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Tuesday, December 3, 2013
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Spotify recently confirmed a whopping $250 million expansion round of funding. But with a lot of public heat from high profile musicians questioning whether the music streaming platform is a boom or bust for business, today Spotify is launching a new service, and putting out updated news on the rise in rightsholder payouts, that it hopes will demonstrate that it's not just growing for its own gain.


Spotify Artists Website is a B2B play that will be an interface between the streaming music platform and the musicians/managers that put their content on it, giving them details on how payouts work and other news about the site. On top of that, as befitting a platform, Spotify has teamed up with Next Big Sound to create a dashboard for artists and managers to have real-time access to data about how their music is performing on the site and other details. And it is also confirming that so far in 2013, it has paid out $500 million in royalties to music rightsholders - that is, labels and artists and all others who get a cut of music whenever it is streamed on Spotify's service.


That effectively means that to date, Spotify has paid out over $1 billion in royalties since 2009:


Total-Annual-Royalty-Payout-Out


“Our belief has always been that if we can offer fans a listening experience superior to piracy, then they will be happy to pay for it, and in turn we are happy to pay out nearly 70% of all the money we earn in royalties,” Spotify writes today in its opening letter on the new site. “We believe that this is the fair approach to take, and that as we grow we will become an increasingly significant contributor to artists' financial lives.”


The moves today underscore the public (and perhaps also private) pressure that Spotify has been under from some artists who accuse the company of being greedy and not actually all that financially beneficial for those whose music is streamed on it. While Spotify has worked hard to win over some of the most influential artists out there (one big win was getting Metallica on board last year), it has also seen some of these artists pull their music from the service as well.


Although that has seen Spotify knocked a bit in the public eye, it's still the platform to beat against others like Deezer, which has yet to launch in the U.S. but is expected to soon, and Rdio, which has apparently “beautiful” APIs for its partners (a source tells me) but hasn't seen the critical mass of user adoption that Spotify has.


While the news in November was about Spotify securing financing for the future (it is still loss-making as a service), today's news is about Spotify showing that it is minding those on whom it is reliant for its plaform to have any meaning for consumers. You can probably expect that this will also lead, soon, to more product launches as well, both on mobile (it's fastest-growing platform) and on the web - where we have heard that the company is likely to be releasing a web-version API for developers and other third parties soon.


More to come. Refresh for updates.







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After two years of dealing with espionage accusations, Huawei CEO Ren Zhengfei recently told French publication Les Echos that he wants the telecoms equipment manufacturer to pull out of the U.S. market. Huawei's problems stem in large part from Ren's past association with the People's Liberation Army, but they also serve as a warning about potential marketing issues for other Chinese companies that want to break into the U.S.


The Les Echos interview was first published last week, but published in English today by Foreign Policy. Ren, who rarely grants media interviews, declared that he is giving up after two years of issues with the U.S. government, including concerns from the U.S. House Intelligence Committee that the telecoms equipment manufacturer may be spying on behalf of the Chinese government.


“If Huawei gets in the middle of U.S.-China relations, it's not worth it. Therefore, we have decided to exit the U.S. market and not stay in the middle,” Ren told Les Echos.


Huawei has denied all espionage accusations, and a White House review reportedly backed up its assertions of innocence, finding no evidence that the company spied on the U.S.


Suspicions about Huawei stem in part from Ren's background: before founding Huawei, he was a military technologist for the PLA. But Huawei's problems underscore similar challenges for other Chinese companies. China's tech industry already faces the stereotype that it is a knock-off factory, not a fount of innovation. Potentially even more problematic, however, is the way distrust of China's government is reflected wariness toward both startups and well-established companies regardless of whether or not they have ties with the Chinese Communist Party or military.


Tencent, one of China's largest Internet companies, was spotlighted in the U.S. media recently as an investor in Snapchat and “role model” for its founder Evan Spiegel. But before that, Tencent's own popular messaging app, WeChat, encountered a slew of controversy during its global expansion. After WeChat was found to be blocking certain words and phrases, the company defended itself by stating that the situation was due to a “technical glitch” and not because of censorship.


Other issues WeChat faced included a less-than-warm welcome in countries the Chinese government has a stormy relationship with. In Taiwan, for example, legislators from the main opposition Democratic Progressive Party, voiced concerns that WeChat posed a security risk when it first launched there in October 2012. Also faced issues in India and Vietnam because of security concerns (though it is important to note that Vietnamese legislators have proposed banning all messaging apps, not just WeChat).


Younger Chinese tech companies have to tread carefully in order to avoid the problems faced by Tencent and Huawei.


So far smartphone maker Xiaomi has avoided same issues, but it may also face branding challenges as it prepares to scale up globally (including complaints its name, which means “little rice,” is hard to pronounce). Xiaomi rose very rapidly in China, where its market share in China passed Apple in the second quarter of 2013, just three years after it was founded in 2010. But Xiaomi first grabbed the attention of American consumers when Hugo Barra, Google's former Android VP, joined it in a surprise announcement three months ago.


Barra will oversee Xiaomi's international expansion and try to help it do what no other Chinese smartphone maker: achieve the name recognition of competing smartphone makers like Apple, Samsung, HTC and Sony. (In fact, Huawei is top third smartphone vendor in the world after Samsung and Apple, though its 5% market share lags behind those two companies by a wide margin.)


In China, Xiaomi's growth was fueled in part by the high profile of co-founder and CEO Lei Jun, whose resume includes launching Joyo.com, which was purchased by Amazon in 2004 for $75 million and is now Amazon China, and chairing the board of UCWeb, the largest mobile Web browser in China. But in many U.S. media outlets, Lei has been presented as a Steve Jobs copycat. It's a comparison that Lei has only recently started to protest. In September, he told told CNN that “they [Apple] don't really care about what the users want. They imagine what the users want.” Lei's remarks may indicate that Xiaomi wants to begin aggressively combating Apple comparisons in order to avoid being branded a “knock-off” when it enters the U.S.


At the TechNode/TechCrunch Shanghai event two weeks ago, Bowie Gai, the founder of World Startup Report, asked panelists if they felt a bias against China-based companies in a discussion about how Chinese startups can build their brand in international markets.


David Chen, founder of Web site builder Strikingly, the first Chinese company in Y Combinator, said that though his company doesn't emphasis that it is headquartered in Shanghai, the fact sometimes comes in handy. “It's a weapon that you can use at certain stages, but you can't use it to associate with innovation unfortunately,” said Chen.


But Chinese tech companies are already making an impact on tech innovation in the U.S. - and not just by providing cheap outsourced labor. For example, Tencent's monetization model influenced Zynga in addition to Snapchat. (Zynga partnered with Tencent in 2011 when it launched a localized Chinese version of Cityville.)


During the TechNode/TechCrunch Shanghai event, Glow co-founder and CEO Mike Huang said that all of the fertility app's product development and speccing is done in Shanghai. Huang, who said Glow sees itself as a data science company, added that the startup doesn't treat China as an “outsourcing firm.”


“Chinese product engineers are very impressive. What they need is more exposure to innovative thinking,” Huang said. “But it will grow very, very fast.”


Edith Yeung, the head of strategy for Sequoia-backed browser maker Dolphin, told the audience that Chinese startups wishing to combat negative perceptions should focus on the benefits of their product.


“Don't say that you are building the Dropbox of this or that,” said Yeung. “What people care about is what problem you are solving, why you care about it so much and why are you in the U.S. or China market.”







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Swipe right if you like. Swipe left if you don't. Mallzee, a ‘personal shopper' for iOS, has a Tinder-esque UI, underpinned by its own recommendation engine, to make clothes shopping simple, efficient and fun.


But it also has a clever social twist. The app lets you share the item you intend to buy with friends. If the consensus is a thumbs-down, Mallzee will actually prohibit you from making a purchase - the buy button becomes disabled - helping to avoid any potential fashion faux pas.


Initially targeting the UK and Ireland, the app's database lets you search 2 million products from around 200 major brand fashion retailers, such as ASOS, Urban Outfitters, and Forever 21. You start off by selecting the category of clothing you're interested in purchasing, and specify things like colour, price range and originating store. Then the right swipe, left swipe modus operandi kicks in, helping Mallzee create what it calls your “style-graph”.


Find an item of clothing you like? It's at this point that you get to solicit feedback from friends and the gamification begins. As Mallzee founder and CEO Cally Russell explains, “if your friends vote an item down then we block the buy button so you can't buy it. You can, though, chat to them and try to convince them to change their vote. If it's a draw we'll still let you buy.”


black-iphone-discoveryIt's also a feature that Russell says the UK startup has been internally calling its “boyfriend feature”. “It's a way for peoples' girlfriends to stop them buying awful clothes,” he adds.


As stereotypical (and, perhaps, unfortunate) as that use-case example may be, the app's social angle is certainly noteworthy since nobody has really nailed the social shopping experience online.


“We don't think social is about following people you don't know, sharing with thousands of people or pinning your aspirations,” says Russell. “To us social is about enabling people to have meaningful conversations with the people that matter. That's why our users can share clothes only with friends using the app and have conversations with people they know. If those friends vote that you shouldn't buy something then you can't!”


In other words, Mallzee could be about to conjure up the fashion police in all of us. However, each time you are allowed to push the buy button, the startup will also get paid. It earns affiliate revenue generated from each purchase.







1:53 AM

Swipe right if you like. Swipe left if you don't. Mallzee , a ‘personal shopper' for iOS , has a Tinder-esque UI, underpinned by its...

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Monday, December 2, 2013
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Why should the ladies have all the fun? Like Le Tote and Rent The Runway, a new start-up, Eleven James, is offering something men may find alluring: the opportunity to wear a cool new watch every few months for a monthly fee.


Founded by Randy Brandoff, former CMO of NetJets and Marquis Jet, the company isn't positioning itself as a rental service per se. The concierge service costs $249 a month to wear three “cheaper” watches worth around $10,000 per year ($449 for six) and $459 a month for a Connoisseur Collection selection of higher end brands. The “Virtuoso” tier gets you three crazy expensive pieces for $899 or six for $1,599 a month. You wear them around, flashing your bling hither and yon, and then return the watches for cleaning and they're sent to another member. To be clear, if $10,000 for a “low-end” watch sounds ludicrous, you're probably not the target audience.


Instead the company is aiming at folks who may not want want to dump a few months' salary on a watch and instead want something fancy to wear to work and about town. Because, for some watch snobs, being strapped to one watch can be as terrible as being strapped to none at all, Eleven James offers a bit of choice and a personal concierge will walk you through potential selections and styles. Their collection includes items from IWC, Panerai, Patek Phillipe, and the like. They have just completed a beta group of testers and now have 100 or so members who will receive a new watch every few months, depending on demand, and get invites to parties and other watch-centric events in their home cities.

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Eleven James also hopes to become a watch trade-in service, allowing its customers to drop their old watches off on consignment or even to enter them into rotation. There is some talk internally with brands who are interested in using this as a marketing exercise and the company has created a special algorithm to match members with watches depending on their preferences.


Brandoff didn't want to make this just another rental service. “The luxury market has evolved to a world prioritizing access and experiences,” he said. “Private jets, vacation homes, classic cars, and many other historically prized possessions have all become accessible via various club and shared ownership models that have multiplied in offerings and popularity.” He's simply following that trend, he said.


The company received $1.4 million in seed funding backed by numerous strategic investors, including Box Group, WGI Group, Kenny Dichter, Ken Austin, Brian Distelberger, Ed Moran, and Jason Saltzman. While it may not make sense for many non-watch nerds, it seems like a great way to get new brands into the hands of fans and, more important, bring back the age-old, timeless habit of strapping on a bit of Swiss frippery and strolling down the boulevard, a jaunty tune on your lips and a merry “Good day” offered to all and sundry. A guy can dream.







4:53 PM

Why should the ladies have all the fun? Like Le Tote and Rent The Runway , a new start-up, Eleven James , is offering something men may fin...

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The Chernin Group confirmed today that it has acquired a majority stake in anime video distribution company Crunchyroll. The deal was first reported by AllThingsD in October and gives Peter Chernin's investment company one of the largest streaming sites out there, with viewers in more than 160 countries worldwide.


Like Hulu, which Chernin had sought to invest in earlier this year, Crunchyroll has both a free, ad-supported video offering, as well as a subscription video-on-demand offering for anime fans. It's available online and on a wide range of devices, including phones, tablets, game consoles, and streaming video boxes like Apple TV and Roku.


In addition to video, Crunchyroll also provides e-commerce, news, and community features for viewers. With the investment by Chernin, the company is expected to dabble into new channels outside of its core anime vertical.







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The Chernin Group confirmed today that it has acquired a majority stake in anime video distribution company Crunchyroll . The deal was first...

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Today IDC released its forecasts for the global PC market, estimating that 2013 sales will fall 10.1 percent, which is a slightly higher than the 9.7 percent the firm had previously anticipated.


The PC market has had a year of historically bad proportions. That in mind, IDC does expect PCs to fare better in 2014, with a contraction of 3.8 estimated. That's the bottom of the curve, however, as IDC expects sales rates to become “slightly positive in the longer term.” Following its predictions, PC sales should not fall below the 300-million mark on a yearly basis.


That's good news for Microsoft, as it works to drive its Windows 8.x operating system into the homes of consumers and corporate clients – the more PCs it sells running its new operating system, the more downloads that the Windows Store will see, helping the software company pitch its platform to yet reticent developers.


PC usage remains strong, with IDC noting that, in terms of hours spent, phones can't match the workplace utility of a personal computer. However, there is low market appetite to replace aging systems, something that has likely annoyed Microsoft as it seeks to reform the Windows operating system.


With sales predicted to hover around 300 million, PCs will continue to sell around 25 million units per month, or 75 million per quarter around the world. In 2012, for reference, almost 350 million PCs were sold. Still, the 300 million minimum threshold – which IDC predicts at least into 2017 – will provide a floor for the larger players in the PC market: Microsoft, Intel, Dell, and so forth.


So in many ways, we are post-PC, but as emerging markets continue to purchase PCs at quick paces, the market appears almost stable.


It is sometimes assumed, incorrectly (I was guilty of this, I must admit), that the PC market is on a decline without end, that it will continue to contract until it all but dries up and blows away. Apparently not. 300 million is a lower floor than many wanted, but it is more than enough units to support the larger PC ecosystem.


The corporate PC market is making up for, at least partially, larger losses in consumer PC demand. For 2013, IDC expects the commercial market for PCs to fall 5 percent. Consumer sales are to slip 15 percent. So we're seeing upgrade cycles to Windows 7, likely from companies moving from Windows XP, provide ecosystem stability.


Microsoft's Windows 8.x operating system is aimed at changing consumer and, yes, enterprise demands. If it can find market resonance, perhaps the PC market will recover more quickly than expected. This year will remain a black mark on the world of PCs, however, no matter how well December fares.


PCs: Not dead, but just not as popular as before.


Top Image Credit: Flickr







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Today IDC released its forecasts for the global PC market, estimating that 2013 sales will fall 10.1 percent, which is a slightly higher th...

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Apple has purchased social analytics firm Topsy, which focuses on parsing data from Twitter, reports The Wall Street Journal. The deal was apparently worth ‘more than $200M' according to the publication.


Topsy is one of several firms that have been focused on gathering and parsing data from Twitter's platform. It allows firms to tap into a store of over 425M tweets from 2006 onwards to sniff out trends. Topsy competitors in the Twitter data reselling game include DataSift and Gnip, but its user-facing tools including a topic and trends search engine have made it one of the more popular options for those looking to make sense of the stuff people are tweeting about.


Given that Apple is a Twitter partner already, and hosts login and posting features for the social network on its iOS and OS X platforms, this seems like a confusing deal if all that it's after is the Twitter data firehose. It seems more likely that Topsy has technology or engineers that can parse trends in a way that Apple wants to incorporate into one of its products.


If I had to hazard a guess, this might be related to Apple building out the relevancy engine of its App and iTunes Stores. Adding social signals to the searching algorithms of its stores could help to improve the relevance of search results, and help Apple surface apps that are hotter and more interesting to users. Tracking app trends across social networks would allow them to fine tune categories and collections of apps, and surface apps that are gaining steam more quickly.


Pulling the thread out a bit further, it's possible that Apple could even use the data from your Twitter feeds to recommend apps on a more personal basis, rather than ‘generically' to everyone. Apple has done little of this kind of personalized recommendation work to this point, but there's always a first time for everything.


The WSJ article points to iTunes Radio ads and the iAd platform as possible beneficiaries of the Topsy engine too. Apple could theoretically use social data to help advertisers display ads to more relevant viewers. This would boost revenue and relevance across Apple's ad platforms, which haven't been incredibly robust so far.


Apple purchased the app search company Chomp last year, but ended up using mostly its ‘card-like' interface, not what some viewed to be its superior discovery model.


As one of only a handful of companies with Twitter firehose access, Topsy's purchase will change the market for those left behind. And it shows that Apple has a growing interest in the data flowing through networks like Twitter, which is a refreshing notion. The company has not typically been bullish in this arena previously. Apple confirmed the purchase with the WSJ.







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Apple has purchased social analytics firm Topsy, which focuses on parsing data from Twitter, reports The Wall Street Journal . The deal was ...

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