Tag: Spotify

Consumer Electronics, IOT, Smart Home

Spotify continues march to dominate streaming audio entertainment

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Spotify continues dominance with Joe Rogan acquisition

Spotify is the dominant player in streaming music and is doubling down to be the streaming audio entertainment leader. The company has 130 million paid subscribers worldwide, well ahead of Apple, Amazon, and Google. Streaming music makes up 47% of global music revenues. Adding Joe Rogan’s podcasts, along with DC Comics and Kim Kardashian further differentiates the service with hot names. CNBC

dis-rup-shun: As the streaming video players have taught, offering original content is the key to keeping ahead of competitors. Spotify has taken a play from the video streamers and is widening the gap between it and its nearest competition. The company will be the dominant radio station, not just music station. Expect other popular audio entertainment, including sports and news, to be added to the platform.

Uber drivers sue for access to proprietary data

A group of Uber drivers in the UK who seek driver data to help unionize drivers in their nation are suing Uber for access to driver information. Uber says that statistics on drivers, including their speed, locations, acceleration, etc., are part of the company’s secret algorithms that bring it competitive advantage, and cannot be disclosed. Gizmodo

dis-rup-shun: The need for competent regulation of Big Tech firms, and difficult decision making about ownership of data is becoming more important, and more difficult every day. These data ownership questions are very significant, and precedent setting, and the creation of better government regulation is not only justifiable, but critical.

Coming soon: balloon rides to space

Space Perspective, a Florida based company, wants to take passengers to the highest levels of the Earth’s atmosphere, where the sky is black and one can see the curvature of the Earth. The pressurized capsule seats eight and includes a bar and bathroom. The company hopes to begin operations as early as next year. CNET

dis-rup-shun: Coming soon — kiddie birthday parties at 100,000 feet. The experience sounds exciting, but what government body regulates and inspects Space Perspective, ensuring that craft are well maintained, adequately equipped with safety gear, and is willing to send out a rescue party should something go wrong? Is this the purview of NASA or the FAA, or the FTC?

Instagram adds fund raising feature

Instragram, in response to a rise in activities to respond to social justice causes, has enabled a fund raising feature within the app. The fundraiser lasts for 30 days, but can be renewed. Fundraisers will be reviewed by Instagram before they can be posted. Does fundraising on social media work? Since 2015, 45 million people have raised over $3 billion on Facebook and Instagram according to CNET.

dis-rup-shun: Instragram is taking on GoFundMe, the best known fundraising platform, finding yet another important use case to incorporate into its platform. Despite criticism to the contrary, Facebook and its entities have a finger on the pulse of the population, and seek to ride the wave of people’s growing passion about causes.

 

 

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Nexflix is decade’s best stock

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Netflix top stock of the decade

Looking back on the decade, Netflix has won the prize of best performing stock, increasing 4,000%. Subscriber growth went from 12 million who were receiving CDs in the mail, to 158 million subscribers to streaming services. The company divides the world into four regions. After North America, the biggest region is Europe/Middle East/Africa with 47.4 million subscribers, then Latin America with 29.4 million. AsiaPac follows at 14.5 million. CNBC

dis-rup-shun: Do you continue to back the stock of a company with razor thin margins that doesn’t consistently make a profit, is being chased by Disney, AT&T and many other companies with deep pockets? The company’s growth is in international markets where competition is far less, but winning this game requires massive spending. This disruptor has been highly valued for completely changing the video market, but, like another game changer called Uber, will the demand for profits sink its high price? 

China helps finance Tesla

Chinese investors have agreed to back Tesla’s Shanghai-based manufacturing plant with a $1.4 billion loan that will, in part, roll over a prior, smaller loan. Tesla broke ground on the plant in January of this year and expects to produce 1000 model S cars per week by end of this year. CNBC

dis-rup-shun: It seems that Musk did not get the trade war memo, and, like Apple, is leading the charge for continued strong trade relations with China. Such big deals will likely keep the trade war political and prevent walls from being built between the economies. Tesla has what China wants — innovative, stylish cars that don’t pollute. Perhaps Musk can lead the way to increasing the number of global ventures that China will back.

Music embraces big data

As we know, the music industry is on a rebound from decimation by digital download. Gone are the talent scouts and record label promoters, replaced by data analysts who study trends on streaming music sites such as Spotify. By analyzing what’s hot, music producers can predict which artists will sell. Artists, by analyzing data, are able to determine where and with what they will become popular. The likely result is more homogeneity in music, making it tougher for off beat artists to be discovered. Wired

dis-rup-shun: This brings up the discussion, made popular a decade ago by Chris Anderson’s book, The Long Tail, of the value of non-popular content. Digital access makes it very inexpensive to find and enjoy the unusual, less popular books, movies and music. Yet, in the digital age, data analytics helps big business spend its resources finding or making the 20% of content that earns 80% of the revenues. This suggests a streaming service dedicated to the fringe artists, where lots of good stuff is less commercialized, would be interesting to those of us who like fringe stuff.

In-home manicure machine

Coral is a company founded by a former Dolby executive who has received $4.3 million to create an in home manicure machine. Put your finger in a hole in the machine, and out comes a completed, painted nail. Tech Crunch

dis-rup-shun: The salon experience seems, from an observer’s perspective, to be part ritual — going somewhere and spending a few minutes being pampered. While many people don’t have the time to go to a salon but want nails to look nice, this may be a better solution than DIY manicures. Peloton has brought the community workout experience home, and massive multi-player games gives one a sense of community experience at home. Coral likely needs to make its machine deliver more of an experience — perhaps by playing soothing music or brewing tea while it gives its auto-manicure.

 

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Backyard grills pursue subscription model

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What does a backyard grill have in common with an iPod?

Weber’s SmokeFire incorporates two innovations, neither of them original, but both defining the future of the outdoor grilling industry. The new model incorporates a Wi-Fi app to not only monitor temperatures, but to access an inventory of recipes and provide guidance throughout the process. In addition, the grill leader is adopting a wood pellet convention, made popular by competitor Traegar. CNet

dis-rup-shun: The marketing team at Weber has been paying close attention to the tech world and has effectively differentiated a no-tech product, taking the Apple iPod/iTunes model to heart. The new grill takes a “systems” approach, incorporating ever changing content (recipes and how-to instructions) and proprietary wood pellets to turn the grilling business model into a razor and blades, or iPod and iTunes model, turning grill buyers into “subscribers” who come back regularly for pellets and recipes.

Spotify shares down on Amazon Music expansion

Amazon announced that its free, ad-supported music service would be available on iOS, Android and FireTV devices. Previously the service was available only on Amazon Echo. Spotify share were down nearly 5% after the news. CNBC

dis-rup-shun: Apple started the mad rush to expand services with its announcements of several new services and service bundles earlier in the year. Other companies, including Google and Amazon have followed rapidly with the knowledge that consumers, in most cases, will not pay for multiple services beyond streaming video. There is only so much room on a credit card for subscription services. Cable and Telco providers taught, some time ago, that bundling services is an effective way to differentiate and both Apple and Amazon are in the unique position of being able to bundle both devices and services in creative ways. 

Google Stadia provides a unique gaming experience

Google’s Stadia service enables people to play games on any connected device — moving the experience to wherever the player is. The company has developed an ecosystem of controllers that enable fans to get as serious as they wish about Stadia and different types of pay models provide something for everyone. Shooter games, however, are not well suited for a clloud architecture, and may hobble adoption. Wired

dis-rup-shun: Game players are like any population — they can be segmented in a variety of ways. It is unlikely that Google will successfully batch the majority of gamers onto a single platform, even with many variants of that platform. The question, then, is can Google capture the widest part of the bell curve of game players with Stadia, and will the variants of Stadia help capture the generalist game player market, or confuse and frustrate the target market. As Google is prone to change directions quickly, fans may be reluctant to invest heavily into an offering which seems to be doing so much for so many segments.

More private space companies land on NASA’s partner list

NASA has added SpaceX, BlueOrigin, and Sierra Nevada to its growing list of contractors vying to carry cargo, and eventually humans back to the Moon by 2024. These companies join nine other NASA approved vendors, who will compete for various slices of the Moon mission pie. TheVerge

dis-rup-shun: Envision an environment in which multiple carriers are competing for Moon tasks, just are airlines compete today for certain routes with different planes, seeking to find the optimal mix of capacity, load factor and profitability. This aggressive competition should result in the U.S. most quickly returning to the Moon, but it is important to remember that most of the private contractors are multi-national companies and will, eventually, be eager to serve customers in many countries, leveling the field. NASA is wise to engage multiple parties and gain the speed, financial and hopefully, safety benefits of competition.

 

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Spotify enforcement spoiling family sharing

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Spotify enforcers are out to limit family plans to single household

Spotify appears ready to enforce its family plan agreement terms requiring that all family plan users reside in the same household. The company is asking users to confirm their addresses. Apparently the company plans to increase its revenues from its existing customer base by eliminating sharing across households. TheVerge

dis-rup-shun: If the Spotify police are successful at extracting more revenue from existing customers, Netflix, Amazon and streaming services could follow, but for the fact that we are in the early days of a years-long streaming video service subscriber war. Less successful streaming music services such as Amazon Music can leverage Spotify’s policy to entice youth and college students with no income to try alternative services with various new benefits and cast Spotify as the stuffy service for parents and older people. Be careful, Spotify, consumer sentiment can change in a heartbeat.

Alexa turns to humans to get smarter

Amazon will turn to humans to give them the opportunity to answer questions that Alexa cannot. Using a wiki-like crowd sourcing model, people will receive points for answering questions which will then be audited by algorithms and some human fact checkers for authenticity and accuracy.  CNBC

dis-rup-shun: Amazon’s Alexa technology enjoys nearly double the market share of Google’s, according to Canalys. If you have used Alexa, you know that despite an amazing number of skills and integrations with other devices, Alexa frequently does not have the answer to even basic questions. Google Assistant, on the other hand, has Google’s search engine and almost always has answers. If only Alexa would use Google to search for answers. Amazon would be well-served to outsource Alexa’s search functions to a third party such as Bing that may be perceived as less of a competitor, then perhaps regulators would perceive Big Tech to be encouraging competition.

Is Nintendo Switch a serious fitness contender?

Nintendo’s RingFit game for Switch comes with an exercise ring and a leg strap. To win the game, the player must perform a series of fitness challenges to defeat enemies and slay an evil body building dragon. The game debuts October 18th. TechCrunch

dis-rup-shun: On the heels of Peloton and the rise of connected fitness machines, Nintendo provides the un-machine for connected fitness. For a fraction of the cost of connected bikes and treadmills, game lovers can immerse themselves in fantasy and get fit. If Nintendo can support this fitness game with diet plans, workout clothes, online communities, and even healthy snacks, it can build yet another Pokemon Go-like franchise around the title and contribute to the health and well-being of its customers.

Amazon’s hardware event follows Apple’s

Amazon continues to grow its arsenal of devices, building a larger product line on top of Alexa. And just like Apple, the company has its big reveal party of new products in September. Expected this year are more Alexa powered devices, including a wall clock. CNBC

dis-rup-shun: In a few short years, Amazon’s Alexa business has become an important engine of the company, beating even mighty Apple to the dominant position of voice standard in the home. Understanding the business model of Alexa is more difficult. Consumers are not purchasing products via voice, and search via Alexa is a poor experience. The business of data mining — knowing what songs people like, how often they are home, and what recipes they are preparing — is of incalculable value to Amazon. As Amazon competes for advertising and shopping revenues, Alexa provides a constant stream of consumer information from thousands of devices that are “listening.”

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Can Walmart.com catch Amazon.com?

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Walmart’s attempts at e-commerce are struggling

Walmart’s e-commerce unit is reportedly losing $1 billion this year.  The company invested $3.3 billion in Jet.com and has been struggling to keep up with Amazon.com. Reports state that while the company is investing in young lifestyle brands, others believe that deep online discounting is the better strategy. CNBC

dis-rup-shun: Given Amazon’s scale, Walmart must keep the long game in mind and be prepared to lose several billion more to catch up. While Walmart debates discount versus brand building strategy, Amazon is doubling down on warehouses, trucks, planes, drones, vendor networks, and machine learning algorithms. Amazon has built enormous scale not only in inventory, but in logistics, requiring an ever increasing investment to catch. Will Walmart shareholders and management decide that the cost of the race is too high a price to pay?

Facebook will pay a fine of $5 billion

After 87 million users’ personal information was improperly shared with political consulting firm Cambridge Analytica prior to the last Presidential election, the Federal Trade Commission has levied a fine of $5 billion, representing one month of revenue. Critics of the deal that does not penalize CEO Zuckerberg call it a slap on the wrist, and shares of the company were up almost 2% after announcement of the penalty.  ArsTechnica

dis-rup-shun: The FTC’s action will stand in contrast with the European Commission which is currently investigating several large corporations for similar mis-handling of consumer data. It is expected that the EU will provide proportionally much harsher penalties for similar failures and may be a much stronger driver for implementation of higher standards and better enforcement.

Amazon music growing faster than Apple and Spotify

Amazon’s service reported 70% growth in the past year.  Amazon reports 32 million subscribers to Apple’s 60 million and Spotify’s 100 million. Despite the strong growth, the other services have a strong lead. ArsTechnica

dis-rup-shun: Given that there are 126 million households in the U.S. and 221 in the European Union, combined, the services are reaching nearly 58% of households in both continents, suggesting that additional subscriber acquisition will be increasingly difficult and expensive. Amazon Prime members get a the basic music service, Prime Music for no additional charge, but may find that the limited catalog is a gateway to the Amazon Music Unlimited service which is available to Prime members at a negligible $2 premium.

Petcube incorporates Alexa into pet amusement device

Petcube’s Bite2 and Play 2 are smart devices that remotely dispense treats and provide a moving laser pointer, respectively. New versions of the devices now include Alexa voice capabilities. TechCrunch

dis-rup-shun: The Internet of Pet care has arrived, and now one can command their Petcube to command their dog or cat to perform tricks or sit for a treat. Amazon’s saturation of the smart speaker space in ever more types of devices is solidifying it as the industry standard for voice control. Why would a manufacturer choose anything but Amazon as its voice interface?

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How Amazon will wreck the pharmacy industry

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How Amazon will wreck the pharmacy business

Amazon quietly entered the pharmacy business in 2017 and introduced PillPack, a direct to home prescription drug business that packages pills by daily dosage, with dates and times to take the medicine printed on the package. The retail pharmacy heavyweights currently play middle man by negotiating discounts from drug makers for large health insurers, creating special pricing for insurance networks. By selling directly to insurance companies, Amazon will cut out the retail pharmacy giants. CNBC

dis-rup-shun: Amazon’s disruptive move will benefit the consumer with lower drug prices and, possibly, lower health insurance premiums, but will destabilize the retail pharmacy industry by forcing it to rely more heavily on the sale of non-drug products, a battle it is already fighting against Amazon.com and Prime. One answer is for retail pharmacies to move more aggressively into care clinics, a trend well underway, putting further pressure on doctor and hospital chains to become more consumer-friendly as they are forced to compete with retail pharmacies for walk-in healthcare.

Direct share offerings will put a squeeze on bankers

Collaboration tool vendor Slack went public this week without assistance from investment banks, gaining 50% value in its first day. The capital raise puts valuation of the company at $23.1 billion. Compare this to Uber’s IPO last month which, by absolute dollar valuation, was the worst performing IPO in history. Both Lyft and Uber have recovered somewhat from a bad initial offering. Gizmodo

dis-rup-shun: Two large IPOs, Slack and Spotify in 2018, were direct (limited banker involvement) offerings. Both companies have enjoyed strong value growth since IPO. Uber and Lyft were heavily hyped by investment banks and crashed after offering. Before we conclude that bankers are bad, it is important to note that Uber and Lyft’s business models do not show profitability in the near term, and seem to be in multiple businesses. On the other hand, Slack is facing stiff competition from tech giants. If we assume that the market is sophisticated enough to understand the competitive landscape ahead of the IPO, then one conclusion is that bankers may be over-promoting offerings and that a more informed market later corrects. Expect direct offerings to become more commonplace, eventually forcing a correction in the fees charged by banking firms.

Zuckerberg outranks Tim Cook

Glassdoor’s anonymous survey of former employees’ views on their CEO has a number of tech CEOs ranking in the top 10. Ranking in the lower half of the 100 ranked are Facebook’s Zuckerberg at 59 (#1 is the best) and Apple’s Tim Cook at 69th place. ZDNet

dis-rup-shun: Interesting to see Cook at the bottom of the heap, especially after a brutal year for Facebook’s public image. Does the secrecy inherent in Apple’s culture create distrust inside the family? Despite Facebook’s missteps, Zuckerberg has been quite penitent in public, perhaps gaining employee’s respect. It is rare for a company as successful as Apple to not become an arrogant empire, and perhaps more transparency would engender more employee admiration.

Netflix will eventually include advertisements, says industry

Netflix, with its 150 million subscribers, faces significant costs from developing original content. Industry insiders predict that Netflix will break its vow of no advertisements as production costs increase and the value of its audience reach soars. CNBC

dis-rup-shun: Netflix continues to pursue a unique strategy — using debt to finance a very large catalog of original content that it can monetize over coming years. As other streaming services are launched from companies including Disney and AT&T’s WarnerMedia, Netflix subscriber growth will be challenged. The barriers to entry for streaming services have become original content — a very expensive barrier. As John Penney, CSO of 29th Century Fox has been telling the industry for years, there is simply not enough non-movie theater revenue in the TV distribution chain to support the costs of original content. The company’s stock price, however, continues to show confidence in the company’s ‘think different’ strategy.

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Amazon and Google and federal scrutiny

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Amazon and Google under federal scrutiny for unfair competitive practices

The Washington Post (owned by Amazon’s Jeff Bezos) reports that the FTC and DOJ have divvied up duties of looking into the practices of Amazon — a job for the FTC, and of Google, to be handled by the DOJ. 

dis-rup-shun: Google’s dominant search engine and Amazon’s marketplace, together with Prime subscription data, enormous logistics resources and leading cloud platform, AWS, put the companies in the difficult position of direct competition with most of their customers. Owning the very rails of the online market, the Post puts it, is akin to the railroads of the late 1800s. The “coopetition” position of the companies — as they both compete and serve their customers, will undoubtedly be the companies’ defense should the feds take the companies to court.

iTunes is dead

This is the week of Apple’s annual developer event, WWDC. It has been rumored that Apple will shutter iTunes, more tightly integrating movie and music content services into new operating system features, rendering iTunes as a standalone marketplace irrelevant. Engadget

dis-rup-shun: Most people likely fell out of love with iTunes years ago as soon as it swallowed their music collection after their first iPhone upgrade. Launched in 2001, the service was the most important thing that happened to the music industry after music became digital, but iTunes complexity was its demise. By making it difficult to manage and share the content that people rightfully owned, it hastened the shift to streaming music services, which Apple finally joined by acquiring Beats in 2014. By that time, consumers had already tried and settled on several streaming services and the majority chose Spotify. Apple, the company that re-invented music, lost it only a dozen years later.

Space race setback: Stratolaunch shutting down

The race to own space is full-on with several governments (China, Russia, Japan, USA) and several private and public companies (SpaceX, Blue Origin, Lockheed, Boeing and others) aggressively pursuing economic and strategic initiatives. Stratolaunch, space company of late Paul Allen, co-founder of Microsoft, is reported to be shutting down. The company has built and flown the world’s largest aircraft, capable of launching heavy rockets from high altitudes, which reduces the cost and complexity of blast offs from a launch pad.  Engadget

dis-rup-shun: The U.S. government has outsourced space innovation to corporations. The free market will create efficient competitors who will profit from space exploration, but whose goals may not align with political and military objectives. Having a contract with NASA, however, helps stabilize the early days of the new space race.

Odd technology: Muro programmable music box

Muro is a wood and metal retro music box encased by a plastic dome. Unlike its pre-computer predecessors, this version can be programmed with an app to play essentially any tune. TechCrunch

dis-rup-shun: The appeal of an antique-looking and sounding music box playing Guns N’ Roses is lost on most, but perhaps this tech novelty will be the rage this holiday season.