Daily Tech Snippet: Friday, September 18

• Facebook Just Made 2 Big Changes to Appease Advertisers on Viewability - Offers premium option and third-party verification: Facebook today introduced a premium buying choice that should quell some of that unease, offering marketers the option to pay for ads only when the entire unit appears on a viewer's screen.  Until this change, advertisers were charged as soon as any piece of an ad appeared on a Facebook user's screen. Now they will have the option to require full visibility before being charged at a higher per-view rate (which hasn't yet been announced). The development is part of a two-tiered announcement today by the Menlo Park, Calif.-based tech giant, which also revealed that it has tapped digital-measurement company Moat to check how often advertisers' promos are seen on Facebook. While Moat is among several viewability-focused vendors that are accredited by the Media Ratings Council, inking this deal—which likely involves considerable sums of money in the near future—with Facebook appears to be the latest sign that Moat is leading its niche.  What's more, Facebook is reversing its stance against using an independent verifier for ad viewability. The move appears to be largely in response to huge companies like Unilever, Kellogg's and WPP banging the drum for better measurement tools in not only recent years but recent hours. Just yesterday, WPP chief Martin Sorrell called out Facebook's viewability standards while speaking at Dmexco in Cologne, Germany.

• Ad Blockers Shoot to the Top of iPhone App Store Chart After Debut Day: After the inaugural day of Apple’s latest operating system version, which permits new extensions for blocking content in Safari browsers, two apps that do just that shot to the top of the paid downloads. Peace, a $2.99 ad-blocking app created by former Tumblr engineer Marco Arment, currently sits at first place in the iOS paid apps, bumping Microsoft’s Minecraft. A similar app, Purify, built by developer Chris Aljoudi, is at fourth place. A third, Blockr, is the 28th most popular, as of Thursday morning.The apps, once activated, strip ads and tracking cookies out of the Safari browser on iPhones, but not other browsers, like Google’s Chrome, or within apps. Apple enabled them with iOS 9, which debuted on Wednesday. Publishers, particularly smaller ones, have worried that Apple’s move may spark an uptick in mobile ad blocking, curbing critical display ad revenue. It has been less of a concern for big ad-supported tech companies like Facebook and Twitter, since their bread and butter, in-stream ads within apps, won’t be affected by the blockers. Google, however, does make its cash from ads within the Web. The search giant has found a way to keep (read: paid for) its profitable text ads from being killed in previous popular content-blocking tools like AdBlock Plus. It’s not clear if Google has worked out a similar fix for these new iOS apps. 

• Shopify Surges After Partnership With Amazon: Shopify Inc. soared after the Canadian software maker teamed up with online retailing giant Amazon.com Inc. to help merchants create their own online stores. The shares rose 23 percent to $35.55 at the close in New York on Thursday. The stock has about doubled since going public in May. Amazon advised the users of its own Amazon Webstore software to move their online stores to Shopify, before it shuts down the Webstore service. Shopify merchants will be able to use Amazon’s payments system and warehouses, and the companies are working to let Shopify merchants list their products on Amazon.com, according to a statement. Terms of the deal weren’t disclosed. For Shopify, the deal advances plans to let its more than 175,000 merchant customers sell goods on as many platforms as possible. The company already has similar arrangements with Pinterest, Facebook and Twitter.

• Amazon Updates Its Fire TV and Tablet Offerings: The company on Thursday introduced new versions of its Fire TV products, which plug into television sets to stream content over an Internet connection. Notably, customers can now buy a Fire TV streaming stick or set-top box with a remote control that can find content to watch using voice commands, similar to the new Siri-powered Apple TV unveiled last week. Amazon’s voice-controlled assistant is named Alexa. This assistant first appeared in Amazon’s wireless speaker, the Echo. You’ll be able to speak commands like “Alexa, play ‘John Wick’ ” to play a movie or “Alexa, how’s the weather tomorrow?” to load the weather forecast on the TV. But unlike Apple, which raised the starting price of its new Apple TV to $150 (up from $70 for the previous model), Amazon is holding its prices steady. You can get the latest stick for the same $40 as before; the Fire TV streaming stick with a voice remote is $50. The Fire TV set-top box with the new remote is the same price as the previous model: $100. And in another sign of how serious Amazon is about competing for attention in the living room, the retail giant is also bundling the Fire TV set-top box with a game controller for $140. In addition, Amazon has added some cheap tablets to its Fire product family. It is offering a low-end Fire tablet for $50, which can also be bought as a six-pack for $250. This inexpensive tablet has a seven-inch screen, can play movies and load books, apps and games. On top of that, Amazon introduced two new tablets with high-definition screens, called Fire HD, which come in eight inches for $150 and in 10.1 inches for $230. (By comparison, Apple’s latest tablets cost $380 to $800.)

• As Search Matures, Baidu Tries to Move Offline: Baidu is spending an estimated $2.5 billion on e-commerce projects this year as its profits dwindle. Baidu runs China’s primary search engine, but with the PC search business maturing and the economy slowing, Chairman Robin Li has been looking to diversify. In the past two years, he’s pushed Baidu deeper into the kinds of e-commerce businesses dominated by China’s other two big Internet companies, Alibaba and Tencent. During that time, Baidu’s invested almost $1 billion in more than a dozen websites and apps specializing in everything from food delivery to laundry pickup, from booking a doctor’s appointment to reserving a slot at a karaoke club. The goal is “transforming the company from connecting people with information to connecting people with services,” says Li, who’s committing $3.1 billion more over the next three years to just one of Baidu’s investments, Groupon look-alike Nuomi.com. But as it commits more money to e-commerce expansion efforts, its profit margins have fallen by half since 2012, to 28 percent in its most recent quarter. So while Baidu is tapping its $12 billion in cash to widen its e-commerce footprint, it’s also trying to attract big-name partners. The company paid an undisclosed amount for a minority stake in Uber in December, and fast-food chain Ajisen announced in July that it’s investing $60 million in Baidu’s takeout service, which launched last year and has about 8 percent of China’s market. Borrowing from Amazon.com’s strategy, Li is also expanding Baidu’s entertainment offerings. Its video service, IQiyi, signed a deal with Paramount Pictures in July for local streaming rights to 800 of the studio’s titles, including the Transformers and Terminator series. Baidu has a ways to go before its new ventures pay for themselves. Investment bank Jefferies estimates that Baidu’s profit will fall more than 12 percent this year, to about $1.8 billion, while the company spends $2.5 billion on its e-commerce-centric expansion. Baidu’s Nasdaq-listed shares have dropped 28 percent in the past six months, and Li says he may consider delisting from the U.S. in favor of his home market. But, he says, “We need to be patient and give our U.S. investors some time. I hope they will be able to appreciate us more.”

• Startups are piggybacking on text messaging to launch services. Conventional wisdom holds that intricately designed mobile apps are an essential part of most new consumer technology services. But there are signs people are getting apped out. While the amount of time U.S. smartphone users spend with apps continues to increase, the number of apps the average person uses has stayed pretty much flat for the last two years, according to a report Nielsen published in June. Some 200 apps account for more than 70 percent of total usage. Product Hunt, a popular website where people post ideas for new tech services, recently compiled a list of more than 40 “apps without an interface,” most of which use text messaging to do things like schedule meetings, sell T-shirts, or process restaurant delivery orders. In August, Facebook introduced M, a digital personal assistant built into its messaging service that allows people to text requests for a dinner reservation or for the perfect baby gift. The service, which is being tested by a small number of users in California, hints at Facebook’s ambitions to transform its own messaging app into a kind of proprietary Internet where people spend all their time instead of bouncing around among different apps. The social media giant appears to be emulating China’s WeChat, which has embedded a broad range of services into its mobile messaging product. The simplicity of text-based services often obscures deep complexity. Most companies still struggle with what’s known as natural language processing, so what may appear to be impressive feats of automation are actually being done by old-fashioned humans. Facebook’s M service uses artificial intelligence to field requests, but people perform the actual tasks. Magic, a text-based concierge service that inspired excitement in startup circles when it was introduced earlier this year, does the same.

• Alibaba's Wipeout Leaves Investors Questioning What Comes Next: Alibaba looked like a sure thing a year ago when it pulled off the largest initial public offering ever. It had a lock on China e-commerce as the economy was surging and consumer spending was steadily rising. Shares soared 76 percent from the IPO price in just two months. Then it all crumbled. Alibaba came under fire from a China government agency, it cut deals that baffled investors and it replaced its chief executive as growth slowed. Most important, China’s economy turned wobbly, jeopardizing the rise in consumer spending Alibaba needed. Its stock slid down, down, down to the IPO price and then below. The sure thing was no such thing. What now? Investors who watched $128 billion in market value disappear shouldn’t expect a reprieve any time soon. Atlantic Equities’s James Cordwell, the top-ranked analyst covering the stock, predicts the slowing Chinese economy will undercut e-commerce transaction growth until at least 2016. The many deals Alibaba has negotiated will take time to pay off too. “All the operating metrics seem to be pointing in the wrong direction,” said London-based Cordwell, who topped Bloomberg Absolute Return rankings for his calls on Alibaba and also recommendations across the portfolio he covers. “Until investors feel some comfort in that slowdown bottoming out, it will be hard for the stock.”

• Adobe revenue, profit forecast miss estimates, shares slip. Adobe Systems Inc's lower-than-expected revenue and profit forecast for the current quarter overshadowed a strong rise in net subscriptions for its Creative Cloud software suite, sending its shares down 3.5 percent in extended trading. Revenue rose 21 percent to $1.22 billion. Net income rose to $174.5 million, or 34 cents per share, in the third quarter, from $44.7 million, or 9 cents per share, a year earlier. Up to Thursday's close of $80.31, Adobe's shares had risen about 11 percent this year. The company also said on Thursday that David Wadhwani, head of its digital media, was leaving to pursue a CEO opportunity. Adobe has been switching to web-based subscriptions from traditional licensed software to help attract more predictable recurring revenue. Recurring revenue had reached 73 percent of total revenue, Chief Financial Officer Mark Garrett said in a statement. The company said it added 684,000 Creative Cloud net subscriptions in the quarter ended Aug. 28, compared with the 640,000 net additions that analysts had expected, according to research firm FactSet Street Account.