Important Note
Tech Narratives was a subscription website, which offered expert commentary on the day's top tech news from Jan Dawson, along with various other features, for $10/month. As of Monday October 16, 2017, it will no longer be updated. An archive of past content will remain available for the time being. I've written more about this change in the post immediately below, and also here.
Apple in 2016: The Six Colors report card – Six Colors (Jan 12, 2017)
This Six Colors survey of Apple observers is an interesting exercise, because although this is a crowd that’s mostly made up of Apple fans, most are unafraid of speaking their minds and being critical where warranted (a complete listing along with a link to their verbatim comments is at the bottom of the post). The Mac was the area where Apple was hardest hit in this report card, understandably given the mounting frustration over the lack of new desktops, but I found the criticism on the Apple TV side less warranted – it got decent software upgrades, and the few gaps in video content have been filled, though admittedly it’s ever clearer that it won’t be an important gaming platform. It’s well worth reading the whole thing, because it’s a mostly honest evaluation of the tough year Apple had in 2016, with quite a bit of detail from some of the people who follow the company most closely. The big question for Apple is how it balances the need to please this vocal but arguably unrepresentative audience with its massive base of mainstream users – in 2016 it clearly served the latter more than the former, and got hit hard for it.
via Apple in 2016: The Six Colors report card – Six Colors
Hacker Steals 900 GB of Cellebrite Data – Motherboard (Jan 12, 2017)
Cellebrite was in the news about nine months ago because Bloomberg reported it was the security firm the FBI used to hack the San Bernardino shooter’s iPhone after Apple refused to help, though the Washington Post contradicted those reports. Whether or not its technology was used in that particular case, that’s exactly the sort of work Cellebrite regularly does for US and other government agencies, and it appears that it has itself now been hacked. It’s not clear that the hack goes beyond some user data, though there’s a vague reference to technical data in the article, but this sort of thing reinforces the sense that no hacks of encryption or other security technologies, even for apparently noble reasons, can ever be deemed 100% safe from being hacked themselves. That, of course, was one of several arguments Apple made in the FBI case.
via Hacker Steals 900 GB of Cellebrite Data | Motherboard
Silicon Valley Takes a Right Turn – The New York Times (Jan 12, 2017)
The headline is an exaggeration – two of the four big companies mentioned are based in Washington, not California, and it’s their corporate PACs which have begun to favor Republican candidates, while their employees remain very firmly left-leaning. But the article does do a great job talking through some of the changes in recent years as big tech companies have shifted their donations towards Republicans while a Democratic president was in office. The data doesn’t go back far enough to indicate whether this is just a cyclical thing, but there’s some evidence the donations were motivated by hopes for more lenient regulatory and taxation policy under a Republican administration. Now that we’re heading into Republican control of both Congress and the presidency, we’ll see how that pans out in practice.
via Silicon Valley Takes a Right Turn – The New York Times
WhatsApp ‘enterprise’ platform for businesses already in app – Business Insider (Jan 12, 2017)
The reporting here is based on a Twitter account that claims to be looking into WhatsApp’s code to find hints about what the app’s future business features might look like. Facebook has already said it wants to take WhatsApp in a similar direction to Messenger, with more hooks for businesses to communicate with users manually and through bots, and these would appear to be early signs of that happening in practice. WhatsApp is a challenging property for Facebook in this respect, because it has always eschewed advertising, and anything that smacks of that direction will likely be poorly received by its users, so Facebook is going to have to tread even more carefully than usual as it pursues this strategy. On the other hand, Facebook didn’t spend $22 billion to buy WhatsApp just to shut off its only revenue stream – this was always inevitable.
via WhatsApp ‘enterprise’ platform for businesses already in app – Business Insider
HTC’s new flagship phone has AI and a second screen, but no headphone jack – The Verge (Jan 12, 2017)
HTC is the Android smartphone manufacturer I keep expecting to be the first to when the shakeout starts, and it’s hard to avoid the sense that this shakeup is imminent. Its financials make grim reading – rapidly declining revenues and regular losses, with only a brief blip following the launch of the HTC Vive. HTC typifies what’s happened to the big-name Android vendors over recent years with the exception of Samsung – LG, Motorola, Sony, and others have experienced similar challenges. Each has its own attempt to turn things around, and with HTC it seems to be the combination of investment in VR and an expansion of its premium smartphone lineup along with some feature experimentation. We’ve already seen the modular approach come and to some extent go, but second screens seem to be a feature that’s sticking around a bit longer. None of what’s here makes me think it’ll help turn HTC’s fortunes around though.
via HTC’s new flagship phone has AI and a second screen, but no headphone jack – The Verge
Amazon to Create More Than 100,000 New Jobs across the U.S. over the Next 18 Months – Amazon press release (Jan 12, 2017)
This is just the latest in a series of announcements from major tech companies (not to mention car companies and others) about job creation in the US in the run-up to the inauguration of Donald Trump as US President in a week’s time. It’s worth putting the numbers in context a bit – 100k new jobs in the US in 18 months compares to around 135k new jobs created globally over the last 18 months. 180k US employees at the end of 2016 would be 57% of my estimate of 315k jobs globally, so 100k new US jobs suggests only a slightly higher run rate and ratio of US to global jobs to the past 18 months. As with a lot of the announcements we’ve seen lately, this seems mostly about highlighting existing job creation plans rather than some new direction.
via Amazon – Press Room – Press Release
Amazon Launches Anime Strike Channel for $5 Per Month – Variety (Jan 12, 2017)
Here’s the second story today about a tech company expanding in the video business. Whereas Apple’s video investments have almost all been happening behind closed doors, with very little public indication of where its strategy is heading, Amazon has been taking a different approach: drip-feeding piecemeal announcements that are slowly adding up to an interesting subscription video business. On top of the Netflix-like service bundled into Prime, it now has relationships with a number of standalone content providers like HBO, Starz, Showtime, and Cinemax, and this anime channel is its first Amazon-branded channel. This whole approach has now been branded AmazonChannels, and it’s actually a pretty smart strategy for building up to a more fully-fledged pay TV-type service. Anime happens to be one of those categories that has a small but passionate audience, and AT&T’s Otter Media has also invested in this space for similar reasons.
via Amazon Launches Anime Strike Channel for $5 Per Month | Variety
Apple Sets Its Sights on Hollywood With Plans for Original Content – WSJ (Jan 12, 2017)
Apple has been investing in video content for a while now, with the unusual strategy of pushing most of it to subscribers through a music service, rather than a dedicated video service. On the one hand, it’s a way to set Apple Music apart, and to the extent that there’s been something of a music theme to some of this video content, that makes sense too. But I still think this investment is really laying the groundwork for an eventual subscription video service from Apple, using the Music investments as cover. At this point, Apple has to get into the video subscription business if it’s to protect its ecosystem around content, much as it belatedly got into streaming music. The exact shape of that service – whether Hulu-, Netflix-, or DirecTV Now-like, is still unclear. I suspect it’ll launch by the end of this year, however, and this kind of original, exclusive content is increasingly essential for differentiation regardless of which of these models it pursues.
via Apple Sets Its Sights on Hollywood With Plans for Original Content – WSJ
Xiaomi stops disclosing annual sales figures as CEO admits the company grew too fast – TechCrunch (Jan 12, 2017)
It’s been apparent for some time that Xiaomi’s early stellar rise was not sustainable, and in 2015 it had to revise its guidance for smartphone sales downward and even then missed it by 10 million. Its business is growing though, including hitting $1 billion in sales in India last year, a strengthening retail business, and good growth in “Internet services”, though those still make up a small minority of sales, for all the talk about Xiaomi as a services company. At this point, Xiaomi is far closer in its model to Amazon than to Google or even Apple in its model – a retail and e-commerce company which sells some of its own hardware and also has a growing services business. But it’s been missing its targets and there’s no clarity about profitability yet at this point. Lots more detail in the CEO letter.
via Xiaomi stops disclosing annual sales figures as CEO admits the company grew too fast | TechCrunch
Netflix Wants the World to Binge-Watch – Bloomberg (Jan 12, 2017)
Though the headline is accurate, the whole point of this article is that Netflix isn’t taking a single global approach to expansion, but instead is focusing on creating localized content for various different markets, with the focus of this article its efforts in Brazil. One of the big challenges for Netflix as it expands is balancing the massive scale economies it gets by offering the same content in many markets against the need to provide culture- and market-specific content to differentiate in individual markets. The latter is of course potentially expensive, but it will be hoping that investing in one major market in a region helps attract customers in other markets in the same region, and Narcos is a great example of more regionally-oriented content. However it pans out, for now Netflix is streets ahead of any other video provider in providing locally relevant content in many markets around the world.
via Netflix Wants the World to Binge-Watch – Bloomberg
This is not a drill: Snapchat is about to get a major redesign – Mashable (Jan 12, 2017)
It’s always seemed almost a point of pride with Snapchat that its user interface is unintuitive and hard to navigate, so it’s a bit surprising to see it engage in such a significant redesign of its app. But this may well make the app less intimidating to new users who’ve been put off by the previous arcane user interface, which may be an indication that Snap wants to broaden the appeal of its app beyond its current target market.
via This is not a drill: Snapchat is about to get a major redesign – Mashable
U.S. appeals court revives antitrust lawsuit against Apple – Reuters (Jan 12, 2017)
This has always struck me as one of the more implausible legal challenges to Apple, and it fended off the first round through a technicality. Now, however, a higher court has overruled the technical objection and the case can proceed on its merits. I would still think it was a long shot that Apple could be successfully sued for monopolizing app storefronts for its own devices, but you never know. One more Apple lawsuit to keep an eye on.
via U.S. appeals court revives antitrust lawsuit against Apple | Reuters
Jawbone in search of new funds after Fitbit approach – Financial Times (Jan 11, 2017)
Fitbit was already in the news recently when it ended its attempts to block sales of Jawbone devices on the basis that the latter appeared to be circling the drain, so it seems even more of a knife between the ribs in the context of an allleged attempt at an acquisition. Though this one failed, it’s further evidence that Fitbit is engaging in a massive rollup of wearable technology companies. But this story is also noteworthy for what it says about Jawbone’s plans to secure a future for itself, which apparently are centered on FDA-approved healthcare devices and therefore potentially an insurance-subsidized model. Fitbit has already pursued the corporate market, and Apple Watches have been sponsored under certain employee healthcare plans too – this is a fascinating new thread in the development of wearables, and one that has the potential to mirror the benefits the iPhone and other smartphones received from the carrier subsidy model.
via Jawbone in search of new funds after Fitbit approach – Financial Times
U.S. Department of Transportation announces a new committee focused on automation – TechCrunch (Jan 11, 2017)
If there’s one thing that’s become very clear to me this week as I’ve attended the North American International Auto Show in Detroit, it’s that autonomous driving is a vastly more complex proposition than many of the claims from its various proponents would suggest. All autonomous driving technology is not created equal, and governments and regulators have lots of thorny issues to resolve before widespread autonomous driving can become a reality. The good news is that the US Department of Transportation seems to understand that and is taking steps to understand all the implications, working with many of the players likely to make it a reality in the coming years. I hope this work continues under the incoming administration, because it’s critical.
via U.S. Department of Transportation announces a new committee focused on automation | TechCrunch
Gartner Says 2016 Marked Fifth Consecutive Year of Worldwide PC Shipment Decline – Gartner (Jan 11, 2017)
This is Gartner’s quarterly press release on PC shipments for the end of 2016 (IDC’s equivalent release is here, with slightly different numbers, and definitions). The thrust is that the PC market continues to decline, with a 6.2% drop for the full year, and a more modest 3.7% decline in Q4 alone. But the other thing worth noting is that there’s a stark difference between the performance of the big players and the rest – the top six grew by 1.4% and the top five by 2%, but everyone but the top six collectively declined by 18.8% over the full year. The big players are mostly doing OK, but at the expense of a plethora of smaller players, and this is the shape of things to come, with the big question being the number of “big” players that will be able to sustain this performance – Asus and Acer saw declines in Q4, while Apple did better thanks to the new MacBooks.
via Gartner Says 2016 Marked Fifth Consecutive Year of Worldwide PC Shipment Decline – Gartner
The iPhone is gaining ground on Android in the U.S. – Recode (Jan 11, 2017)
Kantar’s data is solid, so these conclusions are reliable, and they suggest a bifurcation in iPhone market share between the US and China. It’s rising in the former, and falling in the latter, which is actually to be expected. The iPhone’s share of the market has generally fallen over time in most markets as they expand and more new buyers at the lower end of the market buy cheaper phones. But as markets mature and begin to saturate, there’s potential for the iPhone to gain share, because share is driven by switching and not by new low end users coming into the market, and that’s exactly what we’re seeing now in the US. The key for iPhone sales growth (not share growth, which is not itself important to Apple) going forward is to drive switching behavior, hence Tim Cook’s frequent references to record Android switching rates on earnings calls.
via The iPhone is gaining ground on Android in the U.S. – Recode
The Next Big Thing in Smartphones? The Software – WSJ (Jan 11, 2017)
The foundation of the claims made in this piece – the idea that smartphone growth is slowing driven by saturation and longer upgrade cycles – is absolutely accurate, the headline feels off. Software has always been a critical component of smartphones, so there’s nothing new there. And hardware continues to be extremely important too – see the iPhone 7’s dual cameras and the functionality they’ll support today and tomorrow, or conversely the Note7 recall. So the headline and thrust of the article is overblown, but there’s still some truth here, in that the focus of software innovation in smartphones is changing, and hardware is mature enough that the innovation is happening at the edges, not in huge leaps forward in basic hardware performance.
via The Next Big Thing in Smartphones? The Software – WSJ
Facebook tests product similar to Snapchat Discover – USA Today (Jan 11, 2017)
Though the narrative about Facebook copying Snapchat is generally fairly accurate, and Facebook has largely used Instagram as its vehicle for this cloning recently, this doesn’t feel like part of that narrative. Yes, there’s a carousel of sorts within Snapchat’s Discover section, but that’s really where the similarity ends. This is news- and importantly article-centric, while most of the Discover content is lifestyle-centric and highly visual (video and photos). And this is about bundling content from a single news publisher, potentially around a topic, which also feels quite distinct. This is also all directly related to Facebook’s other announcement today about news, which explicitly referenced this testing.
via Facebook tests product similar to Snapchat Discover – USA Today
Alphabet cuts former Titan drone program from X division, employees dispersing to other units – 9to5Google (Jan 11, 2017)
This doesn’t need much commentary – it’s a minor project within Alphabet, and it fits with the increasingly strong narrative about increasing focus and cost discipline within the company. But it’s also worth noting that this is one of several different efforts within Alphabet aimed at delivering Internet access in new ways, the most high profile of which is Fiber, and the company seems to be scaling many of them back at the moment, suggesting a broader de-emphasis on these goals.
Apple’s CareKit apps get enhanced security option – Mashable (Jan 11, 2017)
From the beginning, Apple has been extremely careful with its HealthKit developer tools, making some really granular choices about how data is shared (my favorite example is that developers can’t even query whether or not there is insulin data, because its presence would suggest diabetes). Now, CareKit is getting end-to-end encryption for better HIPAA compliance, through a partnership between Apple and a third party (here’s the official Apple announcement). We’re going to see lots more partnership work by Apple to solve some of the thornier problems relating to both HIPAA and FDA compliance as it gets deeper into healthcare.
via Apple’s CareKit apps get enhanced security option – Mashable