Thought Starters: Uber, Machine Learning, “Alt-Right” Democracy and Globalisation

Thought Starters provides me with a chance to review and highlight some of the more  interesting (and hopefully well informed) opinions that I’ve read over the last few weeks. This edition is dominated by the fallout from the American elections with people looking at the reasons for the rise of such an unconventional candidate and a look at what we might expect from Donald Trump’s presidency:

Is the tide turning on Uber? There’s no disputing that the ridesharing model has become a key plank of our transport infrastructure. Question is will Uber’s pool of cash be enough to keep the company going until self driving cars arrive? Yves Smith and Eric Newcomer weigh in:

Published financial data shows that Uber is losing more money than any startup in history and that its ability to capture customers and drivers from incumbent operators is entirely due to $2 billion in annual investor subsidies. The vast majority of media coverage presumes Uber is following the path of prominent digitally-based startups whose large initial losses transformed into strong profits within a few years.

This presumption is contradicted by Uber’s actual financial results, which show no meaningful margin improvement through 2015 while the limited margin improvements achieved in 2016 can be entirely explained by Uber-imposed cutbacks to driver compensation. It is also contradicted by the fact that Uber lacks the major scale and network economies that allowed digitally-based startups to achieve rapid margin improvement.

Benedict Evans released the latest version of his Mobile is Eating the World presentation which looks at the growing synergies between mobile and machine learning, with a particularly focus on retail or automotive:

Lighting everything up with machine learning

Benedict’s presentation points to mobile apps as the dominant means for consumers to interacting with the digital world. As mobile becomes ubiquitous, we’re seeing consumers sticking to the apps they know according to research from Adobe in the US:

App abandoment is on the rise as consumers stick to the apps they know

Amazon is taking advantage of mobile technology to further automate the process of shopping with their soon to launch AmazonGo offering. Better experience for consumers, less employment for retail workers:

As mobile matures, we’re seeing the next gold rush emerging in machine learning. Sam DeBrule has pulled together a valuable collection of information sources if you’re keen to track developments in the sector as they increasingly spill over into the real world:

Machine Intelligence Startups & Tools

Providing a counterpoint to Silicon Valley boosterism is Om Malik’s column warning that technology doesn’t exist in a vacuum and that the startup sector needs to be more aware of these changes if it’s to avoid a major backlash:

“It is not just Facebook. It is time for our industry to pause and take a moment to think: as technology finds its way into our daily existence in new and previously unimagined ways, we need to learn about those who are threatened by it. Empathy is not a buzzword but something to be practiced. Let’s start by not raging on our Facebook feeds but, instead, taking a trip to parts of America where five-dollar lattes and freshly pressed juices are not perks but a reminder of haves and have-nots. Otherwise, come 2020, Silicon Valley will have become an even bigger villain in the popular imagination, much like its East Coast counterpart, Wall Street.”

Ryan Broderick tracks the rise of the “alt-right” in the US and Europe and how social media provides fertile ground for its growth.

“Facebook doesn’t want to challenge you, they don’t want to upset you, because they know that if you’re challenged on their platform, you wouldn’t want to use it as much,” Derakhshan said. “The very fact that you cannot show your reaction to anything you see on Facebook by saying that you agree or disagree or that it’s true or false and you can only show your emotions to it is very telling.”

UK’s telecommunications regulator regularly releases research looking at Britons’ use of media and technology. Their most recent report covers media use and attitudes among children and young people aged 5-15, providing a valuable window into where media is heading in the future:

Media used by children aged 5-14 at home

Pew Research’s research from the US point to ebooks market share as stabilising with a similar story for printed books. Another valuable finding is that consumers are now increasingly reading e-books on tablets, PCs and smartphones rather than just dedicated e-book readers:

Print books continue to be more popular than e-books or audio books

Americans have traditionally been strong believers in economic progress with the expectation that they will be better financially positioned than their parents. Research from Raj Chetty profiled by David Leonhardt points to this no longer being the case, a situation which is presumably leading to growing dissatisfaction with the political status quo:

Chance of making more money than your parents by age cohort in the US

Much has been made of Donald Trump’s call for bringing manufacturing back to the US with suggestions that he’ll bring in more protectionist trade policy. Mark Muro in his coverage of the American manufacturing points to how automation is seeing the sector become increasingly divorced from its blue colour labour roots:

More Output, Less Employment

Another initiative Donald Trump has been touting is investment in America’s infrastructure which is one area where the Democrats and Republicans could potentially find common ground…but the devil is in the details. Ronald A Klain’s analysis of the initiative suggests that it’s more likely to line the pockets of those already working on projects rather than providing a boost to employment:

First, Trump’s plan is not really an infrastructure plan. It’s a tax-cut plan for utility-industry and construction-sector investors, and a massive corporate welfare plan for contractors. The Trump plan doesn’t directly fund new roads, bridges, water systems or airports, as did Hillary Clinton’s 2016 infrastructure proposal. Instead, Trump’s plan provides tax breaks to private-sector investors who back profitable construction projects. These projects (such as electrical grid modernization or energy pipeline expansion) might already be planned or even underway. There’s no requirement that the tax breaks be used for incremental or otherwise expanded construction efforts; they could all go just to fatten the pockets of investors in previously planned projects.

China’s economic growth is unprecedented, but a darkening political climate has led to growing suggestions that this trend may be derailed in the future as the country adopts a more authoritarian stance:

% of world GDP from year 1700 to 2008

The rise of Donald Trump, Nigel Farage and Marie Le Pen among others points to a backlash against globalisation, but analysis from The Economist point to this trend not being shared by all countries:

Attitudes towards globalisation against change in GDP per person

Amanda Taub profiles Yascha Mounk’s research pointing to declining support for democracy among many developed countries, coinciding with the growth of the “Far Right”…Although Erik Voeten’s analysis suggests it’s not quite as severe as the graph below suggest:

Percentage of people who say it is “essential” to live in a democracy

Given the rise of the far right, Yale history professor Timothy Snyder’s 20 lessons from 20th century provides valuable advice on fighting a rise in authoritarianism  (even if it is aimed at an American readership):

1. Do not obey in advance. Much of the power of authoritarianism is freely given. In times like these, individuals think ahead about what a more repressive government will want, and then start to do it without being asked. You’ve already done this, haven’t you? Stop. Anticipatory obedience teaches authorities what is possible and accelerates unfreedom.

The Danish concept of hygge has become very much of the moment with its harking back to a simpler age but Charlotte Higgins suggests that the UK’s reinterpretation of the idea is not quite so healthy:

If, for Danes themselves, hygge has an element of fantasy – through the way it draws back from difficulties, difference and debate – then the British import is a fantasy of a fantasy. Hygge may be quintessentially Danish, but there is something utterly British about the nostalgic longing for the simple accoutrements of an earlier time – especially if it can be bought. At the same time, it is hard to deny that just at the moment, the most natural thing in the world is to want to huddle round the fire and wish the outside away. Settle in: it’s going to be a long winter.

The featured image is a MOMO mural from Sicily.

Thought Starters: Google I/O, property puzzle in England and rates of innovation

Thought Starters provides me with a chance to review and highlight some of the more important or interesting research and opinions that I’ve read over the last week or so. This edition looks at Google and Apple at a crossroads, England’s property market and questions over the rate of innovation among other things:

Whilst many technological and social indicators point to the lead that Western Europe and North America has over the developing world, there are cases where incumbent infrastructure slows down the introduction of new technologies. An example of this from  the World Economic Forum is the lead Sub-Saharan Africa has in mobile money accounts, aided by the lack of traditional financial services infrastructure:

Sub-Saharan Africa has worlds largest share of mobile money accounts

Interesting benchmark figures from Pew Research on the use of online services by the American population. There’s obviously plenty of opportunity for growth still across many different categories:

72% of Americans have used some type of shared or on-demand online services

Google I/O developer conference happened on Wednesday which saw the launch of new virtual reality, mobile messaging, smart home and virtual assistant platforms and updates for Android, Android Wear and Android Auto. It’s worth checking out The Verge’s coverage of the leading announcements if you’re wanting more details on what to expect in the coming months.

Ben Thompson has an interesting follow on to the conference pointing to Google’s technical process but also suggesting that other factors at play are likely to hamper the organisation’s success:

The problem is that as much as Google may be ahead, the company is also on the clock: every interaction with Siri, every signal sent to Facebook, every command answered by Alexa, is one that is not only not captured by Google but also one that is captured by its competitors. Yes, it is likely Apple, Facebook, and Amazon are all behind Google when it comes to machine learning and artificial intelligence — hugely so, in many cases — but it is not a fair fight. Google’s competitors, by virtue of owning the customer, need only be good enough, and they will get better. Google has a far higher bar to clear — it is asking users and in come cases their networks to not only change their behavior but willingly introduce more friction into their lives — and its technology will have to be special indeed to replicate the company’s original success as a business.

Another company that’s had a strong run but for which the future is harder to anticipate is Apple. Marco Arment has been a valuable commentator and proponent of Apple and its broader ecosystem and his concerns about Apple’s long term health should definitely be taken seriously:

But if Google’s right, it won’t be enough to buy Siri’s creators again or partner with Yelp for another few years. If Apple needs strong AI and big-data services in the next decade to remain competitive, they need to have already been developing that talent and those assets, in-house, extensively, for years. They need to be a big-data-services company. Their big-data AI services need to be far better, smarter, and more reliable than they are. And I just don’t see that happening.

As a venture capitalist, David Pakman has a vested interest in a more entrepreneurial music ecosystem. That being said, I do believe he has a strong point talking about how major record labels are squeezing some of the innovation out of the music sector:

In my mind, it would have been in the long-term best interests of the recorded music business to enable the widespread success of thousands of companies, each paying fair but not bone-crushing royalties back to labels, artists and publishers. But the high royalty rates imposed upon startups, even after clear signs over the past 19 years that the strategy killed companies, prevented a healthy ecosystem from emerging. It’s a bed the music industry made for itself, and now it is left to lie in it.

Whilst there’s a been a lot of talk about the polarisation of incomes in the West, research from Walter Frick points to a similar polarisation in corporate performance with leading firms galloping ahead of everyone else:

The gap between the most productive firms and the rest is growing

Donald Trump’s nomination for the Republican party is pretty much a given now, and I’m glad to see more and more commentators coming out to express their opposition to his candidacy. Robert Kagan’s is definitely among the more eloquent, let’s just hope the US population listens to reason:

And the source of allegiance? We’re supposed to believe that Trump’s support stems from economic stagnation or dislocation. Maybe some of it does. But what Trump offers his followers are not economic remedies — his proposals change daily. What he offers is an attitude, an aura of crude strength and machismo, a boasting disrespect for the niceties of the democratic culture that he claims, and his followers believe, has produced national weakness and incompetence. His incoherent and contradictory utterances have one thing in common: They provoke and play on feelings of resentment and disdain, intermingled with bits of fear, hatred and anger. His public discourse consists of attacking or ridiculing a wide range of “others” — Muslims, Hispanics, women, Chinese, Mexicans, Europeans, Arabs, immigrants, refugees — whom he depicts either as threats or as objects of derision. His program, such as it is, consists chiefly of promises to get tough with foreigners and people of nonwhite complexion. He will deport them, bar them, get them to knuckle under, make them pay up or make them shut up.

The UK referendum on whether the country chooses to leave the European Union is fast approaching leading to some scaremongering  from the pro Brexit camp.  Providing a rather different perspective is research from Philippe Legrain who points out the economic benefits potentially provided by the influx of refugees to Europe:

Refugees who arrived in Europe last year could repay spending on them almost twice over within just five years, according to one of the first in-depth investigations into the impact incomers have on host communities.

Refugees will create more jobs, increase demand for services and products, and fill gaps in European workforces – while their wages will help fund dwindling pensions pots and public finances, says Philippe Legrain, a former economic adviser to the president of the European commission.

Over the following decade, England’s population rose by 4.1m while its housing stock rose by only 1.7m, something which any economist will tell you is going to cause some problems. This shortage is exacerbated by disparities between local authorities as The Economist recently mapped (click through for the interactive version):

Housing stock v demand

A further indication of the overheated nature of certain parts of the UK housing sector can be seen in the fact that the average first time buyer in London now earns £85k and has a deposit of £123k according to the ONS figures:

London First Time Buyers

Frans de Waal has taken a critical look at economics, pointing to its vision of the self interested human being rather different from how societies developed or currently operate:

Economists should reread the work of their father figure, Adam Smith, who saw society as a huge machine. Its wheels are polished by virtue, whereas vice causes them to grate. The machine just won’t run smoothly without a strong community sense in every citizen. Smith saw honesty, morality, sympathy and justice as essential companions to the invisible hand of the market. His views were based on our being a social species, born in a community with responsibilities towards the community.

There’s been a lot of debate over the rate of innovation, with the naysayers  attitudes illustrated by Peter Thiel’s infamous statement “We were promised flying cars and we got 140 characters.” Neil Irwin has looked at the big inventions over the last 150 years, and suggests the nature of what is being invented might have changed but the pace of innovation hasn’t:
In short, the sheer number of ways a person can be in touch with others, and consume information or entertainment, has exploded, and the price has collapsed.

This is the area in which human life has changed the most in the last 46 years. We live and travel much as we did in 1970. We eat more variety of foods. Products of all types keep getting a little safer, a little more efficient, a little better designed.

But the real revolution of recent decades is in the supercomputer most people keep in their pocket. And how that stacks up against the advances of yesteryear is the great question of whether an era of innovation remains underway, or has slowed way down.

One innovation I am expecting to see much more of in the coming years is augmented reality with its fusing of the virtual and real life. Keiichi Matsuda provides a rather dystopian view of the world we might face in years to come:

The featured image is from eko.

Thought Starters: social media, Apple, banking and changes to employment and income

Thought Starters provides me with a chance to review and highlight some of the more important or interesting research and opinions that I’ve read over the last week or so. This edition looks at the competing social media platforms and their roles, whether Apple can innovate, banking and its relationship with fintech and changes in employment and income among other things. 

Robinson Meyer revisits Reid Hoffman’s look at social networks and the parallels he draws between them and the seven deadly sins:

“Social networks do best when they tap into one of the seven deadly sins,” the LinkedIn co-founder and venture capitalist said. “Zynga is sloth. LinkedIn is greed. With Facebook, it’s vanity, and how people choose to present themselves to their friends.”

Research from Social Fresh, Firebrand Group and Simply Measured points to Facebook being comfortably ahead of other social media platforms in terms of ROI:

Social Media Platforms that Produce the Best ROI According to Social Media Marketers Worldwide March 2016

Whilst Snapchat is making growing inroads among younger audiences in the US, Instagram for the moment is proving a more popular medium for advertisers according to L2 Think Tank’s research:

Snapchat vs Instagram Adoption Among Brands Worldwide by Industry

Twitter recently reclassified its mobile app as a news service rather than social media in Apple’s App Store. Pew Research’s recent findings point to how the services have a different relationship with news content with Facebook driving more traffic whilst users referred by Twitter typically spending more time with the visited content:

On cellphones more visits come from Facebook

Given the increasingly important role that Facebook plays in distributing content, it’s no surprise that commentators cried foul when Gizmodo reported that Facebook was suppressing conservative news. A more careful reading of the news by Tyler Cowen and Ben Thompson suggests this isn’t quite as significant as the headlines suggest:

This, then, is the deep irony of this controversy: Facebook is receiving a huge amount of criticism for allegedly biasing the news via the empowerment of a team of human curators to make editorial decisions, as opposed to relying on what was previously thought to be an algorithm; it is an algorithm, though — the algorithm that powers the News Feed, with the goal of driving engagement — that is arguably doing more damage to our politics than the most biased human editor ever could. The fact of the matter is that, on the part of Facebook people actually see — the News Feed, not Trending News — conservatives see conservative stories, and liberals see liberal ones; the middle of the road is as hard to find as a viable business model for journalism (these things are not disconnected).

James Allworth profiles Apple’s business strategy and suggests that the company’s success is one of the key things holding the company back:

And it appears that Apple has fallen into exactly the same trap. Rather than start anew — with a beginner’s mind—what the above reveals to me is that they’ve tried to take the last paradigm and just jam it into the new one. The old has bled into the new. The result, at least as it stands now: just like Microsoft did, Apple knows what needs to be built — a phone-disrupting device. It’s just that they can’t bring themselves to let go of the past in order to do the job properly.

Whilst the Apple Watch hasn’t proved the breakthrough success for Apple that the iPhone provided, Neil Cybart’s analysis of Apple’s R&D expenditure points to something big coming soon:

Apple R&D Expense (Annual)

At the more nascent end of the technology ecosystem, Jared Friedman’s analysis of applicants to the Y Combinator programme provides a valuable window into the type of startups we’re likely to see more of in the very near future. Think more apps, SAAS businesses and platforms based on messaging, Slack and virtual reality among other things:

Messaging & Communications

For those of you working in startups looking to improve your product and people management, you’d be well advised to read Mike Davidson’s account of life as Vice President of Design at Twitter. He covers a lot of ground so I’m not going to try and summarise it, but it’s well worth checking out.

On the other hand, if you’re looking for a more nuts and bolts approach to improving your digital presence, Nick Kolenda’s 125 easy tweaks provides a good starting point, even if you don’t agree with everything he has to say.

The banking sector won no popularity contests over the last  9 years with its practices fueling the global financial crisis. James Surowiecki reviews moves to reform the sector suggesting improvements have been made but there’s still some way to go:

Of course, there’s much about Wall Street that Dodd-Frank has not changed. Bankers still make absurd amounts of money. Hedge-fund and private-equity managers still benefit from the carried-interest tax loophole. The big banks, though smaller, are still too big. “If you wanted financial reform to radically downsize the financial sector, or thought it was going to make a major dent in income inequality, you’re bound to be disappointed,” Konczal says. And Dodd-Frank’s work is still unfinished: many of the rules it authorized have yet to be written, and the banks are lobbying to have them written in their favor. As Ziegler told me, “The progress that’s been made is precarious. It can be unravelled.” But precarious progress is progress. Regulation involves a constant struggle to keep rules in place and to enforce the ones that are there. Dodd-Frank shows that that struggle is not necessarily a futile one: sometimes government really does regulate business, and not the other way around.

In Fintech circles there’s a lot of talk about the power of startups to disrupt the banking sector but Josh Constine suggests that these startups may actually strengthen rather than undermine your relationship with your bank:

But what many of these startups have in common is that they all rely on connecting to your existing bank to fund your accounts with them or receive money. Rather than shun the startups, the incumbents have built bridges to let you hook fintech products into your bank accounts.

The result is that while banking is changing rapidly, you might be more reluctant to change which bank you use, according to several fintech founders and VCs I spoke to.

There’s been increasingly vociferous discussions  about the impact that automation will have on employment over the long term. Josh Zumbrun’s analysis of US figures provides an indication of where things are heading.  Employment among knowledge workers and non-routine manual workers is proving much less susceptible to automation and is showing much stronger rates of growth compared to employment with routinised workflows:

The Rise of the Knowledge Worker

Pew Research figures point to the polarisation of wealth in American society as not simply coming from growing income and assets among the wealthiest but also due to the relative decline of the country’s middle-income households:

The middle class is shrinking nearly everywhere

Ed Hawkins’ data visualisation of climate over the last 150 years provides a valuable reminder that now is not the time for us all to put our heads in the sand:

Global temperature change (1850-2016)

Elisabeth Zerofsky’s profile of Marine Le Pen provides a reminder of the growing tide of nationalism in European politics and attempts to try provide a more “palatable” face on a movement that was previously at the fringe of European politics.

I am keen to hear your thoughts any of the above, whether you vehemently agree or disagree, so please don’t hesitate to use the comments field.

The featured image is a MOMO piece commissioned by the City of Sydney.

Thought Starters: look at AMP, Amazon’s dominance, corporate profits & music industry

Thought Starters provides me with a chance to review the research and opinions that I’ve read over the last week or so. This edition looks at the launch of Accelerated Mobile Pages, Amazon’s growing dominance in the digital world, rising corporate profits, the declining fortunes of the music industry and terrorism among other things.

Google’s Accelerated Mobile Pages is now out in the open. Alex Bauer profiles what it offers mobile internet users and also what is going on behind the scenes:

AMP isn’t actually new technology. In fact, AMP is what the web could have been all along, if it had been originally designed with nothing but mobile device performance in mind. This “mobile-only” approach is important because one of the ways AMP achieves its blazing-fast performance is by completely ignoring any device that is not small enough to fit in your pocket. AMP is emphatically not about making desktop websites look good on phone screens, but rather a totally separate, alternative presentation of the same content. It’s the web we already know, except stripped back to the bare essentials and then subjected to aggressive validation and rendering controls.

Alex Muir points to Facebook’s Hydra like offering as something any entrepreneur should consider as a competitor before launching a business into the B2C space:

Today, **if you’re building a service for communities or individuals then Facebook is almost certainly your biggest competitor. ** B2B: Excel, B2C: Facebook.

Ben Thompson recently profiled how Amazon is leveraging its scale in ecommerce and cloud computing to gain a near insurmountable competitive advantage. Eugene Kim’s collection of charts profiling Amazon provides a valuable complement to Thompson’s words illustrating what a behemoth the organisation present (at least in the US):

Amazon's long term growth

Bastion of free market economics, The Economist has made a convincing argument that the US economy needs more competition (and regulation) pointing to growing concentration and rising profits among the country’s leading firms:

Even better at making money

Scott Santens joins the chorus of voices raising concerns about the threat automation poses to employment with Google DeepMind’s AlphaGo illustrating the major advances in artificial intelligence capabilities which could upturn society as we know it:

No nation is yet ready for the changes ahead. High rates of labor force nonparticipation leads to social instability, as does a lack of consumers within consumer economies. It turns out, humans are good at designing things, but not so great at picturing a world that their technology will create. What’s the big lesson to learn, in a century when machines can learn? Maybe it is that jobs are for machines, and life is for people.

Ben Sisario and Karl Russell profile the declining fortunes of the music industry over the last ten years with growth streaming services and vinyl sales failing to fill the hole left by declining CD sales. Whilst the figures don’t allow for revenues from other revenue streams such as concerts, sponsorship and branded content initiatives, overall, the picture isn’t particularly healthy: 

Music industry revenues

An interview with Michael Rosenfeld sheds some light on how online dating is (and isn’t) changing the nature of relationships in the 21st century:

I don’t think that that theory, even if it’s true for something like jam, applies to dating. I actually don’t see in my data any negative repercussions for people who meet partners online. In fact, people who meet their partners online are not more likely to break up — they don’t have more transitory relationships. Once you’re in a relationship with somebody, it doesn’t really matter how you met that other person. There are online sites that cater to hookups, sure, but there are also online sites that cater to people looking for long-term relationships. What’s more, many people who meet in the online sites that cater to hookups end up in long-term relationships. This environment, mind you, is just like the one we see in the offline world.

The rise of Donald Trump is one of the more interesting (and scary) phenomenons in the US’s current election cycle. Clare Malone looks at where Trump’s support comes from:

The Upshot’s look at the geography of Trumpism showed a number of variables linked to areas of deep Trump support — counties where a high proportion of the population is white with no high school diploma, where there are large numbers of mobile homes, and where there is a poor labor-force participation rate. Political scientists Michael Tesler and John Sides recently pointed to new research that shows “both white racial identity and beliefs that whites are treated unfairly are powerful predictors of support for Donald Trump in the Republican primaries.”

Whilst playing to race is an important part of Donald Trump’s success, changing demographics point to a strategy of appealing to America’s white population as becoming increasingly untenable in the future according to Pew Research forecasts:

The changing face of America

The recent terrorist attack has led to an inevitable concerns among Europeans about their personal safety. Annalisa Merelli’s analysis of deaths and injuries from terror attacks in Western Europe point to the region being no more dangerous than in the recent past although digital media is no doubt amplifying current fears:

Dead and injured in terror attacks in Western Europe

The featured image shows a Hazul Luzah mural from Underground Paris’ interview with the Portuguese artist.

Thought Starters: children’s media use, app streaming, Dribbbilisation and privacy

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.

Ofcom released Children and Parents: Media Use and Attitudes Report this month which provides a detailed look at the media consumption and device usage of children and teenagers in the UK. Among the interesting statistics are changes in the social media usage and inevitably high penetration of smartphones:

Main social media site used by children

Consumers movement from a browser to an increasingly app based interactive experience poses a significant threat to Google’s business model where the majority of income continues to come from search.  Among the ways that Google is looking to address this threat is the deeper indexing of content from apps and the launching of app streaming smoothing the transition from search to app usage.  You can see an example of it in action below with a search for a hotel in Chicago leading to the Hotel Tonight Android app below:

Google App Streaming

A further indication of the growing importance of mobile can be seen in the growing share mobile is taking of ecommerce revenues in the US according to figures from comScore:

Mobile commerce as share of total ecommerce revenues

An interesting companion piece to comScore’s forecast are figures from the Wall Street Journal which point to a decline in retail space per capita in the US which is no doubt fueled by growing ecommerce sales:

Retail space decline

WeChat provides an interesting case study in how we might see the mobile ecosystem developing in the West with mobile messaging becoming a hub for an increasingly diverse range of services. Edith Yeung profiles some of the different services currently offered in China – we’re beginning to see this with Facebook Messenger’s expansion of functionality and there’ll no doubt be plenty more to come in the near future.

Paul Adams criticises many designers for paying too much attention to aesthetics and not enough attention to purpose in what he describes as the Dribbbilisation of Design (referencing design showcase site Dribbble).  Adams argues that designers need to give greater consideration to outcomes, structure and interaction, particularly as we move to an environment where interactive design permeates everything:
The Dribbblisation of Design

Tony Aube points to the move to an increasingly messaging based world driven by artificial intelligence as making the traditional model of visual user interfaces irrelevant:

“What I do believe, however, is that these new technologies are going to fundamentally change how we approach design. This is necessary to understand for those planning to have a career in tech. In a future where computers can see, talk, listen and reply to you, what good are your awesome pixel-perfect Sketch skills going to be?

Let this be fair warning against complacency. As UI designers, we have a tendency to presume a UI is the solution to every new design problem. If anything, the AI revolution will force us to reset our presumption on what it means to design for interaction. It will push us to leave our comfort zone and look at the bigger picture, bringing our focus on the design of the experience rather than the actual screen. And that is an exciting future for designers.”

Benedict Evans reviews the competition for control of the television which he characterises as a ultimately a sideshow to the broader battles for the PC and more recently the smartphone and tablet:

“Games consoles’ closed ecosystem delivered huge innovation in games, but not in much else. The web’s open, permissionless innovation beat the closed, top-down visions of interactive TV and the information superhighway. The more abstracted, simplified and closed UX model of smartphones and especially iOS helps to take them to a much broader audience than the PC could reach, and the relative safety of installing an app due to that ‘closed’ aspect enables billions of installs and a new route to market for video. It’s not that open or closed win, but that you need the right kind of open in the right place.”

GroupM has released its forecast for the UK media sector, with a continuation in the trend of decline in print advertising and robust growth from television and interactive advertising:

Media Spend Forecast

The Flexport blog looks at the overinvestment in freight shipping capacity where the impact has been compounded by a decline in Chinese exports leading to some unintended consequences:

“It costs $300 to move a 40-foot container from Rotterdam to Shanghai, which is barely enough to cover the cost of fuel, handling, and Suez Canal fees. Here’s some more context. Let’s say that you want to travel for a year; it’s cheaper to put your personal belongings in a shipping container as it sails around the world than to keep it at a local mini-storage facility.”

Germany has long been a manufacturing powerhouse (see below). What The Economist asks is whether the country can adapt to an environment where a greater share of the value added comes from outside the traditional domains of designing and assembling goods:

Manufacturing as percentage of GDP

Turkey’s recent shooting down of a Russian air force plane has raised serious concerns about a further escalation of the conflict in Syria. Liam Denning argues the conflict reflects the increasingly embattled position Russia faces as oil prices decline (I wouldn’t paint Turkey’s role as necessarily benevolent given its support for anti Kurdish forces in Syria):

“Two things flow from this. First, Syria may represent just one front in a many sided struggle by resource-dependent countries such as Russia to maintain their position in oil and gas markets that suddenly look more like actual competitive markets than they did just a few years ago as new supply has entered the scene. That, rather than a Turkish border dispute, is the central geopolitical drama affecting energy.”

We’re seeing privacy at the centre of debates around online advertising and state surveillance but Greg Ferenstein explains that the concept of privacy is a relatively new one. He explores the emergence of privacy and looks at how we’re likely to see it further evolve in years to come:

The History of Privacy

The Economist has produced a valuable interactive infographic (it’s worth visiting The Economist for the interactive version) allowing viewers to examine which countries are doing a better job of empowering women in the workplace. Britain seemingly doesn’t do well in any of the measures:

The glass-ceiling index

The US is often characterised as deeply religious which has an inevitable impact on national and ultimately international politics. Given this, it’s interesting to see Pew Research Center’s latest recent research into religion and faith pointing to the country becoming more secular:

How the U.S. public became less religious

The featured image is Pistache, Bleu Gris et Noir by eko.

Thought Starters

Content that has caught my eye recently or got me thinking, which includes coverage of enterprise technology, changing nature of interaction on the internet and citizen journalism among other subjects.

Recent data breaches at Sony, Target and Home Depot point to serious security issues within large enterprises but Steven Sinofsky points to the move to cloud infrastructure and other developments as addressing many of these concerns in the near future. It’s also worth reading Sinofsky’s look at trends within the workplace in 2015 for Re/code, taking a closer look at cloud and hybrid cloud solutions, email, tablets and mobile device management among other matters.

Ben Bajarin takes a closer look at the emergence of the mobile internet,  pointing to its dominant role in China, with Western markets likely to follow. Ignore at your peril.

Complementing Bajarin’s analysis is Chris Dixon’s coverage of the move from a search to social centric model in what he describes as a move from a pull to a push model of the internet:

Social Media

The Lending Club IPO has placed a spotlight on the emergence of peer-to-peer models within the financial sector. The Economist’s comparison of the costs of the Lending Club versus traditional channels illustrate why Lending Club and other peer-to-peer operators are seen as a disruptors:

Lending Club

The sharing economy has taken a lot of stick for what some critics has described as providing an unfettered form of capitalism. The Nation posits an alternative model of the sharing economy in which associated technologies enable a more collective model of business:

Sharing Economy

Serial reignited my interest in podcasts even if the show didn’t manage to maintain its early momentum. EJ Dickinson compared reporting of the case on the podcast to that on Reddit, with the latter providing a valuable indication of the value of citizen journalism.

Hannah Kuchler covers Pew Research Center’s study into the Ferguson riots, pointing to the long delay in television news’ coverage of the event when compared to social media:

Ferguson

A pair of Morgan Stanley analysts experiences with the much lauded GoPro point to the fact that there are likely to be limits to the success of the action sports video camera:

1) Our feats as equity research analysts provoke way fewer jaw-dropping oohs and ahhs than the world’s top motorcycle freestylers

2) it is way easier to shoot hours of raw video content (the hardware capabilities are great) than it is to create anything that is even remotely digestible

3) the video editing and creation process is incredibly laborious—it took nearly 8 hours of work to create a sub-2 minute video—even as GoPro’s Studio helped ease the process (we didn’t have to match soundtrack to video, Studio’s [software provided] templated clip lengths and transitions, while providing a general storyboard outline).

Bloomberg reports on how the American economy is becoming increasingly independent of the petroleum sector with an interactive infographic – worth a look:

OIL

The Economist profiles the emerging middle class in developing societies as more of the world’s population finds themselves emerging from poverty:

Middle Class

Joseph E. Stiglitz looks at the emergence of China as the pre-eminent global economic power and what this means to the U.S.

The featured image is mural by Patel in Rio San Juan, Dominican Republic and found on StreetArtNews.

Thought Starters

A mixed collection of materials looking at societal trends and the impact of technology on the way we live.

The McKinsey Quarterly profiles technological disruption, emerging markets growth and ageing population as trends that will have a substantial effect on business in the coming 50 years:

Workers per Dependent

Going on public confidence, we’ve still got a long way to go before the world pulls out of the recession according to research from Pew Research, although reassuringly, UK is among the more confident:

Economic mood

Americans are seemingly chain to their desks, followed not too far behind by the UK according to research from the National Bureau of Economic Research. Salon’s reporting of the research also highlights willingness of Americans and Britons to work weekends and evenings:

Working hours

The Economist profiles  the world  of real time bidding for online advertising which has gained a strong foothold in US and UK markets and looks likely to rapidly spread to the rest of the world:

Real time bidding

Research from Harvard Business School profiled in Forbes contrasts the ROI from search and display advertising. I won’t giveaway who came out on top.

Much has been made of the impact that Amazon is having on the retail sector with effects particularly felt in the book sector. Zachary Karabell’s reporting points to the independents rather than the larger book store chains as proving best able to respond to Amazon’s encroachment.

The Guardian has avoided adding paywalls to its website unlike competitors The Times and the New York Times. What the organisation has done is follow the lead of other move media organisations and establish a membership led events programme offering that will bring its staff more into face to face contact with its readers:

Guardian

The New Statesman profiles bellingcat which looks to use a citizen based journalism model to shed light on conflict zones, with successful reporting from Ukraine and Syria among other locations.

There’s been no shortage of coverage of Apple’s launch event for Apple Pay, iPhone 6 and Apple Watch. Marco Arment looks at what we would like to see with the Apple Watch but then goes on to praise Apple for its ability to produce best in class product design:

The ideal smartwatch would have a high-resolution, color, self-illuminated but not too bright, highly visible yet completely subtle screen that’s always on, but isn’t tacky and doesn’t draw much attention to itself from others. The screen must be as large as possible so you can read and touch it nicely, but as small as possible so it isn’t ostentatious and doesn’t look out of proportion on a wrist. This screen, and all of the other components, must use as close to zero power as possible because the battery needs to last at least a week (ideally much longer), weigh as little as possible, and occupy almost no space.

So it needs to be bright, dim, bold, subtle, large, and small, with a battery that lasts a month with zero mass, and some compelling everyday applications beyond telling time and showing phone notifications. The true design challenge isn’t making it pretty — it’s making it good.

Horace Dediu in his analysis points to Apple’s presentation which highlighting the Watch’s role as timepiece, communicator and health and fitness device but he goes on to suggest that we will see lots more use cases emerge in the coming years.

Whilst much of the consumer attention was on the iPhone and Apple Watch launch, we may well find that it’s Apple Pay that will have the most substantial long term effect  on our society, giving the mobile payments sector an important boost.

For those of you wanting to find out more about the wearable technology sector outside of Apple’s launch, you might want to try PSFK’s recently released presentation:

Tinder has reshaped the way that many people approach dating and relationships. If you’re interested in finding out more about the site, I’d suggest you try Kiera Feldman’s oral history or for a more analytical approach try Anne Helen Petersen looking at how race and social class affects people’s choices on the platform.

Tinder

A lot of noise has been made about the disruptive forces of Silicon Valley. Airbnb founder and CEO Brian Chesky argues that the tech sector should be more selective in their use of the phrase and suggests that Airbnb is more a return to older ways of doing business rather than something totally new:

 Dougald Hine highlights the need for reflection as consumers are faced with an ever expanding hosepipe of information:

The latter requires, among other things, space for reflection – allowing what we have already absorbed to settle, waiting to see what patterns emerge. Find the corners of our lives in which we can unplug, the days on which it is possible to refuse the urgency of the inbox, the activities that will not be rushed. Switch off the infinity machine, not forever, nor because there is anything bad about it, but out of recognition of our own finitude: there is only so much information any of us can bear, and we cannot go fishing in the stream if we are drowning in it. As any survivor of the 1960s counterculture could tell us, it is best to treat magic substances with respect – and to be careful about the dosage.

The featured image is by Ben Slow in Vitry, Paris and was found on vitostreet’s Flickr stream.

Thought Starters

A mixed collection of materials looking at societal trends and the impact of technology on the way we live.

We’re seeing a rapid growth in some of the developing world’s major cities as rural populations migrate in search of better economic opportunities. Joel Kotkin takes a critical look at this phenomenon, pointing out that there in many cases isn’t the necessary demand needed for unskilled labour that will lift these populations out of poverty:

Here’s the difficult truth: Most emerging megacities, particularly outside of China, face bleak prospects. Emerging megacities like Kinshasa or Lima do not command important global niches. Their problems are often ignored or minimized by those who inhabit what commentator Rajiv Desai has described as “the VIP zone of cities,” where there is “reliable electric power, adequate water supply, and any sanitation at all.” Outside the zone, Desai notes, even much of the middle class have to “endure inhuman conditions” of congested, cratered roads, unreliable energy, and undrinkable water.

Research from  Betsey Stevenson and Justin Wolfers points to money being able to help buy happiness, with this correlation appearing not to even tail off for more wealthy consumers:

Life satisfaction and income

There has been a lot of talk about disruption, particularly from Silicon Valley with commentators pointing to the threat this process poses to market incumbents. Research from Ian Hathaway and Robert Litan looks to pour some cold water on this view. Among the research’s finding are  that the US is seeing a declining number of start ups which are faced with growing failure rates whilst older enterprises are taking up a growing share of the overall number of businesses:

Companies by Age

Jamil Anderlini reports on growing property prices in China with warnings of a property bubble.  This could have serious negative effects on the country’s economy. A frightening prospect given the size of the country’s population and economy and the role on effect for the rest of the world:

Property Price Comparison

Benedict Evans looks at the impact that mobile is likely to have on the World’s population, with its impact reaching well beyond the developed world consumers associated with the PC driven internet:

Global Adult Population

There’s been a fair bit of noise recently about the declining role of the tablet with lacklustre sales and phablets arguably providing a good enough solution for many consumers. In response, Walt Mossberg jumps to the tablets defence, arguing that there are enough use cases to ensure that the format will see continuing success in the coming years:

I believed then, and now, that the success of the iPad depended not on whether it would wholly replace the laptop, but on whether it could be the best, or most convenient, computer in enough common scenarios for which the laptop (and, to a lesser extent, the smartphone) had been the go-to choice.

Android continues to be the dominant mobile operating system among global consumers market share. Despite this, Semil Shah argues that the development of an Android mobile app should run a distant second for the majority of startup businesses:

The common wisdom used to be iOS first, Android second — but I think it needs to be amended right now to the following: “With the caveat there may be a small handful of apps which need to be on Android early, mobile startups should be iOS first (of course) and resist the urge to make Android second too soon.” For a product early in its life cycle, the return on investment often can’t be justified.

Pew Research’s work points to consumers as being less willing to discuss serious issues via social media when compared to other social channels leading to what they’ve dubbed the ‘Spiral of Silence.’

Social Debates

Competition is hotting up in the ride sharing business with Uber recruiting drivers from its competitor Lyft – a not unusual practice in a competitive market. What Farhad Manjoo points out is that despite the best effortsof Uber and Lyft, there’s little in the way of differentiation between the two which face serious risk of commodification.

 The Atlantic profiles Google’s experiments with drone delivery suggesting that Amazon’s well publicised forays into this area weren’t simply a publicity stunt. Whilst the technology is interesting, what I found most interesting was the argument that this would enable a move towards a more access based society

Those ideas, in turn, became key planks in the original conception of the “sharing economy,” imagined as one in which the world could make much less stuff because efficient, digital logistics would let each asset be used by more people.

“It would help move us from an ownership society to an access society. We would have more of a community feel to the things in our lives,” Teller preached.

In the ‘something to look forward to’ basket is Juno director Jason Reitman’s Men, Women and Children which looks like taking a less than flattering look at the role of technology on the way we live our lives.

The featured image at the top of the page is a piece by by Paulo Arraiano in Djerba, Tunisia and found on StreetArtNews.