Start up: death to calendars!, S6 hits 10m (is that fast?), why Apple ditched the TV, and more


Yeah, you know it’s not really necessary. Photo by clagnut on Flickr.

A selection of 12 links for you. Don’t have a meeting about it. I’m charlesarthur on Twitter. Observations and links welcome.

The chokehold of calendars » Medium

Mike Monteiro:

The problem with calendars is that they are additive rather than subtractive. They approach your time as something to add to rather than subtract from. Adding a meeting is innocuous. You’re acting on a calendar. A calendar isn’t a person. It isn’t even a thing. It’s an abstraction. But subtracting an hour from the life of another human being isn’t to be taken lightly. It’s almost violent. It’s certainly invasive. Shared calendars are vessels you fill by taking things away from other people.

“I’m adding a meeting” should really be “I’m subtracting an hour from your life.”

We need a goal-oriented calendar, but first we need to understand why a goal-oriented calendar is necessary.


Here’s the problem with using YouTube as a babysitter for your kids » Huffington Post

Alexander Howard:

Six weeks after a coalition of consumer advocates accused Google of using ‘deceptive and unfair’ ads in its YouTube Kids app, the same group is raising new concerns about access to videos that are inappropriate for children.

“Our new claims are really about deceptive practices,” said Aaron Mackey, a graduate fellow at Georgetown University Law Center’s Institute for Public Representation, citing Section 5 of the Federal Trade Commission Act.

The coalition, which sent a letter to the Federal Trade Commission on Tuesday as a supplement to the previous complaint, includes the Campaign for a Commercial-Free Childhood and the Center for Digital Democracy.

The groups allege that the app, which is marketing to children ages 5 and under, allows kids to access inappropriate videos — including some that have nothing to do with children at all. Some of the unrelated videos are unremarkable, like videos of corporate filings. Others, though, will raise eyebrows with explicit language, jokes about drug use and pedophilia, and frank discussions of pornography, violence and suicide.

Wonder if the FTC will act on this.


LG unveils wallpaper OLED panel » The Korea Times

The 55-inch wallpaper OLED panel, presented as one of the company’s future displays at a media event, is only 0.97 mm thick, weighs 1.9 kg and can easily be stuck to a wall with a magnetic mat, or removed from it.

The new product is far slimmer compared with LG Display’s existing flagship 55-inch OLED panel that is 4.3 mm thick.

Come on, that is impressive. Imagine how you’d use that at home.


One big reason Jawbone took debt » Fortune

In fact, $300m of debt, rather than venture capital, as Bloomberg discovered. Dan Primack explains:

For BlackRock, this is obviously an effort at risk mitigation. For Jawbone and its existing shareholders, it’s a bit more complicated.

Yes, Jawbone clearly needs BlackRock’s money. But structuring this deal as debt instead of as equity also allows the San Francisco-based company to maintain a $3bn valuation it reportedly received last fall. That means it needn’t reprice existing employee stock options, and gives it upside flexibility when recruiting new employees. Plus, Jawbone doesn’t take the kind of ‘falling unicorn’ PR hit that could cause potential customers to purchase from more stable vendors.

My spidey sense feels that Jawbone is stuffed, though – especially when you compare it to the hugely profitable Fitbit.


Behind Apple’s move to shelve TV plans » WSJ

Daisuke Wakabayashi:

In an effort to distinguish itself, Apple investigated various display technologies.

In the mid-2000s, it created a prototype display that was transparent, like a pane of glass, when turned off but used lasers to display an image when turned on, according to a person familiar with the matter. That technology never made it past the research phase because it used an enormous amount of power and the image quality was poor. Apple patented the technology in 2010.

Apple had a small team working on the TV set in the years before it put the project on ice, said people familiar with the matter. It considered building TVs with screens offering four times the resolution of high-definition displays.

The price of such 4K displays—named because they have about 4,000 horizontal pixels in an image—have come down in the past few years, but those screens were still prohibitively expensive at the time.

Apple also looked at features that could expand the television’s function in the living room. Using cameras above the screen, Apple experimented with a video-calling feature—described as FaceTime for the television—that sensed who was talking and directed the camera to the speaker. In the end, the people familiar with the matter said the feature didn’t seem compelling enough to drive an entry into a new product area.

Truly sounds like a dud, to be honest, but you can imagine some companies putting it out because WE ALREADY SPENT A TON ON R+D HERE DAMMIT. (A great scoop by Wakabayashi, too.)


The Google-Twitter deal goes live, giving tweets prominent placement in Google’s results » Search Engine Land

Danny Sullivan:

Sometimes, tweets might not appear at all. We asked Google about why tweets might show, what controls exactly where they show, if they’re showing all tweets for a query in chronological order or filtering in some way such as to block obscenity or to surface more popular tweets. The company wouldn’t answer any of those questions.

Google’s blog post on the deal does say:

It’s a great way to get real-time info when something is happening. And it’s another way for organizations and people on Twitter to reach a global audience at the most relevant moments.

So presumably, you’re more likely to see tweets in Google when a hashtag, topic, person or organization appears to be trending or is newsworthy.

Twitter also says there’s no “direct” monetisation. (But of course it gets traffic.) Useful deal for both companies. I can only see them getting closer; their interests are aligning more and more.


Liveblog: What would you do if you woke up one morning and there was no Internet? » Liveblog

Dave Winer:

A question that reveals the problem is to wonder what would happen if you woke up one morning and found there was no electricity. Not much would happen in the world as it’s currently configured without electricity, even though there was a time when it worked fine without it.
I think the Internet is sufficiently integrated into our civilization at this point that if it were to be removed, it would be such an enormous shock to our economy that.. well, that’s why #2 [“Cry”] is also a correct answer. 😉

When you reflect on it, this is a great question to pose.


STRML: Projects and Work

Samuel Reed’s site needs to be visited. It builds itself while you watch. (Don’t worry, it’s HTML5.)


Global shipments of Galaxy S6 series top 10 million » Yonhap News

South Korea’s top tech giant Samsung Electronics Co. said Tuesday its global shipments of the latest flagship Galaxy S6 models surpassed 10m units in about one month after their release.
  
“The sales of the Galaxy S6 series have already surpassed 10 million,” a high-ranking Samsung official said. It marked the first time for the company to confirm the sales figure of the latest flagship.
 
 
The Galaxy S6 boasts Samsung’s first built-in wireless-charging batteries. The offbeat Galaxy S6 Edge also has been grabbing the market’s attention with the industry’s first screen that is curved at both the left and right edges. They started official sales on April 10.
  
The new models’ predecessors, the Galaxy S5 and the Galaxy S4, meanwhile, sold more than 10m units in less than a month. Samsung did not clarify when the 10m sales mark was reached for the Galaxy S6.

To be clear, the timings from “on sale” to 10m were:
S2: five months
S3: 42 days
S4: 27 days
S5: 25 days
The S6 doesn’t seem to have moved faster. But these are all sales to carriers (who may be feeling reluctant to take on stock) rather than sell-through. This story has barely begun.


Here’s how they built the beastly machines for Mad Max: Fury Road » The Credits

Bryan Abrams interviews Jacinta Leong, the art director for the film:

A specific challenge designing the vehicles was achieving aesthetic qualities as well as functionality. Our vehicles had to look amazing, but beyond that, they also had to drive safely at speed!

I’ll use a the GigaHorse for example. The Gigahorse was a stacked pair of Cadillac bodies, powered by a pair of Chevy 502 engines. So it obviously looked intimidating, but how did it actually drive? Engineer Antony Natoli and mechanic Mark McKinley designed a system so the two engines sat in a side by side arrangement and were connected to the transmission. I modelled the system in AutoCAD, and from this file, the plates and components were waterjet cut.

Like this:

Easy to forget how much work goes into films like this – which is part of why I find bittorrenting of films like this unbearably arrogant.


The three problems with Android Wear » Beyond Devices

Compare and contrast Jan Dawson’s view (from July 2014, pre-Apple Watch unveiling):

One of the selling points of Android Wear is its tight integration with Google Now, which has been available for quite some time on smartphones but is only now becoming available on smartwatches. The theory here is good: Google Now is supposed to surface information just when it’s likely to be useful to the user, but the watch allows it to be presented in a much more immediate way than were the user to have to dig through their phone to find it. But the problem is that Google Now, in my experience, still presents information much more on a “just in case” basis than a “just in time” basis, and the stuff that’s “just in time” is often not all that useful.


Bright Young Flacks: “Cameron’s cronies” now drive Silicon Valley’s most sinister propaganda machine » PandoDaily

Paul Carr in a lengthy dig into Rachel Whetstone’s move from Google to Uber:

Everyone in UK politics who I asked about Whetstone was agreed on one thing: She’s the person you bring in if you need to convince everyone that your company isn’t quite as nasty as it appears, and if your current spin doctors aren’t delivering the results you want. First that was Google, and now comes the biggest challenge of her career: Uber.

I have low hopes when it comes to the American business press covering Uber, but even I was surprised at how few journalists bothered to share even the most basic details of Whetstone’s background with their readers. That stuff sits barely below the surface and speaks volumes about the famously ultra-libertarian Travis Kalanick’s decision to replace Plouffe with her at Uber: an Obama liberal booted upstairs to make way for a multi-generation Cameron conservative/libertarian.

There’s more – much, much more.


Why Sony might pull out of smartphones: it’s trying to raise prices in a falling market


A message for Sony? Photo by LendingMemo on Flickr.

After my look at the first-quarter performance of various high-end handset vendors – Samsung, Sony, LG, HTC, Apple – plus Microsoft and BlackBerry, it’s time to focus more tightly. First up: Sony, which I think is most likely to pull out of the smartphone business among those presently in it.

Why not LG, HTC, Microsoft or BlackBerry? (Samsung we can be sure will stick with smartphones. Apple, ditto.)

• LG is a rarity: a company that has pulled itself out of the lossmaking mire to come back to success. In part this is because it’s a conglomerate, so it can afford to pile money into its handset division, because (like Samsung) when the handset division does well, it pulls the rest along.

• HTC somehow stutters along. It’s a minor player now, but doesn’t look imperilled as it did last year, when it was posting losses as though it enjoyed it. With cash in the bank, it looks safe for now (though we’ll have to see how the M9 and associated handsets sell).

• Microsoft can bear the losses from handsets pretty much endlessly, and they’re useful for other research.

• BlackBerry has horrendous problems with handset profitability, but handsets are essential to its existence while it doesn’t have a completely solid business in mobile device management; they also lend it a USP, so it’s likely to stick with them even though they don’t make money. Then again, let’s check back when it announces its next set of results in June.

Last man standing

Sony is the one I think is most likely to pull out of this market. It’s in the middle of a huge struggle with its identity, where the only divisions that are performing up to snuff are its image sensor manufacturing and games, while music and films tick over. The mobile side? Not so much.

Here’s how it has been doing – plus its stated ambitions for the coming financial year, outlined in red.

Sony's smartphone aims for 2016

What Sony wants from its smartphones: sell fewer at higher prices, smaller losses.

Sony is aiming to get the average selling price (ASP) of its phones to rise, according to its forecast for next year:

Sony's forecast for smartphone revenues and profits. Well, loss.

Sony’s forecast for smartphone revenues and profits. Well, loss.

Sony presentation: smartphone sales/profit

Extract from Sony’s financial review of 2014 and forecast to March 2015

Specifically, it says it’s going to sell fewer handsets but keep revenue about the same. The figures imply raising handset ASPs from around the $300 mark to over $400.

I don’t think that will work. None of Samsung, LG or HTC has an ASP over $400; for all, the figure has been generally trending down for some time. Apple has a high ASP – over $600 – but it claim all sorts of unique selling points (notably, its brand). Sony is competing with other high-end Android phone makers where it hasn’t been able to stand out.

Also, compare Sony’s ASPs and profitability with LG’s:

Comparing Sony and LG smartphone ASP and profit

Sony’s profit wobbles all over the place – but its ambitions for ASP look wild

They’re both on the same scales: ASP on the left axis, profit per handset on the right. (I ignored Sony’s intangibles writedown for the latest quarter.) LG sells on average for less, but does a lot better from it. Sony swings around wildly – a manifestation of its internal problems. Note also how both firms are seeing falling ASPs (ignoring Sony’s forecast).

The problem for Android handset makers is that the ASP is being driven down relentlessly: entrants such as Xiaomi and big players like Huawei are prepared to set low price expectations, which then make it hard for pricier offerings.

But but but! you say. Sony has a world-famous brand, and it has differentiation from Samsung and LG: its phones are waterproof, you can add SD cards (well, that differentiates them from the top-end Samsung flagship now, at least), and.. hmm.

Not so easy to think of features that really distinguish Sony phones from the others jostling for the top end, is it? Which means that in its aim to push up ASPs while selling fewer phones in turns means concentrating even more on the top-end market. There it is going to bump right into LG, Samsung, HTC and Apple, of which at least two have more powerful brands in this field. While 30m isn’t an ambitious target, the price is.

Not that Sony’s admitting that; it has “financial targets” for the fiscal year to March 2018, where it wants the mobile business to have revenues of between ¥1,000 and 1,250bn ($8.32bn and $10.40bn) with operating income margins of 3% and 5%, which translates to between $416m (lowest revenue, lowest profit) and $520m (highest).

Goals are nice, but Sony’s brand isn’t strong enough in smartphones: I think its strategy may take it in the same direction as PCs, where it fought at the high end (competing, notably, with Apple), making devices that were well-regarded critically but which didn’t sell in sufficient volume to make the business worthwhile. It then threw in the towel as losses grew.

The smartphone business is similar: once you lose scale (as has happened to HTC), it’s really hard to regain it. Sony is aiming to sell half as many phones as LG did in 2014, and only 50% more than HTC did. The incremental sales of camera sensors and phone screens will be nice, but it doesn’t have its own CPU or memory foundry as Samsung does; those factors all help drive Samsung’s profitability. I suspect this will be more like PCs than LG’s smartphone business.

How soon? That rather depends on the smartphone market, and how tolerant Sony’s management are if the strategy doesn’t go according to plan. Give it a few quarters. Then we’ll see if Sony really has the guts for this.

But it also raises a key question. What is the differentiating feature to boost sales for an Android handset today? Waterproofing? SD cards? Removable battery? Great camera? Or is it just price? Sony will have to hope it’s not that.

Start up: Apple v Samsung redux, cornering the DRAM market, what millennials will do to tech


Speed: Facebook’s got it. Photo by _hadock_ on Flickr.

A selection of 8 links for you. Like butterflies, only linkier. I’m charlesarthur on Twitter. Observations and links welcome.

Tools don’t solve the web’s problems, they ARE the problem » QuirksBlog

Peter-Paul Koch:

The web definitely has a speed problem due to over-design and the junkyard of tools people feel they have to include on every single web page. However, I don’t agree that the web has an inherent slowness. The articles for the new Facebook feature will be sent over exactly the same connection as web pages. However, the web versions of the articles have an extra layer of cruft attached to them, and that’s what makes the web slow to load. The speed problem is not inherent to the web; it’s a consequence of what passes for modern web development. Remove the cruft and we can compete again.

The question is, how is Facebook speeding it up, given that it’s going to be shifting the same content? Data compression?


How aging millennials will affect technology consumption » WSJ

Christopher Mims on how the post-1980 “millennials” are moving into a new stage in life:

Data from comScore suggest most switching between Android and iPhone is in favor of Apple, and iPhones have a significantly higher average selling price than Android. So we can assume that, all other things being equal, as millennials age and their earning power increases, their taste in consumer electronics will become more expensive.

This is good news for Apple—and others targeting the higher end of the product spectrum. It’s also fantastic news for pretty much the entire consumer-electronics industry and countless online retailers such as Amazon: A giant demographic bulge is about to enter 20 years of peak earning power. This is a generation that likes its on-demand services, which means the coming decades will almost certainly see more Uber rides and same-day deliveries than ever.


Ad-blocking? No, mobile operators won’t be blocking adverts & charging Google to restore them » Disruptive Wireless

Dean Bubley:

In a nutshell, some European telcos feel they can “get away with” harassing Google and to a lesser degree Apple and Facebook, and get air-cover from their national regulators and the European Commission. While the current trials might have the convenient excuse of “protecting users’ dataplans”, the reality is much more duplicitous – they are jealous that Google has out-innovated and out-maneouvred them, in a similar fashion to their rhetoric about “OTTs”, when they have been asleep at the communications wheel for 20 years…

…[Among advertisers’ countermeasures to such a move] Encryption of content is the most obvious. It is already widespread in mobile, and is growing fast – in some networks, more than 50% is encrypted. There are multiple styles, ranging from SSL built-in to HTTPS traffic, SRTP for WebRTC traffic, through to using compression and proxy servers. Some of these are still theoretically “blockable” based on IP address, but the risk of false positives increases hugely. The inclusion of Google’s SPDY technology into the HTTP2 standard has pretty much ensured this is a one-way ratchet for web traffic in future.

As Bubley also points out, tons of mobile connections are actually made over Wi-Fi. And these points are only the beginning.


Asian component makers take slice of Apple’s iPhone spoils » FT.com

Simon Mundy and Kana Inagaki:

As well as the US-based global market leader Qualcomm, MediaTek must contend with China’s Spreadtrum, a chip designer whose processors are gaining a growing share of the Chinese market. Meanwhile shares in Ningbo-based Sunny Optical, which supplies camera modules to the likes of Xiaomi and Lenovo, have doubled in the past year.

“It’s clear the Chinese brands prefer to have Chinese suppliers,” says Nicolas Baratte, head of technology research for CLSA. “There is a different type of understanding between Chinese companies. The Chinese supply chain is amazingly flexible in terms of tolerance for specification change and redesign, and flexible payment terms.”

Yet with the Chinese market slowing, he adds, some Chinese suppliers — notably phone assembly groups such as Wingtech and Longcheer — are increasingly pinning their expansion hopes on work for faster-growing brands from other countries, especially India.
A reliance on foreign customers has been thrust upon Japan’s handset component suppliers by that country’s dramatic decline in the mobile phone market — but they have responded strongly according to analysts who say Japanese groups account for a third of the parts found in the iPhone, while achieving strong sales of high-tech components to Chinese producers.


EZTV shuts down after hostile takeover » TorrentFreak

A “hostile takeover” by scammers, who got access to the domain details and changed it to their own:

Sladinki007 says that NovaKing must have been devastated by what happened. A life’s work was completely ruined in a few days and access to personal domain names was gone as well.

While EZTV could technically start over using a new name the group’s founder decided to throw in the towel. Too much had already been lost. The group had always been a “fun” non-profit project, and the recent troubles took the fun away.

The scammers, meanwhile, continue to operate both the .it and .ch domain names and are now distributing their own torrents (sourced elsewhere) with the hijacked EZTV brand. They pretend to be the real deal, sending out misleading and false status updates, but they’re not.

Having control over NovaKing’s email address the scammers even reached out to other torrent site operators, claiming that EZTV was back in business. However, most knew better not to fall for it and have retired official EZTV uploader accounts.

So someone who enabled widespread torrenting of TV content (which – astonishingly – doesn’t actually make itself for free) gets scammed and gives up? A “life’s work”? Strike up the world’s smallest violin.


Tipping point ahead: Samsung’s DRAM market share at 40% » BusinessKorea

Cho Jin-young:

Samsung Electronics is riding high with its share of the global DRAM market at 40%.

According to a report on performance in the first quarter of this year published by Samsung on May 17, the company accounted for 43.1% of the DRAM market in Q1 2015, up 2.2% from the number for the entire year of 2014. The figure in Q1 2015 is a nearly 6% increase from the total number for 2013. That data that was mentioned was compiled by market research firm IDC.

Based on market research firm DisplaySearch’s data, Samsung’s share of the global display panel market was 21.8% in Q1 2015, up about 1% from the previous year. The tech giant explained that it is responding to market demand with a full line-up, from ultra large premium displays to those for entry-level UHD and curved TVs.

It made a loss on the TVs, but grew its market share. Could it corner the whole DRAM market? Weird thought.


Apple readies first significant Apple Watch updates, ’TVKit’ SDK for Apple TV » 9to5Mac

Mark Gurman:

Currently in development, the features seek to enhance Apple Watch security, connectivity with other Apple devices, health and fitness features, Wi-Fi capabilities, and integration with third-party applications. Additionally, Apple is also priming major updates for the Apple TV in both the hardware and software departments, including Apple Watch integration. Below, we detail what users can expect from Apple Watches and Apple TVs in the future…

Includes a “Find My Watch” which sounds more like Bluetooth leashing – if the Watch gets some distance away from the phone. There are also promises about health, and others, though they’re also cautioned as “possibly some way off”.


Appeals court finds third trial necessary in first Apple-Samsung case: $380m in damages vacated » FOSS Patents

Florian Müller:

today’s appellate opinion reverses the trade dress-related part of the district court ruling and, on that basis, remands the case for a new trial. A new jury will have to determine damages for all products the first jury found to have infringed an Apple trade dress: the Fascinate, Galaxy S (i9000), Galaxy S 4G, Galaxy S II Showcase (i500), Mesmerize, and Vibrant phones. The total amount of damages (these were only at issue in the 2012 retrial, not the 2013) retrial was over $380m.

The original jury verdict only specified damages by product, but not by product and intellectual property right. That’s why the total damages amount for those products must be redetermined. There’s no way to simply subtract the part that related to design patents.

The Federal Circuit agreed with Samsung that it would have been entitled to judgment as a matter of law (JMOL) on the functionality of the trade dresses on which Apple prevailed. In all other regards, such as invalidity of design and software patents, the Federal Circuit sided with Apple.

Oh good grief. Another trial. Just the other day I was thinking of how Google’s hurried purchase of Motorola for the ludicrous garbillions of dollars belonged to a different age when people thought patents would make a difference in the smartphone struggle. This is nostalgia reflux.

Note though that the appeals court didn’t reverse the jury verdict – as some wilder misunderstanders of legal process had forecast. Judges don’t reverse juries in civil trials without exceptional cause.


Start up: Starbucks gets pass-agg on hacking, what Uber really pays, adblocking for sociopaths, and more


Check that your backup doesn’t look like this. Photo by Mrs Gemstone on Flickr.

A selection of 8 links for you. Use them wisely. I’m charlesarthur on Twitter. Observations and links welcome.

Adblockers are immoral » The Next Web

Martin Bryant is editor-in-chief of the site:

It comes up a lot in conversation, especially online. “Oh yes, I can’t imagine viewing the Web without the ads blocked. I accidentally switched my adblocker off yesterday and it was HORRIBLE.”

No, it really wasn’t – it was perfectly fine, you’re just being a snob. The Web works well for me with the ads displayed. It’s a point of principle – helping publishers earn money is something I want to do and feel we all should do if we consume their work. For those few, accidental minutes your adblocker was off, you were helping the publishers of the sites you visit earn income for their content that you access for free.

I hate to go all high-and-mighty-Mr-Morals, but the proud ad-blocking folk out there are happily starving sites (that they rely on for information and entertainment) of vital income. Yes, publishers (including TNW) are increasingly opting to diversify their income with ‘native ads,’ events, deals, education offerings and the like, but display ads are still an important bread-and-butter income stream. Taking delight in denying publishers that revenue shows either sociopathic tendencies or ignorance of economic realities.

There really isn’t a middle ground. If you understand the economics, you’re being selfish. If you don’t understand the economics, you’re being wilfully ignorant these days. And the alternatives (native ads, paid placement?) will surely be worse. But they may soon be inevitable.


TeslaCrypt: Following the money trail and learning the human costs of ransomware « FireEye Threat Research

Nart Villeneuve:

We tracked the victims’ payments to the cybercriminals—available because the group used bitcoin—and determined that between February and April 2015, the perpetrators extorted $76,522 from 163 victims. This amount may seem trivial compared to millions made annually on other cyber crimes, or the estimated $3m the perpetrators of CryptoLocker were able to make during nine months in 2013-14.  However, even this modest haul demonstrates ransomware’s ability to generate profits and its devastating impact on victims.

The online correspondence between the victims and the cybercriminals provides context regarding the effect on peoples’ lives. The victims were spread across the globe from students in Iran and Spain to regular folks in the United States, Brazil, Argentina, Germany, Croatia and Mongolia. Some feared being expelled from school or fired by their employers if they are unable to retrieve their files. Fathers and mothers were devastated by the loss of family photos. The TeslaCrypt ransomware also affected nonprofits, including an organization dedicated to curing blood cancer, as well as small businesses. Many of the victims were simply unable to afford to pay the ransom and gave up.

Some of the conversations are heartbreaking. Weirdly, the extortionists sometimes cut their price for personal circumstances.


Can Google outsell Amazon and eBay? » WSJ

Google will launch buy buttons on its search-result pages in coming weeks, a controversial step by the company toward becoming an online marketplace rivaling those run by Amazon.com and eBay.

The search giant will start showing the buttons when people search for products on mobile devices, according to people familiar with the launch.

The buttons will accompany sponsored—or paid—search results, often displayed under a “Shop on Google” heading at the top of the page. Buttons won’t appear with the nonsponsored results that are driven by Google’s basic search algorithm…

…Some retailers said they worry the move will turn Google from a valuable source of traffic into a marketplace where purchases happen on Google’s own websites. The retailers, who wouldn’t voice their concerns publicly, fear such a move will turn them into back-end order takers, weakening their relationships with shoppers.

Mobile-only (to begin with). Wonder if this will be tried in Europe, where the concern over this is more substantial.


I was an undercover Uber driver » Philadelphia City Paper

Emily Guendelsberger, who was that undercover driver:

it’s no wonder the taxi industry is having so much trouble competing with Uber — taxi companies have to pay to maintain, acquire and insure all the cars in a taxi fleet. Uber’s drivers shoulder that burden themselves, with expenses eating around 20% of total gross fares. And Uber’s gross fares, according to a Business Insider tipster, are expected to hit $10 billion in 2015.

And it makes complete sense for Uber to continue cutting fares to as cheap as possible while flooding the market with more and more drivers and encouraging people to use Uber for shorter and shorter distances — all of which correlate with reduced take-home pay for each individual driver…

…after 100 rides, I felt like I had enough [data] to work with. Over that duration, during which I maintained a 4.83 [star] adjusted rating, high enough to qualify me for Uber’s VIP program, Uber would say I “earned” $17 an hour in gross fares. But subtract the 28% that went to Uber and the 19% that went to expenses, and I actually made $9.34 an hour (plus a grand total of $16 in tips, $10 of which were for meeting up with a guy who left his Porsche keys in my backseat).

Driving for UberX isn’t the worst-paying job I’ve ever had. I made less scooping ice cream as a 15-year-old, if you don’t adjust for inflation. If I worked 10 hours a day, six days a week with one week off, I’d net almost $30,000 a year before taxes.

But if I wanted to net that $90,000 a year figure that so many passengers asked about, I would only have to work, let’s see …

27 hours a day, 365 days a year.


Who’s responsible when a driverless car crashes? Tesla’s got an idea » WSJ

Mike Ramsey:

The Palo Alto, Calif., electric-car maker soon will begin activating semiautonomous features, including the capability to pass other cars without driver intervention, in its Model S sedans. A driver can trigger the passing function by hitting the turn signal, according to people familiar with the technology. That action not only tells the car it can pass, but also means the driver has given thought to whether the maneuver is safe.

While it might seem a minor detail, having drivers activate the turn signal could help auto makers like Tesla avoid a regulatory pile up.


Starbucks blaming passwords, victims doesn’t fix the problem; burning questions about attack remain » Bob Sullivan

Sullivan first pointed to the hacking of Starbucks app passwords, and now has had to tear down the spin put up around it by the company:

these positions are meant to create the impression that there’s nothing wrong with the way Starbucks is processing payments, and in fact, some journalists declared that to be the case. Fortune magazine wrote “Starbucks says its popular mobile app has not been hacked, contradicting multiple media reports that intruders have hijacked the accounts of hundreds of the coffee chain’s customers…” Starbucks actually never denied that intruders had hijacked consumers accounts, and anyone can find victims complaining about just that with a few moment’s work, but some journalists seemed eager to clear Starbucks of any culpability in the issue.

That’s unfortunate, because my email this week makes it clear that plenty of Starbucks customers are pretty angry at the way this issue has been handled, and many of them don’t appreciate being blamed for having their money stolen after they placed their trust in Starbucks.


Green lights for our self-driving vehicle prototypes » Official Google Blog

Chris Urmson, director of the self-driving car project:

We’ve been running the vehicles through rigorous testing at our test facilities, and ensuring our software and sensors work as they’re supposed to on this new vehicle. The new prototypes will drive with the same software that our existing fleet of self-driving Lexus RX450h SUVs uses. That fleet has logged nearly a million autonomous miles on the roads since we started the project, and recently has been self-driving about 10,000 miles a week. So the new prototypes already have lots of experience to draw on—in fact, it’s the equivalent of about 75 years of typical American adult driving experience.

Each prototype’s speed is capped at a neighborhood-friendly 25mph, and during this next phase of our project we’ll have safety drivers aboard with a removable steering wheel, accelerator pedal, and brake pedal that allow them to take over driving if needed. We’re looking forward to learning how the community perceives and interacts with the vehicles, and to uncovering challenges that are unique to a fully self-driving vehicle—e.g., where it should stop if it can’t stop at its exact destination due to construction or congestion.


Samsung’s Tizen Store is available in 182 countries and with 25 apps at launch » Malaysian Digest

At launch, the Tizen Store has 25 apps spread across four categories (games, apps to plan new resolutions, photography and EA games). Of the 25 apps, 14 of them are gaming while photography takes second spot with 6 apps.

There is currently only one device that supports the Tizen Store which is the Samsung Z1. Announced last June, the Samsung Z1 is now only sold in India and Bangladesh. Samsung initially wanted to launch the Z1 and other Tizen-powered smartphones in more markets, but things did not turn out as planned.

“Things did not turn out as planned” is putting it mildly.


Start up: Starbucks app hack, more image recognition, HomeKit on the way, drone questions and more


That’s another sort of third-party keyboard altogether. Photo by zen on Flickr.

A selection of 7 links for you. They are. I’m charlesarthur on Twitter. Observations and links welcome.

EXCLUSIVE: Hackers target Starbucks mobile users, steal from linked credit cards without knowing account number » Bob Sullivan

Sullivan broke this story:

Because Starbucks isn’t answering specific questions about the fraud, I cannot confirm precisely how it works, but I have informed speculation, based on conversations with an anonymous source who is familiar with the crime. The source said Starbucks was known to be wrestling with the problem earlier this year. Essentially, any criminal who obtains username and password credentials to Starbucks.com can drain a consumer’s stored value, and attack their linked credit card.

Hackers often manage to steal hordes of username and password combinations, the way they steal databases of credit card account numbers. Because consumers often re-use credentials, hackers take them and “brute force” thousands of potential logins at the website. Because Starbucks’ mobile payment app is so popular, any large set of stolen credentials is bound to have at least a few combinations that unlock Starbucks accounts.

Perhaps you’re wondering: what’s the use of hacking the Starbucks app? Answer, as a wilier mind than mine pointed out: you can buy Starbucks gift cards at the counter with them. Then you sell them on eBay. (Though I can’t decide if this is pretty small-time crookedness or a huge line of business. Certainly going to be inflating Starbucks’s bottom line though.)


Wolfram Language Artificial Intelligence: the Image Identification project » Stephen Wolfram Blog

“What is this a picture of?” Humans can usually answer such questions instantly, but in the past it’s always seemed out of reach for computers to do this. For nearly 40 years I’ve been sure computers would eventually get there — but I’ve wondered when.
I’ve built systems that give computers all sorts of intelligence, much of it far beyond the human level. And for a long time we’ve been integrating all that intelligence into the Wolfram Language.
Now I’m excited to be able to say that we’ve reached a milestone: there’s finally a function called ImageIdentify built into the Wolfram Language that lets you ask, “What is this a picture of?”— and get an answer.


Apple says first HomeKit smart devices coming in June » WSJ Digits blog

Daisuke Wabayashi:

“HomeKit [hardware certification] has been available for just a few months and we already have dozens of partners who have committed to bringing HomeKit accessories to market and we’re looking forward to the first ones coming next month,” said Apple spokeswoman Trudy Muller.

Apple’s statement comes on the heels of a report in Fortune that said Apple’s software platform — which will allow the company’s devices to control connected home appliances — was experiencing problems and that the introduction of the first HomeKit devices were being delayed.

For its part, Apple has never said when HomeKit-compliant devices would start hitting the market, but one developer working with Apple on the platform had told Re/code earlier this year that new products would be ready in May or June.

Interesting: Apple moved quickly to respond to this – within hours – and chose the WSJ to say it.


Dirt cheap drones: Is Europe’s largest Kickstarter in over its head? » Ars Technica UK

Cyrus Farivar:

In January 2015, the Welsh drone startup concluded its Kickstarter campaign to fund production of the Zano. It raised over £2.3m ($3.4m) in under two months, becoming the most crowdfunded European project ever. This summer, Torquing [Group, which is making the device] says it will ship drones to the more than 12,000 people who backed the project.

There’s only one problem. Despite Zano’s release date being less than two months away, no one outside Torquing has actually flown the drone. And it’s questions about the project that are truly beginning to take off.

Ars visited Torquing last month for an exclusive tour of the company’s offices. After spending a couple of hours with the Zano team, we don’t have a good sense of how well the device actually flies. Although we heard more about its touted “swarm” feature, we didn’t see the drone working in a real-world situation; we were merely able to hold a Zano and verify its existence.

Reece Crowther, the company’s head of marketing, regretfully informed us that we turned up just before a shipment of 500 last-minute prototypes arrived. Torquing, therefore, said it was unable to let us fly one. At the time, Reedman noted that only 12 Zanos existed, and we saw what appeared to be only a few of them.

I’m one of the backers. Fingers crossed. I’d expect this to be late, at best.


Sunrise launches ‘Meet’, a custom keyboard to schedule meetings » MacStories

Federico Viticci:

When I first tried Meet, Sunrise’s latest addition to their popular calendar app, I didn’t think it made much sense as a custom keyboard. Now, a few months later, Meet has become my favorite way to check on my availability from any app and create one-to-one meetings. With Meet, the Sunrise team has created one of the most innovative mobile calendar features I’ve seen in years.

Sunrise, part of Microsoft since February, rarely shied away from subverting traditional calendar features found in most clients for smartphones and tablets. As I explored last year, Sunrise’s biggest strengths lie in excellent integration with web services, prolific use of icons to quickly discern events, weather support, external calendars, and the ability to show details for event participants. At its core, Sunrise aims to reimagine the calendar by expanding it beyond a list of days and events

.

Super-clever. Expect more lateral thinking on keyboards as a result. Available on iOS and Android. Oh, Windows Phone? Doesn’t allow third-party keyboards.


How smartphone startup Light plans to replace high-end cameras » Re/code

Ina Fried on a company that’s not exactly making a smartphone; it’s making the camera systems to go into them:

Put more simply, Light tries to emulate digitally what a big zoom lens does through expensive glass lenses. It aggregates the data from the different cameras to create both optical zoom and high-resolution images. Light has applied for a bunch of patents to cover aspects of its approach, including creating zoom using images from the multiple fixed-focal length lenses.

As a business, Light is banking on the fact that using smartphone cameras, even a bunch of them, is a far more economical way to achieve the kind of images that in the past have required expensive glass lenses.

The technology is ready, says Grannan, who previously ran start-up Vlingo and also worked at Sprint PCS. There is of course, added cost in putting a bunch of cameras and mirrors inside a cell phone, an addition of perhaps $60 to $80 in the final cost of a phone, Light estimates.

Seems high. Creating a big lens from smaller ones is a solved software problem: it’s how the Very Large Array works, for example. Wonder if this is really a defensible USP.


Why I’m breaking up with Google Chrome » The Next Web

Owen Williams, on a topic I previously linked to:

The Verge reported that using Chrome over Safari resulted in a three and a half hour shorter battery life on the latest MacBook.

I’ve always loved Chrome’s interface, its plethora of extensions, and how it integrates with services every day, but it’s time for something new. We can do better.

The problem is that the Web is now optimized for Chrome users and that means alternatives often provide a terrible experience.

Thanks in part to the browser’s massive market share, the best developer tools and Google’s aggressive adoption of the latest Web technologies, developers have gravitated toward Chrome’s rendering engine as the only one they support.

I’ve switched to Safari (on a Mac), and found that yes, processor use plummets and battery life extends dramatically. Nor is it noticeably slower (or faster).

But the important point here is in the third paragraph of this excerpt: that lots of sites are now using Chrome-specific tweaks, which means that they don’t work as well in other browsers, at least on the desktop.

This does pose a problem if it becomes dominant in mobile: Android isn’t going away, and Chrome is increasingly the default browser on mobile too.


Start up: Apple Watch’s big security hole, iPhone rumours!, fight for your right to be forgotten, and more


Forgetful sign. Photo by mikecogh on Flickr.

A selection of 8 links for you. Go on, click them. I’m charlesarthur on Twitter. Observations and links welcome.

Watch OS 1.0 lacks the necessary security features to dissuade thieves » iDownloadblog

Jeff Benjamin:

The Apple Watch contains security measures to prevent thieves from accessing your data, but it doesn’t include the necessary features to dissuade thieves from trying to steal your device to begin with.

The problem stems from the lack of an Activation Lock-like feature on Watch OS 1.0.

Unlike the iPhone, if someone steals your Apple Watch, they can easily reset the device (bypass the passcode), and pair it with a new iPhone logged in to a different iCloud account. In other words, it’s totally feasible to steal an Apple Watch and set it up on a different device as if you just purchased it from an Apple Store.

What a colossal security oversight. Bad, bad, bad.


Maybe Samsung is starting to think wearables through more carefully » ReadWrite

Brian Rubin:

Samsung’s new software development kit for its homegrown mobile OS Tizen offers a few hints about its upcoming Gear A smartwatch (codenamed Orbis)—namely, that it will probably sport a round display and a rotating bezel for taking a spin through the interface.

More important, though, the SDK also suggests that Samsung is taking a more measured approach to its new wearable—one that bodes well for its future efforts in the area.

Rotating bezel sounds a clever idea… until you try to think what you’d control with it. OK, it was a great idea on the iPod for scrolling through a long list. But on a watchface, you’d be obscuring part of the list at least once every revolution.


Introducing Windows 10 Editions » Microsoft

There’s Home, Pro, Enterprise, Education, and…

Windows 10 Mobile is designed to deliver the best user experience on smaller, mobile, touch-centric devices like smartphones and small tablets. It boasts the same, new universal Windows apps that are included in Windows 10 Home, as well as the new touch-optimized version of Office. Windows 10 Mobile offers great productivity, security and management capabilities for customers who use their personal devices at work. In addition, Windows 10 Mobile will enable some new devices to take advantage of Continuum for phone, so people can use their phone like a PC when connected to a larger screen.

Windows 10, a break from the past of confusing SKUs. Also: Windows Mobile. We have always been at war with Eurasia. (There’s a Mobile Enterprise version too.)


Next A9-based iPhone predicted to have 12MP camera, 2GB RAM, rose gold and more, mass production in August » Mac Rumors

As it’s never too early for “next iPhone” rumours, Joe Rossignol channels KGI Securities’ Ming-Chi Kuo (who has done OK on this stuff before):

The main selling point of the so-called “iPhone 6s” and “iPhone 6s Plus” will be Force Touch, the pressure-sensitive display technology built into Apple Watch and new MacBook trackpads. Other predicted features for Apple’s next iPhone, many of which have already been rumored, include an A9 processor with 2GB of RAM, improved 12-megapixel camera, a new Rose Gold colour option, possible sapphire cover lenses and more.

2GM of RAM is overdue. Unsure about the Force Touch thing: would that make the phone thicker? Would it work all over the screen? It might get rid of a moving part that’s probably prone to break (the home button) which could still have a sapphire lens for the fingerprint unlock. Might.

The most surprising forecast is that there won’t be a refashioned 4in model. Will the 5S remain on sale, but ageing? Or are the larger screens the only future?


Fitbit IPO rides on persuading you to dust off your wristband » Bloomberg Business

Caroline Chen:

Some Fitbit users have found they can use smartphone apps to count steps instead of having to wear a wristband. For others, the novelty just wore out. Catherine Toth Fox bought her Fitbit Charge, which sells for $129.95, in January and was done with it after a month.
“I stopped using it when I figured out how much activity it took me to hit 10,000 steps,” the Honolulu freelance writer, 40, said in an e-mail. “I realized very quickly that I was already reaching that goal just by my normal daily activities, so there was no need to have a device to tell me that anymore.” She gave the Fitbit to her mother, who uses it daily. Her husband, on the other hand, has never taken his out of the box.
Keeping users engaged will matter even more as Fitbit increases its offerings to employers. The device maker’s corporate wellness program lets companies buy Fitbits for their workers and monitor their health via a dashboard. For companies that are self-insured, encouraging employees to exercise more can help reduce the firm’s health bill.

That “I figured out how much was enough” point is an important one: it sets a ceiling even on active users.


How Google’s top minds decide what to forget » WSJ

Lisa Fleisher and Sam Schechner:

Google has only been removing results from European domains such as Google.fr or Google.co.uk—but not Google.com, even when accessed in Europe. That can make it simple to find results that have been removed, leading regulators to issue an opinion saying Google’s position didn’t go far enough.

Regulators say their position holds and that Google should comply or face legally binding orders to do so.

“Their position will have to change,” said Isabelle Falque-Pierrotin, head of the CNIL, France’s data-protection regulator, as well as chairwoman of a pan-European advisory body that includes all EU privacy regulators.

Another confrontation looms. (Clever headline, too.)


Google wins privacy case, allowed not to forget in Finland » Ars Technica UK

The (original) headline here is misleading. Let’s see why in this Glyn Moody article:

As the news site yle.fi reports, the case concerned a Finnish man’s business “blunders,” which he claimed were harming him because they continued to turn up in Google’s search results. After Google refused a request to remove them, the man appealed to Finland’s Data Protection Ombudsman. The latter pointed out that “Finland’s business register lists the man as still being involved in business operations, including debt collection.” That presumably meant the links to stories about his past would still be relevant to people who were seeking information about the person in question now. As such, there was no reason for Google to be forced to delete those hits from its search results page.

Ah, so this is an appeal. Which means the “RTBF” (or RTBdelinked) does apply in Finland. As the article continues by explaining:

Finland’s Data Protection Ombudsman is currently dealing with around 30 other complaints about Google’s refusal to delete results. According to the article, “In Finland there have been close to 3,700 requests [to Google] to remove information from roughly 12,000 search results. Google has conformed to about 45%.” This is close to its average compliance rate of 40% across the EU, where Google has received 250,000 requests to remove information from more than 900,000 search engine results.

So in fact the RTBF is enacted *more* strongly in Finland than elsewhere in Europe, on average. After I pointed this out to Moody, he tweaked the headline to “Google wins privacy case, allowed this time not to forget in Finland”.

People get worked up over the RTBF, even though it rests on the same principle as that preventing US companies from grabbing data from Europeans and abusing it. They like the latter, but not the former; except they’re indivisible because of their origin.


Apple Watch vs Android Wear: Why most smartwatches still suck for women » iMore

Serenity Caldwell:

When I first heard about Android Wear last year, I thought the folks behind the OS were doing a lot of things right. And I still do: the approach to notifications is smart, custom watch faces are neat, and Google Now — while creepy — works exceptionally well at providing smart information for your day.

There’s only one problem: There’s not a single Android Wear device designed to fit a small-wristed person.

If wearable technology is the next big thing for our tech-connected society, why is Apple the only company paying attention to the smaller-wristed set? Lady or dude, there are quite a few people on this earth whose arms don’t resemble the trunk of a Sequoia tree — many of whom would be excited to use a smartwatch. I was thrilled when Apple announced multiple sizes for the Apple Watch, and moreover that both were reasonably-sized for the wrist; sadly, I have yet to find an Android Wear device that will fit on my wrist without making it look like the technology equivalent of an iron shackle.


Android (and Apple, and BlackBerry, and Microsoft Mobile) handset profitability – the Q1 scorecard (updated)


Quality. Profitable. Photo by Thomas Hawk on Flickr.

At the end of January, I drew together the figures from the fourth quarter of 2014 to look at how profitable making smartphones was for companies including Apple, Samsung, HTC, LG, and Sony. The approximate answer was: not very, unless you were Samsung or Apple.

Another quarter gone: time again to see if anyone is faring any better. As a bonus I’m also throwing in Microsoft Mobile and BlackBerry.

Proceed with caution

A few words first on procedure. I look at the companies’ financial statements and information about the smartphone shipments, revenues and operating margin of their handset divisions. In some cases they don’t give this explicitly, or they give some but not all of the numbers, which have to be estimated or wrangled by triangulating with analysts’ data. (I tend to use IDC and/or CounterPoint, who I’ve found to be reliable.)

Some people have wondered why I use operating margin rather than gross profit to calculate these numbers. There’s an important difference. “Gross profit” is what you have left over after subtracting the cost of the goods in the product, and the cost of making it, and the cost of getting it to the customer. It’s a number that flatters a business because it doesn’t take into account all the other costs involved in running that business – such as paying sales, general and administrative [SG&A] staff, marketing, R+D (which comes out of your current cash, and is an investment in the future of the business), and all the other things you think of as “keeping the lights on”. If selling your products doesn’t cover all those costs, then you don’t actually have a viable business.

The Motorola finesse

This was why it used to bug me when Motorola Mobility’s people would say that it “made money on each handset it sold” selling its low-priced devices while owned by Google. Sure – it made money on gross margin. It wasn’t a lie, but it was economical with the truth, a comment made perhaps in the knowledge that most journalists wouldn’t ask “you mean on gross margin or operating margin?”

Motorola Mobility was fabulously unprofitable; its losses, once you included SG&A and R&D, were dramatic. Between the second quarter of 2012 (when Google took it over) and the first quarter of 2014, Motorola’s total revenues were $10.98bn. Its losses, once you took account of those costs, were $1.9bn, or 17 cents for every dollar of sales. Motorola never had a profitable quarter while inside Google. In fact if you take its entire life after being spun off from the larger organisation at the start of 2010 to the start of 2014, over 17 quarters just two showed operating profit, totalling $160m. Total operating losses, including those profits: $2.47bn on revenues of $30.6bn. Now it has been swallowed by Lenovo, which promises to make it profitable. We’ll see.

So don’t let glib answers fool you. There are lots of way to talk about “profit”. Here’s mine. (“ASP” is average selling price, across the company’s whole portfolio of smartphones.)

So how was Q1 for you?

With the numbers now in from all the top-line handset makers (who you’d expect would be the profitable ones), here are the numbers. (An asterisk means the number isn’t absolute, and the reason for each is explained below the table.)

OEM Handset
revenue
US$ (approx)
Operating profit US$m Operating
margin %
handsets shipped Implied ASP per phone Implied profit per phone
HTC $1.35bn $0.89m 0.06% 5.0m $270 $0.18
Sony $2.28bn –$461m -20.2% 7.9m $288.70 –$58.40
LG $3.25bn $79.85m 2.46% 15.4m $210.79 $5.18
Samsung $22.53bn $2.47bn* 10.96% 83.3m* $250.88 $29.65
Total for top-end Android $29.41bn $2.09bn 7.1% 111.6m $263.50 $18.73
Lenovo $2.82bn* -$218m -7.7% 18.7m $150.80* -$10.28
Top-end Android inc Lenovo $32.23bn $1.87bn 5.80% 130.3m $247.35 $14.35
Apple $40.28bn $11.27bn (at 28% margin) 28% (est) 61.17m $658.53 $184.20
Microsoft Mobile $1.03bn –$369m -35.8% 8.6m $119.70 –$54.00
BlackBerry $274m –$156.88m -57.2% 1.3m $210.77 –$120.68

Assumptions
HTC: I’ve assumed that all the first-quarter revenue is for HTC phones – which isn’t true, given that it also now offers the HTC Re and made the Nexus 9 tablet sold by Google. (Sales were likely pretty small, since it didn’t show up in IDC’s tablets category where the smallest number was about 1m, and you’d expect that Amazon sold more. I understand Nexus 9 shipments in Q4 were just 70,000; the number would be substantially smaller in Q1.)
The 5m phones number comes from one of the big analysis companies that tracks smartphone shipments. (Not sure I have their permission to say who, but they’re very reliable.)
The operating margin isn’t a mistake – it really is $890,000 after conversion. HTC truly lives on the edge; and has been spending on R+D for its virtual reality headset. The phones are probably more profitable than this suggests; the Nexus 9 and Re probably aren’t, but it’s unlikely they contribute much to revenue.

Sony: Currency converted using the yen rate for the quarter cited in Sony’s results presentation. The huge operating loss is a puzzler: Sony’s explanation in its financials is that besides the dollar’s appreciation hitting costs, it was due to “the recording of intellectual property related reserves in the current quarter”. I don’t know what the IP-related issues are; is Sony gearing up for a court fight with someone? (Microsoft, over Android licensing?)

LG: Currency converted from Korean won using the same conversion rate as Samsung.

Samsung: the company doesn’t give exact figures for its smartphone shipments; it coyly said in its investor call it had shipped 99m mobile phones including featurephones and that smartphones were in the “mid-80s percent”. This is IDC’s number.
Its smartphone revenues calculated on the prevailing won-dollar exchange rate on 31 March, and the basis that those 15.7m featurephones had a shipping price of $15, and that the “about nine million” (quote from the earnings call) tablets had a shipping price of $175.
Samsung gives operating profit for its entire “IM” division, which includes its PC divison. I’m assuming these make zero profit, or not enough to perturb the figures. If any of its PCs, tablets or featurephones makes a profit, that reduces the per-handset smartphone profit.

Lenovo: now owns Motorola, which is dragging down its results, as it does everywhere. Assumptions: the 2.5m tablets it sold went for an ASP of $100 and made zero profit; a higher tablet ASP and profit means the smartphone business did worse. Another assumption: Moto360 smartwatch sales didn’t add materially to revenues, and didn’t lose money. (You can argue about this. It reduces the smartphone revenue, but boosts profitability if the Moto360 sold well at what was probably a loss or breakeven.)

Lenovo is odd in that its smartphone business is now partitioned into two – there’s the Lenovo brand, which sells almost entirely in China (and recently in India, a little), and the Motorola brand, which sells much more widely. The Lenovo brand phones have really low ASPs – historically, around the $100 mark. The Motorola ones have much higher ASPs – about $230 in the most recent quarter. None of it is profitable, though; even before Motorola the mobile business was losing money, and there are various unspecified writeoffs of unspecified amounts in the latest quarter that make the losses even worse. Lenovo says it’s aiming to get Motorola profitable within 4-6 quarters of acquisition. So that’s by the middle of 2016.

Trouble for Lenovo is that it hasn’t made a profit with low ASP phones, and it’s not making one with Motorola’s high ASP ones. Perhaps it hopes the profit will come with scale (or the departure of rivals?).

Top-end Android cumulatively: clearly, Samsung dominates: it has 30 times more profit than its nearest rival (LG) on about 5 times as many phones.

Apple: we have to assume Apple’s iPhone operating profit margin at 28%, because it doesn’t break out divisional profits; all costs are assigned across the company. (You could estimate it by taking iPhone revenues as a percentage of the total, and assigning that percentage of all other costs to it.)

Microsoft Mobile: I previously set out all the calculations used here (which exclude writedowns on intangibles). Specific assumptions: its featurephones have an ASP of $15 and make $5 profit per handset; sales and marketing was $300m per quarter. Mobile is a terrible business for Microsoft, but it has to stick with it.

BlackBerry: these are the figures for its quarter to the end of February. I looked at those in detail, and found that services and software have consistent gross profit margins of about 82%. Subtract that from the gross profit, and you get a total gross profit for handsets of $21.20m. Now we have to subtract operating expenses from that; assuming those are proportional to the revenues from each slice of its business (hardware, software, services) we take away 42%x $424m = $178.08m to get the operating profit for BB’s handsets. It’s negative.
Handsets are an even worse business for BlackBerry than for Microsoft – and BlackBerry can’t bear the losses like Microsoft can. Tick tock.

Questions you’re asking:

1) Where’s Lenovo (including Motorola)?
Hasn’t reported yet; calendar Q1 is the end of its financial year, and it takes an age putting together its results. Might have them some time in, who knows, June. (It seems to have shipped 18.8m phones in the quarter, down year-on-year from the 19.1m Lenovo and Motorola shipped when separate.)

There, it’s now included.

2) What about Xiaomi/Huawei?
Though they’re big players in shipments (15.3m and 17m respectively), Xiaomi doesn’t publish numbers anywhere I can find (pointers welcome), and Huawei doesn’t break out any detail from its mobile division – though a year ago it said it was operating just ahead of break-even.

Comparison

Sequential quarter comparisons are usually odious, especially if you look from the Christmas quarter to the new year one; shipments fall, revenues fall and stuff gets cheaper as companies try to shift unsold stock and get ready for New Things. Bearing that in mind, looking back at the Q4 figures, we find that:
• HTC’s margins worsened quite a lot; handset ASP stayed fairly steady.
• Sony’s ASP dropped a lot, from $305 to $288.70.
• LG actually improved its operating margin, kept revenues and shipments up, and saw only a slight dip in ASP
• Samsung kept revenues up while increasing shipments – hence a big drop in ASP, from $306 to $250.88 – and improved operating margins and profit
• Apple saw shipments fall (as expected), a slight fall in ASP but per-handset profit remained almost the same. And it’s still taking all the money.

Coming up…

In a followup post, I’ll look at ASP trends for these companies, and what they suggest about the challenges facing these companies – particularly Sony – and also the question of whether Samsung might withdraw from the PC business altogether. (It pulled out of Europe last year.) Stay tuned.

Start up: Apple Watch v Android Wear, the old smartphone buyers, Google halts Mapmaker (finally), and more


Seems to be free of intentional errors so far. Photo by scarlettfawth on Flickr.

A selection of 9 links for you. Slather them over your body like peppercorn sauce. I’m charlesarthur on Twitter. Observations and links welcome.

Philly.com got 555 comments on an article about changes to comments » Poynter

Kirsten Hare: You’re making an effort to keep comments in a time when many sites have scrapped them. Why is that?

Erica Palan: There are definitely folks in our newsrooms — and in the industry overall — who would be happy to see comments go away. But our digital leadership team is committing to keeping comments. Commenters are some of our most dedicated readers. They come back again and again to our stories. Also, the Internet is a big, chatty place. If we don’t give our readers the opportunity to talk about the news, they’ll go elsewhere.

KH: There were 545 comments with this piece! Is that normal?

EP: Ha, not at all! Some of our stories will generate a ton of comments, but 545 is a lot no matter what barometer we’re using. I was really nervous it’d be crickets for awhile, because it was a few hours before it took off! (How embarrassing to write an article about comments and then receive no comments?) To me, it showed that our commenters really do care about being a part of Philly.com.

KH: I noticed you moderated them. Any advice for other journalists or news outlets?

EP: At Philly.com we’ve been really inspired by the work being done by the Engaging News Project. They put out a study that showed that having writers moderate and comment on their own stories improved the tenor of comments overall. A handful of reporters for the Inquirer and Daily News have started to do this and anecdotally, we feel it’s been pretty successful.

I reckon different dynamics apply: that the people with the most useful insights reserve those for places where they’ll be most valuable, which isn’t necessarily comment sections. “Commenters are some of our most dedicated readers” is true, but that doesn’t necessarily mean they’re the ones who attract other readers. (Also, having writers moderate comments on their own stories probably isn’t smart – nor a great use of their time. I didn’t moderate comments at The Guardian; no writer did.)


US smartphone sales among consumers earning less than $30,000 grow more than 50% » NPD Group

As US mobile phones sales transition to predominately smartphones, buyers have become significantly older and less affluent. For the third consecutive three-month period ending February 2015, sales among consumers earning less than $30K per year grew by more than 50%. This demographic is now the largest segment of the smartphones market, accounting for 28% of all sales. In contrast, sales among consumers earning more than $100K a year increased by just 24%. For the three months ending February 2015, buyers aged 55+ also represented 28% of all sales, up 24% from a year ago, and were the fastest growing age segment of the population.

Over the three month period ending in February, overall sales of mobile phones rose 28% compared to last year, while smartphone sales increased 35%. During the same three-month period, the share of sales for non-smartphones declined to just 14%…

…Apple and Samsung accounted for two out of every three smartphones sold over the three month period, although Apple sales increased by 45% and Samsung’s just 10%.

And here’s a brand breakdown:

NPD seems to think it’s the oldies buying the new models. So, old geezers are going to rule the mobile biz?


What to Wear? » Rusty Rants

Russell Ivanovic, of Shifty Jelly, in a comparison that I’ve been wanting to read since the Apple Watch came out:

One of the benefits of being curious about technology and running a company where we get to buy it to test on, is that I get to play with a lot of cool gadgets. When it comes to watches alone I have the Apple Watch, LG G, LG Watch R, Moto 360, Samsung Galaxy Gear and the Sony Smartwatch 3. I thought it might be interesting to compare Android Wear and Apple Watch as they are today.

The must-read for today, if only to keep up with how the two platforms are evolving. I think he’s spot-on with each prediction, too.


Baidu leads in artificial intelligence benchmark » WSJ Digits blog

Robert McMillan:

The company’s Minwa supercomputer scanned ImageNet, a database of just over one million pictures, and taught itself how to sort them into a predefined set of roughly 1,000 different categories. This meant learning the difference between a French loaf and a meatloaf, but also trickier challenges such as distinguishing a Lakeland terrier from a wire-haired fox terrier.

Five years ago, the possibility that computers would surpass humans at this work appeared remote. But computers run by Microsoft, Google, and now Baidu have all done better than the best human results in the past few months.

With practice, humans correctly identify all but about 5% of the ImageNet photos. Microsoft’s software had a 4.94% error rate; Google achieved 4.8%. Baidu said that it had reduced the error rate further to 4.58%.

The so-called deep learning algorithms that Baidu and others are using to ace these tests have only recently made the leap from academia to Silicon Valley. But they’re starting to have an impact in daily life.

Unfortunately the broader “impact in daily life” isn’t specified. Google used it for voice recognition in Android, but that’s not quite “daily life”.

Also notable: Chinese companies starting to challenge western ones in this field.


After several public Google Maps hacks, Google forced to suspend Map Maker to prevent more fake edits » SearchEngineLand

Barry Schwartz:

Google has temporarily suspended Google Map Maker, a service to allow the community to make edits to Google Maps similar to how Wikipedia edits work. The reason the service was suspended was because of the recent public edits made to show how easy it is to make fraudulent edits to businesses.

We covered the loopholes that showed how Edward Snowden was at the White House and how Android relieved itself on Apple. But these hacks and fraudulent edits have been going on for a long long time.

Indeed – recall locksmiths and the US Secret Service and the restaurant a rival said was closed at weekends. The problem with the “peeing Android” edit was that it was multi-stage, by a “trusted” editor. This isn’t going to be solved easily.


High profile tech start-up Ninja Blocks goes bust » The Age

Rose Powell:

Ninja Blocks built and sold home automation systems that allowed users to control electrical devices through their smart phone. It managed both the software and also manufactured a range of sleek hardware products.

The company was launched three years ago and sustained its growth through sales and a series of successful crowdfunding campaigns: $103,000 in 2012 and $703,000 in 2013. Both brought in double or triple their original goal. It also raised $2.4m in three funding rounds, which included leading Australian tech investors Square Peg Capital, Blackbird Ventures, Atlassian founders Mike Cannon-Brookes and Scott Farquhar as well as Sing Tel’s Innov8.

Crowdfunding campaigns require significant, ongoing public communication. The company went quiet in April as their latest product, the Ninja Sphere, ran over time and over-budget.

In a blog post, the team wrote the fact it was receiving “far below what they would expect to get somewhere else” their burn rate could not be sustained.

Unclear if the dollar amounts are Australian or US, but shows that hardware remains a tough business in which to succeed. (Side note: Powell’s byline describes her as “journalist”. Helpful.)


Hard numbers for public posting activity on Google Plus » Stone Temple Consulting

Eric Enge dives very deep into numbers that many have tried to dive deep into many times before:

Our extrapolated total suggests that about 23.4 million people have put public posts on Google+ within a given 30 day period. There is a hyperactive group of 358K+ people who do 50 or more public posts per month. After adjustments, we see these two numbers drop to 16M and 106K respectively.

These numbers should give you a good sense of what’s really going on in the G+ stream at this point.

Note that we also found that a small percentage (0.16%) of the total profiles examined currently return 404 errors (which means that the page does not exist), suggesting that the accounts have been abandoned or shut down.

The invalid profiles may include profiles that were robotically created in attempts to artificially game Google+. Those of you who are active on G+ are familiar with your follower count dropping at those times when Google clears a bunch of these out.

Isn’t going away, though, for reasons Enge then goes on to explain.


Four reasons why the Apple Watch will be a success » GlobalWebIndex

Jason Mander:

while the smart(est) money will probably wait for v2 of the Apple Watch to become available – the one where all of the initial annoyances and shortcomings have been addressed – there can be no doubt that, Apple’s first foray into this sector will finally push it into the mainstream. Quite simply, it’s inevitable that this watch will be a success – and here are four reasons why.

GWI provides wide-scale demographic information about web users worldwide. Of particular interest: it finds that those who have already bought a wearable are the most interested in using an Apple device, as here:

(Makes a change from all the “why Apple’s Watch will flop” pieces, anyhow.)


Regulator probes pitfalls of ‘sharing economy’ » FT.com

Barney Jopson and Tim Bradshaw on the US FTC’s plan to look into a number of companies:

In the US, the past actions of the FTC — which enforces federal antitrust and consumer protection laws — indicate that it sees ride-hailing apps such as Uber, Lyft and Sidecar as a positive force for competition
It has written to state and city legislators urging them not to pass laws that would put them at a disadvantage to traditional taxis.
But the agency wants to probe two practices that are central to peer-to-peer platforms — the accumulation of personal data and the use of rating systems — as well as questions over legal liability for injuries.
“We want to see to what extent sharing economy platforms should be able to monitor participants by collecting, let’s say, location data,” said Ms Lao. “And if they do monitor, how can they do so while adequately protecting the privacy of the participants?”


Start up: Hololens on the edge, what self-driving cars need, the buttons that do nothing, and more


Might make a difference. Might not. Photo by Cyron on Flickr.

A selection of 8 links for you. No strings attached. I’m charlesarthur on Twitter. Observations and links welcome.

Google’s self-driving cars have been in 11 accidents, but none were the car’s fault » The Verge

Chris Ziegler notes that Ford thinks we need some flexibility:

another example [Mike] Tinskey [Ford’s head of electrification and infrastructure] brought up was that of overcoming the excessively careful self-driving systems of the future:

Q: So you’re saying that from the driver’s perspective, the car will be self-driving, but really there’s someone else driving it from afar for them?
Tinskey: That’s right. If you’ve ever had the pleasure to go to, for instance, China, if you’re not aggressive to try to turn left, there will be people that will walk in front of you all day long. And an autonomous vehicle would end up sitting there forever. And a driver normally just has to kind of say, “Alright, I’m going,” and the people will stop and the car heads through. So there are going to be situations where a remote driver can actually pilot a vehicle better than an autonomous in certain conditions. Or just because of policy, that might be the way that we have to deal with it.

Indeed, in Google’s view of vehicle autonomy — as in the generally rational view — a car can never assume (or hope, at least) that a pedestrian will stop or jump out of the way the way a human driver can. Sometimes, simply moving (particularly in the world’s most congested cities) requires a degree of cowboyishness that a stupidity-proof autonomous car can never permit. There needs to be a way for the car to say, “well, I can’t make this potentially dumb decision, but I invite a human to make it for me.”


The growing US smartphone base » Tech.pinions

Jan Dawson, in a subscriber-only article looking at the disparity (of about 40m smartphones) between Comscore’s US smartphone number, and that shown by mobile operators – which has various explanations:

If you were relying on Comscore’s data to forecast the total iPhone market in the US, for example, you’d end up with about 80m users, while there would be just under 100m Android users. But we already know that Comscore is under-counting the total smartphone market by around 35-40m, so each of these numbers might be 15-20m higher in practice. That’s important if you’re trying to get an accurate gauge.
The next question is whether the split between operating systems is accurate, or whether that’s defective too. That’s harder to ascertain through other sources and Kantar and other data seems to bear out similar trends in broad terms, so I’m inclined to believe it’s fairly accurate. But I take it with at least a pinch of salt on the basis that I know the overall data is flawed. I think the key, ultimately, is not to rely on any one data point, but rather to find as many data points as possible that either corroborate or contradict one another, then synthesize and aggregate them to arrive at the best possible picture of reality.


On sale now: Tesco Mobile » Counterpoint Technology Market Research

Peter Richardson, on the UK supermarket MVNO, which is up for sale to try to alleviate corporate debts of around £22bn:

Tesco Mobile is actually one area where is has carved out a strong position. Its range of attractively priced and no-nonsense tariffs appeal strongly to particular segments: young people, family orientated consumers and seniors being primary focal areas. It also offers a good range of handsets at prices on par with most high street mobile stores. Its success means it contributes approximately £100m per year to Tesco’s profits. Assuming similar multiples as other recent trade sales, Tesco could realize seven to eight times net profit — therefore something around £800m when it sells its stake in the venture. The most likely buyer is Tesco’s partner in the business, O2. However other MVNOs may also enter the bidding including Talk Talk, which recently purchased Tesco’s video TV service, Blinkbox.

Tesco Mobile also operates around 250 Tesco Phone Shops, that provide point of sale for a range of feature phones, smartphones and accessories. It sells around 2m units per year through these stores and online. Tesco has done well addressing seniors and is one of the UK’s leading suppliers of Doro’s range of products that are designed specifically for older generation consumers. It is not clear what will become of Tesco Phone Shops — even to staff working in them.

Last year saw Phones4U squashed; will Tesco’s outlets be next?


HoloLens: why Microsoft has to play down expectations to avoid Google Glass failure » IBTimes

After yesterday’s post from Tim Bajarin on why Google Glass didn’t click with consumers, David Gilbert contrasts the stage promise of Hololens with the experience (at present):

Just hours later I was given the chance to test out this game-changing technology for myself and my initial reaction was one of huge disappointment and being completely underwhelmed.

That was until I realised what HoloLens really was and what it could do, and I readjusted my expectations. By the end of my time with HoloLens I saw the huge potential this device has, but Microsoft is in danger of falling into some of the same traps as Google Glass.

Microsoft is a company in need of a revolutionary product like HoloLens. Unlike Apple, Microsoft is seen as a stale and staid tech company, one which is associated with “boring” products like Office and Windows rather than the iPhone or iPad.

The problem for Microsoft, is that while HoloLens may be revolutionary, it is not (yet) a mass consumer product like the iPhone or iPad. It is a hugely powerful holographic computer that is ideally suited to enterprise applications and that is where the company needs to focus its attention.

Via David Gilbert. (It’s OK to promote your own stuff to me, folks.)


How the Apple Watch cured my iPhone addiction » Medium

Evgenia Grinblo:

It’s not that I was addicted, per se. I just spent a lot of time using my phone. But the app Moment, which I installed on my phone to prove I didn’t have a problem, told me that my average total daily iPhone use added up over two hours.

On my worst day, I spent 7 hours and 41 minutes on my iPhone.

As a UX designer and qualitative researcher, this was not only alarming but also fascinating. I wanted to know what it was that kept hooked on my phone. I researched mobile phone addiction (it sounded dramatic), I tried a 30-day-off-Facebook challenge (but still clocked considerable time on my phone). I also spoke with others. It appeared that many felt equally drawn to their smartphones but no one quite understood why.

Then came the Watch.
Everything changed when I got my Apple Watch. Within twenty-four hours of wearing it, I forgot where my iPhone was for the first time.

(Via Jay Kannan.)


How World of Warcraft led to Glassdoor » Business Insider

Julie Bort:

in 2006, Hohman quit a fabulous job as president of Hotwire to do nothing but play the game. Full time. For a year.

And the second he hit the highest level, the itch to play was scratched, and he needed a new thing to obsess over. So he launched a startup.

In his words: “I took a year off and played World of Warcraft. I would pat the kids on the bottom every morning, send them to school and then I would dominate as an Orc Warrior.”

He adds, “I played for a year nonstop and then I hit the maximum level in WoW. I was maniacal in chasing this goal and literally the next day I started a company, Glassdoor.”

The meaning of ‘community’
The year of WoW helped him decide the kind of company he wanted to build.

“I learned from playing WoW about community. It was the first time I really felt part of a online community. I’d be up the morning and be excited to see my guild. Isn’t that nerdy?” he laughs.

Yes. Yes, it is. But it’s hard to argue with success: he learnt the difference between offline and online community through that experience. (Arguably, he could have learnt it in less time than a year.)


Press me! The buttons that lie to you » BBC Future

Chris Baraniuk:

Computer scientist Eytan Adar at the University of Michigan has described a series of fascinating “benevolent deceptions” in a paper co-written with two Microsoft researchers. Take the 1960s 1ESS telephone system for instance. After dialling, a caller’s connection would sometimes fail to go through properly. Instead of a dead tone or error noise, the system would instead simply route the call to a completely different person. “The caller, thinking that she had simply misdialled, would hang up and try again: disruption decreased and the illusion of an infallible phone system preserved,” notes the paper.

Adar and his co-authors also describe how Skype phone calls today sometimes contain “fake static noise” because when users experience a completely noise free line, they are prone to thinking that the call has in fact dropped. A quick Google search reveals that there are plenty of examples of fake noises. From pre-recorded car door slams to artificial shutter sounds made by digital cameras, the world is full of noises designed to delight users and reassure them that the device is working as intended.

Those noises deserve a word of their own, rather like onomatopeia.


Snapchat debuts video ads for 2 cents per view » Adweek

Snapchat wants companies to know its not just for millennials: Advertisers can find a home there as well. At the Daily Mail/Elite Daily Digital Content NewFronts presentation Thursday, the platform announced it would be unveiling 10-second ads that cost 2 cents per view.
The new ad offering creates a new way for Snapchat Discover publishers to generate revenue. Daily Mail North America CEO Jon Steinberg said his company was standing by to create those snaps for brands.

Another American platform using adverts to monetise. I often wonder whether if US TV were more like the (licence fee-subsidised, ad-free) UK’s BBC whether “advertise for money” would be a less reflexive monetisation strategy.


Putting iOS and Android apps on Windows 10 is a white flag to rivals – and a red flag for developers


We just need some firmware in here and everything will be fine. Photo by 4nitsirk on Flickr.

Microsoft announced at its BUILD conference that it will be providing a way for iOS and Android developers to port – sorta kinda – their mobile apps to Windows 10, so they don’t have to rewrite them from scratch in its coding language.

As Peter Bright described it at Ars Technica:

[In “Project Islandwood] Microsoft has developed an Objective C toolchain and middleware layer that provide the operating system APIs that iOS apps expect. A select group of third parties have been using the Islandwood tools already, with King’s Candy Crush Saga for Windows Phone being one of the first apps built this way. King’s developers had to change only a “few percent” of the code in order to fully port it to Windows Phone.

For Android, there is Project Astoria. Rumors of Android apps on Windows have been floating around for some time, and in Windows 10 Microsoft is delivering on those rumors. Astoria will allow Android apps to run in Windows. Specifically, Windows Mobile (and yes, that’s now officially the name for Windows on phones and sub-8 inch tablets) will include an Android runtime layer that’ll let them run existing Android apps (both Java and C++) unmodified.

Bright then followed up on Monday last Friday (thanks Walt) with an analysis which goes much more deeply into the mechanics of how it will be done, but also points to two examples where companies have tried to make up for the lack of apps on their platform by enabling others effectively to run on them: IBM’s OS/2 platform, and BlackBerry’s BB10.

The point about OS/2 is well-remembered, delving back into PC history when Windows was young and IBM was trying to keep control of the burgeoning PC platform. It failed, because IBM couldn’t update OS/2 fast enough to keep compatibility with the fast-expanding Windows 3.x API base; but also, developers didn’t want to get distracted by having to look after more than one platform.

Indeed, when it comes to porting, Bright observes that “neither OS/2 nor BB10 has made a success of this capability”. He could also have added Amazon’s Android fork, and the Nokia X, which used AOSP (Android Open Source Platform) and tried to replace Google services with Microsoft ones.

We surrender to your platform

The trouble with “compatibility mode” is that it’s so evidently a white flag on the part of the company that enables it. In effect, the company is saying: we can’t attract enough developers to write natively for our platform, so we’ll try to piggyback on the more successful one.

But that’s also a giant red warning flag to developers on that platform. By effectively telling them that other platforms are more successful, it calls into question the future of the development tools on the platform, and the user base; it accepts that there are both more users and more developers elsewhere.

I don’t think Islandwood and Astoria will work. Not because they technically won’t work – Microsoft has scads of smart people who can do clever things with code – but because this is a technical solution to a business problem.

Even worse, it’s a technical solution that makes the business problem worse. If you subscribe to the idea of “moats and castles” (that businesses aim to surround themselves with an advantage that rivals can’t cross), then effectively dumping your own developer kit on mobile so that you can lure people from rival platforms strengthens the rivals’ moats – their loyal cohorts of third-party developers. Why would anyone write first for mobile on Windows, given these two projects?

The business problem

Microsoft’s user base for Windows Phone is around 70m-80m worldwide, out of a total smartphone user base of around 2 billion. Superficially this sounds like the late 1990s, when Apple was just about able to eke out an existence by having around 50m-60m out of 1.5bn PCs.

The crucial difference though is that Apple had the high-end users, who were willing to pay a premium for Apple’s qualities (principally in desktop publishing and graphic design, and lots of consumers in the US). Windows Phone occupies the low end. Its users don’t monetise well. That means developers don’t concentrate on them. A little experiment for you: today, when you see an ad for an app, notice how many mention availability on Windows Phone. If you get above zero, you’re lucky (or browsing a Windows site).

The category error

But, say the the Windows diehards, the access to 1.5 billion PCs and, ahem, Windows Phone will prove irresistible to all those developers currently writing for iOS and Android. All those PCs! Who wouldn’t want to be on those?

This is wrong, for two reasons: context and support costs.
1) apps written for mobile do not, in the main, translate to the desktop/laptop. What would Snapchat on the desktop be like? Or Uber? Apps that rely on the camera or geolocation don’t make sense; others can in general be done in the browser (example: Facebook). John Kneeland pointed this out back in February, before we knew about these initiatives. What he wrote remains true:

The most interesting developers and companies today aren’t shrinking down desktop experiences. They are building entirely new experiences that wouldn’t make any sense — or even be possible — on a PC.

2) the cost of “writing” the app is only the start; after that you have support, updates and compatibility. Imagine an iOS developer who has written an app for iOS 8 (presently covering 81% of users) considering this.

If they’re sensible, they’ll look first at monetisation via Android – after all, it’s the far bigger market, which has a premium (= willing to pay) segment that rivals iOS in size. So they do that. And then clean up, perhaps, with the iPad market too.

Now – Windows Phone via compatibility mode or Android tablets? If they write for “Windows Phone compatibility” they’ll have a product that will need special tweaking on a new platform where because of the comparatively low number of users, a few bad reviews could spell doom. Even if they get it right, Apple will introduce iOS 9 in the autumn, which might or might not tweak or twerk the existing APIs, and will surely kill off some of the older ones. How long will it take Microsoft to update to those? One thing’s for sure – iOS new version adoption will run ahead of Microsoft’s ability to update. This means there are now two versions of the app, on slightly different APIs, not entirely compatible.

When iOS 9 comes out, the iOS developers’ attentions will be on bugfixing and customer support there. This means (because people are finite) less time to attend to the Windows Phone customers. Things don’t get fixed there, bad reviews get left, the app sinks down the store, and.. what was the point of writing for this thing again?

As for Android developers – if we assume that they haven’t already done an iOS version, then do you think they’d want to write something for a platform with over 500m mobile devices in use, or one with 1.5bn users… except that for almost all of those 1.5bn, their app will make no sense at all (if they’re even able to load it – for don’t forget that about half of those PCs are in businesses, and probably locked down)?

Again, this isn’t hard to figure out.

A good try, but doomed

Microsoft had to do something, and people who like clever technical solutions are delighted by this clever technical solution to the fact of developer indifference and incompatible software. But it doesn’t change the fundamental truth: Windows Phone (v10 or whatever) is too small to matter in platform terms on mobile.

Microsoft is surely interested in keeping the mobile side going, as much as anything because of all the lessons it teaches you about things like power management, chip integration, sensor management, and a multitude of other things that are important.

History tells us that software compatibility is a losers’ move. Far better to move the fight to a new battleground and win there – as Apple did, first with the iPod and then the iPhone and then the iPad and then (thus far) the Apple Watch. Seems like a working strategy.

Update: some responses on Twitter have been along the lines of “Oh, no, really, developers will love it!”

Why, I ask? “Azure! The developer environment! Access to Xbox! It’ll get people to switch to Windows!”

In order:
• developers don’t need Windows 10 to use Azure. Vesper, which is resolutely iOS-only, uses Azure, for instance.
• if there’s one thing developers likely don’t want to get accustomed to, it’s yet another developer environment if the payback is small. Also, is there any developer who hasn’t heard that Windows (desktop) has a lot of users? The point is that Windows 10 is not magically going to make those desktop users into mobile users, for the reasons discussed above. iOS and Android have 95% of pretty much any market that’s worth squeezing developer money from. If anyone wants to tell me which niches monetise better on Windows Phone than on iOS and/or Android, I’m all ears.

• Xbox access isn’t worth much. There are about as many Xbox users as Windows Phone users (of the order of 70-80m; Xbox One is replacing Xbox 360, and any new buyers are balanced out by those abandoning as they get older). Games are notoriously difficult to write well; developers need to write “close to the metal”. Porting mobile games to the Xbox isn’t a sensible strategy.

• people do switch to Windows Phone from other platforms. However, just as many (if not more) flow back to the other two platforms because they aren’t happy with the app situation. And if this works, then what’s the reason for switching to Windows? So that you can get the apps that you already had on the smartphone platform you were on before? That doesn’t make sense.

I’m happy to be proved wrong, of course – if those who say I’m going to be wrong are willing to put up some solid numbers here (in the comments) that we can refer back to in a year or so, such as forecast Lumia sales, or Lumia installed base, or forecast length in 2016 of the app gap between other platforms and Windows Phone/10.

I’m charlesarthur on Twitter. Say hi or leave a comment.