Thought Starters: venture capital’s global hubs, blockchains and Facebook’s ups and downs and Amazon as more than just a retailer (and we’re not talking about AWS)

Thought Starters provides me with a chance to look through the articles, research and opinion pieces I’ve read, highlighting interesting trends, developments and changes in the world you and I live in. This edition looks at the global hubs for venture capital, blockchains ups and downs, Facebook’s success and challenges and Amazon’s move from retailer to service provider among other trends and insights.

A profile of Martin Prosperity Institute points to the dominance the US has in venture capital with London ranking 7th among metropolitan centres:

Venture capital investment by metropolitan area

There’s been a lot of talk of the potential for blockchain technologies to upend the incumbents in the financial services sector, but the major banks are beginning to make themselves known. Tanaya Macheel profiles different blockchain based initiatives by some of the major American banks which includes attempts to patent innovations in a sector previously associated closely with open source technology:

Blocking off the Blockchain

Keeping on the blockchain theme, Timothy B. Lee profiles the growing pains that Bitcoin is experiencing as growing demand challenges the infrastructure of the technology as it currently stands:

The Bitcoin community is currently locked in a debate about whether to follow that same trajectory: whether to grow quickly at the cost of possibly becoming more centralized. The difference is that the way the Bitcoin network works means that early adopters have an effective veto over further growth. If a critical mass of Bitcoin stakeholders refuse to accept larger blocks, the Bitcoin network could be stuck with its current, limited capacity for years to come.

WhatsApp has done a great job of expanding its reach which has seen it recently pass the 1 billion user maker despite having only 57 engineers. What the mobile messaging platform has been less successful in doing is monetising its user base compared to Line and WeChat as Terence Lee reports although there are indications this is likely to change:

WhatsApp Statistics

Amazon is one organisation that has done a great job of monetising its platform, moving from a bare bones online retailer to a dominant player in retail providing a range of ecommerce related services to third parties (see illustration below). This ties in nicely with a recent Jan Dawson blog post where he stresses the need for providers to absorb as many activities as possible (eg Facebook) or alternatively be on as many domains as possible (eg Uber):

Amazon ecommerce value chain

An interesting recent development in Amazon’s strategy is its experiment with the opening of a physical store in Seattle with reports that they plan on rolling out 300 to 400 stores across the US in the future.

Tal Shachar with Liam Boluk point to the growing glut of content that consumers face across a range of media and with this comes the growing issue of discovery and opportunities for content curation. Sentiments further echoed in a recent post by Benedict Evans:

WeAreSocial have recently published the Digital in 2016 report, providing a range of digital benchmark statistics including internet, mobile internet, social media and mobile app usage along with a range of other indicators. Well worth bookmarking for future use:

It’s financial results season in the US with recent announcements from Apple, Alphabet and Facebook. One of the interesting points to emerge from Facebook’s results is how well the company has transitioned to a mobile first company since 2010 as Alice Truong reports:

Facebook's mobile users as percentage of all active users

Where Facebook has been less successful is in the launch of its Free Basics offering in India. The service looks to offer free access to limited selection of mobile optimised content to mobile users but has come into fierce opposition from net neutrality campaigners in India according to Lauren Smiley’s report:

Free Basics only serves a tiny Facebook-endorsed portion of the Internet to users for free — a “walled garden” as opponents call it — while users must pay to access anything else on the web. As Backchannel has been chronicling for some time, they see it as a violation of the principle of net neutrality, that all things on the internet should be treated the same to preserve competition: no faster data connection for deep-pocketed companies, no charging consumers for some sites but not others, no cordoning off slices of the internet by private companies.

Sometimes the internet doesn’t prove quite as virtual as you’d imagine. Dan Wang profiles the physical delivery of data to servers around the world by content delivery networks (CDNs) as a means of speeding up the delivery of content to internet users in a curious mix of the physical and the virtual:

So instead of using the Internet to transfer big pieces of data, companies have turned to the global freight network. High-traffic websites copy data onto hard drives (which are no bigger than what you’d use to back up your laptop), pack them into cardboard boxes, and then fly them around the world. They can be in a box in the belly of a passenger plane, right beside cartons full of iPhones.

Business Insider profiles the digital habits of American teens. Whilst the sample size of 60 is a far from representative sample, it does provide some interesting insights into the habits of younger consumers:

Most Important Social Networks Among Teens

Alexander J. Motyl warns of a Russian collapse, fueled by an economy hamstrung by its dependence on a declining petroleum market and a political system resistant to change and reform:

The problem for Putin—and for Russia—is that the political–economic system is resistant to change. Such a dysfunctional economy is sustainable only if it is controlled by a self-serving bureaucratic caste that places its own interests above those of the country. In turn, a deeply corrupt authoritarian system needs to have a dictator at its core, one who coordinates and balances elite interests and appetites. Putin’s innovation is to have transformed himself into a cult-like figure whose legitimacy depends on his seemingly boundless youth and vigor. Such leaders, though, eventually become victims of their own personality cult and, like Stalin, Hitler, Mao, and Mussolini, do not leave office voluntarily. Russia is thus trapped between the Scylla of systemic decay and the Charybdis of systemic stasis. Under such conditions, Putin will draw increasingly on Russian chauvinism, imperialism, and ethnocentrism for legitimacy.

Ben Judah recently published This is London: Life and Death in the World Citytaking the approach of a foreign correspondent to reporting on the experience of immigrants in his home city.  His interview in London School of Economics’ lecture series is well worth a listen for anyone interested in the experience and impact of London’s many immigrant communities:

The featured image is a CT mural from Torino published in ekosystem.

Thought Starters: Facebook’s M, Privacy, Driverless Cars, the Dating Apocalypse and more

The following is a collection of articles and thought pieces highlighting interesting trends, developments and changes in the world you and I live in, with an emphasis on technology.

Research from Flurry profiled by Yahoo points to the dominant role that apps have in the mobile ecosystem. The following graph doesn’t tell the entire story given the ability to reach web pages within a mobile app but does show the comparatively marginal role of the mobile browser:

Time_spent_on_Mobile

Facebook has launched its M virtual assistant as part of its Messenger offering and was recently profiled in Wired.  It has been rolled out to only a limited audience at this stage and what’s particularly interesting about the service is its use of humans as the system’s artificial intelligence develops a robust knowledge base:

“In the larger world of AI-driven personal assistants, M may seem like a regression. And as Facebook tests the tool with the public, it’s unclear whether this human-machine partnership can keep pace as the project expands to an ever-larger audience. But in a counterintuitive way, M may actually be a step forward for AI.”

Instagram now offers consumers and brands the opportunity to share photos and videos that are rectangles and not simply the iconic squares that we’ve become so used to.  Advertising Age has a look at the likely impact for brands:

There has been an awakening… #StarWars #TheForceAwakens

A post shared by Star Wars (@starwars) on

WeAreSocial follow up their profile of China with a profile of the world’s other fast developing behemoth with topline digital, social and mobile statistics for India:

A lot of noise has been made by commentators and critics about the cost in privacy that consumers are paying for the free services provided by Facebook and Google (“If you’re not paying for it; you’re the product”). Andrew McAfee jumps to their defence arguing that consumers are getting a fair deal, particularly given the plethora of consumer information already available to marketers:

“It’s true that all the information about me and my social network that these companies have could be used to help insurers and credit-card companies pick customers and price discriminate among them. But they already do that, and do it within the confines of a lot of regulation and consumer protection. I’m just not sure how much “worse” it would get if Google, Facebook and others started piping them our data.”

Maxwell Wessel looks at how the introduction of driverless cars is likely to restructure the auto industry, with the car forecasted to become less of a personal luxury and more of a utility.

The launch of UberPool brings Uber into closer competition with public transport with users picked up along what are being labelled as Smart Routes.  Given this, it was encouraging to see Nate Silver and Reuben Fischer-Baum argue that Uber and public transport are complementary and will hopefully get more cars off the road in urban centres:

Uber and Public Transport versus the Car

China’s economy seems to have hit the skids recently with Tyler Cowen giving a good overview of some of the key reasons for the downturn.  The BBC put together the following infographic which show why China’s economy isn’t significant just for the Chinese and investors in the country’s economy:

China's central role in world trade

Nancy Jo Sales‘ report on the impact of Tinder on relationships kicked up more than its fair share of criticism. Moira Weigel rightly points out that there’s been a long list of societal and technological changes that have created significant changes in courtship rituals without human society falling apart. Looking at the issue from another angle, Jon Birger’s analysis points to imbalances in education levels among men and women as creating a source of growing tension in relationship patterns.

Europe’s refugee crisis has deservedly dominated news headlines recently and the following infographic from the Washington Post illustrates why the scale of the crisis in Syria is so tragic. Please show your support:

Syria_popIf you’re in London between now and the 20th of September, I’d recommend a visit to the Photographers’ Gallery where the Shirley Baker exhibition Women Children and Loitering Men is well worth a view:

Hulme, May 1965 © Shirley Baker Estate Courtesy of the Shirley Baker Estate

The feature image was produced by Eko and published in his Flickr stream.

Thought Starters: China, Twitter, startups and the role of food

The following is a collection of articles and thought pieces highlighting interesting trends and changes in the world you and I live in, with an emphasis on technology.

China’s digital media sector has developed its own distinct characteristics with unique properties and innovations that set it apart from many markets in the West. WeAreSocial profile key digital, social and mobile benchmark statistics for the Chinese that give a taste for the key players:

The markets have not responded kindly to Twitter’s performance with one of the company’s largest investors Chris Sacca pitching in with what he feels Twitter should be doing. James Gleich provides a contrasting opinion, suggesting that it’s doing a great job as it is and leadership should be wary of turning the service on its head (even if the returns don’t satisfy investors):

“Twitter doesn’t just want to make it easy for users to find tweets. They want to make it easier for marketers to find users. Everyone wants to know the secret of how to use Twitter to reach their million potential customers. I will tell you the secret. You can’t do it. Twitter is not a giant megaphone. There is no mouthpiece. Those 300 million people, that glistening prize, are not waiting for your message. They’re not tuning to your channels. They’re choosing their own.”

Research from Branch Metrics points to the benefits of contextual deep linking, something that will become increasingly important as we move more toward an app based world:

Advantages of Contextual Deep LinkingThere’s been growing speculation about Apple’s development of their own car as the company looks to expand its footprint outside its heartland of computers and portable devices. Benedict Evans takes  an  insightful look at the market opportunity for the likes of Apple and also how new technologies and business models are likely to see the market evolve.

Mark Suster looks at the dangers of pouring investment into early stage startups where capital inflows can undo the hunger that makes startups so dangerous to the status quo. An interesting complement to this is Andreessen Horowitz’s compilation of startup metrics which provide a guide for those of you looking to assess which opportunities are really in a healthy financial position.

There’s been a lot of talk about unbundling in the cable television industry, particularly in the US which will impact what shows are produced and how they’re distributed in the future. Jan Dawson looks at the factors which will impact on whether consumers will stay with the incumbents or move to the new players such as Netflix and HBO Now.

There’s no denying there’s been a real change in what media consumers are interacting with, particularly among the younger generations. David Pakman takes a closer look, pointing to the growth in media forms which enable self expression and communication:

Media Consump

Tim Wu writing for the New Yorker takes a closer look at the growing hours faced by America’s more educated, as the age of leisure moves further off into the distance:

“What counts as work, in the skilled trades, has some intrinsic limits; once a house or bridge is built, that’s the end of it. But in white-collar jobs, the amount of work can expand infinitely through the generation of false necessities—that is, reasons for driving people as hard as possible that have nothing to do with real social or economic needs.”

The jury is still out on the ultimate effect that the digitisation of culture is having on the careers of artists and other cultural makers. Steven Johnson provides a convincing case of the benefits for musicians, filmmakers and authors with a blurring of the boundaries between professionals and interested amateurs.

We’ve seen food’s profile grow in terms of contemporary culture providing an intersection of material and experiential culture. Eugene Wei profiles this move, drawing on a recent Econtalk podcast feature Rachel Laudan:

“Food has replaced music at the heart of the cultural conversation for so many, and I wonder if it’s because food and dining still offer true scarcity whereas music is so freely available everywhere that it’s become a poor signaling mechanism for status and taste.”

You can see this issue explored further with Joe Pinsker’s interview of Eve Turow focusing on the Millennials’ obsession with food in The Atlantic.

The featured image is Rage & Fury by Nootk! in Moscow, Russia.

Thought Starters

Content that has caught my eye recently or got me thinking. I particularly recommend Tim Urban’s article on artificial intelligence.

WeAreSocial provide their wrap up of key digital up of key digital, social and mobile statistics for 30 key global markets as well as regional overviews – a valuable reference source:

Flurry’s mobile statistics point to lifestyle & shopping as growing rapidly in consumers’ use of mobile, providing a stark contrast to the more well established mobile gaming:

Time Spent Mobile

Whilst global tablet penetration continues to grow, we’re seeing a drop in the phenomenal growth rates of earlier years according to eMarketer’s forecast:

Tablets

Joichi Ito compares and contrasts the development of the internet with bitcoin,  providing a valuable lens in which to understand the fundamentals of the cryptocurrency and how it may develop in the future.

Steven Levy looks at how Google adapted its business strategy to better accommodate an increasingly mobile driven world:

Knowledge Graph structures the world’s information in a vast database. Voice Search incorporates spoken language into Search. Google Now tells what people want to know before they ask. All three, not coincidentally, are tied to Google’s focus on mobile. Though certainly not an exhaustive list, those components — and the way they work together— have helped transform Google Search in the past three years, from a delivery system of “ten blue links” into something almost psychic: a system that doesn’t behave like a computer but an intelligent hive of knowledge that wisely interprets and satisfies your information needs. And it did it all when you weren’t looking.

Benedict Evans similarly looks at how Google adapted Android and Apple adapted iOS to changing market environment and capabilities. Whilst in some respects, their positions are closer now than they were in the past, the companies strategy are based on fundamentally different underpinnings.

Nick Bilton profiles Snapchat Stories and how it fits in to the increasingly diverse range of communication channels available to consumers and particularly teenagers and young adults. Snapchat is looking to sell the service to advertisers, big question is whether it’s asking too much for the service with commentators both for and against.

Microsoft publicly revealed their HoloLens offering, taking the concept of enhanced eyewear a stage beyond Google Glass. It’s a fascinating project although it will be interesting to see if Microsoft does a better job than Google in overcoming consumers misgivings about wearing a computer on their face. Read a first hand experience of using the eyewear over on Wired:

Tim Urban profiles the growth of artificial intelligence, profiling the transition from Artificial Narrow Intelligence to Artificial Superintelligence and the innovations that are likely to enable this:

Intelligence2

The Verge highlights the role of British based Gamma Group International in supporting Bahraini regime through spyware enabling the surveillance and hacking of activists digital communications. Given the more insidious uses that surveillance can be put to, I’m not a fan of David Cameron’s proposal for backdoor access to digital communications and also given the damage this could do to the UK’s digital sector as covered by Cory Doctorow.

Raffi Khatchadourian looks at Affectiva’s move to digitally read consumers’ emotions through the tracking of facial expressions. Obvious implications for measuring the impact of marketing communications but it’ll be interesting to see how it gets used for other purposes.

LSE Cities has pulled together a data visualisation illustrating how much population densities vary among the world’s major cities and published in Vox.

City Pop Density

Aaron Sankin looks at racial preferences among users of OkCupid and Tinder which points to biases among different ethnic groups, including among those who typically claim otherwise.

The featured image is mural by Nelio and Simek in Lyon.