In a world where everyone implicitly assumes “there’s an app for that,” Yo has the potential to be a layer for all the products and services that don’t actually need — and where users don’t want — a dedicated app. Yo does this along three axes: notifications, buttons, and friction.
On the notification layer:
As notifications become more prominent in iOS 8, more companies will want access to that layer and they don’t all have compelling enough reasons for users to download their apps. In the restaurant buzzer example from earlier, it’s pretty unlikely I’d want to download the restaurant’s app just to be notified when my table is ready — even if it were an app that worked with multiple restaurants. I just wouldn’t use it enough for it to warrant downloading an app.
He goes on to cite Yo as a potential enabler of IoT connectivity as well.
I suppose the question that first comes to mind is: how easy does Yo make this for average users and how many of these would one have to set up on the platform to make the app worthwhile? Probably a lot of different answers to that depending on who you are.
Most people who mock Yo likely do not have any clue about the changes afoot on the notification screen, how younger users tend to view notifications as media (versus in-app experiences), and how the mobile gatekeepers are planning to modify their operating systems to allow for a range of actions within push notifications themselves, removing the need of opening an app entirely.
Of the many things that keep founders up in the middle of the night, one of the biggest may be the looming specter of the “Big Four” as a competitive threat. Founders are taught to have a good answer for the question that inevitably rises in pitch sessions or fundraising excursions: what would you do if Facebook, Google, Apple or Amazon entered your market? How would you react?
Perhaps, if recent history is any indication, the reaction should be: bring it on. At least if you’re a social app and Facebook has you in their crosshairs.
While most point to Mark Zuckerberg’s apparent $3 billion offer for Snapchat as the first publicly expressed moment of validation for Snapchat’s business model, Zuckerberg actually had his eye on the nascent LA-based startup for some time. The Facebook Poke app, released in December 2012, was the first app built with the intent of dethroning Snapchat’s reign as the pre-eminent ephemeral app. Spiegel himself acknowledged as such, sending a note of congratulations to Facebook:
“Snapchat co-founder Evan Spiegel responded to Facebook’s new Poke app today with the brief statement, “Welcome, Facebook. Seriously.” He declined to comment further.”
Columnist MG Siegler encapsulated the sentiment of this veiled threat:
I also can’t help but wonder if maybe this is a message from Facebook: don’t want to come work with us? Fine, we’ll clone your service in a couple weeks and ship it to a billion users.
What actually happened is that a healthy percentage of those billion users not only ignored the Poke app but continued using Snapchat. In fact, Snapchat’s monthly share actually grew from December to January ’13, leading one to suspect that perhaps Facebook’s focus on the space also helped turn more attention towards Snapchat that may not have been there to start. A rising tide lifting all boats, indeed.
Facebook’s inability to gain any traction for Poke led to the infamous talks of late 2013 where supposedly an offer of $3 billion was made to Spiegel by Zuckerberg that was rebuffed.
The Empire Strikes Back
So after failing to lure Snapchat into the fold, Zuck went back to the well again and had his Facebook Creative Labs team give it another go, this time with an app called Slingshot, an asynchronous photo sharing app that again focused on the dynamics that made Snapchat such a success: ephemerality, spontaneity & customization.
Now we’re only a month into it’s release, so it’s probably too early to write Slingshot off entirely. But the numbers don’t look good. After briefly cracking the top 50 upon launch, the app has tumbled out of the top 1000 and its growth is slowing monumentally.
Which leads us back to our earlier question: is Facebook still an entity to be feared in the consumer-focused, mobile-social landscape?
Leaving aside the question (for a moment, anyway) of whether or not it would have behooved Snapchat to accept Facebook’s offer, it seems painfully obvious that once a startup has established itself as the market leader, it makes it very difficult for anyone to catch them, even if that competitor has billions of dollars at their disposal.
So what does this mean for Facebook? If they can’t entice a valuable startup (think: north of a billion dollar valuation) to sell at the price they want, they will inevitably have to overpay for the peace of mind of not having a competitor chip away at their market share in social.
Creative Labs Holds the Key
But perhaps we’re asking the wrong question. Maybe what we ought to be asking is something much deeper than that. And that is this: Can Facebook’s Creative Labs team come up with software that seriously challenges ascendant competitors on their own turf? Or perhaps more importantly, can they produce experiences independent of both the core Facebook functionality AND that of their competitors? Because that’s what ultimately will get them out of this reactive cycle of producing copycat apps and having to go back to the well (sometimes in vain) to acquire their competitors.
Facebook should be setting up Creative Labs to function more like Google X’s project teams: independent of Facebook and designed to build stand-alone experiences that leverage the creative muscle of the larger company but are ultimately their own projects capable of standing on their own accord.
Easier said than done, of course. And perhaps Facebook has already started along that path. But after missing out on ephemeral media and having to pony up $19 billion for WhatsApp, it’s high time for Facebook to start developing their own moonshots and putting a scare back into smaller upstarts in mobile/social instead of buying everyone else’s. Otherwise, startups will have their answer to the “800 pound gorilla” question, at least relative to Facebook: and that is that the emperor has no clothes.
So how is it possible that we can all have and use four, five, six or more messenger apps on our phones? It’s because the notifications channel is the primary UI on mobile, replacing the home screen, and its easy to communicate with people using a variety of applications on your phone.
As for whether or not you’ll see further fragmentation or some sort of push to consolidate, I agree with the top comment from Brandon Burns:
I’d vote for consolidation in the future. Not just because of annoyances like these, but because we’ve seen these trends go back and forth in almost every sector. Social media (currently coming out of the Facebook consolidation), photo-specific (getting comfortable in the Instagram consolidation), music (in a heavily fragmented post-iTunes world), etc. Even in messaging, the early and mid 2000s were all about everything from AIM to MSN messenger and all the rest, and then SMS ruled, and now we’re back to multiple apps.
Indeed. The fragmentation -> consolidation thing is largely cyclical.
StrictlyVC posted an interview today with VC Niko Bonatsos that was kind of interesting:
Controversy is great when it comes to building a brand and acquiring users for zero marketing spend. Obviously, you have to graduate from one controversy to another, or three to six months later there’s fatigue, but it can be controversy because of behavior, content, or because your product annoys people.
Obviously he doesn’t mean all of this completely literally. But this kind of thinking kind of worries me. Controversy for controversy’s sake doesn’t help anyone. Ask Chatroulette, Clinkle, Color, Diaspora or any multitude of other startups that got reams of press for being mired in controversy.
Buzz can be useful, be it positive or negative. But true network effects only come about if a service or product is compelling enough for people to use, irrespective of chatter from the outside. That’s what the Snapchat team built. In fact, the loyalty of the product’s users has kept it from falling off the map after phone numbers were exposed in various hack attemps, after unseemly information came out about Evan Spiegel etc. These were all things that came out after Snapchat had crossed the chasm and built up a huge following well into the so-called “late majority.”
Disturbing stuff but unsurprising. What does it mean though? Should these platforms not be built? Should platform providers be more strict about policing anonymous social networks? Should Apple and Google ban them altogether from the App Store and Google Play? Certainly both companies have more power to police these kinds of things in a walled garden as opposed to the web, where these kinds of things used to manifest. (Formspring, as an example.)
I think back to Evan Williams’ quote on building a successful software company:
We often think of the internet enables you to do new things. But people just want to do the same things they’ve always done.
And kids (teenagers particularly) have, for the most part, always been cruel and lacking in the empathy department. Give them tools to help facilitate that cruelness and things like this happen.
“I’ve realized how much people fear that their digital footprint is creating a digital profile of all us. Your Facebook page. Your tweets. Your Pinterest, Tumbler, Instagram pages. Your Spotify and Pandora playlists… All of these are being aggregated and evaluated to tell marketers what you like, don’t like, buy, won’t buy, your political affiliations. Five plus years of all this data tells the world who you are – whether you wanted to or not.”
Certainly, that first class of innovators/early adopters pushing ephemerality felt that same way, although I’m not sure if everyone else that followed did or if it was just a product of social lock-in. (e.g. my friends are all doing this so I should too). Personally, I don’t think of ephemeral content as a “phase” in the evolution of social media: I think there’s enough room for choice in the matter as far as what content stays forever and what content is disposable.
The big problem that these products pose to MNOs, it seems to me, is not actually the threat to SMS revenue. Rather, it’s the threat to identity. We do already have number portability, but changing your number remains a major frictional issue reducing churn. But if your contact point moves to FB Messenger or some yet-to-be-founded app that explodes in the next few years, then the SIM you have in your phone today doesn’t matter at all, and you could swap it in and out from week to week depending on which mobile operator was offering the best deal – a great recipe for truly murderous price wars.
Another thoughtful post from Ben Evans re: mobile, Facebook & what will ultimately act as the identity on your phone:
I also think that retailers should be thinking about how they can leverage the social platform aspects of smartphones – shouldn’t the Zappos app show you which of your friends have it and let you share shoes directly? Again, doing that well on the desktop would be really hard, but on a smartphone it’s just a tap or two away.
I’m all for it, in fact I had a similar use case pop up yesterday when I was away from my desktop, browsing for tickets to a game on Stubhub’s app on my iPhone. To have been able to easily share a potential seat location with my friend prior to purchase (complete with seating chart visual) in a seamless way, via a card or some other form of atomic content would have been fantastic. Instead, I have to take a screen cap (or several, depending on whether or not I can get all of the pertinent ticket information in one shot), go through my address book, find the person I’m texting, find the screenshot in my photos, pass the screenshot on and hope/pray that it gets their without failing, while I’m at a bar with no wi-fi to speak of.
Of course this also speaks to the larger point Ben brings up in this piece which is identity and how it evolves in a mobile context: who owns it? Facebook? The retailers (or whomever) themselves? Someone else? Of course like Ben, I think there are no winner-takes-all dynamics here. But I also think that it remains tied to Facebook for the time being just because there are already so many other apps & services that utilize it already as a central login and I’m not sure Apple or Google, while they certainly have the leverage, want to get into the larger identity game. I think Zuck has realized for some time now that Facebook as a company needs to evolve beyond Facebook the service as its been traditionally known for the last 10 years. One of the methods for remaining not just top of mind but tangentially connected to the Facebook ecosystem is to allow other companies the ability to leverage its platform to connect people to other native app experiences. The other of course, which Zuck is engaging in right now, is to use the cash at FB’s disposal to make strategic acquisitions in growing mobile-social platforms that allow FB the company to rely less on FB the service to serve up ads. Indeed, there may well come a point where the majority of Facebook users don’t engage with the platform at all, aside from Messenger (which is already its own de facto service); where it simply acts as this central gateway to point you to everywhere else in the mobile landscape. A more seamless version of the old portals (Yahoo, Excite) or AOL’s home screen.
Funny how these all come back around to services that existed a decade or more ago. But hey, everything is a remix, right?
FireChat (free) is one of the new generation of apps that lets you communicate to nearby iOS devices without Internet or mobile phone coverage. It shows you other people who are local to you, say on the same camping trip, and you can chat or share images using Apple’s Multipeer Connectivity Framework, which can use WiFi or Bluetooth to connect two or more devices.
There are no logins or accounts required, and no setup. Everything is open, and that is the blessing and the curse of this app. You have no way to filter who contacts you, so at a venue like a basketball game you could be deluged with abuse. The range of the app is about 30 feet.
And in many ways, mobile apps and services — which have been taking off most rapidly lately — face security challenges different from those of technology built for their desktop predecessors. The information at risk on mobile devices is often more personal than on desktop devices, because mobile devices now include things like digital wallet apps, location-tracking recommendation services, and photo-messaging apps.
A warning here, we don’t know a lot about the WhatsApp over all architecture. Just bits and pieces gathered from various sources. Rick Reed’s main talk is about the optimization process used to get to 2 million connections a server while using Erlang, which is interesting, but it’s not a complete architecture talk.
SoftBank Corp. (9984) is seeking to buy a stake in Line Corp., the mobile-messaging service controlled by South Korea’s Naver Corp., people with knowledge of the matter said. Naver shares jumped.
Line has received at least one other offer for all or some of the company, prompting it to slow preparations for an initial public offering, said two of the people, asking not to be identified as the information is private. Tokyo-based Line, which has about 340 million users, may be valued at as much as $14.9 billion, according to BNP Paribas SA estimates.
Selling to a telcom like Softbank strikes me as unusual since a lot of the service’s value is as an alternative to those same telcoms. Anyway, Line is dismissing the report as fiction:
“The report is groundless. We haven’t had any talks with SoftBank,” said an official in Naver’s investor relations team. There’s no reason to sell a stake and no plan to sell.”
This could be a big win for Line — if FFOS takes off. Telefónica has 320 million global subscribers using its network infrastructure, including a significant presence in the LatAm region where Line believes its cuddly cartoon messaging style, which features a range of cute sticker characters and games, can find a Hispanic home from home.
Natasha also notes that no sales figures have emerged from the carriers running Firefox’s OS so it’s safe to assume that the platform hasn’t taken off yet as a viable alternative.
Telefónica is presumably hoping to drive interest in its FFOS devices by leveraging Line’s regional popularity, and the popularity of over-the-top mobile messaging in general. So, while the Line application is now available globally via the Firefox OS Marketplace its FFOS app will be exclusive to Telefónica subscribers in the aforementioned (mostly LatAm) markets.
That may seem an oddity — i.e. for a platform apparently built to champion the open Web to allow controls on how apps are distributed — but it’s exactly the kind of carrier-focused flexibility that enabled Mozilla’s platform to attract such significant mobile network operator backing in the first place. FFOS gives them back an element of control that’s lacking on Google’s Android.
OK. But how will users in Latin America act? Will they actually go through the rigamarole of switching carriers/phones for one app? Or will they instead gravitate towards any one of a number of different mobile messaging apps and keep their phone? It’s a lot less expensive and less time consuming to do the latter. I understand the logic but it seems like a dangerous game they’re playing.
Video from yesterday’s segment at DLD14:
Courtesy of founder Jan Koum, who’s been speaking today in Munich, Germany at the DLD Conference:
WhatsApp processes 18 BILLION inbound and 36B outbound messages per DAY! More than 50B total daily. #DLD14
— Bill Gross (@Bill_Gross) January 20, 2014
Analyst Ben Evans mapped this out visually versus previous figures:
WhatsApp message volume growth is still accelerating. Has probably now overtaken SMS. pic.twitter.com/KsR85Mplrt
— Benedict Evans (@BenedictEvans) January 20, 2014
As for active users, Koum estimates more than 430 million MAUs, of which 35 million of those are coming from India.
Wild. In the U.S. market, WhatsApp has been knocked back a bit by Snapchat, Kik & others. But clearly they remain a dominant player on a global level.
Here are WhatsApp’s numbers in the U.S. over the last year, first for iOS then Android/Google Play, courtesy of AppAnnie:
The messaging features serve as a replacement for email, texting, and IM. Like WhatsApp, a lot of people are opting to replace their traditional SMS plans with more data and using WeChat to fill in the gap. Throw in the network effect, and even those that don’t choose to forego SMS find themselves on WeChat more and more as well in order to interact with their friends.
These messaging apps have adopted different strategies to WhatsApp when it comes to attracting and holding onto users. For Line, messaging is a front door to an experience that then opens up to include games, photosharing, stickers, and a de facto app store, which drives downloads of its other apps, including Camera and Tools. Kik is really just a mobile Web browser that hosts its own HTML5 apps, which third-party developers can now build. KakaoTalk has its own virtual eBay. And in China, people use WeChat to pay for physical goods. The messaging part, which is ostensibly these apps’ reason for existence, is actually an easily replicated commodity. It also happens to be all that WhatsApp has got.
At the same time, you could argue that Facebook had an easily replicated commodity as well at the height of the social networking wars. They won out, partially because they didn’t have all of the other intangibles that MySpace, Bebo & some of the other regional networks had. Which speaks to the question of localization and what matters in each country. Part of WeChat’s appeal is as an alternative to desktop-driven services that are largely still behind a firewall in mainland China. It doesn’t mean that people are going to start abandoning What’sApp in droves because they can’t use it as a payment mechanism. Whether or not messaging, on the surface, is easily replicable, doesn’t mean What’sApp is at risk of losing users considering the moat they’ve built up.