Daily Tech Snippet: Wednesday, July 20

• Microsoft Earnings Are Up, Cushioned by Its Cloud Business: On Tuesday, in its quarterly earnings results, Microsoft offered strong signs that its cloud business was growing quickly. Revenue from Azure, a business Microsoft started to compete in cloud computing with Amazon, the market leader, rose more than 100 percent in the quarter. Revenue from Office 365, a subscription version of the old Office software, rose 54 percent from commercial customers and 19 percent from consumers.Microsoft’s chief executive, Satya Nadella, has made cloud computing a priority for the company since becoming chief executive two years ago. Many believed it was a move that Microsoft had long needed to make but was held back by the reluctance of its previous boss, Steven A. Ballmer. There is risk in this transition. The profit margins from renting software in the cloud are not as high as selling a license to customers, and Microsoft investors have always counted on the company to generate exceptional profits. But the cloud business model tends to be more stable — a trade-off for slimmer margins. After Microsoft’s misadventures in the smartphone market, it is a necessary trade-off. Last week, the company said it would fail to meet a goal of getting its Windows 10 operating system running on one billion devices before June 2018, largely because of its retrenchment in the mobile phone business.Now the company has laid off most of the thousands of people who joined Microsoft through the deal, written off the value of nearly all of the acquisition and whittled back the number of smartphones it sells. On Tuesday, Microsoft said that its phone revenue had declined 71 percent from a year ago. For years, people have put off purchases of new machines or avoided them entirely in favor of smartphones and tablets. Last week, IDC, the technology research firm, said worldwide PC shipments fell 4.5 percent in the most recent quarter compared with a year earlier.For the quarter ended June 30, Microsoft reported net income of $3.12 billion, or 39 cents a share, compared with a loss of $3.2 billion, or 40 cents a share, during the same period a year earlier. Revenue fell to $20.61 billion, from $22.18 billion a year ago. The decline was partly the result of a $2 billion deferral of revenue related to Windows 10, its latest operating system. Accounting rules require Microsoft to recognize revenue from the software to be recognized in pieces over time. Without the deferral, Microsoft’s revenue rose 2 percent from a year earlier to $22.64 billion. The company’s shares jumped about 4 percent in after-hours trading following the release of its results.

• Google has found a business model for its most advanced artificial intelligence: Two years ago, Google spent over half a billion dollars for the tiny artificial intelligence startup DeepMind. Since then, the unit has walloped Atari video games and beaten an impossible board game. Impressive stuff, that. But those AI demonstrations have yet to spell actual revenue. Until now — although the efforts are helping Google save money on its most expensive part. DeepMind chief Demis Hassabis told Bloomberg that his unit recently began applying its advanced AI to Google’s data centers, finding ways to reduce the company’s sizable energy bill. Google started using machine learning for its data centers two years ago, searching for ways to reduce costs for one of the company’s top expenses. A month ago, it aimed the more specialized AI tools from DeepMind at the problem of cooling these server farms. That cut the energy needed for cooling by 40 percent, the company said. It didn’t offer a dollar figure for that, but it’s safe to assume that it means hundreds of millions in savings over the long haul.DeepMind technically sits outside of Google in Alphabet. (I’ve heard people describe it as in the “Alphaverse,” whatever that means.) But a rep said that Google was not paying DeepMind for its cost-cutting research here.

• Facebook Pilots Offline Video for India in Duel With YouTube: Facebook Inc. is piloting a feature in India allowing users to save videos to watch offline, chasing a similar program from Google’s YouTube, as the companies attempt to crack a market ridden with poor internet connectivity. The move followed feedback from users in the country citing poor video experiences because of limited mobile coverage, Facebook said in a statement. “We’re testing an option for people to download videos to Facebook while they’re online on good internet connections, to view the video at anytime, online or offline, without using extra mobile data,” the company said. YouTube introduced offline video in 2014 to cater to Indians crazy about watching Bollywood song sequences, cricket snippets and comedy sketches. Despite the cost of downloads, an estimated 40 percent of data consumption on phone networks is video, said Nikhil Pahwa, editor of the New Delhi-based Medianama.com, which monitors news on the digital industry.Facebook, which has 142 million users in India, said the new feature helps users get through the lag between downloading and playing a video by saving it for later, similar to the YouTube feature. Only original videos posted on personal Facebook accounts and on the social network’s pages can be downloaded. The program is being tested on a small percentage of Indian users, the company said without providing details on broader rollout.

Daily Tech Snippet: Tuesday, April 12

• Apple Watch verdict a year later: Half of those surveyed think it’s a dud: More than half of those surveyed by the advertising technology company Fluent said they considered the Apple Watch a flop. That sentiment — expressed by the majority of the 2,578 adults in the U.S. who responded last week to an online survey — reflects how the device is perceived by the tech press and industry insiders, many of whom have been pessimistic about the Apple Watch from the start. Asked whether they considered the Watch a successful product for Apple, 53 percent responded “no.” But Fluent’s survey also offers a more nuanced picture of Apple’s first wearable device,which launched on April 24, 2015. A significant majority of Apple Watch owners — 77 percent — consider the smartwatch a success and about two-thirds said they plan to upgrade when the next version comes out. Those owners surveyed said they take advantage of a range of the smartwatch’s features, including monitoring their activity and receiving notifications (79 percent), listening to music (75 percent) and checking email or chat (66 percent). This survey supports the more comprehensive findings of Wristly’s “Pulse on Wristware,” released earlier this year. The research group, which surveys some 2,500 smartwatch and fitness band owners every week, says that despite some views of the Apple Watch as a “mediocre novelty,” it enjoys “astoundingly high customer satisfaction ratings.”

• Israel to Levy New Taxes on Google, Facebook in Policy Shift: Israel has expanded its definition of who must pay taxes on commerce, targeting digital multinationals such as Facebook Inc. and Google that critics say get a free ride. Because much of today’s trade is carried out on the Internet, a foreign firm may now be considered a “permanent establishment” and subject to tax even if most of its presence is virtual, the Israel Tax Authority said in an e-mailed statement. The authority said Internet multinationals will be required to pay value-added tax, which is 17 percent for Israelis. The new taxes, which take effect immediately, will eventually add hundreds of millions of shekels a year to state revenue, the authority said. A Google representative in Israel couldn’t immediately be reached for comment. Facebook “pays taxes according to the law in every country it operates, including Israel,” a spokeswoman said via e-mail. Although Israel’s relatively small population of 8.5 million means the new taxes won’t clobber the international giants, they build on broader efforts worldwide to level the playing field between foreign Internet companies and local commerce. Russia is pushing to raise taxes on U.S. Internet companies to help its local industry and governments across Europe and beyond are trying to extract more revenue from Google, Apple Inc. and other multinationals with increasingly complex billing and ownership structures.

• Cloud-based video production platform 90 Seconds lands $7.5M Series A led by Sequoia India: Despite the increasing ubiquity of online videos, making a professional-looking one is still a complicated process that usually involves chains of emails and uploads. 90 Seconds wants to fix that problem with its cloud-based platform, which lets users handle almost every part of the video production process in one place. Today, the startup announced it has raised a $7.5 million Series A led by Sequoia India. Other investors in this round include pay television provider SKY TV New Zealand, Airtree Ventures, Beenext and Oleg Tscheltzoff, founder of stock image agency Fotolia.com. Now based in Singapore, 90 Seconds was launched in Auckland in 2010 by CEO Tim Norton after he struggled to find an online video production service for shoots in different places. 90 Seconds started with online production tools before launching its marketplace, which now lists 5,000 video professionals from 70 countries. The company plans to continue adding to the mobile version of its software until clients can manage every part of the production process — from commissioning a video to reviewing footage and uploading to YouTube and social media platforms — on their tablets or smartphones. Timeliness is important for 90 Seconds’ users, who have included Visa, Samsung and Microsoft, because they need to take advantage of trending topics and search terms. More companies are also using the platform to handle longer shoots, like TV spots. Hooking up companies with creators and giving them all the software tools they need to produce a video is how 90 Seconds differentiates from other video production sites (which include Visually, Userfarm and SmartShoot) and also what it hopes will future-proof its business model from new competitors as demand for online videos grows.

• Dell's SecureWorks valued at $1.42 billion in year's first tech IPO: Dell's cyber security unit, SecureWorks Corp, could be valued at up to $1.42 billion in its initial public offering, the first major U.S. listing of a technology company this year. Atlanta, Georgia-based SecureWorks said on Monday its offering was expected to be priced at $15.50-$17.50 per Class A share, raising as much as $157.5 million.  The share issue market worldwide plunged to a seven-year low in the first quarter, more than halving from a year earlier to $106.6 billion, as worries over slowing economic growth kept investors wary, according to Thomson Reuters data. In the past few years, several cyber security firms such as FireEye, Rapid7 and Mimecast have gone public to take advantage of growing investor interest in them after a spate of hacking attacks on companies including major banks and retailers. However, shares of Rapid7 and FireEye, which popped 70-80 percent in their debut, are now trading way below their IPO prices. Mimecast, which jumped 20 percent on its listing day, has also slipped below its offering price. Ritter warned against premium pricing for stocks of cyber security firms, saying that these companies were fighting for market share, which would keep their profit growth muted.

Daily Tech Snippet: Thursday, March 24

• The Uber Model, It Turns Out, Doesn’t Translate: Other than Uber, the hypersuccessful granddaddy of on-demand apps, many of these companies have come under stress. Across a variety of on-demand apps, prices are rising, service is declining, business models are shifting, and in some cases, companies are closing down. Here is what we are witnessing: the end of the on-demand dream. That dream was about price and convenience. Many of these companies marketed themselves as clever hacks of the existing order. They weren’t just less headache than old-world services, but because they were using phones to eliminate inefficiencies, they argued that they could be cheaper, too — so cheap that as they grew, they could offer luxury-level service at mass-market prices. So do a lot of other apps offering services across a number of industries. They are super convenient, but the convenience comes at a premium, which seems here to stay. Some of these services could make for fine businesses, but it is hard to call them groundbreaking. After all, paying extra for convenience isn’t really innovative — it is pretty much how the world has always worked. Before we get to why many on-demand apps have struggled to achieve mass-market prices, it is important to remember why anyone ever thought they could: because Uber did it. The ride-hailing company that is valued by investors at more than $60 billion began as a luxury service. The magic of Uber was that it used its growth to keep cutting its prices and expand its service. Uber shifted from a convenient alternative to luxury cars to an alternative to taxis to, now, a credible alternative to owning a car. But Uber’s success was in many ways unique. For one thing, it was attacking a vulnerable market. In many cities, the taxi business was a customer-unfriendly protectionist racket that artificially inflated prices and cared little about customer service. The opportunity for Uber to become a regular part of people’s lives was huge. Many people take cars every day, so hook them once and you have repeat customers. Finally, cars are the second-most-expensive things people buy, and the most frequent thing we do with them is park. That monumental inefficiency left Uber ample room to extract a profit even after undercutting what we now pay for cars. But how many other markets are there like that? Not many. Some services were used frequently by consumers, but weren’t that valuable — things related to food, for instance, offered low margins. Other businesses funded in low-frequency and low-value areas “were a trap,” Mr. Walk said.

• Why you should be skeptical that any video is real: Be careful about believing what your eyes are telling you. Researchers have shown how a video of a person talking can be altered in real time to change what a speaker appears to be saying. In a new video, the scientists show how they edited YouTube clips to change mouth movements. The system uses a webcam to track one person’s facial expressions, and then applies them to the face of the person in the target video. The software creates a 3D representation of a subject’s face, which can then be swapped with the 3D representation of another face. The process works even if one subject has facial hair or a different skin tone. But it won’t work if a person’s long hair blocks his or her mouth. Currently the researchers are considering commercializing the technology for use in TV shows that are re-released in a different language. Editing actors’ facial movements to match the audio should make the dubbed programs seem more natural, even if what’s onscreen is actually fake.

• Square Teams Up With Facebook to Offer Ads That Can Be Gauged: On Wednesday, Square announced a new integration with Facebook. Under the integration, small businesses that use Square to process payments can buy and target Facebook advertising using Square’s software. Square will make subscription fees off the new product. Small businesses can benefit from the move because Facebook ads bought through Square’s platform are directly connected to sales activity and data, Square said. That will allow business owners to understand whether their Facebook ads are working to attract new and repeat customers. The Facebook ad integration is just the most recent new line of business for Square, which went public in November. When the company began in 2009, it focused on providing a square credit card reader that easily attached to smartphones and tablets, giving small, cash-only businesses the ability to accept credit cards. Square takes a small percentage of each transaction, a fee it splits with credit card companies and other financial intermediaries. But as Square has grown, the company has diversified from that payments processing core, which some analysts and investors have criticized for having overly thin margins. Square now offers cash advances to merchants through Square Capital, scheduling with Square Appointments and food delivery with Caviar. The company has also begun offering other subscription-based products to businesses, like an email marketing service linked to sales history. The new Facebook advertising integration was spurred by an acquisition of talent and technology from a start-up called LocBox a few months ago. Square hired Mr. Mehta and his colleagues from LocBox, which specialized in online marketing for small and local businesses, to work on similar advertising technology at Square. The new lines of business still account for far less revenue than Square earns by processing payments. But Square believes that as more small businesses begin adopting its full array of products, these nascent revenue streams will grow. Two weeks ago, Square reported its first quarterly earnings as a public company, posting a 49 percent revenue increase to $374 million for the fourth quarter from a year ago, with sales from its software and data products more than tripling.

• Why I’m skeptical about Apple’s future: Facebook is set to release its virtual reality headset, Oculus, next week. It will be big and clunky, expensive, and cause nausea and other problems for its users. Within a few months, we will declare our disappointment with virtual reality itself while Facebook listens very carefully to its users and develops improvements in its technology. Version 3 of this, most likely in 2018 or 2019,will be amazing. It will change the way we interact with each other on social media and take us into new worlds — like the holodecks we saw in the TV series Star Trek. This is the way innovation happens now. You release a basic product and let the market tell you how to make it better. There is no time to get it perfect; it may become obsolete even before it is released. Apple hasn’t figured this out yet. It maintains a fortress of secrecy and its leaders dictate product features. When it releases a new technology, it goes to extremes to ensure elegant design and perfection. Steve Jobs was a true visionary who refused to listen to customers — believing that he knew better than they did about what they needed. He ruled with an iron fist and did not tolerate dissent of any type. People in one division of Apple also did not know what others in the company were developing, that is the type of secrecy the company maintained. Jobs’s tactics worked very well for him and he created the most valuable company in the world. But without Jobs — and given the dramatic technology changes that are happening, Apple may have peaked. It is headed the way of IBM in the ’90s and Microsoft in the late 2000’s. Consider that its last major innovation — the iPhone — was released in June 2007. Since then, it has been tweaking its componentry, adding faster processors and more advanced sensors, and releasing this in bigger and smaller form factors—as with the iPad and Apple Watch. Even the announcements that Apple made Monday were uninspiring: smaller iPhones and iPads. All it seems to be doing is playing catch up with Samsung, which offers tablets and phones of many sizes and has better features.  It has been also been copying products such as Google Maps and not doing this very well.

• Shopify Doubles Down on ‘Buy’ Buttons Despite Sluggish Start: Last year certainly wasn’t the year of the “Buy” button that some envisioned, but Shopify is betting that 2016 could be. The e-commerce company, which makes software that small businesses use to sell products online, is expanding the number of online sales channels its customers can sell through as shopping on mobile devices booms. The new channels include product discovery app Wanelo, home design site Houzz and coupon app Ebates; Shopify said that more are on the way. “This is a continued bet on distributed commerce,” said Satish Kanwar, Shopify’s director of product. The expansion follows Shopify’s previous work to let its merchants start selling directly on Twitter, Facebook and Pinterest, in addition to their own sites. But shopping on Pinterest got off to a slow start last year, and e-commerce efforts on Twitter and Facebook are still in early stages.

Daily Tech Snippet: Monday October 5

• After stopping Product Ads, Amazon discontinues recently-launched Text Ads: As of October 31, Amazon’s recently launched Text Ads program will be RIP-status. Yesterday afternoon, Amazon notified its advertisers via email that the Amazon Text Ads (ATA) program will be discontinued on October 31 — ironically, the same day that Amazon Product Ads also get the boot. Let’s back up. ATA ExampleThroughout the past year, you may have noticed text-based ads within Amazon search results and product listings. The Amazon Text Ads program delivered content based on keywords used in Amazon shoppers’ browser searches. This past August, Amazon used the sunset announcement of its popular Product Ads advertising format to introduce Text Ads as a possible alternative. The program has been in beta since Q4 2014 but will never see a public debut. It’s important to note that Amazon’s Text Ads and Product Ads take shoppers off Amazon and to the advertiser’s website. Is Amazon discontinuing these programs in an attempt to keep shoppers within the Amazon ecosystem? What does this mean for its remaining advertising program, Sponsored Products (with auction-based, keyword-driven ads promoting your Amazon listings when you have the Buy Box)? No one can say for sure. However, we recently caught sight of Sponsored Products in a new location on the Amazon webpage, which makes us think that Amazon is possibly working to improve this channel to help sellers promote their products on the marketplace.   

• Google Inc has morphed into Alphabet Inc.: After U.S. markets closed on Friday, Alphabet replaced Google as the publicly traded company that will house Google's search and Web advertising businesses, maps, YouTube and its "moonshot" ventures such as driverless cars. Google's class A shares and class C shares will automatically convert into the same number of Alphabet class A shares and class C shares and start trading on the Nasdaq from Monday. The ticker symbols will not change. The core businesses will be called Google and operate as a wholly-owned subsidiary of Alphabet. Sundar Pichai will head Google. Alphabet will be run by Google co-founder Larry Page and each of its businesses will have its own chief executive. Starting from the company's fourth quarter in January, Alphabet will have two reporting units - Google and all other Alphabet businesses taken as a whole.

• Amazon to Stop Selling Apple TV and Chromecast:  Amazon said on Thursday that it would stop selling devices from Apple and Google that compete with its own streaming media players, escalating the entertainment battle between the major tech companies. Apple TV and Google’s Chromecast are popular items in Amazon’s electronics store. But the devices are in a brawl for market share with Amazon’s Fire TV and Fire TV Stick, which were introduced in 2014. The Fire Stick delivers Amazon’s rapidly expanding video offerings to its customers. Apple TV and Chromecast do not. Amazon’s move to ban competitors is not a retailing gambit. In fact, the company is willing to risk annoying customers who cannot get what they want because it is pursuing a much bigger prize. The stick is crucial to Amazon’s ambitions to move from being just a retailer to a multifaceted provider of everything virtual and physical. “It’s unlike Amazon to be this territorial,” said James McQuivey, an analyst with the research firm Forrester. But he said it was a logical and perhaps inevitable move.

• Facebook Expands Mobile Video Feature That Helps Content Creators Make Money 55% of ad revenue in curated video feeds goes to creators: In July Facebook made a big move into YouTube's turf with plans to launch Suggested Video—a feed of curated video clips from brands like Funny or Die, the NBA and Tastemade. After a small test over the past three months, it's now showing up in more mobile news feeds. Clicking on a video from a news feed leads to a page that pulls all of the publisher's videos together in a stream, as well as other related clips. To help publishers make money off those clips, an ad appears between every few videos, similar to a commercial. Similar to YouTube's business model, creators receive 55 percent of money sold from the ads while Facebook gets 45 percent. All video ads are sold by Facebook. The program is geared specifically for iPhone viewers, since a majority of Facebook's traffic comes from mobile, to help publishers squeeze some extra money from clips watched from a smartphone. The stream pulls in video ads that brands have already bought, meaning that marketers are not paying extra money to get their clips to appear in the new section.  During a small test on Thursday and Friday, ads for Under Armour, Procter & Gamble, Taco Bell, Jet Blue, Target and KFC were playing alongside publishers' clips. Just this week, Sheryl Sandberg pitched a room of agencies and brand marketers at Advertising Week on Facebook's size as equivalent to a Super Bowl. "What people are starting to understand is that what we offer is really broad reach—we have a Super Bowl on mobile in the U.S. every day," Sandberg said. "Our data says that if you do TV plus Facebook, you enhance your reach by 17, 18 percent and more than double that for millennials, which is a hard group to reach right now on TV."

• Pew stuty of teen dating measures effects of social media and technology: Ah, young love. Many of us may remember the intensity and ecstasy of puppy love. But how have those relationships changed in an era of constant communication, oversharing and emoji? That's what a new study into teen dating, published Thursday by the Pew Research Center, explored in-depth. The study takes a look at how social media and technology weave into every stage of the dating process, from flirting to breakup. There's a lot of digital flirting going on -- one boy said that his way of flirting is to put "a bunch of emojis" under a girl's  photo. But asking someone out in person is still the most common way to start a relationship. Over three-quarters of teens said they've never dated someone they initially met online, though a quarter did admit they have dated (or hooked up) with people they met first online. One thing is for certain: if Romeo and Juliet had carried out their romance today, they probably would have avoided their catastrophic communication breakdown. Thirty-eight percent of teens who date expect to hear from their partners at least once per day; 11 percent expect to hear from their partner every hour. That doesn't mean, however, that teens necessarily like this constant communication. Sure, many teen daters have used online messages or texts to resolve arguments (48 percent) or just engage in conversations that makes them feel closer to each other (70 percent). But 43 percent have also found themselves in situations where they think their partner is distracted by their gadgets during their alone time. The study also explored some questions of gender differences. Girls, for example, are much more likely to experience unwanted flirting, mirroring another Pew finding that women are more likely to be the victims of online harassment. Male and female teens, however, reported that there are definitely times when partners have crossed the line. Online tools can also exacerbate jealous tendencies, the study found, and 69 percent of teens reported that they think social media in particular gives too many people a window into their private lives. Many teens told researchers that pressure to post about their relationships made them present a less authentic picture of their lives. Others said they stayed away from posting too much about their dating lives online because it leads to "drama";  one teen said it was because "more people ask questions and stuff like that." Digital communication had its role to play at the end of relationships as well, researchers found, but in some ways teens were surprisingly traditional. Yes, there were slivers of teens -- 7 percent each -- that think it's perfectly fine to break with someone by proxy or by just changing your social media status to "single." (That's cold, kids.) 

Daily Tech Snippet: Friday, September 4

Google Dreams of a World After Apps but It’s a Nightmare for Rivals: With one search algorithm tweak this week, Google rekindled deep-seated fears that it is doing its damnedest to nuke apps. Maybe. Google earns more money when people are on the mobile Web, not in apps. Publicly, the company has voiced support for solving the nagging problems of apps, discovery and dormancy. Internally, however, chatter is less about crippling apps than imagining a world beyond them. Conversations with people inside and recently departed from Google reveal that the company is spending considerable attention on what comes after mobile apps, and how Google can usher that era in. A primary vehicle for doing so is app indexing and deep linking, methods to tie content within and between apps. Apple and a host of Silicon Valley startups are doing this as well. But Google’s effort is unique in that it is wrapped tightly with search and artificial intelligence — and, like Google’s approach to the Web, it is all-encompassing in its scope. There are some hints of how Google envisions mobile evolving beyond apps. Now on Tap, its feature launching soon in Android, inserts Google’s personal assistant tech and search intel into apps that allow it, essentially allowing a more seamless transition from app to app on a phone. A chat in email about a movie, for instance, would jump quickly to the app of IMDB. Voice control plays a role in the app-less future, too. Several rivals, along with app publishers and ad sellers, interpreted Google’s move this week as hostile. “It’s basically Google starting to meddle with people’s products,” said Alex Austin, CEO of Branch Metrics, a deep-linking firm. Austin noted that with Google’s app indexing drive, it is pushing app creators to build mobile websites. “In an app world,” he said, “Google is nothing.”

Facebook Takes a Step Into Education Software: Facebook, which transformed communication with its social networking service, now wants to make a similar impact on education. The Silicon Valley company announced on Thursday that it was working with a local charter school network, Summit Public Schools, to develop software that schools can use to help children learn at their own pace. The project has been championed by Mark Zuckerberg, Facebook’s co-founder and chief executive, and one of his top lieutenants, Chris Cox. The software allows students to work with teachers to create tailored lessons and projects. Teachers can also administer individualized quizzes that the software can grade and track. The platform, which is separate from the Facebook social network, is now being used by nine Summit schools and about 20 others. Ultimately, Ms. Tavenner said, “our motivation is to share it with everyone and anyone who wants it,” including other charters and public school districts. The software would be free for all users. Mike Sego, the Facebook engineering director running the Summit software project, said making money was not an immediate goal. “Whenever I ask Mark, ‘Do I need to think of this as business?’ he always pushes back and says, ‘That shouldn’t be a priority right now. We should just continue making this better.’ ”

Amazon Announces Purchase of Video-Software Company Elemental: Amazon is buying Elemental Technologies, a provider of technology for distributing videos to Web-connected devices, seeking to expand its portfolio of cloud-computing services. The online retailer paid about $500 million for Elemental, which helps media and entertainment providers reformat video made for cable, satellite and airwaves broadcast so that clips can be transmitted to desktop computers, smartphones and tablets. Amazon described the acquisition as a way to bring more video capabilities to Amazon Web Services, its Internet computing business. The Web retailer also offers movies and TV shows, which may also benefit from Elemental’s technology. Elemental has more than 700 media customers and supports over-the-top TV applications such as BBC’s iPlayer, CNNGo and ESPN ScoreCenter, and will continue to operate under its existing brand.

Extra screen time drags down teenagers' exam grades, study finds: Teenagers who spend an extra hour a day surfing the internet, watching TV or playing computer games risk performing two grades worse in exams than their peers who don't, according to research by British scientists. An extra hour in front of the TV or online at age 14-and-a-half was linked with 9.3 fewer exam points at age 16 -- equivalent to two grades, for example from a B to a D. Two extra hours was linked to 18 fewer points. Unsurprisingly, the results also showed that pupils doing an extra hour of daily homework and reading scored better - getting on average 23.1 more points than their peers. The scientists said further research was needed to confirm the effect conclusively, but advised parents worried about their children's grades to consider limiting screen time. In a breakdown analysis of different screen activities, the researchers found that TV came out as the most detrimental in terms of exam performance. In a study of more than 800 students aged 14 and 15, researchers from Cambridge University also found that physical activity had no effect on academic performance. Since this was a prospective study, in which the researchers followed the pupils over time to see how different behaviors affected performance, the scientists said it was reasonable to conclude that too much screen time reduced academic achievement.

Indian Shopkeepers Help You Tap ‘Buy’: Since 2013, at least $8.6 billion has poured into Indian e-commerce companies. The slice of the population that’s ever shopped online: 4 percent. As the country’s leading Internet bazaars—Flipkart, Snapdeal, and Amazon India—hawk wares to the urban, English-speaking middle class, they’re all but ignoring the 510 million working-age adults living in rural areas. “These people don’t trust an app or a website” even if they have a phone, says Krishna Lakamsani, founder of e-commerce startup IPay. “They will only buy from someone they know and trust.” That’s why IPay and rival StoreKing are recruiting local shopkeepers to sell online goods in their stores in exchange for commissions. By relying on merchants to persuade people to buy online, IPay says it moves about $1.6 million worth of merchandise each month through 6,000 shopkeepers’ tablets in India’s southern states; StoreKing sells $4.2 million through 10,000. The early returns are promising, even if they’re a sliver of Flipkart and Snapdeal, each of which says it sold $300 million worth of goods in June. Amazon wouldn’t disclose sales. For the shopkeepers, commissions range from 4 percent to 10 percent, and the tablets—$134 from IPay, $226 from StoreKing—quickly pay for themselves. During the eight months Panjala has had the IPay unit, he says, each day he’s done about $30 worth of business on it, one-seventh of his sales. Using shopkeepers to push the tablets means IPay and StoreKing don’t have to worry about training most customers to order through their apps. Because shipments get delivered to the shops, there’s less risk of losing goods on remote roads. And the buyers pay cash, so the companies don’t have to invest in electronic payment systems. “We’ve been generating operating profits from Day One,” says StoreKing Chief Executive Officer Sridhar Gundaiah. “That’s something none of the big e-commerce companies can boast of.” Amazon and Snapdeal say they’re experimenting with kiosks that also help customers buy online. StoreKing and IPay are creating a rural e-commerce market in India by selling via tablets in thousands of local stores.

Facebook Makes It Easier To Optimize Ad Campaigns Based On Conversions: Facebook is unveiling an improved version of its Conversion Lift measurement tool, which first launched in January. Previously, Facebook allowed you to measure whether your ad campaign was actually improving online and offline sales. Now, you can also test different ads to find the best approach. Conversion Lift previously looked at two groups — a group of users who saw the ad and a group who didn’t. It then compared each group’s conversion data (the data can be pulled from Facebook’s Custom Audiences pixel, an in-store point-of-sale system and elsewhere), which should reflect whether an ad actually succeeded in driving sales. With the improved Conversion Lift tool, advertisers can compare multiple test and control groups. That means they can see which ad units are delivering the best results, compare brand and direct response ads, see how mobile ads are performing compared to the rest of the campaign or compare ads featuring product versus lifestyle-format photos. For example, website builder Wix compared a group that saw only direct response ads with another group that saw direct response and video ads. It turned out that the combined of formats did a better job of improving premium subscription signups — that group saw uplift of 7.4 percent, compared to the DR-only group, which saw uplift of 6.8 percent. Also part of the update: Conversion Lift can now look at how ads improve in-app sales, as well, so that app developers aren’t just optimizing campaigns to deliver the most downloads, but instead focus on improving revenue.

Daily Tech Snippet: Monday, July 27

• Archived snippets are here, and MP3 versions are here

• Yelp Cries Foul at Google’s Mobile App Ad Declaration: Those ads that splash on your phone, nudging you to install an app? You know the ones. Earlier this week, Google released an internal study showing that these app download “interstitials” were not merely obnoxious but ineffective, hindering the intended goal of encouraging app installation. Google said it was retiring them and asked the mobile Internet to do the same. Some were pleased. Some were not. Firmly in the latter camp is Jeremy Stoppelman, Yelp CEO and frequent Google sparring partner. On Friday, he pointed to the study and cried hypocrite. Here’s the background: Google’s test paired the full-page ads against subtler banner promotions on mobile websites. Nine percent of mobile users tapped through to the app from the first ads, while 69 percent ran away from the site. With the second version, Google reported an uptick of 17 percent in traffic to the app. Innocuous enough. But Stoppelman is not just accusing Google of a double standard (running its own app ads while nixing others). Behind his beef is the suspicion, percolating in the mobile industry now, that Google is trying to replicate its Web search position with apps. In the past year, Google has pushed aggressively to index the entirety of the app world, while positioning itself, through deep-linking features like the upcoming Now on Tap, as the facilitator. And with Google as facilitator, that leaves less room for other app go-betweens, a la Yelp. It doesn’t help Google’s case here that the interstitial study relied on its own Google+ social app, a Google application that, to be kind, is not terribly in demand.


• Using Algorithms to Determine Character: A company in Palo Alto, Calif., called Upstart has over the last 15 months lent $135 million to people with mostly negligible credit ratings. Typically, they are recent graduates without mortgages, car payments or credit card settlements. Those are among the things that normally earn a good or bad credit score, but these people haven’t been in the working world that long. So Upstart looks at their SAT scores, what colleges they attended, their majors and their grade-point averages. As much as job prospects, the company is assessing personality. “If you take two people with the same job and circumstances, like whether they have kids, five years later the one who had the higher G.P.A. is more likely to pay a debt,” said Paul Gu, Upstart’s co-founder and head of product. “It’s not whether you can pay. It’s a question of how important you see your obligation.” The idea, validated by data, is that people who did things like double-checking the homework or studying extra in case there was a pop quiz are thorough and likely to honor their debts. Analytics, meet judgment of people. “I guess you could call it character, though we haven’t used that label,” said Mr. Gu, who is 24. The same personality dynamic holds for people go to great schools or have top grades. Douglas Merrill, the founder and chief executive of ZestFinance, is a former Google executive whose company writes loans to subprime borrowers through nonstandard data signals. One signal is whether someone has ever given up a prepaid wireless phone number. Where housing is often uncertain, those numbers are a more reliable way to find you than addresses; giving one up may indicate you are willing (or have been forced) to disappear from family or potential employers. That is a bad sign. Zest recently branched into “near prime” borrowers, who have either fallen from the prime category or risen from subprime. The question is why these people have changed categories, and Zest tries to figure out if a potentially reliable borrower has had some temporary bad luck, like a one-time medical expense. “‘Character’ is a loaded term, but there is an important difference between ability to pay and willingness to pay,” said Mr. Merrill. “If all you look at is financial transactions, it’s hard to say much about willingness.”


• Facebook and Other Tech Giants Expand Internet Access in Africa: Africa has become a hotbed of experimentation by big American technology companies as well as local start-ups. In addition to Facebook’s efforts, which included developing a Swahili language version of Facebook, Google, Microsoft and IBM have all been promoting tech projects on the continent. Google, for example, has built a high-speed, fiber-optic Internet network in Kampala, Uganda. But unlike the similar Google Fiber project in major American cities, Google doesn’t offer the service, called Project Link, directly to Ugandans but instead sells access cheap on a wholesale basis to local Internet providers. The result was a sharp drop in the price of Internet access in Kampala as new entrants competed with the traditional carriers to offer services. Microsoft has been supporting various projects to transmit Internet signals via “white spaces,” which are basically unused portions of the television broadcast spectrum. On Friday, the company announced that it was working with the United States government’s Overseas Private Investment Corporation to provide financing to Mawingu Networks to build solar-powered Internet access stations across rural Kenya using white spaces technology. And IBM said on Saturday that it would begin a formal program to assist entrepreneurs in Nairobi’s iHub innovation and collaboration space. And Africa seems to have brought a bit of kumbaya to the traditional tech rivals. “It’s the one place where I have seen Microsoft and Google and Facebook as allies,”


• Facebook partnership a boon for video technology firm Bidalgo: Facebook marketing partner Bidalgo targets a tripling in sales in 2015 as its new technology to automate the process of making personalized online video advertising benefits from Facebook's growing share of the video market. Facebook is becoming a leader in the video market as users prefer to watch video ads over static images, said Peleg Israeli, general manager of Bidalgo's Israeli operations. Videos are expensive to make and an advertiser usually makes only one or two versions. The Bidalgo executive said his company's technology, called ADaptation, can automatically turn one video into as many versions as needed, so that targeted audiences will see images they respond to most. For example, a German audience might see a German flag in one video while users in France will see their flag. Automated videos will give Facebook an advantage over Google's YouTube, as Facebook's core technology can identify users "in the most accurate way". U.S.-Israeli Bidalgo's technology targets mobile app and game developers, who have been quick to adopt mobile advertising. Clients include online gaming firm 888 Holdings and Zynga. Bidalgo, which has 40 employees, has been profitable for about a year, with a target of $100 million in sales this year, Israeli said. It competes with San Francisco-based Ampush and Boston-based Nanigans. Companies wishing to advertise on Facebook must bid for users that they wish to see their advertising. Bidalgo's algorithms test an ad against multiple audiences to understand which segments are relevant and what is the right price the advertiser should offer.

Daily Tech Snippet: Wednesday, July 8

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• China stocks are 8% down this morning; Alibaba stock is at its lifetime low: China's securities regulator said there was "panic sentiment" in mainland stock markets on Wednesday, acknowledging the recent increase in irrational selling, Reuters reported. Shortly after, the People's Bank of China said it will closely watch stock market direction and guard against systematic regional financial risks. The comments did little to soothe investor worries about tumbling mainland equities, with the Shanghai Composite sinking more than 8 percent in early trade on Wednesday. In US trading, Alibaba was traded at its lifetime low.


• Worldwide spend on gadgets will fall year-on-year this year for the first time since 2010: According to a new forecast from Gartner, shoppers worldwide will spend less on gadgets in 2015 than they did in 2014 — the first drop since 2010. Analysts from Gartner still predict we'll spend a total of $606 billion in 2015. But it's still a decline of 5.7 percent compared with 2014 — lower than Gartner had forecast just three months ago. So what's behind the softer sales? Its because sales of desktops, tablets and smartphones are all slowing. Fewer people are buying desktop computers in Western Europe, Japan and Russia. In addition the tablet market is reaching its saturation point, and that analysts expect users to upgrade their tablets an average of once every three years — far less than smartphones. Sales of mobile devices such as smartphones as well as of high-end laptops will continue to grow, the firm said. Still, even within that bright spot, there is some hint of a slowdown. The rates of first-time smartphone buyers in China, one of the world's fastest-growing and most important mobile markets, have slowed.


• Alibaba boosts Singapore Post stake, invest in SingPost's e-commerce unit: Chinese e-commerce giant Alibaba is investing about $206 million to expand its holdings in Singapore Post and its e-commerce subsidiary, the two companies said in a statement. SingPost is seeking to boost its e-commerce business to offset weak postal revenues, and last year an Alibaba unit bought an over 10 percent stake in SingPost for $249 million. In the latest deal, Alibaba said it was buying an additional 5 percent stake in SingPost for S$187.1 million. Alibaba will also invest up to S$92 million to buy a 34 percent stake in Quantium Solutions, a SingPost subsidiary that provides e-commerce logistics across the Asia Pacific. Alibaba is currently the second largest shareholder in SingPost after Singapore Telecommunications


• Music streaming firm Saavn raises $100M from Tiger Global, others: Saavn (South Asian Audio Video Network), a US-based Indian music streaming firm, has raised $100 million in Series C funding from existing investor Tiger Global Management and others. The company will use the money to improve product development efforts and to speed up customer acquisition. Saavn is said to be preparing for the launch of a video streaming service. The company claims to be adding one million users every month. Earlier this year, Saavn had appointed former Google executive Mahesh Narayanan as COO. Last year, Saavn added Twitter-powered radio station to its service. It also entered into licensing agreements with Warner Music and EMI Music that helped it add 800,000 tracks from international artists.


• ClipMine Improves Videos With Crowdsourced Tagging And Annotations: So this happens to me pretty often: I pull up an online video that I want to watch, only to be taken aback when I realize that it’s 10 or 20 or 30 minutes long. It’s particularly frustrating when there’s just one section or just one quote that I’m looking for. I end up skipping around trying to find that one bit — not exactly a great experience. A new startup is trying to fix that. With ClipMine, you get searchable videos, with a table of contents. For example, here’s a curated collection of videos related to startups. With each video, not only can you see an outline of all the big topics covered and jump to the section that interests you, you can also search for every time something gets mentioned (though your success will depend on how thoroughly the video has been tagged and annotated). To be clear, ClipMine isn’t trying to build its own video player. Instead, it sits on top of players like YouTube. You can also install a plugin to see the ClipMine player anywhere you see YouTube videos.

Daily Tech Snippet: Wednesday, July 1

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• Facebook is testing a more conservative definition of video views, but is still far more aggressive than YouTube in charging advertisers: While Facebook charges advertisers for videos the second they appear in a news feed, views are defined differently since users can easily scroll past the ads. Facebook considers a view to last three seconds compared with YouTube's 30-second rule. This has resulted in marketers' clips uploaded to Facebook to amass a wealth of views compared with those published on YouTube in recent months. But those views don't necessarily mean people are watching ads. Now, advertisers can start paying for videos with a cost-per-view rate that kicks in after a user watches for 10 seconds, making the ad seemingly more valuable to advertisers who want to pay for qualified views. Until now, advertisers have paid for videos immediately after they show up in a news feed—something akin to a cost-per-impression model. When Twitter launched autoplay video earlier this month, it tried to address concerns by promising brands 100 percent viewability: promising only to charge on video ads that have been seen 100 percent in full view of the user..


• Xiaomi Continues International Push, Starts Selling $160 Redmi 2 Phone in Brazil: Xiaomi made its expected move into the Brazil market on Tuesday, announcing plans to sell its affordable Redmi 2 smartphone for 499 Brazilian reals ($161). To avoid hefty taxes placed on foreign imports, Xiaomi is working with Foxconn to have the devices built in Brazil, with additional products coming soon.


• Online recharge and mobile wallet app MobiKwik targets $700M GTV in 2015-16, profits by 2016-17: MobiKwik.com, is gunning for a nearly four-fold jump in gross transaction value to $700 million (Rs 4,270 crore) this year. “We don’t have the audited numbers right now, but I can tell you that we have crossed the 2014-15 target of Rs 1200 crore ($190 million) sales and are looking forward to $700 million sales this year,” Upasana Taku, co-founder of the company told Techcircle. The Gurgaon-based company aims to turn profitable by financial year 2016-17. “We expect to meet our goal of 100 million users for the mobile wallet by 2016-17 and so next year we anticipate to start generating profits,” she added. Profitability is the holy grail for India’s fast growing consumer internet firms. MobiKwik’s competitor, the Alibaba-backed Paytm saw the gross value of the transactions conducted on its network rise to around Rs 4,000 crore by 2014-end from around Rs 1,000 crore the year before. Paytm is said to be targeting gross merchandise value (GMV) run rate of $3-4 billion by March 2015. MobiKwik plans to spend about Rs 100 crore on marketing this financial year. Most of the money will be deployed on television and online campaigns. MobiKwik is also betting big on joining hands with offline service provider. It started a service for offline players in March 2015 and has the likes of quick service restaurants, grocery stores and coffee stores on its platform. It has tie ups with Big Bazaar, Cafe Coffee Day and other players for the same.


• Apple Music First Look: Rich, Robust — But Confusing: Paid streaming music has arrived on Planet Apple, where it was regarded as unworthy for years. Today, the tech giant has entered the streaming music business with its much-anticipated Apple Music subscription service. Like other streaming services, it offers access to tens of millions of tracks for a monthly fee. Would I pay $10 a month — $120 a year — to use it? My answer is a tentative yes, with some caveats. Apple has built a handsome, robust app and service that goes well beyond just offering a huge catalog of music by providing many ways to discover and group music for a very wide range of tastes and moods. But it’s also uncharacteristically complicated by Apple standards, with everything from a global terrestrial radio station to numerous suggested playlists for different purposes in different places. One of the most confusing aspects of Apple Music is that it moves all your iTunes Music to the cloud, along with the streaming catalog. On the other hand, the service has three big strengths, in my view. First, it smoothly integrates the existing library of iTunes songs you own with the much larger catalog of music you are merely, in effect, renting. Second, while the service does use some algorithms, it suggests numerous playlists, albums and songs curated by 300 human editors, based on your tastes. Third, while Apple’s $10 monthly fee per user is both standard — and for some, pricey — the company is offering a family plan that cuts the price dramatically.


• LTE-U versus WiFi: The future of mobile data pits cellphone carriers against cable giants: To cellular providers, WiFi represents a huge missed opportunity. Internet consumption on cellular data networks — your 3G or 4G connection - could've grown by a whopping 84 percent last year, according to Cisco. But because consumers shunted so much traffic to WiFi, that figure was much lower, at 69 percent. Carriers could charge you for all that extra access to the mobile data network. Instead they're losing out when you hop onto WiFi at your home or office. And LTE-U is the industry's solution. The cable industry, on the other hand, wants to keep you on WiFi as much as possible. This is the math they fear: By 2019, Americans are expected to consume nearly 10 times more mobile data than they did in 2014. By then, 77 percent of all Internet traffic will be sent and received over mobile devices rather than stationary PCs. That's not good for cable, an industry that built its reputation on running fast (but fixed) Internet service into people's homes and businesses. You're probably familiar with 4G LTE, the current cutting edge of mobile data technology. Under ideal conditions, it provides download speeds that rival what you can get on a wired connection — fast enough to download a song in less than a minute. LTE-U is virtually identical to LTE, but with one key difference: It runs on the same frequencies that WiFi does. Unlike regular LTE, which piggybacks on airwaves owned exclusively by your carrier, LTE-U travels on public airwaves that are free to anyone. Garage door openers, cordless phones, WiFi routers — all also transmit over these open channels. Interference between the two technologies can slash WiFi transmission rates by 75 percent, according to a Google white paper filed last month to the federal government. The cable industry's top trade group, the National Cable and Telecommunications Association, argued the technology could be "disastrous" without further protections and "will severely degrade consumers' Wi-Fi experience, rendering unusable many services that are widespread today, to say nothing of the innovative new uses currently on the horizon."


• Google's Local Search, unlike Google's Organic Search, Favors Google+ Results, Yelp Claims: According to a highly critical new paper out from legal scholar Tim Wu, Harvard Business School professor Michael Luca and data scientists at Yelp, many of us are totally missing out on the information that’s most relevant, and critical, to our lives. In a statement to The Washington Post, Yelp vice president of public policy Luther Lowe uses this example: If a parent searches “pediatrician NYC,” he or she will, in a prominent first-page listing, see the names of seven pediatricians who happen to have Google+ or Google+ Local pages. “The Google organic ranking algorithm does a great job at identifying helpful content on the Web,” Lowe said. “But it’s sadly not being deployed in the most common user behavior on Google: local search.” According to Yelp, from one-third to one-half of all Google searches are local. They primarily involve something called the “Local OneBox” — the special, extra-prominent list of seven links that Google displays at the top of local search results. Local OneBox takes up a big chunk of first-page real estate, frequently at the very top of the page, which means people are disproportionately more likely to click into it than they are into regular links. Local OneBox also pulls exclusively from Google’s versions of specialized search sites, such as Google+ Local.


• Samsung, HTC suffer blowback from phone financing schemes of years past, as consumers turn slow to upgrade: It’s payback time for handset makers that long profited from Americans’ tendency to upgrade their mobile phones early and often. U.S. consumers got a taste for phone financing two years ago and never looked back. They bought fancy new devices for a few more dollars a month with no service contract attached. Now they’re holding on to their old smartphones longer than they did when they signed two-year contracts and got freebies, spelling further trouble for manufacturers like Samsung Electronics Co. and HTC Corp. that have struggled with declining sales. “When people spend $600 to $700, they are not in the mood to upgrade every year,” said independent wireless analyst Chetan Sharma. Thrifty consumers are starting to buy devices every 20 to 24 months instead of every 15 months when carriers subsidized all of their devices and made up the cost through higher service charges, he said. While iPhone maker Apple Inc. -- whose customers tend to be less price sensitive -- has remained largely unaffected, Samsung and HTC may see the most impact, analysts said. In a sign that the end of subsidies is on the horizon, Dallas-based AT and T asked in May that retail partners like Apple and Best Buy stop offering subsidized phones with two-year contracts and to sell them on its Next financing program instead. Verizon, which has been slower to move to phone financing, expects 50 percent of new sales to be on its Edge installment payment plan this year.


• Cisco to buy OpenDNS for $635 million to boost security business: Cisco said it would buy OpenDNS, a privately held cloud-based security firm, for $635 million, the latest move to boost its security business as cyber attacks increase in number and sophistication. Cisco has been buying a number of security companies, which has made its relatively tiny security business one of its fastest growing areas in the past two years. OpenDNS uses predictive intelligence to block malware, botnets and phishing threats that antivirus and firewalls miss. Cisco was a minority investor and was one of the backers that invested $35 million in OpenDNS in May last year. When Cisco buys stakes in startups, it often receives defensive rights that give it an edge to acquire companies it has invested in ahead of competitors. Cisco, whose security business is known for its firewalls, expanded into intrusion detection and prevention systems with the $2.7 billion acquisition of Sourcefire in 2013. Cisco, which has acquired dozens of companies over the years, is transitioning towards high-end switches and routers and investing in new products such as data analytics software and cloud-based tools for data centers. It bought malware analysis company ThreatGRID in 2014 and security advisory firm Neohapsis this year.

Onager's Daily Tech Snippet: Thursday May 28

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• Mary Meeker's 2015 Report is Out, and Calls Out that India Tech is at an Inflection Point: Kleiner Perkins partner Mary Meeker’s yearly Internet Trends report is the ultimate compilation of essential tech statistics. Here is her 2015 report, which  calls out that India could be at a tipping point. India's Internet penetration in 2014 was where China was in 2008 and the U.S. was in 1996. If India's curve follows the same pattern, get ready for big things in the next five years. One thing India is lacking is the catalyst companies that will lead its Internet revolution.

• Nielsen to measure digital ads in partnership with Tencent: Nielsen announced on Wednesday that it is partnering with Tencent Holdings to measure its digital audience in a move that could direct more ad dollars from companies in the United States to China's biggest social network. Nielsen said it is launching its Digital Ad Ratings, which tracks unique users, reach and frequency of a digital ad across computers, tablets and smartphones for the first time in China. Comscore, which offers a similar service and competes with Nielsen, said it is already available in China. The online gaming company Tencent, which also operates the popular mobile messaging app WeChat with 500 million monthly active users, has been making a big push to increase its advertising revenue especially through mobile. Nielsen will measure an ad campaign in a combination of surveys, consisting of 46,000 Chinese consumers, and aggregated, anonymous data from Tencent's hundreds of millions of active users. Tencent, which has a market value of $190 billion and reported first-quarter online advertising revenue of $438.4 million competes with Alibaba and Baidu.

• Its a Small World: Ola-owned TaxiForSure integrates Alibaba-investee Paytm wallet as cashless payment option, joining its arch-rival Uber: TaxiForSure, has tied up with Alibaba-backed online payments platform Paytm. The move will allow users of TaxiForSure to go cashless and pay through Paytm’s pre-paid wallet, the company said in a statement. Customers can link their debit card or bank account via a Paytm wallet or recharge their Paytm wallet and use it to pay for their rides. In March, cab hiring startup Ola had acquired TaxiForSure in what largely a stock transaction. Interestingly, Ola also has a prepaid wallet called Ola Money. Last November, on-demand car service Uber, Ola's arch-rival in India's ride-hailing space had joined hands with Paytm.

• Google and Apple Adjust Their Strategies on Mobile Payments: The battle for mobile software dominance revolves around two companies: Apple and Google. Now both giants are also going head-to-head in mobile payments, as they prepare to push deeper into digital wallets. Google is set to unveil plans at its annual developer conference on Thursday for an overhaul of its mobile payment products. Changes include a service called Android Pay that will let merchants accept credit card payments from inside their mobile apps and can be integrated with loyalty programs at retailers, the people said. Google Wallet, a mobile commerce app, will also be reintroduced as a peer-to-peer payments app that consumers can use to send money to each other directly from their debit accounts, they said. Apple is preparing to announce details about enhancements to Apple Pay at its software conference next month. Those include a rewards program for the mobile wallet service. The moves are the latest advances in mobile payments as several players jockey for an edge. With more consumers willing to make purchases using smartphones, companies are rushing to take the lead in the market, spurring eBay’s PayPal to heavily market a suite of mobile apps, while start-ups like Square and Stripe expand their payments processing software to small and midsize businesses. The stakes are also high for Apple and Google, which are entering mobile payments later than others in the industry. For Apple, mobile payments tie people more directly to its main product, the iPhone. For Google, payments are a hook to reel people into its ecosystem of services and another way to gain insight about consumers. The challenge for Apple and Google, along with rivals, is that the mobile wallet is generally a technology in search of a problem. Cash and credit cards are easy to use and accepted broadly worldwide. As a result, the mobile wallet is typically more of a supplementary service than a replacement. Nonetheless, mobile payments are growing quickly. Forrester Research predicts they will balloon to $142 billion by 2019 in the United States, almost tripling from $52 billion in 2014. Still, Google and Apple offer something that few others can: Hardware, software and an insatiable desire to win. “Google and Apple have deep pockets and the appetite to invest,” said Sucharita Mulpuru of Forrester Research. “They may create something that is a lasting disruption.”

• Despite Its Dominance, Analysts See A Murky Road Ahead for Android: Android is now not just the globe’s most popular smartphone operating system but the most popular operating system of any kind. More than a billion Android devices were sold in 2014, a c cording to the research firm Gartner. That’s about five times the number of Apple iOS devices sold, and about three times the number of Windows machines sold. Yet all is not well on planet Android. On the eve of Google IO, the company’s annual developer conference that starts Thursday, where Android will once again be a primary topic of discussion, cracks are emerging in Google’s hold over the operating system. Google’s version of Android faces increasing competition from hungry rivals, including upstart smartphone makers in developing countries that are pushing their own heavily modified take on the software. There are also new threats from Apple, which has said that its recent record number of iPhone sales came, in part, thanks to people switching from Android. Hanging over these concerns is the question of the bottom line. Despite surging sales, profits in the Android smartphone business declined 44 percent in 2014, according to one estimate. Over the holidays last year, according to the research firm Strategy Analytics, Apple vacuumed up nearly 90 percent of the profits in the smartphone business. The stark numbers prompted a troubling question for Android and for Google: How will the search company — or anyone else, for that matter — ever make much money from Android? Google faces several major Android-related headaches. First, while Google makes most of its revenue from advertising, Android has so far been an ad dud compared with Apple’s iOS. iOS users tend to have more money and spend a lot more time on their phones (and are, thus, more valuable to advertisers). Because Google pays billions to Apple to make its search engine the default search provider for iOS devices, the company collects much more from ads placed on Apple devices than from ads on Android devices. A recent analysis by Goldman Sachs estimated that Google collected about $11.8 billion on mobile search ads in 2014, with about 75 percent coming from ads on iPhones and iPads. A brighter spot for Google is the revenue it collects from sales via Android’s app store, called Google Play. For years, Android apps were a backwater, but sales have picked up lately. In 2014, Google Play sold about $10 billion in apps, of which Google kept about $3 billion (the rest was paid out to developers). Apple makes more from its App Store. Sales there exceeded $14 billion in 2014, and rising iPhone sales in China have led to a growing app haul for Apple. Still, Google’s app revenue is becoming an increasingly meaningful piece of its overall business, and it is also growing rapidly. But how long Google can expect Play to keep paying remains an open question, thanks to the second Android-related headache. Google’s strategy of giving Android to phone makers free has led to a surge of new entrants in the phone business, several of which sell high-quality phones for cut-rate prices. Among those is Xiaomi, a Chinese start-up making phones that have become some of the most popular devices in China. Because Xiaomi and others don’t make much of a profit by selling phones, they’re all looking for other ways to make money — and for many, the obvious business is in apps offering mail, messaging and other services that compete with Google’s own moneymaking apps. Android has always been a tricky strategy; now, after finding huge success, it seems only to be getting even trickier.

• Twitter Is Giving Advertisers More User Data In The Hope That They Spend More: Twitter is hoping to help marketers better understand their Twitter audience by adding a tool that will give them deeper user behavior around organic tweets. The audience insights dashboard tool adds some similar insights as the Facebook advertising platform with aggregate information on user demographics, interests, and purchasing behavior as well as what television shows users watch and their mobile usage. These new insights are expected to help advertisers identify a more relevant audience for upcoming campaigns on the platform. Will these new insights help boost advertising on Twitter? The company needs it right now. It had slower than expected growth in advertising sales this last quarter and even die-hard fans and early investors think the company needs some help. Early investor Chris Sacca recently scribed a blog post warning Twitter that he would soon be sharing a few thoughts on what the company needs to do now. Offering more profound insights about organic user behavior may be an answer to some of this frustration and may help to lure brands to spend more ad dollars on the platform. The audience insights tool is now available to all Twitter advertisers and analytics users. Twitter-specific information can be accessed within the U.S., with plans to roll this out more broadly over the next few months.

• Cisco Predics that in 5 years, 80 percent of Internet Traffic will be online video: We already know that Netflix accounts for one-third of Internet traffic at peak hours. Toss in YouTube, and that figure rises to roughly half of all bandwidth consumed. But even that's small potatoes compared with what's coming. In five years, 80 percent of the entire world's Internet consumption will be dominated by video. That number will be even higher in the United States, approaching 85 percent. That's according to the latest projections from Cisco, which publishes an annual study peering into the near future of the Web. The newest report, out Wednesday, predicts that by 2019, the Internet will have become more or less a big video pipe. Part of the growth will come from adding new people to the Internet — for the first time, over half the world's population will be digitally connected. But individual Internet users are also expected to consume more video over time, and at a higher quality, which will put tremendous new burdens on the world's Internet infrastructure. When you see the Internet as a huge distribution channel for video, it puts virtually everything that tech and communications companies are doing into perspective. Telecom firms like Verizon are racing to expand their cellular networks so that they can deliver video over LTE. Cable companies are fleshing out their public WiFi hotspots so users can watch videos outside their homes. Content providers like HBO and CBS are putting their programming on the Internet so that customers don't have to be tethered to their television sets. Implicit in this idea is that mobile devices will be the primary way users will access all this video. And researchers agree on that point. Five years ago, Americans were spending less than an hour a day on mobile devices. Today, it's more like three hours a day, accounting for more than half of the time we spend consuming digital media in general, according to the latest in an annual report released Wednesday by Kleiner Perkins partner Mary Meeker.

Daily Tech Snippet: Tuesday, May 5

• Foreshadowing Tensions Between Hollywood and Tech, Twitter’s Periscope Disabled Dozens of Mayweather Fight Streams: Twitter Inc. said its Periscope streaming business scrambled Saturday night to take down users’ unauthorized live feeds of the championship boxing match between Floyd Mayweather and Manny Pacquiao. “Members of the Periscope team were on staff Saturday night working to disable streams of the fight,” Twitter said Monday in a statement. “We were able to respond to takedown requests within minutes.” The year’s biggest fight cost $100 to see live on pay-per-view television from Time Warner Inc.’s HBO and CBS Corp.’s Showtime. Some fans used their phones to capture the video and stream it to Periscope and a competing service, Meerkat. Twitter executives including Chief Executive Officer Dick Costolo appeared to boast of Periscope’s use, creating the impression they supported the copyright-violating streams. Periscope was trying to stop the streams, according to Twitter. The company received 66 reports from the rights holders, and took action on 30, it said today in a statement. The others either had ended already or weren’t available. “Our content policy expressly prohibits streaming content that is protected by copyright. This kind of use constitutes a clear violation,” San Francisco-based Twitter said. “We are working to ensure that there are robust tools in place that allow us to react expeditiously.” The use of Periscope on big televised events threatens to exacerbate longstanding friction between Hollywood and tech companies over piracy. In April, fans of HBO’s “Game of Thrones” streamed the show on Periscope and Meerkat, giving people who weren’t paying access to a grainy video rebroadcast. While Saturday’s streams are unlikely to dent the millions made by HBO and Showtime, the event signals a potential problem if more people use live-streaming apps to watch pay TV. Twitters investors and executives helped contribute to that perception with tweets on Saturday night. Costolo pronounced Periscope the fight’s winner, while Twitter investor Chris Sacca, also proclaimed Periscope a winner “by a knockout.” Sacca clarified those remarks with subsequent posts on Sunday, lauding the use of Periscope for behind-the-scenes footage by Showtime, HBO and Yahoo Sports. He also said: “1) The Scope team shut down countless streams last night 2) Scope was awesome second screen/behind the scenes.”

• Tech-centric Elementary School Chain Raises $100M from Zuckerberg, Others: Add an elementary school to the list of ventures attracting nine-figure sums from Silicon Valley investors. AltSchool, a chain of technology-centric private schools in San Francisco, has raised $100 million from Facebook Chief Executive Officer Mark Zuckerberg, through his family's charitable organization, as well as from Founders Fund, Andreessen Horowitz, and other backers. Founded by former Google executive Max Ventilla, AltSchool has been developing customized hardware and software that it says allows teachers to create more personalized education plans. Instead of having children follow the same curriculum throughout the year, lesson plans can be tailored to each student. Tuition costs about $21,000 a year, and the company eventually plans to sell its technology to other schools. "Everything is instrumented through technology," Ventilla says. Tech investors have been pouring money into education-related companies. Spending on education startups last year increased 55 percent, to a record $1.87 billion, according to CB Insights, which tracks venture capital spending. In 1999, when the researcher started tracking education, financing within the industry was $385 million. AltSchool is different from many other education-tech companies, which typically build applications to help with math or reading. That's because it operates its own schools. The company started last year in a single San Francisco classroom with 20 students. This year, it plans to have eight schools serving 500 kids. Its first school outside of California will open later this year in—where else—Brooklyn, N.Y. After Ventilla sold his search startup, Aardvark, in 2010 to Google, where he worked until 2013, he became increasingly interested in what he describes as a failing education system in the U.S. The country ranks 14th—below Russia and other developed nations—in a Pearson study on global math, science, reading, literacy and graduation rates. One reason for that is a lack of funding for public schools, something Ventilla's hot tech startup no longer needs to worry about.

• Startup Works to Translate Videos Into Structured Data: Vu Digital is launching new technology to help customers figure out what’s actually going on inside web online videos. B. Wade Smith, the company’s vice president of operations and development, said that as more and more online content moves to video, it will become increasingly important to extract data about those videos in a form that’s easy to analyze — namely, text. So as Smith demonstrated for me, Vu Digital’s Video-to-Data product actually breaks down a video frame-by-frame, identifies the objects in each frame, and then creates a chronological transcript identifying things like music, dialogue, faces, logos, text and graphics. What’s the point? Smith suggested this could be used by “anyone in the video value chain,” such as creators, publishers or marketers. The data could used for things like search engine optimization, personalization, ad targeting, and determining the “brand value” of a video, namely how long and how prominently a product or logo appeared. Smith admitted that the current product comes from a pivot, but a pivot that illustrates the problem Vu Digital is trying to solve. The company started out focused on web personalization, but Smith said, “We quickly found more and more website content was becoming video and we couldn’t make long tail content recommendations — the tags for the video were absolutely insufficient.” So the team decided to “drop everything” and focus on the video issue. Other companies have built video analysis and search tools — in fact, Microsoft acquired its own video search company back in 2011. However, Smith said he’s not aware of any competitors that can identify everything that Vu Digital can, nor can competitors do it with the product’s speed.

• Generational Shift at Cisco as longtime CEO John Chambers Steps Down: On Monday, perhaps the last veteran leader of the old guard signaled it was time to leave the corner office — if only for a move down the hall. John T. Chambers, chief executive of Cisco Systems since 1995, said he was stepping down effective July 26, to be succeeded by a longtime Cisco sales executive. “He is the last of the lions, presiding over years of incredible growth,” said George Colony, chief executive of Forrester Research, a market research firm. Cisco makes much of the gear that runs the Internet, notably digital information switches. It also supplies equipment for the world’s telecommunications infrastructure, and for teleconferencing, video and Wi-Fi networks. It had sales of $47.1 billion in the 2014 fiscal year, compared with $1.2 billion in 1994, just before Mr. Chambers took over. Mr. Chambers’s successor, Charles H. Robbins, is 49, and joined Cisco, the networking equipment maker, in 1997, just two years after Mr. Chambers became C.E.O. Mr. Chambers, 65, will remain as executive chairman. The company said that Mr. Chambers would spend time supporting the company’s new chief and “engaging closely with customers and governments around the world.” The transition is another sign of a generational shift in Silicon Valley. In September, Lawrence J. Ellison announced he would leave the C.E.O. position at Oracle, the world’s largest maker of database software. Like Mr. Chambers, Mr. Ellison became the company’s executive chairman and remains active. In August 2013, Steven A. Ballmer said he would step down as head of Microsoft, and he was succeeded in February 2014 by Satya Nadella. Unlike Mr. Ellison or Mr. Chambers, Mr. Ballmer cut his ties with Microsoft and left the board in August. He now gives commands from the courtside of the Los Angeles Clippers basketball team, which he purchased for $2 billion in May 2014. In addition, just months before Mr. Ballmer announced his decision to step down as Microsoft chief, there was a passing of the guard at the chip maker Intel, with Brian M. Krzanich becoming chief executive to succeed Paul S. Otellini. The year before, in 2012, Virginia M. Rometty took the place vacated by Samuel J. Palmisano as head of IBM. Even as the executive suites at these large companies have turned over, a web-focused and mobile-proficient group of companies now dominate the technology scene, including Facebook and Google. Many of these are run by much younger leaders than Mr. Chambers, especially Google’s Larry Page, 42, and Facebook’s Mark Zuckerberg, 30. Their companies have powerful networks but are primarily devoted to software, and an ethos that information should be ubiquitous and shared. “Now it’s a young man’s game,” Mr. Colony said.

• With Big Names and Money Flowing In, Tech Start-Ups in India Heat Up: Intense interest from prominent investors is helping to drive eye-popping valuations among Indian tech start-ups. Venture capital firms, hedge funds and the likes of business executives such as Rupert Murdoch are all vying for a piece of India’s rapidly growing e-commerce market — particularly companies aimed at the growing number of aspiring middle-class consumers. It is a radical turnaround from just a few years ago, when fewer smartphones, a smaller number of Internet users, general government inertia and a lack of funding hampered many entrepreneurs and start-ups. Well-known investors like Masayoshi Son, the chief executive of SoftBank; Jack Ma, the executive chairman of Alibaba; and Mr. Murdoch, the media tycoon, have all made investments in India’s e-commerce companies. They are going head-to-head with other experienced tech investors like Sequoia Capital and Accel Partners. Mr. Son said he would pump $10 billion into India, joking during a visit that he was “speed dating” entrepreneurs to gauge their passion. Amazon’s chief executive, Jeff Bezos, posed on a festooned truck holding a $2 billion check to be invested in the company’s India unit. India’s market potential is enticing. Only 300 million Indians, or less than 25 percent of the country, are Internet users, and while that is already the second-largest Internet market in the world, after China, five million users are added each month, according to Rajan Anandan, Google India’s managing director. The number of Internet users in India is expected to reach 500 million in three years, he said. As investors rush in, the stampede has brought its own set of challenges. Despite the optimism, none of India’s e-commerce players are profitable yet. For now, it is a game of capturing market share, and the expenses are high as rivals try to distinguish themselves in front-page newspaper ads and prime-time TV commercials. There is also the matter of the aggressive valuations that start-up founders are demanding. News reports this year suggested that a deal between Alibaba and Snapdeal fell through because the two could not agree on a valuation. With such inflated prices, investors ought to be wary. Any downturn could take with it hundreds of millions of dollars of their money. “Follow-on financing offers land even before entrepreneurs have closed the previous round. It is a little chaotic,” said Shailendra Singh, managing partner at Sequoia Capital in India, which has investments in the cab-summoning app Ola and the restaurant and food platform Zomato. Investors get sticker shock as entrepreneurs demand outrageous multiples and stiff premiums. Mr. Singh said some demands were “uncomfortably high.” Still, the investor interest and money are being aggressively put to use by start-ups like Flipkart, which has tripled its number of employees in one year, to 33,000 as of March. It says it has averaged eight million shipments a month (compared with three million a year ago). It recently hired two Silicon Valley-based Google executives: Punit Soni, as its chief product officer, and Peeyush Ranjan, as its head of engineering. Both will be based in Bangalore, where Google has leased 1.5 million square feet for its new campus in an office park backed by the Blackstone Group, the private equity firm. Already, the value of goods sold on Snapdeal — which offers goods as varied as bulletproof cars and luggage made in Mumbai’s slums — exceeds that of India’s largest offline retailers, said Mr. Bahl, its co-founder. Experts see India’s e-commerce market at an inflection point. A recent Morgan Stanley report titled “The Next India” said Indian e-commerce would expand to $100 billion in revenue by 2020, from $2.9 billion in 2013, making it the world’s fastest-growing market. India’s youthful market makes it an e-commerce sweet spot, said Vijay Shekhar Sharma, founder of India’s largest mobile payments platform, Paytm. As in China, India’s smaller cities and towns lack retail infrastructure. In 5,000 cities and towns, tapping an app is the new equivalent of a visit to the mall, and it could unleash pent-up demand for the latest fashion or the newest device. India resembles China of seven to 10 years ago in its broadband Internet growth, creation of digital-native marketplaces and rapid user adoption. Even ideas like online grocers, which have just started to gain a foothold in places like Silicon Valley could do well in India. “So investors who won in China are playing in India. Those who missed in China, too, are playing in India. This is the land of opportunity,” Mr. Gururaj said.