Times. The six award winners also beat out a number of big-name apps including Tumblr, Evernote, Indiegogo, Lyft and Buzzfeed. The awards honour well-designed Android apps that apply Google’s Material Design guidelines, with the nominees honoured in a best-in-class Android design section of the Google Play app store. The Material Design guidelines were introduced by the tech giant at the Google I/O conference in 2014, as part of Android 5.0 Lollipop. Aside from Android, the guidelines are also used to inform Google’s design for apps, the Chrome web browser and online services. Other key announcements from Google I/O included a new IoT platform called Brillo, a virtual reality platform called Jump, a photo sharing service called Google Photos, its Android Pay mobile payments service, and the latest version of the Android operating system, known as Android M. This article originally appeared on SmartCompany. Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Brillo, a cut-down version of Android aimed at embedded devices, and Weave, a framework designed to compete against Apple’s HomeKit API, were among the key announcements from the Google I/O developer conference this year. Other key announcements from the tech giant include a photo sharing service and app designed to compete against Flickr called Google Photos, a series of major virtual reality announcements, and the latest version of the Android operating system, which is known as Android M. Clinicloud founder Hon Weng Chong told StartupSmart that while Brillo and Weave are aimed more at the home automation end of IoT rather than medtech devices, a key issue for any embedded device is the trade-off between ease of programming and memory use. “Right now, we’re not even using Embedded Linux. We’re working on bare metal in Assembler,” Chong says. “There’s always a trade-off. When you use Windows 10 or Embedded Android, you need to have extra memory and more processing power, and that comes at a cost. So the trade-off is between the cost versus how easy it is to program. “Certainly, it will be good for new startups that are just prototyping their ideas. But when it comes to the nitty-gritty of getting a product ready, you need to do a bit more work. I’m not sure the trade-offs and chip costs are something Microsoft and Google have really taken into consideration.” Assembler still the only way to go The sentiment is shared by Procept products and marketing manager Rob Crowder, who also serves as the managing director of Smash Wearables. He told StartupSmart Assembler is the only way to go right now, assuming you can write apps that basic. Crowder also says multi-purpose wearable devices such as Android Wear smartwatches and the Apple Watch still lack the precision needed to do something like accurately measure a player’s tennis swing, as single-use wearables such as Smash Wearables’ device does. “Right now, if we asked a wearable to do everything the Apple Watch does, and at the same time have the precision we need it to, you’d probably need a battery the size of a backpack, and no one would buy it. “Our own wearables, that are useful for some very specific purpose, have a shelf life of somewhere around three to five years. At some time, someone will come up with a general device that’s precise enough with a battery good enough for tennis. But right now, there’s still a trade-off. How hard you ask it to work led us to develop our own wearable.” Concerns around Brillo’s memory use David Soutar, co-founder and chief executive at Wattcost, says a lot of embedded devices couldn’t support the memory use Brillo requires. However, not all startups are as pessimistic. Oomi vice president Chris Hall says he intends to take a close look at Google’s IoT ecosystem – as long as it doesn’t compromise the user experience for Apple and Windows users. “At our end, we’ve encouraged an open ecosystem. What’s been happening in the IoT space is a lot of fragmentation. So we’ve tried to be as platform-agnostic as possible,” Hall says. “Oomi Touch integrates with Apple HomeKit to give full value to iOS users. We’re also a partner in Samsung’s Tizen Alliance. “On the Google side, the big talk last year Nest Thread. However with Weave, there seems to be a distancing away from Nest and on the hardware side, we’ll take a close look at what the hardware offers.” Great to have an Apple HomeKit rival LEAPIN Digital Keys cofounder Steve Dunn says he thinks it’s great that Google have finally stepped in and set a new IOT platform with Brillo and Weave to rival Apple's HomeKit. “It means that we can now more easily interface our smart lock products with other IOT products without having to go through a lengthy negotiation exercise with all the different companies with all their different IOT products one at a time. “We’ve been talking with some overseas telcos, other startups, security product manufacturers, and even insurance companies about building interfaces, and pulling together smart home products and kits with our smart locks. But up until now it feels like we've been going on dates with all these other companies, talking and looking at each other’s products, discussing taking action, but not actually doing anything. This Project Brillo announcement by Google levels the playing field now, so it means that the best products can more easily come together and offer more choices for the consumer. “Up until now, it’s only been the loudest voices and best negotiators (mostly in the US) and not necessarily the best products, which are coming together because there hasn't been one primary platform for IoT products… Hopefully, Brillo will enable the smaller startups like us with great IoT products to get all the interfaces done, and get their products out there in front of consumers easier than they do now.” Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
On one level, the European Commission’s argument with Google is unsurprising. The EC’s commissioner for competition, Margrethe Vestager’s job is to investigate possible breaches of EU competition law. That is exactly what she is doing with her official complaints against Google’s use of its Google Shopping service. Equally unsurprising, is the investigation of Google’s other possible breaches of its monopoly position with how it controls the use of its mobile operating system, Android. One should also set aside the melodrama that accompanies such cases. News reports of the case have highlighted calls for the break up of Google as suggested by the European Parliament last year. The reports have also focused on the possible massive Euro 6 billion fine Google faces if the antitrust complaints are upheld. Finally, there is the fact that the case is the result of a conspiracy of competitors, led by Microsoft. All of the drama however, masks what is going to be a protracted process that could take years, during which time the entire landscape that is being fought over could have changed, not once, but several times. Google themselves were at pains to respond to the accusations that they were harming consumers by pointing out that search was quickly being superseded, and that: “People are increasingly using social sites like Facebook, Pinterest and Twitter to find recommendations, such as where to eat, which movies to watch or how to decorate their homes” Whilst it may be true that Google has a monopoly on search of the Internet as a whole, that is certainly not the case when it comes to the “social web” which is well and truly dominated by Facebook, Instagram, Twitter and others. Likewise, Google may have dominated advertising on the desktop but that is increasingly not the case on mobile. Law and trade policy operate on timescales that are always going to significantly lag technological change. As if understanding the full impact of an existing technology on consumers and competition was already not challenging enough, attempting to do this in the context of what will happen in even a few years is almost impossible. In fact, even determining monopoly in a technological market is not always straightforward. For example, even though Android controls over 80% of the world’s smartphone market compared to Apple’s share of 15%, in terms of mobile e-commerce, users of Apple’s mobile devices account for 5 times the value of Android users. For all of the EC’s past actions against Microsoft, they were irrelevant in shaping what eventually happened in the market. The actions had no effect on Microsoft’s behaviours, and came as little-to-no benefit to consumers. As with the EC’s complaint against Android, the fact that software comes pre-installed does nothing to preclude a consumer’s ability to run alternative software. The EC’s objections against Google again raises the more general issue that it is a futile exercise to use antitrust law to retrospectively try and influence the way the technology companies, and the digital economy as a whole, work. As with copyright and patents, the law has simply not been able to adapt and keep pace with the disruptive change brought about by technology and society at a global scale. It has led policy and law makers, and companies not wanting to adapt to change, to focus on the past and act as a break, rather than an enabler, of progress. It would be a far better use of the EC’s time and resources if their energies were spent creating policy that enabled the digital economy that they profess to want rather than keeping their vision of it restricted to a time that has long since passed. This article was originally published on The Conversation. Read the original article.
“It’ll never work.” “It’s not trustworthy.” “It’s not fair.” “It’s illegal.” For the last 20 years, this sequence of responses has become quite common to those who watch the internet and the creative companies it’s spawned. Incumbent businesses confronted by these digital disrupters resist changes to the status quo for understandable reasons: they were winning at a game they had mastered. When the game changes, efforts to strengthen the previous barriers to entry are standard procedure. Microsoft did it to Linux (an open-source operating system), the Bell companies fought voice service competition from cable-TV triple-plays and startups like Vonage, and record labels defeated Napster and then proceeded to sue their own customers once they realized peer-to-peer file sharing could not be shut down at a central locus. More recently, Airbnb and Uber have inspired a new generation of incumbents to play these same cards. Both companies have grown at phenomenal rates over short lifetimes, both rely on not owning the core asset (sleeping rooms in the former case, cars in the latter), and both have attracted sky-high equity valuations. Because of these traits, they have also attracted the attention of asset-owners who formerly profited from scarcity and thus are threatened by the lower prices brought by the asset-light coordination model of these two disrupters. This threat has prompted the asset-owners to erect barriers to entry wherever they can, often in the guise of more regulation. Just this month, Airbnb faced a proposal in San Francisco that would place more restrictions on rentals, while Uber has inspired fierce opposition to a bill that would allow its entrance into the Nevada (read “deliberately scarce Las Vegas taxi”) market. More interestingly, New York hotel interests are fighting Airbnb’s efforts to pay lodging taxes, in part because doing so would seem to legitimize the new competitor. In all cases, the incumbents are trying to use their links to legislators to increase regulation of their sector, biased toward status-quo definitions of same. But such efforts that purport to protect consumers lead to all sorts of unintended consequences. Previous efforts to stifle disruptive technologies have often been costly for the economy and in the end unsuccessful, no matter how logical and attractive they appeared to be at the time. Sharing beds and cars Both Airbnb and Uber make commissions by matching sleepers or riders with beds or cars, aided by the internet’s tendency to lower coordination costs and smartphones' unique combination of geographic context, rich visuals and ubiquitous wireless networking. It’s a much more attractive model than owning infrastructure and having to pay health care for employees. Across the world, many taxi and limousine commissions (TLCs) have ruled Uber illegal (even so, the service currently operates in 55 countries). Couch-surfing is more difficult to regulate: a 30-story hotel in Times Square is impossible to miss, while 20,000 available rooms in New York city (the figure dates from 2014) are mostly invisible from the street. In both cases, however, the incumbents can only do so much by way of competition: cab fares are set by law and taxi medallions are scarce for obvious reasons. In New York, the price of those medallions dropped by 17% (about $200,000) between 2013 and 2015, so Uber is hurting incumbents where it counts. Hotels with high fixed expenses, meanwhile, can only compete with Airbnb in subtle ways: saying “we’re cleaner than Joe Blow’s guest room” might be seen as damaging the brand while validating the competition. As a result, these incumbents can do little except drop prices or resort to regulatory protection. In part, this paucity of options reflects the highly fragmented nature of both markets. Trying to organize 50,000 licensed New York taxi drivers (who share 13,600 vehicles) to improve service, speed up pick-up times or otherwise compete with Uber on quality would be a logistical impossibility. Incentives aren’t aligned: the medallion owners don’t drive cars. Furthermore, taxi companies have been slow to invest in GPS and similar technology, guarded as they were by the regulated scarcity. Hailing and hoping Compare this model to Uber, in which the car owner is the driver. The smartphone app is a far superior method of arranging a ride compared with hailing and hoping – or even calling a dispatcher then hoping. Much like Fedex, Uber’s supply chain visibility (knowledge of where the package or cab is) contributes to the overall value of the experience. Conversely, waiting for a cab to get to the airport is made much more stressful by the lack of knowledge of where the ride is or how bad traffic is on a given route. Airbnb uses a similar confidence builder, wrapping information around the transaction. Much like eBay (its business-model grandfather), Airbnb rates both buyers and sellers, making both opening one’s home and staying in a private residence less of a gamble. For both Airbnb and Uber, the low barrier to entry and then the decentralized structure of the asset threatens the incumbents' moats: medallions in the taxi setting, real estate investment and heavy overhead (branding, IT systems and labor costs) in the case of a hotel. Complex regulation protects incumbents It’s important to realize how complex business regulation has become. What started as an effort in consumer protection (think of Upton Sinclair, “The Jungle,” and the creation of what became the FDA) now serves to do multiple additional things: to employ regulators who have a vested interest in keeping their jobs to maintain barriers to new-market entry and thus innovation to reassure markets and investors of a stable competitive environment. Thus what looks like “illegal” or “unfair” competition is in fact often a matter of innovation breaking an outdated, well-protected business model that has focused on profits rather than customer service or competitive differentiation. Note that in every case we have mentioned, the consumer protection function of regulation did not drive efforts to outlaw the competitive threat: Linux, VoIP, and unbundled CDs all dropped prices in the market while arguably improving quality. Regulators, however, need things to regulate, as we have just seen when the Federal Communications Commission defined the internet in such a way as to make up for millions of Americans abandoning wireline phone service, its primary locus of influence and revenue. Thus the incumbents and the regulators face a common threat. Room for regulation, but… At the same time, it’s worth noting that Airbnb’s and Uber’s independent contractors, with few exceptions, are looking littler and littler in light of the massive valuations and global aspirations of the two startups. In the latter case particularly, drivers have faced repeated and arbitrary changes in compensation models. Uber asserts that these changes should increase gross revenues, but the effect on operating expenses (and thus take-home pay) is less clear. Given the power imbalance between very big money at headquarters and independent contractors at the edge of the network, there is scope for harm, for protection and for risk – and thus a potential place for regulation – but those affected lack the political weight to compete with the more powerful motivator of eroded profits among a small number of incumbents. Labor unions and regulations protecting both workplace safety and the right of workers to organize were part of the answer to a similar imbalance in the 20th century. It’s as yet unclear what new arrangements could emerge now. So when a TLC tries to block Uber cars from accessing airport terminals, or hotels ask a city to refuse Airbnb’s efforts to pay lodging taxes, it’s worth asking: whose interests are being protected? Most likely, the legal efforts directly relate to the incumbent businesses that have been insulated from competition rather than to the common good, public safety, or economic progress. This article was originally published at The Conversation.
Cyanogen, a startup that distributes software based on Google’s Android mobile operating system, has raised $US80 million in series C funding in order to hire talent and accelerate software development. The round was led by PremjiInvest and included participation from other investors such as Twitter. "We’re committed to creating an open computing platform that fundamentally empowers the entire mobile ecosystem from developers to hardware makers, and most importantly, consumers around the world,” Cyanogen’s chief executive Kirt McMaster said in a statement. “We’re excited to have the backing of an amazingly diverse group of strategic investors who are supporting us in building a truly open Android.” The startup has received a total of $110 million in funding to date. The company reportedly rejected a buyout offer from Google last year. Instagram launches standalone photo-editing app Instagram has launched a standalone photo-editing app in order to give users the ability to make collages or mirror effects before uploading them to the photo-sharing app or other sites, such as Facebook. “From imagining mirrored landscapes to sharing multiple moments from an entire adventure, we’ve seen these kinds of visual storytelling happening on Instagram and we’re inspired by it,” the company said. “With Layout, it’s easier than ever to unlock your creativity — and we can’t wait to see what you’ll make next.” Layout is currently available on iOS and will be available on Android devices in the next few months. Twitter testing autoplay videos on iPhone and iPad apps Twitter has started testing a new feature in the US that will mean videos in a user’s timeline play automatically. “We’re running a small test on a few variations on the video playback experience,” a Twitter spokesman told Advertising Age. The autoplay test will apply to video advertisements. Facebook has had autoplay videos since September 2013. Overnight The Dow Jones Industrial Average is down 11.61 points, falling 0.06% overnight to 18,116.04. The Aussie dollar is currently trading at around 78.89 US cents. Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Google has announced it is going to begin introducing paid search results for apps into its Google Play app store, with the news drawing a mixed reaction from Australian app developers. Under the changes, sponsored results will soon begin appearing at the top of search queries in Google Play in a manner similar to Google’s web search results. The move is designed to help the search giant to monetise the global installed base of its Android operating system, which runs on around 1 billion devices globally. According to figures published by Kantar Worldpanel last year, smartphones running Google’s Android operating system account for around 58.1% of the Australian market, meaning the Google Play app store is also a significant gatekeeper in the local market. David Mah, co-founder of mobile shopping app BlueSky, told StartupSmart he was among the app developers approached to participate in a trial of the paid ads, but turned down the invitation. “They approached us to do just that, but we didn’t go ahead with it. Apple also approached us for something similar by putting us at the top of their app store on the front page. We were their top shopping app for 2014, and [Apple] didn’t charge us for that,” Mah says. Klyp mobile lead Tyson Bradford told StartupSmart if the ads work like Google’s existing search ads, it will be advantageous for app developers to look at the ads as a channel to build exposure. “The apps stores can be hard to navigate and get to new content on. You’re trying to view over a million apps on a four-inch screen. Especially if Google gets the contextual part right, this is going to be valuable for app developers,” Bradford says. “It’s not going to cost you millions of dollars to get an ad on there, but if they put down $50 their ads won’t be there as long as someone with a million dollar budget. So it could be more cost-effective for app developers than other mobile channels.” Zoom2u cofounder Steve Orenstein told StartupSmart the benefits of advertising will vary depending on what marketplace each app serves. “In our instance there could be some relevance – gaming apps might be more relevant because people search for those a lot. If it’s good, it will give Google a new revenue stream while adding value for app developers,” Orenstein says. Meanwhile, Freight Exchange co-founder and chief executive Cate Hull told StartupSmart she hopes the news prompts Apple to improve its search results. “Anything that improves Apple’s search results will be great for users and developers,” Hull says. In a post on Google’s official Android Developers Blog, Google Play product management director Michael Siliski said that in the coming weeks, selected users will begin to see ads in the app marketplace from a pilot group of advertisers. “With more than 100 billion searches every month on Google.com, we’ve seen how search ads shown next to organic search results on Google.com can significantly improve content discovery for users and advertisers, both large and small,” Siliski said. “Search ads on Google Play will enable developers to drive more awareness of their apps and provide consumers new ways to discover apps that they otherwise might have missed.” Image credit: Flickr/ashkyd Follow StartupSmart on Facebook, Twitter, and LinkedIn.
The purpose and implementation of the Australian government’s proposed metadata retention scheme is making less sense as political pressure mounts to get the legislation passed. So what’s going on? The bill, as written, suggests it can be easy for criminals to “opt out” of data collection, while the remainder of Australians still have their personal communications spied on, retained for two years and kept in commercial data centres at taxpayers' expense. The Australian Greens senator Scott Ludlam recently raised a number of such concerns about the bill which has already met opposition from privacy advocates. But the bill’s worth as a tool to specifically fight terrorism, or any other serious crime, seems dubious if potential terrorists and criminals in Australia can easily “opt out” of having their data retained simply by choosing any internet messaging service where the persons operating the service do not own or operate “in Australia, infrastructure that enables” that service. So what does that mean for the apps commonly used on smartphones today? Whatsapp, the popular mobile messaging app with 700 million users, around 10% of which come from the Middle East, or Viber, a similar app with 20 million users in Pakistan alone, would both be excluded from data retention. These are some of the apps that the UK’s prime minister David Cameron recently mused about baning in the UK. According to answers given by Australian Attorney General’s (AG) department staff during the Senate Legal and Constitutional Affairs Reference Committee, the “in Australia” provision also means that even Google’s web-based Gmail service is excluded from data retention. So what does the bill call for? With all the reports of what the bill leaves out and doesn’t do, no one seems to acknowledge what is actually in the draft bill, and how that language might affect policing, government and privacy. So what is at play? One possible explanation is that Australia is carrying out its obligations as part of the “five eyes” network of English speaking intelligence partners. The logic here is that it makes economic and political sense to have Australian internet service providers (ISPs) such as Telstra and iiNet retain what originates in their infrastructure rather than have the US’s National Security Agency (NSA) collect it. A more plausible explanation is that, contrary to the PM’s politiking, the data to be retained is not valued by the Australian government for its national security or anti-child abuse value. Instead, Australians are to be spied on for data that will become valuable for other state functions including the expanded reach of civil litigation. The expanded value considers normal policing, civil subpoenas and even copyright disputes. A look inside the bill The Australian government is not explicitly interested in the internet protocol (IP) addresses that you visit. The bill in its current form states in section 187A that the government: […] does not require a service provider to keep, or cause to be kept […] [information that] states an address to which a communication was sent on the internet, from a telecommunications device. In more detail, the helpful “explanatory memorandum” codifies that: Under proposed paragraph 187A(4)(b), the retention obligation is explicitly expressed to exclude the retention of destination web address identifiers, such as destination internet Protocol (IP) addresses or uniform resource locators (URLs). So what are we talking about then? It’s all about the destination What the government does seem to be after is “destination” data that basically amounts to an assortment of dummy variables that help identify you, and who you are communicating with. Instead of IP address or web pages, it is interested in retaining email accounts, Skype handles and phone numbers, etc. for the connections you have made. The government’s “destination” is in many ways more invasive than IP addresses or web URLs alone. For instance, think about how each person in Australia connects to the IP address 188.8.131.52. That’s the IP for Facebook.com, and is physically located in the US. Retaining the metadata of time spent at that address would not produce much actionable intelligence on you or the other 8 million Australians who browse Facebook each day. Nor would it be all that invasive to privacy. “Destination” data is different. “Destination” data seeks to capture who, specifically, you’re spending time with online; who is the destination that you are messaging through email, Skype or possibly even Facebook’s real-time apps and services? Think of it this way: two “destinations” pass data through the same communications service at a series of very specific times, again, again and again. No other two “destinations” share this unique pattern of time and connection. The government’s definition of “destination” is multiple click here, search for “destination”), but we can isolate a key phrase: This information can then assist with determining the subscribers who sent or received relevant communications. That is to say, who you’re talking to online, not where you went. Analysing how these “destinations” link together with other metadata (geo-location, device type/operating system, etc.) allows the government – or anyone else who snoops in on the retained data – to predict, for instance, that these communications were yours, and whether you targeted them to, let’s say, your spouse, or an “old friend” across town. And whether you meet up with that person from time to time. And where. And for how long. Geolocation data alone is incredibly powerful when we all carry smartphone and other devices that connect to the internet in our pockets. People are just starting to learn how powerful this type of metadata is. Retaining all of that metadata provides an incredible amount of information for civil litagants that can ask for it through a subpoena. As an former iiNet lawyer wrote: The Data Retention Bill does not impose any limitation on access to the retained data by other legal avenues. This means there’s nothing stopping your ex-husband, your employer, the tax office or a bank using a subpoena to get access to that data if it is relevant to a court case. All this data also creates a very valuable target for hackers, including “adversarial intelligence agencies” trying to infiltrate your identity, ransom you for your secrets, or run some form of economic espionage. Can we trust Australian service providers can keep all the data safe once they’ve accumulated two years worth of intimate connections for each Australian who uses any sort of telecommunications device? Sadly, recent security breaches at companies as diverse as Apple, Target, and the latest heist from “100 banks and other financial institutions in 30 nations” suggest otherwise. The flawed explanations of what good the bill does, what privacy risks it creates and the reality of how our retained data will be used, offers many red flags on why this legislation should be reconsidered. This article was originally published on The Conversation. Read the original article.
Australian startup Kounta has launched in the United States in order to stake a claim in the increasingly competitive point-of-sale software market. Kounta, which is based in Sydney, has proved popular with retailers who want the flexibility of both online and offline solutions across multiple platforms – including iPads, Android tables, Mac OS, Windows and existing point-of-sale software. North American president of Kounta, Jason Seed, says while the company is entering a “busy market” it is up for the challenge. “On the one hand you have companies like Square and Groupon that have entered the POS market and done quite well,” he said in a statement. “However, they have ulterior motives to get you on to a specific payment provider or service, which they obviously earn money from. They are far from being open and this lock-in is dangerous for small business owners.” Despite taking on an investment from MYOB in June last year, Kounta will face stiff competition from other POS startups – including mobile payments company Square which was started by Twitter co-founder Jack Dorsey. However, Seed says he expects Kounta to stand out because in his view the startup’s approach is “completely different”. “We have built an open platform that integrates with everything else, so small business owners can choose the payments provider, or accounting software or ordering applications, that suits them best.” “Similarly, the current crop of POS startups are too simplistic. They either tie you down to a specific operating system, or are beautiful, but lacking in deep features that small business owners need.” Follow StartupSmart on Facebook, Twitter, and LinkedIn.
Ninja Blocks has begun shipping the Ninja Sphere and announced it has signed up as a key partner for Canonical’s Ubuntu Core embedded device operating system, as it opens its first office in the US. The startup launched in 2012, when it was selected to participate the Startmate accelerator program, and also smashed a Kickstarter campaign for its first product, which was also called Ninja Blocks. In January 2014, the startup raised $702,937 against a $115,000 crowdfunding target on Kickstarter for their second product, Ninja Sphere. Then in October, it raised $US700,000 from local and international investors including SingTel Innov8, Blackbird Ventures and 500 Startups. Ninja Blocks chief executive Daniel Friedman told StartupSmart the first 500 units are in the process of being shipped to Kickstarter backers, with manufacturing and production now in full swing. "Obviously, we had wild success with our Kickstarter campaign and that that level – we have orders for 2500-odd Ninja Spheres – we couldn't make them ourselves. We had to get a manufacturing partner. "There are a lot of challenges that come along with a larger order, including supply chain issues, quality control and quality assurance, certification, packaging and trademarks. "For big scale projects – if things go really well on Kickstarter – my advice to people would be to be prepared to find people to give a helping hand. We had experience with our first product – Ninja Blocks – and never underestimated the challenges." The product design also posed some unique challenges, including ground-breaking work mass-producing a device that does gesture control with capacitors. It also set a goal to get wireless control mechanisms certified in all markets simultaneously, allowing it to ship to all parts of the world at the same time. Ninja Blocks has also gained global attention by signing on as one of the first partners for Canonical's Linux-based Ubuntu Core embedded device operating system. "We're really, really excited about this announcement. Ninja Sphere is one of the most advanced smart IoT systems on the market – it's a full Linux system in people's homes. So it needs to be reliable, resilient and secure. "We went with Ubuntu because it's the biggest name in Linux – in fact, you'll find a lot of the cloud runs on servers that are powered by Ubuntu." Meanwhile, Ninja Blocks recently hired a chief marketing officer and opened an office in San Francisco. The office will focus on marketing and funding the company's future growth, with Friedman himself preparing to move to the US shortly. Despite these moves, Friedman says Ninja Blocks remains committed to Australia, with design and engineering set to remain here. "We will still do our engineering and design in Australia and we have strong roots here. So it's really about having people in the places where they'll be the most impactful."