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Netflix launches Rs 199 ($2.8) mobile-only monthly plan in India

Netflix has a new plan to win users in India: make the entry point to its service incredibly cheap. The streaming giant today introduced a low-priced mobile tier in the country that costs Rs 199 ($2.8) per month in a bid to take on Disney, Amazon and dozens of other aggressively priced competitors in the country.

The new subscription tier from Netflix restricts the usage of the service to one mobile device — and permits only one concurrent stream — and offers the standard definition viewing (~480p). Users also can opt to have the new plan on their tablets, but again, several features such as the ability to cast (or mirror) the content to a TV are restricted.

Netflix began testing a lower-priced subscription plan in India and some other Asian markets late last year. (During the test, Netflix charged users about $3.6 per month.) At a press conference in New Delhi, company officials said today that there is currently no plan to expand this offering to other regions. During the trial period, Netflix was also testing a weekly subscription plan; that too, is no longer being pursued, officials said.

The announcement comes days after Netflix reported that it added 2.7 million new subscribers in the quarter that ended in June this year, far fewer than the 5.1 million figure it had projected earlier this year. Jessica Lee, VP of Communications at Netflix, said the company’s recent performance in other markets did not influence its move in India.

During its earnings report, Netflix said last week that it planned to introduce a mobile-only subscription offering in India by Q3 this year. But the company has moved to make the new offering already live in the country. Previous subscription tiers that start at Rs 499 ($7.2) and go up to Rs 799 ($11.5) will continue to be offered in the country.

Mobile devices are increasingly driving media consumption in India, said Ajay Arora, director of Product Innovation at Netflix. The streaming service’s users in India have shown far richer appetite for consuming content on mobile devices than users in any other nation, he said.

India has turned into an intense battleground for video streaming services in recent years. Netflix today competes with more than three-dozen local and international players in the country. Hotstar, owned by Disney, currently leads the market with over 300 million users. The ad-supported service offers about 80% of its catalog at no cost to users. Its yearly plan, which includes titles from HBO and Showtime, is priced at Rs 999 ($14.5). Amazon Prime Video is similarly priced in India.

Indians spend 30% of their smartphone time and over 70% of their mobile data on entertainment services, a recent industry report estimated.

A cheaper plan could significantly help Netflix grow its user base in the country, analysts say. “Netflix had a good early start, but growth has been slow in the last six months given the mass Indian consumer market remains value-conscious,” Mihir Shah, vice president of research firm Media Partners Asia, told TechCrunch.

“At 200 rupees, Netflix could address a sizable target market in India. One could draw parallels from the Indian multiplex industry, which caters to 100 million consumers spending an average $4 per movie,” he added.

Netflix is estimated to have less than two million subscribers in India. However, despite its relatively smaller user base, it was the top video streaming app in the country by revenue last year, according to research firm App Annie. Research firm IHS Markit estimates that the service could scale to 4 million subscribers in the country by year-end.

At a conference last year, Netflix CEO Reed Hastings said that India could contribute as many as 100 million users to the platform in the coming years.

Netflix CEO “expects to see 100m” subscribers in India. A reminder, only ~80m Indians (top 10%) make more than $3000/yr. Even for them a $90 annual Netflix sub is well over a week’s wages. And they can get local content for basically free. So no, not 100m https://t.co/323RHe6hmS

— Stanley Pignal (@spignal) February 23, 2018

Some analysts say Netflix also needs to focus on its content catalog to make it more appealing to Indians. Hotstar has grown its business largely on top of live streaming of high-profile cricket matches. Netflix, which has produced over two-dozen titles in India to date, currently has very few titles that focus on sports.

“Netflix will need to strike the right balance of ensuring a steady supply of original local content,” Shah said.

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Apple releases iOS 12.4 with potential software support for Apple Card

While iOS 13 is right around the corner with a ton of new features, it isn’t quite ready just yet. Apple has just released iOS 12.4, a new stable update. There aren’t many radical changes, but this is the first version that theoretically supports the Apple Card — the feature isn’t enabled just yet.

Apple has been testing its credit card for a few weeks now. According to Bloomberg, Apple’s retail employees have been able to sign up to the Apple Card with beta versions of iOS 12.4 and an invitation.

As a reminder, Apple has partnered with Goldman Sachs on a credit card for U.S. customers. When you sign up, you receive a Mastercard credit card that you control from the Wallet app.

In addition to a list of your most recent transactions, you can see a breakdown of your purchases by category. You get 1% back when you pay with your card, 2% if you pay using Apple Pay and 3% if it’s an Apple purchase.

Cash back is credited directly on your Apple Cash card. You can pay for things using Apple Pay, make a payment on your Apple Card or transfer it to your bank account.

The Apple Card was originally announced back in March. The company said that it would be available this summer. Now that iOS 12.4 is available, the release date shouldn’t be too far off.

Also, iOS 12.4 features a new migration tool so you can wirelessly transfer data from one iPhone to another. It should make it easier to switch to a new iPhone, especially if you don’t use iCloud.

With this update, you also can control your Apple News+ content more granularly. For instance, you can clear downloaded magazines, check your downloaded issues and more.

Today’s update also re-enables Walkie Talkie on the Apple Watch. The company had to temporarily disable the feature due to a vulnerability.

Apple pushed an additional 36 security fixes through in iOS 12.4, per a security contents advisory.

Don’t forget to back up your iPhone to iCloud or iTunes before updating. Then head over to the Settings app, tap General and Software Update.

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The roles tools play in employee engagement

Christina Janzer
Contributor

Christina Janzer is Slack’s Director of Research & Analytics, responsible for leading all global research and product analytics efforts that provide insights about people and work.

Employee engagement isn’t just about the morale of individual workers—it also enables broader workforce productivity and leads to better business outcomes. In fact, research conducted by The Society for Human Resource Management (SHRM) argues that an understanding of the role employee engagement plays in driving morale and productivity is critical to business success.

At Slack, my team of researchers and analysts spends time studying how people work and what they need to do their best work. We consistently find that an important signal of employee engagement lies in how people feel about the tools they use at work.

Good tools can enable both productivity as well as increase morale. We’ve done research to learn more about successful and thriving Slack teams, and what it is about Slack that enables them to do better work.

These teams don’t just talk about how Slack improves efficiency, but also how it builds community and in some ways modernizes the company. We also found that the top three emotions people associate with Slack are happy, fun and easy, which you might not expect from a productivity tool.

Technology overall has impacted how, for how long, and from where we work, as well as our efficiency in getting things done. Engaging employees with technology isn’t just about supplying more robust software, but giving people tools that they look forward to using everyday as much as their preferred personal apps.

When products and technology reflect the nuances of human communication, while at the same time making information more accessible, employees feel more connected — both with the workplace and with their co-workers – resulting in a stronger, more trusting relationships and better performance.

So, how can we challenge ourselves to set higher expectations for the work products we build and use every day, and what would it look like to bring more humanity, fun and delight into the tools we use for work? Here are some principles to keep in mind.

Add emotional context to improve communication

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Huawei’s new OS is for industrial use, not Android replacement

Seems Hongmeng isn’t the Android replacement it’s been pitched as, after all. The initial story certainly tracked, as Huawei has been preparing for the very real possibility of life after Google, but the Chinese hardware giant says the operating system is primarily focused on industrial use.

The latest report arrives courtesy of Chinese state news agency, Xinhua, which notes that the OS has been in development for far longer than the Trump-led Huawei ban has been in effect. Hongmeng is a relatively simple operating system compared to the likes of Android, according to SVP Catherine Chen. The news echoes another recent report that Huawei had initially developed the software for use on IoT devices.

None of this means that Huawei isn’t working on a full mobile operating system, of course. Or that the seeds of this new OS couldn’t be adapted to do more.

And given the recent news, such a move would be a pretty good use of the company’s vast resources. After all, it’s no doubt seen the writing on the wall for some time. While no one anticipated that such a ban would arrive so suddenly, questions about the company have been floated in security circles for years now.

New restrictions from the Trump administration barred Huawei from working with American companies like Google, but temporary reprieves have allowed the smartphone maker to employ Android services — at least temporarily. Questions about the company’s health are still very much up in the air, however, as the ban ramps back up.

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Watch an unfiltered interview of PicsArt founder at Disrupt Berlin

Smartphones have become a creative playground thanks to cameras and innovative apps, such as PicsArt. With PicsArt, anybody can add filters and stickers and tweak photos and videos in many different ways. It has been a massive hit with 130 million monthly active users. And that’s why I’m excited to announce that PicsArt founder and CEO Hovhannes Avoyan is joining us at TechCrunch Disrupt Berlin.

PicsArt started with a simple app that lets you edit photos before sharing them. There are many companies in this space, including VSCO, Snapseed and Prisma. But PicsArt has managed to become a cultural phenomenon in many countries, including China.

If you’re thinking about editing a photo or video in one way or another, chances are you can do it in PicsArt. In addition to traditional editing tools (cropping, rotating, curves, etc.), you can add filters, auto-beautify your face, change your hair color, add stickers and text, cut out your face and use masks just like in Photoshop… I’m not going to list everything you can do because it’s a long list.

The result is an app packed with features that lets you express yourself, create visual storytelling and improve your social media skills. If you’re an Instagram user, chances are you’ve seen more than one photo that has been edited using PicsArt.

picsart

While the app is free with ads, users can also subscribe to a premium subscription to unlock additional features. And PicsArt is not just about editing, as you can also use the app as its own social network.

PicsArt is based in the U.S. and has raised $45 million over the years. But the company is also betting big on Armenia, with a big engineering team over there.

And it’s a natural fit, as Hovhannes Avoyan is originally from Armenia. In addition to PicsArt, he has founded many successful startups in the past — he sold them to Lycos, Bertelsmann, GFI, TeamViewer and HelpSystems. Many entrepreneurs would have a hard time founding just one of these companies, so I can’t wait to hear how Avoyan manages to work on so many different products and turn those products into successes.

Buy your ticket to Disrupt Berlin to listen to this discussion and many others. The conference will take place on December 11-12.

In addition to panels and fireside chats, like this one, new startups will participate in the Startup Battlefield to compete for the highly coveted Battlefield Cup.



Hovhannes Avoyan is a serial entrepreneur, investor and scholar. He is the founder and CEO of PicsArt, the No. 1 photo and video editing app and community with more than 130 million monthly active users. PicsArt is backed by Sequoia Capital, Insight Venture Partners, DCM and Siguler Guff. The company employs more than 350 people and is headquartered in San Francisco, with offices across the globe in Yerevan, Armenia; Los Angeles; Beijing; and an AI lab in Moscow.

Avoyan brings more than 25 years of experience in computer programming and global business management. Prior to PicsArt, Avoyan founded five other startups, all of which had successful acquisitions by global companies including Lycos, Bertelsmann, GFI, TeamViewer, and HelpSystems.

He is a graduate of Harvard Business School’s Bertelsmann Senior Executive’s program. He received his B.S. and M.S. from the State Engineering University of Armenia and his M.A. in Political Science and International Affairs from the American University of Armenia. He’s also a frequent speaker at business conferences on topics ranging from business strategy to international team building and Al.

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FaceApp gets federal attention as Sen. Schumer raises alarm on data use

It’s been hard to get away from FaceApp over the last few days, whether it’s your friends posting weird selfies using the app’s aging and other filters, or the brief furore over its apparent (but not actual) circumvention of permissions on iPhones. Now even the Senate is getting in on the fun: Sen. Chuck Schumer (D-NY) has asked the FBI and the FTC to look into the app’s data handling practices.

“I write today to express my concerns regarding FaceApp,” he writes in a letter sent to FBI Director Christopher Wray and FTC Chairman Joseph Simons. I’ve excerpted his main concerns below:

In order to operate the application, users must provide the company full and irrevocable access to their personal photos and data. According to its privacy policy, users grant FaceApp license to use or publish content shared with the application, including their username or even their real name, without notifying them or providing compensation.

Furthermore, it is unclear how long FaceApp retains a user’s data or how a user may ensure their data is deleted after usage. These forms of “dark patterns,” which manifest in opaque disclosures and broader user authorizations, can be misleading to consumers and may even constitute a deceptive trade practices. Thus, I have serious concerns regarding both the protection of the data that is being aggregated as well as whether users are aware of who may have access to it.

In particular, FaceApp’s location in Russia raises questions regarding how and when the company provides access to the data of U.S. citizens to third parties, including potentially foreign governments.

For the cave-dwellers among you (and among whom I normally would proudly count myself) FaceApp is a selfie app that uses AI-esque techniques to apply various changes to faces, making them look older or younger, adding accessories, and, infamously, changing their race. That didn’t go over so well.

There’s been a surge in popularity over the last week, but it was also noticed that the app seemed to be able to access your photos whether you said it could or not. It turns out that this is actually a normal capability of iOS, but it was being deployed here in somewhat of a sneaky manner and not as intended. And arguably it was a mistake on Apple’s part to let this method of selecting a single photo go against the “never” preference for photo access that a user had set.

Fortunately the Senator’s team is not worried about this or even the unfounded (we checked) concerns that FaceApp was secretly sending your data off in the background. It isn’t. But it very much does send your data to Russia when you tell it to give you an old face, or a hipster face, or whatever. Because the computers that do the actual photo manipulation are located there — these filters are being applied in the cloud, not directly on your phone.

His concerns are over the lack of transparency that user data is being sent out to servers who knows where, to be kept for who knows how long, and sold to who knows whom. Fortunately the obliging FaceApp managed to answer most of these questions before the Senator’s letter was ever posted.

The answers to his questions, should we choose to believe them, are that user data is not in fact sent to Russia, the company doesn’t track users and usually can’t, doesn’t sell data to third parties, and deletes “most” photos within 48 hours.

Although the “dark patterns” of which the Senator speaks are indeed an issue, and although it would have been much better if FaceApp had said up front what it does with your data, this is hardly an attempt by a Russian adversary to build up a database of U.S. citizens.

While it is good to see Congress engaging with digital privacy, asking the FBI and FTC to look into a single app seems unproductive when that app is not doing much that a hundred others, American and otherwise, have been doing for years. Cloud-based processing and storage of user data is commonplace — though usually disclosed a little better.

Certainly as Sen. Schumer suggests, the FTC should make sure that “there are adequate safeguards in place to protect the privacy of Americans…and if not, that the public be made aware of the risks associated with the use of this application or others similar to it.” But this seems the wrong nail to hang that on. We see surreptitious slurping of contact lists, deceptive deletion promises, third-party sharing of poorly anonymized data, and other bad practices in apps and services all the time — if the federal government wants to intervene, let’s have it. But let’s have a law or a regulation, not a strongly worded letter written after the fact.

Schumer Faceapp Letter by TechCrunch on Scribd

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Netflix will roll out a lower-priced subscription plan in India

Netflix said on Wednesday that it will roll out a cheaper subscription plan in India, one of the last great growth markets for global companies, as the streaming giant scrambles to find ways to accelerate its slowing growth worldwide.

The company added 2.7 million new subscribers in the quarter that ended in June this year, it said today, far fewer than the 5 million figure it had forecasted earlier this year.

The company said lowering its subscription plan, which starts at $9 in the U.S., would help it reach more users in India and expand its overall subscriber base. The new plan will be available in India in Q3. According to third-party research firms, Netflix has fewer than 2 million subscribers in India.

Netflix started to test a lower-priced subscription plan in India and some other markets in Asia late last year. The plan restricts the usage of the service to one mobile device and offers only the standard definition viewing (~480p). During the period of testing, which was active as of two months ago, the company charged users as low as $4.

The company did not specify the exact amount it intends to charge users for the cheaper mobile-only plan. During the testing period, Netflix also provided some users the option to get a subscription that would only last for a week. The company also did not say if it intended to bring the cheaper plan to other markets. TechCrunch has reached out to Netflix for more details. (Update: Netflix declined to elaborate at this point.)

“After several months of testing, we’ve decided to roll out a lower-priced mobile-screen plan in India to complement our existing plans. We believe this plan, which will launch in Q3, will be an effective way to introduce a larger number of people in India to Netflix and to further expand our business in a market where Pay TV ARPU is low (below $5),” the company said in its quarterly earnings report.

The India challenge

Selling an entertainment service in India, the per capita GDP of which is under $2,000, is extremely challenging. The vast majority of companies that have performed exceedingly well in the nation offer their products and services at a very low price.

Just look at Spotify, which entered India earlier this year and for the first time decided to offer full access to its service at no cost to local users. Even its premium option that features playback in higher quality costs Rs 119 ($1.6) per month.

That’s not to say that winning in India, home to more than 1.3 billion people, can’t be rewarding. Disney-owned streaming service Hotstar, which offers 80% of its content catalog at no cost, has amassed more than 300 million monthly active users. There are about 500 million internet users in India, according to industry reports.

In fact, Hotstar set a global record for most simultaneous views to a live event — about 25.3 million users — during the recently concluded ICC cricket world cup. It broke its own previous records. Hotstar’s free offering comes bundled with ads, while its ad-free premium option costs Rs 999 ($14.5) for year-long access.

Amazon, another global rival of Netflix, bundles its Prime Video streaming service in its Prime membership, which includes access to faster delivery of packages and its music service, for Rs 999 a year.

For Netflix, the decision to lower its pricing in India comes at a time when it has hiked the subscription cost in many parts of the world in recent quarters. In the U.S., for instance, Netflix said earlier this year that it would raise its subscription price by up to 18%.

During a visit to India early last year, Netflix CEO Reed Hastings said the country could eventually emerge as the place that would bring the next 100 million users to his platform. “The Indian entertainment business will be much larger over the next 20 years because of investment in pay services like Netflix and others,” he said.

So far, Netflix has largely tried to lure customers through its original series. (Many popular U.S. shows such as NBC’s “The Office” that are available on Netflix’s U.S. catalog are not offered in its India palate.) The company, which has produced more than a dozen original shows and movies for India, this week unveiled five more that are in the pipeline.

“We are seeing nice, steady increases in engagement in India. Growth in that country is a marathon and we are in it for the long haul,” Ted Sarandos, chief content officer at Netflix, said during an earnings call today.

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Facebook’s regulation dodge: Let us, or China will

Facebook is leaning on fears of China exporting its authoritarian social values to counter arguments that it should be broken up or slowed down. Its top executives have each claimed that if the U.S. limits its size, blocks its acquisitions or bans its cryptocurrency, Chinese company’s absent these restrictions will win abroad, bringing more power and data to their government. CEO Mark Zuckerberg, COO Sheryl Sandberg and VP of communications Nick Clegg have all expressed this position.

The latest incarnation of this talking point came in today’s and yesterday’s congressional hearings over Libra, the Facebook-spearheaded digital currency it hopes to launch in the first half of 2020. Facebook’s head of its blockchain subsidiary Calibra, David Marcus, wrote in his prepared remarks to the House Financial Services Committee today that (emphasis added):

I believe that if America does not lead innovation in the digital currency and payments area, others will. If we fail to act, we could soon see a digital currency controlled by others whose values are dramatically different.

Senate Banking Committee Holds Hearing On Facebook's Proposed Crypto Currency

WASHINGTON, DC – JULY 16: Head of Facebook’s Calibra David Marcus testifies during a hearing before Senate Banking, Housing and Urban Affairs Committee July 16, 2019 on Capitol Hill in Washington, DC. The committee held the hearing on “Examining Facebook’s Proposed Digital Currency and Data Privacy Considerations.” (Photo by Alex Wong/Getty Images)

Marcus also told the Senate Banking Subcommittee yesterday that “I believe if we stay put we’re going to be in a situation in 10, 15 years where half the world is on a blockchain technology that is out of reach of our national-security apparatus.”.

This argument is designed to counter House-drafted “Keep Big Tech Out of Finance” legislation that Reuters reports would declare that companies like Facebook that earn over $25 billion in annual revenue “may not establish, maintain, or operate a digital asset . . .  that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function.”

The message Facebook is trying to deliver is that cryptocurrencies are inevitable. Blocking Libra would just open the door to even less scrupulous actors controlling the technology. Facebook’s position here isn’t limited to cryptocurrencies, though.

The concept crystallized exactly a year ago when Zuckerberg said in an interview with Recode’s Kara Swisher, “I think you have this question from a policy perspective, which is, do we want American companies to be exporting across the world?” (emphasis added):

We grew up here, I think we share a lot of values that I think people hold very dear here, and I think it’s generally very good that we’re doing this, both for security reasons and from a values perspective. Because I think that the alternative, frankly, is going to be the Chinese companies. If we adopt a stance which is that, ‘Okay, we’re gonna, as a country, decide that we wanna clip the wings of these companies and make it so that it’s harder for them to operate in different places, where they have to be smaller,’ then there are plenty of other companies out that are willing and able to take the place of the work that we’re doing.

When asked if he specifically meant Chinese companies, Zuckerberg doubled down, saying (emphasis added):

Yeah. And they do not share the values that we have. I think you can bet that if the government hears word that it’s election interference or terrorism, I don’t think Chinese companies are going to wanna cooperate as much and try to aid the national interest there.

WASHINGTON, DC – APRIL 10: Facebook co-founder, Chairman and CEO Mark Zuckerberg testifies before a combined Senate Judiciary and Commerce committee hearing in the Hart Senate Office Building on Capitol Hill April 10, 2018 in Washington, DC. Zuckerberg, 33, was called to testify after it was reported that 87 million Facebook users had their personal information harvested by Cambridge Analytica, a British political consulting firm linked to the Trump campaign. (Photo by Chip Somodevilla/Getty Images)

This April, Zuckerberg went deeper when he described how Facebook would refuse to comply with data localization laws in countries with poor track records on human rights. The CEO explained the risk of data being stored in other countries, which is precisely what might happen if regulators hamper Facebook and innovation happens elsewhere. Zuckerberg told philosopher Yuval Harari that (emphasis added):

When I look towards the future, one of the things that I just get very worried about is the values that I just laid out [for the internet and data] are not values that all countries share. And when you get into some of the more authoritarian countries and their data policies, they’re very different from the kind of regulatory frameworks that across Europe and across a lot of other places, people are talking about or put into place . . . And the most likely alternative to each country adopting something that encodes the freedoms and rights of something like GDPR, in my mind, is the authoritarian model, which is currently being spread, which says every company needs to store everyone’s data locally in data centers and then, if I’m a government, I can send my military there and get access to whatever data I want and take that for surveillance or military.

I just think that that’s a really bad future. And that’s not the direction, as someone who’s building one of these internet services, or just as a citizen of the world, I want to see the world going. If a government can get access to your data, then it can identify who you are and go lock you up and hurt you and your family and cause real physical harm in ways that are just really deep.

facebook logo down glitch

Facebook’s newly hired head of communications, Nick Clegg, told reporters back in January that (emphasis added):

These are of course legitimate questions, but we don’t hear so much about China, which combines astonishing ingenuity with the ability to process data on a vast scale without the legal and regulatory constraints on privacy and data protection that we require on both sides of the Atlantic . . .  [and this data could be] put to more sinister surveillance ends, as we’ve seen with the Chinese government’s controversial social credit system.

In response to Facebook co-founder Chris Hughes’ call that Facebook should be broken up, Clegg wrote in May that “Facebook shouldn’t be broken up — but it does need to be held to account. Anyone worried about the challenges we face in an online world should look at getting the rules of the internet right, not dismantling successful American companies.”

He hammered home the alternative the next month during a speech in Berlin (emphasis added):

If we in Europe and America don’t turn off the white noise and begin to work together, we will sleepwalk into a new era where the internet is no longer a universal space but a series of silos where different countries set their own rules and authoritarian regimes soak up their citizens’ data while restricting their freedom . . . If the West doesn’t engage with this question quickly and emphatically, it may be that it isn’t ours to answer. The common rules created in our hemisphere can become the example the rest of the world follows.

COO Sheryl Sandberg made the point most directly in an interview with CNBC in May (emphasis added):

You could break us up, you could break other tech companies up, but you actually don’t address the underlying issues people are concerned about . . . While people are concerned with the size and power of tech companies, there’s also a concern in the United States about the size and power of Chinese tech companies and the … realization that those companies are not going to be broken up.

WASHINGTON, DC – SEPTEMBER 5: Facebook chief operating officer Sheryl Sandberg testifies during a Senate Intelligence Committee hearing concerning foreign influence operations’ use of social media platforms, on Capitol Hill, September 5, 2018 in Washington, DC. Twitter CEO Jack Dorsey and Facebook chief operating officer Sheryl Sandberg faced questions about how foreign operatives use their platforms in attempts to influence and manipulate public opinion. (Photo by Drew Angerer/Getty Images)

Scared tactics

Indeed, China does not share the United States’ values on individual freedoms and privacy. And yes, breaking up Facebook could weaken its products like WhatsApp, providing more opportunities for apps like Chinese tech giant Tencent’s WeChat to proliferate.

But letting Facebook off the hook won’t solve the problems China’s influence poses to an open and just internet. Framing the issue as “strong regulation lets China win” creates a false dichotomy. There are more constructive approaches if Zuckerberg seriously wants to work with the government on exporting freedom via the web. And the distrust Facebook has accrued through the mistakes it’s made in the absence of proper regulation arguably do plenty to hurt the perception of how American ideals are spread through its tech companies.

Breaking up Facebook may not be the answer, especially if it’s done in retaliation for its wrong-doings instead of as a coherent way to prevent more in the future. To that end, a better approach might be stopping future acquisitions of large or rapidly growing social networks, forcing it to offer true data portability so existing users have the freedom to switch to competitors, applying proper oversight of its privacy policies and requiring a slow rollout of Libra with testing in each phase to ensure it doesn’t screw consumers, enable terrorists or jeopardize the world economy.

Resorting to scare tactics shows that it’s Facebook that’s scared. Years of growth over safety strategy might finally catch up with it. The $5 billion FTC fine is a slap on the wrist for a company that profits more than that per quarter, but a break-up would do real damage. Instead of fear-mongering, Facebook would be better served by working with regulators in good faith while focusing more on preempting abuse. Perhaps it’s politically savvy to invoke the threat of China to stoke the worries of government officials, and it might even be effective. That doesn’t make it right.

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ClassPass introduces a corporate wellness program

ClassPass has set up yet another revenue stream, signing to a corporate wellness program partners like Facebook, Glossier, Google, Morgan Stanley, Under Armour, Etsy, Southwest Airlines and Gatorade.

The program will give employees at these companies access to the ClassPass network of more than 22,000 studio partners across 2,500 cities around the world, which includes studio brands like Barry’s Bootcamp, Flywheel Sports and CorePower Yoga. Corporate partners also get access to a “large library” of on-demand audio and video workouts.

This comes after ClassPass retooled the ClassPass Live product, in which it invested the resources to build out a new live broadcast studio, and rebuilt it into a library of on-demand video workouts.

The company launched ClassPass Live in 2018 with the hopes that users could workout from home within the ClassPass ecosystem. CEO Fritz Lanman told TechCrunch in June that the company stopped doing live classes in April 2019 and repackaged the content into free, on-demand video classes.

According to the release, one of the issues with corporate wellness programs is that HR departments have to patch together programs based on the regions in which their companies have offices/employees. ClassPass argues that its scale across the country, and in 17 other countries, gives it an edge with corporations that have global workforces.

Moreover, the ClassPass corporate wellness program only charges employers when employees actually use the service, and allows employers to reward good behaviors (going to a certain number of classes per month) by offering additional credits toward ClassPass experiences.

Here’s what Lanman had to say about it in a prepared statement:

The ClassPass Corporate Program enables employers of all sizes to offer the world’s most extensive, one-stop fitness and wellness program to their employees worldwide. ClassPass is the best fitness program ever created for consumers. With this launch, it’s now also the best fitness program ever created for employers and their employees.

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Social chat app Capture launches to take a shot at less viral success

At first glance launching a new social app may seem as sensible a startup idea as plunging headfirst into shark-infested waters. But with even infamous curtain-ripper Facebook now making grand claims about a ‘pivot to privacy’ it’s clear something is shifting in the commercial shipping channels that contain our digital chatter.

Whisper it: Feeds are tiring. Follows are tedious. Attention is expiring. There’s also, of course, the damage that personal digital baggage left out in the open can wreak long after the fact of a blown fuse or fleeting snap.

Public feeds have become vehicles of self-promotion; carefully and heavily curated — which of course brings its own peer pressures to keep up with friends’ lux exploits and the influencer ‘gram aesthetic that pretends life looks like a magazine spread.

Yet for a brief time, in the gritty early years of social media, there was something akin to spontaneous, confessional reality on show online. People do like to share. That’s mostly been swapped for the polish of aspirational faking it on apps like Facebook-owned Instagram. While genuine friend chatter has moved behind the quasi-closed doors of group messaging apps, like Facebook-owned WhatsApp (or rival Telegram).

If you want to chat more freely online without being defined by your existing social graph the options are less mainstream friendly to say the least.

Twitter is genuinely great if you’re willing to put in the time and effort to find interesting strangers. But its user growth problem shows most consumers just aren’t willing (or able) to do that. Telegram groups also require time and effort to track down.

Also relevant in interest-based chat: Veteran forum Reddit, and game chat platform Discord — both pretty popular, though not in a way that really cuts across the mainstream, tending to cater to more niche and/or focused interests. Neither is designed for mobile first either.

This is why Capture’s founders are convinced there’s a timely opportunity for a new social app to slot in — one which leverages smartphone sensors and AI smarts to make chatting about anything as easy as pointing a camera to take a shot.

They’re not new to the social app game, either. As we reported last year, two of Capture’s founders were part of the team behind the style transfer app Prisma, which racked up tens of millions of downloads over a few viral months of 2016.

And with such a bright feather in their cap, a number of investors — led by General Catalyst — were unsurprisingly eager to chip into Capture’s $1M seed, setting them on the road to today’s launch.

Point and chat

“The main idea behind the app is during the day you’ve got different experiences — working, watching some TV series etc, you’re sitting in an arena watching some sports, or something like that. So we imagine that you should open the app during any type of experience you have during the day,” says Capture co-founder and CEO Alexey Moiseenkov fleshing out the overarching vision for the app.

“It’s not for your friends; it’s the moment when you should share something or just ask something or discuss something with other people. Like news, for example… I want to discuss news with the people who are relevant, who want to discuss it. And so on and on. So I imagine it is about small groups with the same goal, discussing the same experience, or something like that. It’s all about your everyday life.”

“Basically you can imagine our app as like real-time forum,” he adds. “Real-time social things like Reddit. So it’s more about live discussion, not postponing something.”

Chat(room) recommendations are based on contextual inferences that Capture can glean from the mobile hardware. Namely where you are (so the app needs access to your location) and even whether you’re on the move or lounging around (it also accesses the accelerometer so can tell the angle of the phone).

The primary sensory input comes from the camera of course. So like Snap it’s a camera-first app, opening straight into the rear lens’ live view.

By default chats in Capture are public so it also knows what topics users are discussing — which in turn further feeds and hones its recommendations for chats (and indeed matching users).

Co-founder and CMO Aram Hardy (also formerly at Prisma) gives the example of the free-flowing discussion you can see unrolling in YouTube comments when a movie trailer gets its first release — as the sort of energetic, expressive discussion Capture wants to channel inside its app.

“It’s exploding,” he says. “People are throwing those comments, discussing it on YouTube, on web, and that’s a real pain because there is no tool where you can simply discuss it with people, maybe with people around you, who are just interested in this particular trailer live on a mobile device — that’s a real pain.”

“Everything which is happening around the person should be taken into consideration to be suggested in Capture — that’s our simple vision,” he adds.

Everything will mean pop culture, news, local events and interest-based communities.

Though some of the relevant sources of pop/events content aren’t yet live in the app. But the plan is to keep bulking out the suggestive mix to expand what can be discovered via chat suggestions. (There’s also a discovery tab to surface public chats.)

Discovery 1

Hardy even envisages Capture being able to point users to an unfolding accident in their area — which could generate a spontaneous need for locals or passers by to share information.

The aim for the app — which is launching on iOS today (Android will come later; maybe by fall) — is to provide an ever ready, almost no-barrier-to-entry chat channel that offers mobile users no-strings-attached socializing free from the pressures (and limits) of existing social graphs/friend networks; as well as being a context-savvy aid for content and event discovery, which means helping people dive into relevant discussion communities based on shared interests and/or proximity.

Of course location-based chatting is hardly a new idea. (And messaging giant Telegram just added a location-based chats feature to its platform.)

But the team’s premise is that mobile users are now looking for smart ways to supplement their social graph — and it’s betting on a savvy interface unlocking and (re)channelling underserved demand.

“People are really tired of something really follower based,” argues Moiseenkov. “All this stuff with a following, liking and so on. I feel there is a huge opportunity for all the companies around the world to make something based on real-time communication. It’s more like you will be heard in this chat so you can’t miss a thing. And I think that’s a powerful shot.

“We want to create a smaller room for every community in the Internet… So you can always join any group and just start talking in a free way. So you never shared your real identity — or it’s under your control. You can share or not, it’s up to you. And I think we need that.

“It’s what we miss during this Facebook age where everybody is ‘real’. Imagine that it’s like a game. In a game you’re really free — you can express yourself what way you want. I think that’s a great idea.”

“The entry threshold [for Twitter] is enormous,” adds Hardy. “You can’t have an account on Twitter and get famous within a week if you’re not an influencer. If you’re a simple person who wants to discuss something it’s impossible. But you can just create a chat or enter any chat within Capture and instantly be heard.

“You can create a chat manually. We have an add button — you can add any chat. It will be automatically recognized and suggested to other users who are interested in these sort of things. So we want every user to be heard within Capture.”

How it works

Capture’s AI-powered chatroom recommendations are designed to work as an onboarding engine for meeting relevant strangers online — using neural networks and machine learning to do the legwork of surfacing relevant people and chats.

Here’s how the mobile app works: Open the app, point the camera at something you view as a conversational jumping off point — and watch as it processes the data using computer vision technology to figure out what you’re looking at and recommend related chats for you to join.

For example, you might point the camera around your front room and be suggested a chatroom for ‘interior design trends and ideas’ , or at a pot plant and get ‘gardeners’ chat, or at your cat and get ‘pet chat’ or ‘funny pets’.

Capture app

Point the camera at yourself and you might see suggestions like ‘Meet new friends’, ‘Hot or not?’, ‘Dating’, ‘Beautiful people’ — or be nudged to start a ‘Selfie chat’, which is where the app will randomly connect you with another Capture user for a one-to-one private chat.

Chat suggestions are based on an individual user’s inferred interests and local context (pulled via the phone) and also on matching users across the app based on respective usage of the app.

At the same time the user data being gathered is not used to pervasively profile uses, as is the case with ad-supported social networks. Rather Capture’s founders say personal data pulled from the phone — such as location — is only retained for a short time and used to power the next set of recommendations.

Capture users are also not required to provide any personal data (beyond creating a nickname) to start chatting. If they want to use Capture’s web platform they can provide an email to link their app and web accounts — but again that email address does not have to include anything linked to their real identity.

“The key tech we want to develop is a machine learning system that can suggest you the most relevant stuff and topics for you right now — based on data we have from your phone,” continues Moiseenkov. “This is like a magical moment. We do not know who you are — but we can suggest something relevant.

“This is like a smart system because we’ve got some half graph of connection between people. It’s not like the entire graph like your friends and family but it’s a graph on what chat you are in, so where are you discussing something. So we know this connection between people [based on the chats you’re participating in]… so we can use this information.

“Imagine this is somehow sort of a graph. That’s a really key part of our system. We know these intersections, we know the queries, and the intersection of queries from different people. And that’s the key here — the key machine learning system then want to match this between people and interests, between people and topics, and so on.

“On top of that we’ve got recognition stuff for images — like six or seven neural networks that are working to recognize the stuff, what are you seeing, how, what position and so on. We’ve got some quite slick computer vision filters that can do some magic and do not miss.

“Basically we want to perform like Google in terms of query we’ve got — it’s really big system, lots of tabs — to suggest relevant chats.”

Image recognition processing is all done locally on the user’s device so Capture is not accessing any actual image data from the camera view — just mathematical models of what the AI believes it’s seen (and again they claim they don’t hold that data for long).

“Mostly the real-time stuff comes from machine learning, analyzing the data we have from your phone — everybody has location. We do not store this location… we never store your data for a long time. We’re trying to move into more private world where we do not know who you are,” says Moiseenkov.

“When you log into our app you just enter the nickname. It’s not about your phone number, it’s not about your social networks. We sometimes — when you just want to log in from other device — we ask you an email. But that’s all. Email and nickname it’s nothing. We do not know nothing about you. About your person, like where you work, who’s your friends, so on and so on. We do not know anything.

“I think that’s the true way for now. That’s why gaming is so fast in terms of growing. People just really want to share, really want to log in and sign up [in a way] that’s easy. And there is no real barriers for that — I think that’s what we want to explore more.”

Chatroulette

Having tested Capture’s app prior to launch I can report that the first wave chat suggestions are pretty rudimentary and/or random.

Plus its image recognition often misfires (for instance my cat was identified as, among other things, a dog, hamster, mouse and even a polar bear (!) — as well as a cat — so clearly the AI’s eye isn’t flawless, and variable environmental conditions around the user can produce some odd and funny results).

 

Capture app

The promise from the founders is that recommendations will get better as the app ingests more data and the AI (and indeed Capture staff performing manual curation of chat suggestions) get a better handle on what people are clicking on and therefore wanting to talk with other users about.

They also say they’re intending to make better linkage leaps in chat suggestions — so rather than being offered a chatroom called ‘Pen’ (as I was),  if you point the Capture camera at a pen, the app might instead nudge you towards more interesting-sounding chats — like ‘office talk’ or ‘writing room’ and so on.

Equally, if a bunch of users point their Capture cameras at the same pen the app might in future be smart enough to infer that they all want to join the same chatroom — and suggest creating a private group chat just for them.

On that front you could imagine members of the same club, say, being able to hop into the same discussion channel — summoning it by scanning a mutual object or design they all own or have access to. And you could also imagine people being delighted by a scanner-based interface linked to custom stuff in their vicinity — as a lower friction entry point vs typing in their directions. (Though — to be clear — the app isn’t hitting those levels of savvy right now.)

“Internally we imagine that we’re like Google but without direct query typing,” Moiseenkov tells TechCrunch. “So basically you do the query — like scanning the world around you. Like you are in some location, like some venue, imagine all this data is like a query — so then step by step we know what people are clicking, then improving the results and this step by step, month by month, so after three month or four month we will be better. So we know what people are clicking, we know what people are discussing and that’s it.”

“It’s tricky stuff,” he adds. “It’s really really hard. So we need lots of machine learning, we need lots of like our hands working on this moderating stuff, replacing some stuff, renaming, suggest different things. But I think that’s the way — that’s the way for onboarding people.

“So when people will know that they will open the app in the arena and they will receive the right results the most relevant stuff for this arena — for the concert, for the match, or something like that, it will be the game. That’s what we want to achieve. So every time during the day you open the app you receive relevant community to join. That’s the key.”

Right now the founders say they’re experimenting with various chat forms and features so they can figure out how people want to use the app and ensure they adapt to meet demand.

Hence, for example, the chatroulette-style random ‘selfie chat’ feature. Which does what it says on the tin — connecting you to another random user for a one-to-one chat. (If selfie chats do end up getting struck out of the app I hope they’ll find somewhere else to house the cute slide-puzzle animation that’s displayed as the algorithms crunch data to connect you to a serendipitous interlocutor.)

They’re also not yet decided on whether public chat content in Capture will persist indefinitely — thereby potentially creating ongoing, topics-based resources — or be ephemeral by default, with a rolling delete which kicks in after a set time to wipe the chat slate clean.

“We actually do not know what will be in the next one to three months. We need to figure out — will it be consistent or ephemeral,” admits Moiseenkov. “We need to figure out certain areas, like usage patterns. We should watch how people behave in our app and then decide what will be the feed.”

Capture does support private group chats as well as public channels — so there’s certainly overlap with the messaging platform Telegram, which also supports both. Though one nuance between them is Capture Channels let everyone comment but only admins post vs Telegram channels being a pure one-way broadcast.

But it’s on interface and user experience where Capture’s approach really diverges from the more standard mobile messaging playbook.

If you imagine it as a mash-up of existing social apps Capture could be thought of as something like a Snap-style front end atop a Telegram-esque body yet altogether sleeker, with none of the usual social baggage and clutter. (Some of that may creep in of course, if users demand it, and they do have a reactions style feature linked up to add in so… )

“With our tool you can find people not from your graph,” says Moiseenkov. “That’s the key here. So with WhatsApp it’s really hard to invite people not from your graph — or like friends of friends. And that’s a really tough question — where I can find the relevant people whom I chat about football? So now we add the tool for you in our app to just find these people and invite them to your [chat].”

“It’s really really hard not to like your friend’s post on Instagram because it’s social capital,” he adds. “You are always liking these posts. And we are not in this space. We do not want to move in this direction of followers, likers, and all this stuff — scrolling and endless communication.

“Time is changing, my life is changing, my friends and family somehow is changing because life is changing… We’re mobile like your everyday life… the app is suggesting you something relevant for this life [now]. And you can just find people also doing the same things, studying, discussing the same things.”

Community building

Why include private chats at all in Capture? Given the main premise (and promise) of the app is its ability to combine strangers with similar interests in the same virtual spaces — thereby expanding interest communities and helping mobile users escape the bubbles of closed chat groups.

On that Moiseenkov says they envisage communities will still want to be able to create their own closed groups — to maintain “a persistent, consistent community”.

So Capture has been designed to contain backchannels as well as open multiple windows into worlds anyone can join. “It’s one of opportunities to make this and I think that we should add it because we do not know exact scenarios right from the launch,” he says of including private conduits alongside public chats.

Given the multiple chat channels in the first release Capture does risk being a bit confusing. And during our interview the founders joke about having created a “maximal viable product” rather than the usual MVP.

But they say they’re also armed to be able to respond quickly to usage patterns — with bits and pieces lined up in the background so they can move quickly to add/remove features based on the usage feedback they get. So, basically, watch this space.

All the feature creep and experimentation has delayed their launch a little though. The app had been slated to arrive in Q4 last year. Albeit, a later-than-expected launch is hardly an unusual story for a startup.

Capture also of course suffers from a lack of users for people to chat to at the point of release — aka, the classic network effect problem (which also makes testing it prior to launch pretty tricky; safe to say, it was a very minimalist messaging experience).

Not having many users also means Capture’s chat suggestions aren’t as intelligent and savvy as the founders imply they’ll be.

So again the MVP will need some time to mature before it’s safe to pass judgement on the underlying idea. It does feel a bit laggy right now — and chat suggestions definitely hit and miss but it will be interesting to see how that evolves as/if users pile in. capture app

Part of their plan is to encourage and nurture movie/TV/entertainment discussion communities specifically — with Hardy arguing there’s “no such tool” that easily supports that. So in future they want Capture users to be notified about new series coming up on Netflix, or Disney’s latest release. Then, as users watch that third party content, their idea is they’ll be encouraged to discuss it live on their mobiles via Capture.

But movie content is only partially launched at this stage. So again that’s all just a nice idea at this stage.

Testing pre-launch on various celebrity visages also drew a suggestive blank — and Hardy confirmed they’ve got more pop culture adds planned for the future.

Such gaps will likely translate into a low stickiness rate at first. But when the team’s ambition is to support a Google-esque level of content queries the scale of the routing and pattern matching task ahead of them is really both massive and unending.

To get usage off the ground they’re aiming to break the content recommendation problem down into more bite-size chunks — starting by seeding links to local events and news (sourced from parsing the public Internet); and also by focusing on serving specific communities (say around sports), and also linked to particular locations, such as cities — the latter two areas likely informed by in what and where the app gets traction.

They’ve also hired a content manager to help with content recommendations. This person is also in charge of “banning some bad things and all that stuff”, as they put it. (From the get go they’re running a filter to ban nudity; and don’t yet support video uploads/streams to reduce their moderation risk. Clearly they will need to be very ‘on it’ to avoid problem usage mushrooming into view and discouraging positive interactions and community growth within the app. But again they say they’re drawing on their Prisma experience.)

They also say they want this social app to be more a slow burn on the growth front — having seen the flip side of burn out viral success at Prisma — which, soon after flooding the social web with painterly selfies, had to watch as tech giants ruthlessly cloned the style transfer effect, reducing their novelty factor and pushing users to move on to their next selfie lens fix.

“As data-driven guys we’re mostly looking for some numbers,” says Moiseenkov when asked where they hope to be with Capture in 12 months’ time. “So I think achieving something like 1M or 2M MAU with a good retention and engagement loop by then is our goal.

“We want to keep this growth under control. So we could release the features step by step, more about engagement not more about viral growth. So our focus is doing something that can keep engagement loop, that can increase our spend time in the app, increase the usage and so on, not driving this into the peak and like acquiring all the trends.”

“Conclusions are drawn from Prisma!” adds Hardy with investor-winning levels of chutzpah.

While it’s of course super early to talk business model, the question is a valid one given Capture’s claims of zero user profiling. Free apps backed by VC will need to monetize the hoped for scale and usage at some point. So how does Capture plan to do that?

The founders say they envisage the app acting as a distribution tool. And for that use case their knowing (only) the timing, location and subject of chats is plenty enough data to carry out contextual targeting of whatever stuff they can get paid to distribute to their users.  

They are also toying with models in a Patreon style — such as users being able to donate to content authors who are in turn distributing stuff to them via Capture. But again plans aren’t fully formed at this nascent stage.

“Our focus right now is more like going into partnerships with different companies that have lots of content and lots of events going on,” says Hardy. “We also are going to ask for permission to get access to music apps like Spotify or Apple Music to be aware of those artists and songs a person is interested in and is listening to. So this will give us an opportunity to suggest relevant new albums, maybe music events, concerts and so on and so forth.

“For example if a band is coming to your city and we know we have access to Apple Music we know you’re listening to it we’ll suggest a concert — we’ll say ‘hey maybe you can win a free ticket’ if we can partner… with someone, so yeah we’re moving into this in the near future I think.”

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