Alibaba is shoring up its war-chest with a massive IPO. But what does it mean for the American startups and tech companies with which Alibaba competes?
Last week, Mary Meeker revealed the newest in her annual Internet Trends reports, this one for 2014. The big news? Mobile and tablets.
Mobile — Mobile phones are now in the hands of 73% of the world’s population, and smartphones are now at 22%.
Perhaps more foundational: Mobile use of the web is now 25% of total, up from 14% year over year.
Tablets — Added together the data about mobile and smartphones represents in a startling shift. But the astonishing rise of tablets is perhaps as pivotal. Tablets increased 53% in 2013 alone: the fastest adoption of new technology, ever.
The first order effects of this tectonic shift in computing will show up in how businesses try to connect to customers, consumers, and — for media companies — the people formerly known as the audience. And internet advertising is still growing — up 16% overall year over year — but mobile advertising grew 47% to reach 11% of the total advertising market. Obviously, that is still lagging, but shows real upside.
But I am less interested in those sorts of revenue figures: advertising isn’t my beat. But the trends in messaging services are a harbinger of what is coming in the world of business.
Just six selected over-the-top messaging services (OTT means they run over web data connections or wifi, not carrier provided messaging services like SMS) have grown to tens of billions of messages per day, and over a billion active users.
Meeker makes a really smart analysis of this trend, and contrasts it with services like Facebook: people are transitioning to messaging tools geared toward frequent communication with a small group of contacts — or what I have been calling communications with a set — and moving away from broadcasting messages to large audiences — like Twitter and Facebook — which is communication with a scene, in my terms.
As Meeker describes it, this means the action is moving from supporting sets and away from scenes, where the value of the network is not principally about the number of nodes, but the number of sets and the amount of messaging going on. (Note that this sounds like a rediscovery of Reed’s Law, which states that the utility of a network grows exponentially over the number of nodes, based on the number of groups that form.)
In the consumer web, this shift is going to pose interesting challenges for businesses and advertisers, because users will be less willing to accept ad tracking, or ads at all, in what they generally consider a private context for communications in sets.
Implications for work technology — Meeker’s analysis lines up with trends we have been seeing in our own research regarding the increasing rates of adoption for mobile and set-based, OTT messaging. And in the context of work technology, the same drivers — the rise of mobile and tablets, the inclination away from large-scale, scene-oriented messaging — will play out in a similar manner to the challenges now confronting Facebook and Twitter. Except in the work technology market, it is the broadly horizontal enterprise social networks that are likely to see defections as people shift to more narrowly focused messaging apps.
As a result, witness the slowing growth and mounting losses for companies like Jive, and companies like Cisco drop their internal work management products (see What does the Cisco/Jive partnership mean?). Established work management solutions that are one element of a range of work technology in larger companies — like IBM Connections, Citrix Podio, and Microsoft’s Yammer — will be shielded from this transition longer than independents, but the change is coming. Tools like Slack (see It’s getting even more real time: Slack and Skwiggle), Convo, and Glip, which are conversational in their foundation, will begin to bleed away users from the collaboration vendors, and then I think we’ll see a big swing towards conversations, away from heavy, systems-of-record feeling collaboration tools.
Focused independents, however, will likely ride this wave. Consider Atlassian, who acquired Hipchat and so now have their own set-oriented chat solution, and whose work management solution starts with a focus on supporting developers building software. That is their beachhead, and then their products spreads out past development.
For those that are watching closely, this transition is already in motion, and will lead to a dramatic recast of how work gets done in the business of 2015. More sets, and less scenes; more chat, less posting; more time spent with smaller networks, less messaging across large networks.
A faster and looser sort of business, the sort of business where change can happen faster, where ideas can spread more quickly, and where innovation is happening close to the edge, where individuals meet and mix.
With $4.7 million in new funding, Omada Health says it will support its online program that helps people with prediabetes lower their risk, as well as expand into other disease categories.
Without the underlying pipes connecting data centers, cell phone towers and telco points of presence, there would be no internet. A $2 billion deal to merge two fiber providers shows how the new infrastructure demands of the consumer web and cloud computing are driving deals.
San Francisco-based Omada Health, a graduate of health startup accelerator Rock Health, on Tuesday launched its first product aimed at helping people with prediabetes reduce their risk of developing the chronic disease.
Businesses are struggling with how to evaluate the effectiveness of their social media campaigns. Currently, most companies are using metrics that fail to provide a clear picture of which marketing programs are increasing their revenues. Here, Sudha Jamthe outlines five metrics that accurately measure success.
With all the bad news about recent outages of Amazon Web Services and Sony’s Playstation Network, cloud-based services and the cloud industry needs to more proactively educate users to protect the “cloud” brand.
Last week the cloud computing world was shaken down to its foundation by the days-long outage of Amazon Web Services. The reach of the outage was enormous, especially for a company has been seen as the bluest of blue chips in the cloud-platform space, and no doubt many with products on the previously solid foundation of AWS are re-evaluating their cloud architectures to avoid these types of disruptions in the future. But it’s not just the large enterprises with cause for concern: Consumers, too could come to doubt the reliability of cloud-based storage and services in the wake of last week’s events.
Up to this point, the AWS situation has been viewed through the prism of technology vendors or enterprise CIOs — not surprising, since AWS is a suite of products for those who utilize public clouds as a foundation for their own web service or as portion of an enterprise IT architecture. But many many consumer-grade web services, including Quora and Foursquare, were also knocked offline, and there’s a possibility some may question the wisdom of using cloud offerings for storing their own personal data — particularly in light of the news that some of the data in the affected zones may have been lost forever.
Many purists bemoan the fact that the term “cloud” has become a catch all for anything web; certainly, it seems increasingly slapped onto anything web-related today, because of the sexiness and marketing cache attached to the word. However, there’s no arguing that real cloud-based architectures are increasingly beneath many of the consumer services we use today, be it Facebook, Gmail or Quora. As a result of the AWS outage, the cloud “brand” may have lost a bit of its shine this past week for consumers.
But it’s not just Amazon shouldering this problem. The outage and resulting impact on sites is the latest in a long line of high-profile cloud outages. Between the Amazon problem (and news of loss of data), the massive breach of Playstation Network and other recent high-profile web-service failures such as that which happened to Gmail (and this week’s limited failure of Yahoo mail), or outages at Tumblr and WordPress (see disclosure), it’s possible that the collective tarnish of the consumer web-services market could result in some users ultimately “opting-out” of consumer-cloud services. Others may start asking their providers about ways to ensure the safety of their information. And some may choose to simply not adopt new cloud-based offerings, or de-emphasize those that they do use.
In many ways we’re at a critical point for the consumer cloud. The high volume of failures of late is no doubt beginning to resonate in the consumer’s mind at the same time Amazon just launch its Cloud Drive and Apple is getting close to its iCloud rollout (or whatever it calls its cloud music service); the industry would be wise as a collective whole to figure out ways to advise consumers to manage their data, as well as prove it’s taking responsibility by creating more stable architectures that don’t fail in the first place.
What will this “collective” action look like? Who knows. Maybe it’s simple industry self-regulation in the form of the big providers jointly stating how they will strive to avoid data loss and service downtime through a variety of measured steps. Maybe an industry compliance body is created.
No matter what the industry does, it needs to act before consumers themselves decide this cloud thing isn’t worth it.
Disclosure: WordPress is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.