Thought Starters: looking critically at mobile apps, venture capital, how Volkswagen ***ked up and the decline of pornography

The following is a look through articles, research and opinion pieces highlighting interesting trends, developments and changes in the world you and I live in, with an emphasis on technology.

Consumers are spending more of their time on their smartphones in mobile apps which inevitably leads many media owners to see the development of their own as a means of increasing consumer engagement. Priya Ganapati warns that this approach is flawed in many cases with the development of mobile web offering providing a much better use of resources:

“Apps aren’t magical universes. They are part of a platform that is not viral, resource-hungry and hard to grow. So why not bet on the mobile web instead?”

Sam Altman and Paul Graham look critically at the financial fundamentals of startups in a market where valuations don’t necessarily match up with future prospects:

“Here’s a common way startups die. They make something moderately appealing and have decent initial growth. They raise their first round fairly easily because the founders seem smart and the idea sounds plausible. But because the product is only moderately appealing, growth is ok but not great. The founders convince themselves that hiring a bunch of people is the way to boost growth. Their investors agree. But (because the product is only moderately appealing) the growth never comes. Now they’re rapidly running out of runway. They hope further investment will save them. But because they have high expenses and slow growth, they’re now unappealing to investors. They’re unable to raise more, and the company dies.”

Also looking at the startup universe is Ben Thompson who points to less successful venture capitalists as being increasingly squeezed between angel investors below and more traditional investors above:

“So it is with venture capital: once startup funding requirements were reduced, the superior information and the willingness to hustle of angels and incubators earned the trust of the big companies of tomorrow, reducing more and more venture capitalists to dumb money hardly worth the 20% premium. The inputs to the Silicon Valley system have been changed, and we’re only now seeing the effects, and that should be a cautionary tale for just about everyone who thinks they and their industry are safe from the Internet’s impact.”

Matt Roskoff contrasts the falling prices of consumer electronic hardware with the rising price of television and radio services:

Prices for Electronic Goods and Services

Paul Kedrosky suggests that the Volkswagen emissions scandal may have been the result of cultural norms within the engineering department rather than a deliberate move on the automotive manufacturers management:

“It is still possible, of course, that we will learn that the engineers were under orders from management to beat the tests by any means necessary, but based on what we now know, that seems implausible. It’s more likely that the scandal is the product of an engineering organization that evolved its technologies in a way that subtly and stealthily, even organically, subverted the rules.”

Credit Suisse in their annual Global Wealth Report looks at the current spread of financial wealth across countries and regions including the disparities between the wealthy and the poor:

Global Wealth Pyramid

We are seeing a broader array of jobs affected by technology, as smarter systems enable more technically complex tasks to be automated. MIT Professor David Autor looks at the costs and benefits of these changes, suggesting that the opportunities will outweigh the threats if societies ameliorate the negative effects with education, taxation and transfer programmes.

The migrants pouring into Europe has focused largely on the plight of refugees fleeing civil war in Syria. What Alex Tabarrok points to is that by focusing on the plight of refugees, we fail to acknowledge the benefits that more open borders would provide both to people trapped in less developed societies and to global society as a whole:

“Closed borders are one of the world’s greatest moral failings but the opening of borders is the world’s greatest economic opportunity. The grandest moral revolutions in history—the abolition of slavery, the securing of religious freedom, the recognition of the rights of women—yielded a world in which virtually everyone was better off. They also demonstrated that the fears that had perpetuated these injustices were unfounded. Similarly, a planet unscarred by iron curtains is not only a world of greater equality and justice. It is a world unafraid of itself.”

Pornography has been getting plenty of column inches lately thanks to Playboy’s announcement that it will no longer be publishing full nudity, reflecting falling profitability of ‘legitimate’ operators (no tears shed here). Whilst the industry has long been pointed to as technological leader, recent changes mean that the sector is becoming something of a technological laggard according to Cade Metz:

“With the rise of mobile devices and platforms from the likes of Apple and Google, not to mention the proliferation of free videos on YouTube-like porn sites, the adult industry is in a bind. Money is hard to come by, and as the industry struggles to find new revenue streams, it’s facing extra competition from mainstream social media. Its very identity is being stolen as the world evolves both technologically and culturally.”

Another area where technology has changed the balance of power is music where we’ve seen a democratisation of the tools of production. Art Tavana looks at GarageBand’s role as a stepping stone for many budding musicians looking to get their music out and about.

If you find yourself in London between now and the start of January, I’d definitely recommend visiting Ann Veronica Janssens’ yellowbluepink installation at the Wellcome Collection. A great exercise in disorientation:

The featured image is the SatOne mural Insomnia in Mannheim, Germany and published in Graffuturism.

THOUGHT STARTERS: CONTENT THAT HAS GOT ME THINKING 13

There’s been a fair amount of coverage over the last week looking at the mobile web/mobile app divide.  Matt Gemmell provides four different classifications of mobile apps running from web apps (explicitly running in a general-purpose browser) through to fully native classifications (without an HTML/CSS user interface). He goes on to look at the pros and cons of the different options.

What really kicked things off though was Flurry’s release of statistics which point to mobile apps taking a greater share of the time Americans spend on their mobile phones.

Apps Continue to Dominate the Mobile Web

Microsoft has released an infographic which give you an idea of the mobile browser and app split as well as giving an indication of which of the major Western countries are heavier users of their smartphones.

Time Spent Using Phones Online Per Month

Chris Dixon has used Flurry’s figures to raise concerns about the trend as signalling a move away from a more open web, with Apple’s App Store and Google’s Play Store acting as potential gatekeepers.

Steve Schlafman looks at the ‘Uberification of the US service economy’ as startups deliver app based business models that bring together discovery, order, payment, fulfillment and confirmation in a closed loop.

On-Demand Mobile Services

Benedict Evans looks at the rapidly evolving mobile environment, pointing to the issues of discovery and identity as areas that we are still looking for solutions to evolve and/or mature.

A less mobile centric picture of the online landscape in the UK is provided by the following infographic, again from Microsoft.

Where the UK Spends Its Time OnlineBoth Forrester and We Are Social are giving a plug for the sometimes neglected Google+ as part of brand’s social strategy.  Engagement levels are good, even if the user population is dwarfed by that of Facebook.

Mobile will drive growth in media usage worldwide, with television and PC based internet access showing respectable increases, with print advertising being the major loser according to ZenithOptimedia’s forecast for global media quoted in Econsultancy.

Contribution to global growth in adspend by medium 20132016

The release of the Amazon Dash is a great example of Amazon’s continuing quest to reduce consumers’ barriers to purchase.

The world is seeing increases in inequality in income and wealth with Occupy Wall Street’s drawing attention to the top 1%. Priceonomics looks more closely at the figures and finds that it’s the top .01% that are really taking the cake.

Top wealth shares decomposing the top 1%The featured image is by eko