Zoox raises $200 million at $1 billion valuation for its self-driving cars

Zoox raises 0 million at billion valuation for its self-driving cars

TechCrunch has confirmed reports that auto startup Zoox is raising about $200 million at a $1 billion valuation. We’ve also learned that investors Lux Capital and DFJ are involved in the round.

The Palo Alto-based startup founded by Tim Kentley-Klay and Jesse Levinson, has been deliberately quiet about what they are working on presumably for competitive reasons, but the Zoox team has been working on autonomous vehicles for a few years now.

Zoox is said to be building technology that could compete with Google’s self-driving cars and Cruise Automation, which was recently acquired by GM.

Zoox made an appearance at the LA auto show in 2013.  Then these renderings of a “Boz” design emerged, lacking windshields, to emphasize the car’s autonomy.

Sources tells us that Zoox is more than a car that simply steers itself, but that every aspect of the car has been reinvented. They think that they have proprietary technology that could help them compete with Tesla.

As the technology improves with self-driving cars, there has been talk that Uber-like services will be purely automated. Significant investment has been poured into automotive startups, and traditional automakers, which have been slow to innovate, are likely to continue making acquisitions in the space.

We have reached out to Zoox for comment.

Source: TechCrunch

Capitalizing on foundations of innovation

Capitalizing on foundations of innovation

Two of the most important technological advances that helped fueled much of the country’s record economic growth in the post-WW II era were ubiquitous computing devices and modern communications technologies.

Indeed, most of the companies covered on TechCrunch certainly would not exist if not for the development and commercialization of microprocessors and the internet.

In my opinion, insufficient attention in the current ideological debate taking place in Silicon Valley and around the country has been given to the important role that government played throughout the lifecycle of these technologies. Understanding how these relatively mature technologies and industries were initially spawned and encouraged is critical to developing a strategy to empower the next generation of entrepreneurs in capital- or R&D-intensive industries with high growth potential.

ENIAC was the first “programmable, general purpose, electronic digital computer,” and is widely regarded as the first modern general-purpose computing device. Its construction was financed by the U.S. Army beginning in 1943; the project was completed in 1946 at a total cost of $400,000.

Only after the government’s investment in the research and development of the first ENIAC did similar vacuum tube-based computers find their way into industry. These machines were enormous, however, and the microelectronics we take for granted today would not have been possible without subsequent innovations.

The modern integrated circuit (IC) was developed by Jack Kilby while at Texas Instruments. He was working on a project sponsored by the U.S. Army Signal Corps to develop a way to use smaller transistors as a replacement for the bulky vacuum tubes; he developed the integrated circuit as an alternative approach. However, the cost of Texas Instruments’ early integrated circuits were high; a single IC cost $450 in 1960. As a result, industry reacted coolly to the introduction and it was the military that was the technology’s early adopter.

After reading the paragraphs above, it may seem less surprising that the first computer processors based on ICs were developed for NASA’s Apollo Guidance Computer, and many of the basic protocols and technologies at the foundation of the modern internet were invented by researchers working for the Defense Advanced Research Projects Agency (DARPA).

As Isaac Newton wrote, “if I have seen further, it is by standing on the shoulders of giants.” In the case of the tech industry, it is not only past innovations, but the cumulative investment in developing and commercializing those innovations that provide both inspiration and a platform for future innovation.

The smartphone owes its existence to the early research on ENIAC, the IC and the microprocessor. Some tech entrepreneurs may have a visceral reaction to Elizabeth Warren’s assertion that “you didn’t build that alone,” but the tech industry owes an enormous debt to the government for its early sponsorship of the predecessor and enabling technologies that make the modern high-tech economy possible.

We can either come together to reinvest … or we can take profits and fall behind.

The innovations that are likely to be responsible for substantial economic growth for the next century include enabling technologies for clean, efficient energy production and personalized medicine. In fact, government investment in basic research, such as its expenditure of $2.7 billion 1991 dollars over the more than decade-long Human Genome Project, and commercial subsidies, such as federal and state renewable energy tax credits, have already played a critical role in kick-starting these industries.

While some argue that we can cut our way to long-term growth by lowering taxes, it is worth noting that between 1943 and 1980, when most of the innovations described above were developed, marginal federal income tax rates on the highest earners were among the highest in our country’s history.

It is also worth noting that government investment in research and development, and renewable energy tax credits, are “subsidies” that have allegedly been the target of well-funded and well-organized opposition by fossil fuel interests who masquerade as Libertarians (the Koch Brothers). Other countries are not hamstrung by ideological opposition to clean energy investment. In fact, China, not the U.S., is the world’s largest investor in renewable energy.

The stakes could not be higher; nothing short of America’s long-term economic competitiveness is at stake. In my opinion, the choice is clear: We can either come together to reinvest in growth and maintain our leadership in an increasingly competitive global economy — or we can take profits and fall behind.

Featured Image: BrAt82/Shutterstock
Source: TechCrunch

IBM’s Cognitive Social Media Command Center is bringing Wimbledon to you

IBM’s Cognitive Social Media Command Center is bringing Wimbledon to you

Most tennis fans would salivate over the chance to witness Serena Williams attempt to win Wimbledon and tie Steffi Graf’s 22 Grand Slams, pulling within two of Margaret Court’s 24 for the most major singles titles in women’s tennis history. But for those unable to make the trip to London to witness the tournament, which is currently in full swing, IBM now offers a new way to experience the event via Wimbledon’s official smartphone apps and website.

In addition to improvements made to Wimbledon’s official smartphone apps for iOS and Android and a new Apple TV app — all of which IBM designed, built and hosts via its iX hosting team — the company is also powering this year’s tournament with its new Cognitive Social Media Command Center, which was built with the company’s Watson and hybrid cloud technologies.

WimbledonBacked by Watson’s ability to read and understand natural language, the Cognitive Command Center ingests feeds across several social media platforms. It separates conversations about Wimbledon from conversations about other sports going on right now — like the Euro 2016 soccer tournament — and pinpoints and highlights trending topics about Wimbledon itself. Across roughly two weeks of the tournament, IBM will capture 3.2 million data points from 19 courts with an accuracy target 100 percent and a sub-second response time.

How? Well, the Command Center uses Watson’s APIs, including its Natural Language Classifier and Alchemy Topic Analysis services, to review social media comment across Twitter, Facebook, Instagram and YouTube. Those same APIs are trained to recognize what’s relevant to Wimbledon. Once it hones in on those sticking points via real-time conversations, the Command Center is able to identify emerging topics, geographic locations, key sources of information and who key influencers are, according to Sam Seddon, IBM’s Wimbledon and RFU Client and Program Executive.

The deluge of information gives Wimbledon’s digital team of editors insight into how to tune their approach, giving them a first mover advantage around where to focus.

“It’s all for getting Wimbledon in front of as many people around the world as possible,” said IBM Technology Manager John Kent. “Watson analyzes volumes of information in the world of social.”

He added: “Our primary role is to work with the club, help them really take the tournament and bring it to the world in concert with their brand. Whatever experience we create needs to be done the Wimbledon way, if you will. Their ‘in pursuit of excellence’ mantra is something that’s not just a tagline, but something they live, breathe and feel.”

To accomplish that under Wimbledon’s standards, IBM beefed up its mobile applications, allowing fans to pick the players, events and countries they want to follow with the help of curated content that’s catered to their selections. So if you choose Serena Williams, for example, you’ll get alerts when she takes the court, her real-time match information, end results, and stories about her — both on and off the court.

Fans at the event will also get to participate in the “My Wimbledon Experience” via the mobile app. Part of that includes the “Create My Story” feature, which allows fans to check off their customized bucket list, whether it’s being at center court or checking out Wimbledon’s famed Henman Hill. Photos they take are pre-fitted with a social media-ready Wimbledon border.

Source: TechCrunch

Zenefits halves its previous valuation to $2B to head off investor lawsuits

Zenefits halves its previous valuation to B to head off investor lawsuits

Zenefits is executing a change in its current ownership structure that will increase the overall ownership of the company for late-stage investors, in a move that revalues the company’s Series C round at $2 billion and looks to placate investor concerns over the company’s regulatory investigations.

As part of accepting the new ownership changes, the investors participating will sign a release of claims against the company. It’s another move that new CEO David Sacks is doing in what’s been a massive cleanup effort of the company following report after report of the company skirting insurance regulation. Since all those regulatory issues came to light, the company has laid off more than 350 employees and parted ways with its former CEO Parker Conrad. The biggest issue stemmed from a program called “The Macro” that would aid in circumventing state licensing requirements.

“Since shortly after becoming CEO, I have been in discussions with a number of our major investors about how we can reset our relationship in light of the fact that they (like I) were never informed about the Macro before investing in the company,” Sacks said in a memo released today. “We have been working on a new basis on which they can re-commit to the company and get fully aligned with the new Zenefits.”

It’s not surprising that investors, who have a big stake in the company’s success, would also want some kind of guarantee that their investment is still in decent shape given the company’s problems. The hope here it would seem is that Zenefits — and Sacks — can quickly put all this in the past and start rebuilding the company and placate investors, rather than having to face off against them.

Here are the details: Investors in the company’s Series C round, where it raised $500 million at a previous $4.5 billion valuation, will have their ownership stake upped from around 11% to 25%. A source tells us this amounts to a change in the share conversion rate upon a liquidation event. That change now effectively now values the company at $2 billion in its Series C round, and earlier investors will receive small adjustments to offset the dilution.

The company’s common stock will be diluted by around 20%. Non-executive employees will receive a special stock grant equal to 25% of their current number of shares, to offset the dilution, that will be vested in 12 months and consist of restricted stock units rather than options. That move should help also placate employees, who previously had an opportunity to accept a generous severance but decided to stay on board with the company.

Now, here’s the big question: what happens when it needs to raise money again?

Zenefits, even with its skirting of regulation and growth proclamations, reached $60 million in ARR in 2016, Sacks said in an email detailing the layoffs of 250 employees in February. Former CEO Conrad previously said, when the company raised its $500 million round, that Zenefits was on track to hit $100 million in annually recurring revenue by January 2016. This was certainly a miss, and raises a lot of questions as to whether Zenefits would be able to control its burn in the wake of missing those targets. At a $4.5 billion valuation, and with all the issues the company has had, that certainly could scare away investors. But it’s now going to be a bigger question as to whether they’ll buy in even at a lower valuation.

“At some point, this company will want to sell its shares again, and future prospective shareholders will look closely at how we treated our current shareholders,” Sacks wrote in a note coinciding with the announcement.

All this is basically a way to reset expectations for investors, as well as try to retain employees following the changes in the company’s ownership structure. Shareholders were kept in the dark in relation to the existence and use of “The Macro,” which required a reset of the relationship. Zenefits grew like a rocket ship, reaching a $4.5 billion valuation in just about two years after the company started. That, at the time, labeled the company as one of the fastest-growing SaaS startups ever — but, obviously, there was a bunch of shady stuff going on behind the scenes to pad that growth.

Sacks has made other moves to try to restructure the company, which was being torn asunder by investigations, a party culture and the break-neck growth that Conrad went after in its earliest days. Zenefits offered its employees a buyout offer that equaled to two months’ severance in an effort to effectively reset the culture of the company, of which Sacks said around 10% of employees accepted. It also open-sourced a new application that provides licensing controls to companies in what seemingly amounts to a mea culpa to the industry. “We are becoming the Compliance Company,” Zenefits wrote in an announcement of the effort.

And, of course, this is yet another instance of companies finding themselves resetting expectations for investors in the wake of a changing financing environment. If Zenefits wants to raise capital again, it’s going to have to deal with two issues: controlling its burn as it continues to try to grow, and also resolving its regulatory issues.

One footnote to the announcement: the agreement does not include a release of claims for the $10 million in stock Conrad sold. “I hope that issue will be resolved in the near future,” Sacks said in the memo.

Andreessen Horowitz, Fidelity, TPG and Insight Venture Partners all agreed to the new investor agreement.

“I want to thank our investors for reaffirming their confidence in us. We take our commitment to you seriously to build value for all shareholders,” Sacks said in the memo. “As a result of The Offer and Investor Settlement, all of our employees and investors will be aligned, committed, and focused on what’s next, which is the launch of Z2 in October.”

Here’s the full memo:

As you all know, I became CEO of Zenefits in February after it was discovered that the previous CEO/founder had written a software program (or “Macro”) that was widely disseminated in the company to circumvent a state licensing requirement. He resigned, the Board asked me to step in, and since that time, we have been working to remediate the situation and reset our relationships with all of our key stakeholders. These include regulators, industry partners, customers, employees and investors.

Our efforts have included self-reporting the Macro issue, bringing our licensing into compliance, changing our leadership and governance, instituting new company values, and transforming the culture so that compliance is a top priority. We announced plans with Salesforce to open-source our licensing controls so the rest of the industry could benefit from our technology. We also offered a generous voluntary separation package (“The Offer”) for any employee who did not agree with the new direction. I’m proud that roughly 90% of employees chose to stay and re-commit to the new Zenefits.

Today we are announcing something similar for our investors. Since shortly after becoming CEO, I have been in discussions with a number of our major investors about how we can reset our relationship in light of the fact that they (like I) were never informed about the Macro before investing in the company. We have been working on a new basis on which they can re-commit to the company and get fully aligned with the new Zenefits. We are announcing that agreement today.

This agreement will increase the ownership of our Series C investors, who invested approximately $500 million in May 2015, from about 11% of the company to about 25%. This effectively revalues the Series C at a $2 billion valuation. The Series A and Series B investors will receive small adjustments to offset their dilution. The common stock will be diluted about 20% from its current level — about the same as a typical financing round. In my view, that is well worth it to realign our existing shareholders with the company. At some point, this company will want to sell its shares again, and future prospective shareholders will look closely at how we treated our current shareholders.

We do not want employees to be negatively impacted by this agreement. So each non-executive employee of Zenefits will be “trued up” through a special stock grant equal to 25% of their current number of shares. This new grant will vest 100% in 12 months. It will consist of RSUs rather than options so that employees don’t have to pay a strike price. Our executive team will also receive additional 4-year grants to incentivize them. However, co-founder/CTO Laks Srini and I have offered not to participate in this true-up in order to ensure that there are enough shares for employees. We will be diluted to the same extent as any other common stockholder.

As part of this agreement, each participating investor will sign a release, which will allow the company to move forward and put the past behind us. This agreement does not include a release for the $10 million of stock that Parker sold personally; I hope that issue will be resolved in the near future.

The agreement also contains a few provisions to foster good governance, such as the creation of a permanent seat for the Series C on the Board of Directors (which is already occupied by TPG’s Bill McGlashan) and the creation of a Compliance Committee on the Board. Both the company’s management and its investors believe these are wise things to do.

The investor agreement has already been approved by a number of the company’s major investors including Fidelity, TPG, Andreessen Horowitz, and Insight Venture Partners. We will be offering it to all our investors shortly.

I want to thank our investors for reaffirming their confidence in us. We take our commitment to you seriously to build value for all shareholders. As a result of The Offer and Investor Settlement, all of our employees and investors will be aligned, committed, and focused on what’s next, which is the launch of Z2 in October.

David

Source: TechCrunch

Apple might buy Jay Z’s Tidal music app

Apple might buy Jay Z’s Tidal music app

If you can’t beat ’em, buy ’em. Apple is in discussions with Tidal about acquiring its music streaming app, which offers exclusives and early releases from big artists like Beyonce and Kanye West. The Wall Street Journal reports that the talks are still early and might not end in a deal, but Apple wants those exclusives to bolster its Apple Music streaming app that’s currently in hard-fought competition with Spotify.

Apple has been pushing to score exclusives of its own, like the release of Drake’s most recent album. But Tidal has been winning on that front. Rapper Jay Z bought Tidal for $56 million in March 2015, then revamped it with a set of landmark partnerships with some of the biggest names in music, including venture as co-owners: Alicia Keys, Calvin Harris, Arcade fire, Chris Martin from Coldplay, Beyonce, Daft Punk, Jack White, J. Cole, Jason Aldean, Kanye West, Deadmau5, Madonna, Nicki Minaj, Rihanna and Usher.

Tidal Exclusive Videos

In a pompous declaration-signing ceremony, Tidal made these stars co-owners in exchange for them giving it first crack at releasing their music. While that arrangement seemed unlikely to pan out at first, Tidal was the only place to stream Kanye’s new album “Life Of Pablo” for several weeks, and is still the only place you can stream Beyonce’s visual album “Lemonade”.

Tidal MobileApple sees music as a big part of the future of mobile, and as a way to encourage sales of its flagship iPhones. Even if it had to pay a steep price for Tidal, its exclusives could give it a big edge over Spotify, which has concentrated on listening features like Discover Weekly instead.

If Apple does buy Tidal, it could be good for listeners, who are facing a balkanized music catalog divided between the different streaming apps. To listen to the new Drake and the new Kanye, you’d need two almost entirely redundant $10 per month subscriptions. If Spotify gets serious about exclusives thanks to the hire of former Lady Gaga manager and tech investor Troy Carter, things could get even worse.

Apple Music now has 15 million paying subscribers, compared to Spotify’s 30 million paying subscribers and 100 million active listeners. While Apple Music has been growing fast, the company might want to buy Tidal to accelerate user acquisition of people who’ve never really used streaming services. That could be easier now than going it alone without Tidal and having to wrestle listeners away from Spotify later when they’ve become entrenched with playlists and personalization.

Apple is already criticized for using its ownership of the App Store and iOS operating system to hinder competition from Spotify. Apple owning Tidal would certainly give listeners fewer options. But if it puts the best new music all in one app, even loyal Spotify users might switch to a Tidal-powered Apple Music.

Source: TechCrunch

Nougat Was Pretty Much Android N’s Only option. That or Nun’s Farts

Nougat Was Pretty Much Android N’s Only option. That or Nun’s Farts

After a months-long search for just the right name, Google will call its next Android release “Nougat.” The Internet does not like this! Fair enough. But hating on Nougat ignores two incontrovertible facts: nougat is delicious, and Google didn’t have any other options.

There’s no need to argue the merits of nougat, the dessert, because it’s chewy and crunchy and delicious and those are attributes any sane person can get behind. As for Nougat, the operating system name, the fault lies with Google’s insistence on naming its platform versions exclusively after desserts. Nougat was the best it could have hoped for this time around. To prove it, we’ve rounded up all the other “N” desserts—outside of brand names like Nutella or Necco (bleh), which Google didn’t necessarily have access to—that could have been contenders. They are all bad. Or more to the point, they are all worse than Nougat.

Nonpareils

The best alternative; also about 80 percent too French.

Getty Images

The best alternative; also about 80 percent too French.

Nanaimo Bar

No thank you, bar.

Getty Images

No thank you, bar.

Natillas

Nothing says innovation like warm custard.

Getty Images

Nothing says innovation like warm custard.

Neenish Tart

Sounds like a Monty Python insult.

Getty Images

Sounds like a Monty Python insult.

Norman Tart

Sounds like a Monty Python CPA.

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Sounds like a Monty Python CPA.

Nonnevot

Traditional Limburgian pastry or lesser Harry Potter villain? 

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Traditional Limburgian pastry or lesser Harry Potter villain? 

Nut Roll

I mean come on.

Getty Images

I mean come on.

Nun’s Farts

Okay, that would have been great.

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Okay, that would have been great.

Source: WIRED

NFL star Martellus Bennett on his new children’s book and app, Hey A.J.

NFL star Martellus Bennett on his new children’s book and app, Hey A.J.

It’s not everyday that a 6 ft. 7 in. NFL star says he is going to spend his offseason designing and launching an new interactive children’s app.

So to learn more, we sat down with Martellus Bennett, tight end for the New England Patriots and founder of The Imagination Factory, a multimedia production company designed to bring Martellus’ ideas to life.

The first product out of the studio is Hey A.J, a children’s book with an accompanying interactive mobile app. The app lets you read along with different narrators and play a game where you help A.J make breakfast.

It’s certainly unusual for an NFL star to be creating children’s characters and stories in his spare time. But as Martellus explained, it’s something he’s done his whole life. But now, using proceeds from his football career, Martellus is shifting his focus from creating characters to actually putting them to work inside content like books, apps, and animated film.

Screen Shot 2016-06-30 at 12.53.38 PM

While Hey A.J is the only project released so far, Martellus explained he has “hundreds of characters in his head” just waiting to be turned into a story. And it seems that he’ll get his wish, as his startup is planning on releasing two more apps and books over the next year, as well as upcoming animated TV and film projects showcasing Martellus’ creativity.

Watch the above video to learn more about Martellus’ vision for The Imagination Agency, how he thinks technology like virtual reality will change entertainment, and what it’s been like trying to start a new company while playing in the NFL.

Hey A.J is available online now, and the app is available in both the iOS App Store and Google Play Store.

Source: TechCrunch

Trulia can now help you find a place to rent near public transport

Trulia can now help you find a place to rent near public transport

Trulia, the online real estate search engine now owned by Zillow, launched an interesting new feature today that allows you to quickly find rental homes and apartments that have good public transport access. Rent Near Transit, as the new feature is called, is essentially an additional search filter that removes all houses that are more than a 15-minute walk away from a major transit station.

For now, those major stations include the Bay Area Rapid Transit (BART) system around San Francisco, the Boston ‘T,’ Chicago’s ‘L,’ New York’s subway lines, Philadelphia’s SEPTA system and the D.C. Metro in Washington. Yardley Ip, GM of Trulia Rentals, tells me that the company is looking to add support for other cities and additional transit systems over time.

Using this new feature, renters can also compare the average rental prices around different stations to help narrow down their search even more.

By focusing only on a few select transit systems, this new feature may be a bit too limited, though. There are, after all, other ways to get around on public transit than just the six systems the company currently supports. Ip acknowledged as much and noted that this new feature is the result of an internal hackathon and that the company still has lots of ideas for how to improve it over time. If you’re specifically looking for a place close to a BART station though, this is definitely worth a try.

This new feature is now available on Trulia’s desktop site and on the mobile web.

Source: TechCrunch

Facebook throws out the news Paper

Facebook throws out the news Paper

Facebook Paper could have given publishers the reach they lost yesterday in the News Feed, but no one wanted the standalone news reading app. Facebook has pulled the Paper app from the app store and will discontinue support for existing downloads of it on July 29th, according to a message show to all user.

Despite it’s eye-catching, progressive design, the experience proved unnecessary for most and too unfamiliar for those that tried it. Part of the app will live on, though, as design elements and features in Facebook’s Instant Articles. For example, Facebook pioneered the tilt-to-pan method of exploring wide landscape images in Paper when it was launched in 2014.

opening_paper_articles-5

TechCrunch originally caught a glimpse of a Paper prototype being used by a Facebook employee  a full year before it was released. Upon its debut, it let readers browse full-screen tiles of different news articles in categories like sports, world news, and business, plus a stylized version of their News Feed.

But almost immediately, Paper began to tumble down the app download charts. It fell from the top 300 US apps in a month, and hasn’t been in the top 1500 since the end of 2014. Few talked about Paper, though there was a small but loyal audience who preferred its design to the white-space heavy main Facebook app. According to third-party research firm SensorTower, Paper is estimated to have only seen roughly 119,000 downloads in the past year.

Paper App Annie

Late last year Facebook canned several other standalone apps built by the Creative Labs team that initially spawned Paper. And just this morning, Ben Cunningham, one of Paper’s core engineers, left Facebook after 3.5 years working. He exited with a post of this video showing a variety of Paper screenshots showing how it evolved into Instant Articles. And now Paper is gone, as first reported by The Verge.

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Here’s Facebook’s message to Paper users about the shut down.

unnamedIn 2014 we launched Paper, a standalone app designed to give people a new way to explore and share stories from friends and the sources they care about. Today we’re announcing that we are ending support for the app and users will no longer be able to log into the app after July 29.

We know that Paper really resonated with you–the people who used it–so we’ve tried to take the best aspects of it and incorporate them into the main Facebook app. For example, the same team that built Paper also built Instant Articles—a fast and interactive experience for reading articles in News Feed—using many of the same tools, design elements, and fundamental ideas as Paper. Our goal with Paper was to explore new immersive, interactive design elements for reading and interacting with content on Facebook, and we learned how important these elements are in giving people an engaging experience.

We know not all the features you love will move over to Facebook, but we hope you’ll continue to notice elements from Paper improving the Facebook experience for everyone. We can’t thank you enough for using the app and exploring Paper with us over the past couple of years.

Now with no dedicated place to read news, and the main News Feed focusing on showing posts from friends and family, news publishers may find it tougher to pull referral traffic from Facebook.

Facebook Paper CustomizeThe whole media industry is sneering at Facebook for supposedly screwing them over. But users demonstrated that they just don’t need non-stop links to the latest shallow gossip, political stunts, exaggerated tragedies, and mundane industry news (yep, that’s us sometimes). Both their behavior and surveys said there were too many blathering news outlets in their feed.

Many publications grew too big for their britches, posting non-stop to social networks when there are really only a few truly important news stories each day that people require to stay informed. We need information about the future of government, the struggles for justice by the disempowered, true art, and the businesses that will change our world for the better. Frankly, a lot of what may disappear from the News Feed didn’t fall into those categories.

Facebook rebalancing the mix of content to focus on the unique stories about the people you care about shouldn’t be seen as the apocalypse for news. Instead, it should be a rallying call for publishers to concentrate on telling the stories that matter in compelling ways. That’s what people will still read and share.

Source: TechCrunch

How Mexico went from telecom laggard to mobile trailblazer

How Mexico went from telecom laggard to mobile trailblazer

Twenty years ago only one out of 10 people in Mexico had a telephone of any kind. Today, more than 100 million people (out of a population of roughly 125 million) have cell phones and, more amazingly, more than 70 percent of those are smartphones. To keep up the torrid growth, scrappy competitors are offering smartphones for every budget and plans that let users choose right from their handsets which services they want and how much they want to spend.

Three factors have catapulted Mexico’s mobile industry into the 21st century. First, Mexico has grown into the world’s 11th largest economy (in terms of purchasing power) in just the last two decades. Second, millennials are Mexico’s largest demographic group (they make up more than half of Mexico’s online population) and they want and expect what their counterparts in developed countries have. And third, the towering presence of a company that Mexico’s government considers a monopoly in both the landline and mobile markets has spurred its smaller (though not unsubstantial) competitors to be more inventive and aggressive.

That monopoly is the creation of a man who for four years in a row was ranked the world’s wealthiest individual, Carlos Slim. His flagship business, America Móvil, is one of the largest telecom concerns in the world, with operations in nearly 30 countries.

The telecom titan controls roughly 80 percent of Mexico’s landline market and 70 percent of its mobile market. The Mexican government has been trying unsuccessfully for years to break up Slim’s empire. However, his mobile competitors aren’t waiting for that to happen. Instead, they are challenging the status quo that America Móvil is struggling to preserve by bringing innovative technology and business models to Mexico’s mobile market.

Mexico’s second largest mobile operator, Telefónica, is shaking up the market by offering users a more modern solution for purchasing and managing mobile services. As the fifth-largest mobile operator in the world, Telefónica has the financial assets and know-how to give America Móvil serious competition. The company introduced a new service, branded as Movistar On, in response to the rampant confusion and frustration among consumers that it discovered through intensive market research.

Mexico’s millennials did not grow up in a wired world with its physical limitations and bureaucratic practices.

Telefónica partnered with Silicon Valley-based ItsOn to build Movistar On around that firm’s cloud-client platform. “Cloud-client” is the architecture of choice among internet phenoms like Amazon and Uber. The cloud component enables the operator to quickly introduce new services, while the client piece gives users the self-service functionality that millennials crave. The combination enables Telefónica’s marketers to engage subscribers directly, presenting them with timely offers and closely tracking their choices.

While traditional mobile operators force users to purchase data by the megabyte or gigabyte, Movistar On gives users more comprehensible buying options, such as “1 day of YouTube,” “3 days of Netflix,” and “30 days of Spotify.”

Users can see exactly what they’ve used at any point in the billing cycle and make adjustments right from their phones. This appeals to millennials who prefer self-service over calling customer service and being put on hold, and who feel they have a right to know exactly what they are getting for their money. Such are the expectations of young people who have grown up with the internet and smart devices.

Mexico’s third-largest mobile carrier, AT&T Mexico, holds the remaining 10 percent of the market. The company is leveraging its operations in the U.S., Canada and Mexico to provide seamless service throughout the North American Hispanic community. With smartphones, subscribers can keep in touch with friends and family just by participating in the same social networks, and by using over-the-top services that make voice and even video calls more affordable.

The shift to smartphones in Mexico has been nothing short of spectacular. Smartphone penetration soared from 17.9 percent in the second quarter of 2014 to 59.8 percent in the third quarter of 2015. That means the number of smartphone users tripled in little over a year. Why are so many Mexican users making a relatively big investment in their phones? Because a smartphone gives them all of the capabilities of telephones, TVs and personal computers in a single device that is loaded with intelligence and goes wherever they go.

Despite America Móvil’s dominance, which is very real, Mexico’s mobile users have compelling choices, and the way that operators are competing for their business is a case study for mobile carriers everywhere.

Mexico’s millennials did not grow up in a wired world with its physical limitations and bureaucratic practices. They are flocking to smart devices that add new features almost on a weekly basis. They demand mobile operators find new ways to engage and empower them — and Mexico’s mobile operators are advancing to make it happen.

Featured Image: Jess Kraft/Shutterstock
Source: TechCrunch