Tech Brew Ride Home - Mon. 03/02 - I Don't Think Streaming Platforms Have Coke Habits

Episode Date: March 2, 2020

Some investors want Jack out as Twitter CEO. Apple settles a class action lawsuit for half a billion dollars. If you listen regularly, I bet you can guess why some game developers don’t want to work with Stadia. Spotify wants artists to pay to promote their own songs. And AT&T TV is a new way to re-invent the cable bundle. Sponsors: Metalab.co Zapier.com/ride Links: Rajeev Suri to step down as Nokia CEO; Pekka Lundmark to take over (TechCrunch) Singer’s Elliott Seeks to Replace Twitter CEO Dorsey (Bloomberg) Apple to pay up to $500 million to settle U.S. lawsuit over slow iPhones (Reuters) Google's ambitious push into gaming is floundering, and it's due largely to too few games on its Stadia platform — here's why developers have held back (Business Insider) AT&T TV now available nationwide with Android TV set-top box — and a two-year contract (The Verge) Spotify’s Newest Pitch to Labels and Musicians: Now You Pay Us (Bloomberg) The Week in Tech: Coronavirus Disrupts the Industry (NYTimes) Airbnb’s Path to 2020 Stock Listing Imperiled by Coronavirus (Bloomberg) Kuo: iPhone Production Will Not Significantly Improve Until Second Quarter of 2020 (MacRumors) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. Welcome to the Tech meme right home for Monday, March 2nd, 2020. I'm Brian McCullough today. Some investors want Jack out as Twitter CEO.

Apple settles a class action lawsuit for half a billion dollars. If you listen regularly, I bet you can guess why some game developers don't want to work with Stadia. Spotify wants artists to pay to promote their own songs, and AT&T TV is a new way to reinvent the cable bundle. Here's what you miss today in the world of tech. Things continue to be looking shaky over at Nokia. Rajiv Surrey is stepping down as Nokia CEO after half a decade. Peca Lundmark, who is currently the outgoing president and CEO of an energy firm called Fortum, has been appointed to replace him as CEO and

president, quoting TechCrunch. The networking giant said Surrey had expressed his intention to step down from the role and that they have been working to formulate a smooth transition. After 25 years at Nokia, I have wanted to do something different, said Surrey, who will leave his current position on August 31st and continue to serve as an advisor to the Nokia board until January 1st next year. Lundmark is expected to start in his new role on September 1st of this year. The announcement comes days after Bloomberg News reported that Nokia was exploring a range of strategic options including selling portions of its business assets to potential merger deals, end quote.

And suddenly some turmoil for Twitter. Sources told Bloomberg over the weekend that Elliott Management has taken a sizable stake in Twitter and has nominated four directors to Twitter's board in an effort to push for the replacement of Jack Dorsey as Twitter CEO. Quote, Twitter has been a potential target for activist investors for years. The company only has one class of stock, which means co-founder Dorsey doesn't have voting control of the company like Facebook's Mark Zuckerberg or Snap co-founders Evan Spiegel and Bobby Murphy. Elliot has a long history of agitating for change at some of the world's largest companies. This month, the firm disclosed a stake in Japan's soft bank and said it

planned to push for a larger share buyback and governance changes at the firm's vision fund. Elliot has also pushed for changes at AT&T, eBay, Marathon Petroleum, and Pernaud, Ricard, end quote. As Jason Murray joked on Twitter, some people will play the long game to get Twitter to add an edit button, end quote. Apple has agreed to pay up to $500 million to settle a classic. action lawsuit in the U.S. that accused the company of quietly slowing down the performance of older iPhones. Quote, the preliminary proposed class action settlement was disclosed on Friday night and requires approval by U.S. District Judge Edward DeVilla in San Jose, California. It calls for Apple to pay customers $25 per phone, which may be adjusted up or down depending on how many iPhones are eligible, with a minimum total

payout of $310 million. Apple denied wrongdoing and $7.7.7. Apple denied wrongdoing and settled the nationwide case to avoid the burdens and costs of litigation, court papers show. Friday's settlement covers U.S. owners of the iPhone 6, 6+, 6S, 6S, 6S plus, 7, 7 plus, or SE that ran the iOS 10.2.1 or later operating systems. It also covers U.S. owners of the iPhone 7 and 7 plus that ran iOS 11.2 or later before December 21, 2017. Consumers contend that their phones perform. suffered after they installed Apple software updates. They said this misled them into believing their phones were near the end of their life cycles requiring replacements or new batteries, end quote.

Over the weekend, Business Insider had a piece saying that Google's cloud gaming project is in trouble because its library of games is sort of paltry at this point. Why? Well, BI seems to think that indie game developers and publishers aren't on board. Why? Because these same publishers say Google hasn't been offering devs enough money, but also, and don't think these paragraphs aren't why I elected to do this segment in the first place, quote, if you could see yourself getting into a long-term relationship with Google, one developer said, but with Google's history, I don't even know if they're working on Stadia in a year. That would be something crazy that Google does. It's within their track record, end quote. This concern that Google might just give up on Stadia at some point and kill the service,

as it is done with so many other services over the years, was repeatedly brought up, unprompted by every person we spoke with for this piece, end quote. I've warned Google before that their reputation would catch up to them someday. There are currently just 28 titles available on the Stadia platform right now, though Google does say 120 are slated to come to the platform by the end of this year, including many expected blockbusters like Doom Eternal and Cyberpunk 2077. But where are the table stakes indie games that truly make up the broader gaming ecosystem? games like bloodstained, shovel night, dead cells, untitled goose game.

The point here is that, yes, blockbusters from EA, from Ubisoft, from Rockstar, they're all there on stadia. You can play Red Dead 2 if you want. You can play Assassin's Creed Odyssey if you want. But those are big publishers who can afford to dip their toes in multiple waters. You can't win over the entire gaming industry until the entire ecosystem of both large and small developers feel like it's worth. their while. And Google clearly hasn't made them feel that way yet. Okay, I've tried to hold off on any COVID-19 stories until I couldn't avoid it anymore. Let me just run down a collection of things affecting the tech world that I missed. Expedia said it could not provide a full year of financial

outlook for that company because of disruptions to the travel space. Ride-hailing companies are beginning to provide plastic barriers between the front and back seats in cars to protect drivers and writers, or both, I guess. Amazon has told its employees not to travel even domestically. Twitter has suspended all non-critical business travel and events, including Jack Dorsey, canceling his planned keynote at South by Southwest. Shares in Zoom were skyrocketing all last week, even as the broader markets plummeted, as investors seem to think we'll all be working from home for a while.

So, yep, video conferencing for everyone. Much of what I just told you was helpfully collected by Mike Isaac in the New York Times over the weekend. But this comes from Bloomberg. Sources are saying that Airbnb's long-planned IPO had been scheduled for this month or maybe April, but it is likely now been pushed back to 2021. Obviously, you don't want to debut on a day when the Dow is down a thousand points or something like that. And as we spoke about previously, there were already some questions as to whether the market even had an appetite for Airbnb at the moment after the, shall we say, uneven performance of fellow unicorn debuts last year.

But one detail I learned from the Bloomberg piece, a lot of Airbnb employees have stock options that are set to expire this year and they want to cash out. So Airbnb is feeling the pressure to get out the door somehow. And finally, this comes from Mac Rumors. Apple analyst extraordinaire Min Chi Quo says iPhone production is still being hampered and will not improve before Q2 of this year. Quote, iPhone camera lens shipments from supplier genius electronic optical reportedly fell significantly over the past month, and supplies are dwindling. Quo predicts there is about a month of lens inventory remaining with significant production

resuming in May at the earliest, end quote. Quote, quote, maintains that the rumored iPhone SE2 launch should still be on track for later this month, but one wonders at this point if the announcement of said phone will be made online only in front of maybe, I guess, an empty auditorium at the Steve Jobs Theater. AT&T TV has officially launched today in the U.S. after rolling out in over a dozen markets last year. Given all of the streaming wars, Bruehaha, you'd be forgiven if you asked if this was another entrant into the streaming wars.

Well, not really. It is an OTT streaming service. It is TV over TCP. but it's not like Hulu or Netflix. For one thing, confusingly, AT&T already has an entrant into the streaming wars. It's named AT&T TV now, and it's not out yet. This is not that. Though again, it doesn't help that those names are nearly identical. No. It might clear things up if I told you that AT&T TV, which did come out today, has prices starting at $49.99 a month, and those prices actually go up quite dramatically after your first year.

In short, this is an old-style cable TV bundle replacement, quoting the verge. The subscription TV service, not to be confused with AT&T TV now, formerly Direct TV now, is contract-based, which is a departure from the freedom you get with month-to-month streaming TV apps like YouTube TV, Hulu with Live TV, and Sling TV. Signing up for a two-year agreement gets you an Android TV set-top box and a very cable like remote control with a Google Assistant button. AT&T is trying to position AT&T TV as its premium streaming TV experience. It's more for people seeking a better cable-slash satellite alternative than a cheaper one.

This is basically AT&T's next play as it moves on from DirecTV, which continues to bleed subscribers each quarter as more consumers cut the cord. Alongside live TV, you can install apps like Netflix, Disney Plus, and others from the Google Play Store, or control smart home devices with the assistant-enabled remote. Chromecast support is built in too. You can watch AT&T TV on the box when in front of your television, and there's also an AT&T TV app for iOS, iPadOS, and Android. Setup is pretty simple.

You plug the box into your TV's HDMI port, enter your Wi-Fi info, sign in with your AT&T TV credentials, and then start watching. Everything will feel similar to cable-slash satellite converts. The remote has number buttons, with a channel guide that sticks closely to direct TV's listings, but here everything is streaming over the web, end quote. So yeah, forget even Fios.

To muddy the waters even more, this is a play to deliver again old-style TV watching without actually having to wire anything new into your home. The home screen on this new service, for example, is always live TV, usually the last channel you were watching. So again, functioning as you would expect old-style TV to function. You get local broadcast channels, all the cable channels you would expect, including ESPN, and HBO is free for the first three months. AT&T TV also has a cloud DVR that lets you save up to 500 hours of shows, but annoyingly, they all get deleted after 90 days.

And about that, price rising dramatically. I guess they want you to feel nostalgia for old-style cable TV bundle pricing as well because that entry level $49.99 plan goes up to $93 a month after a year. And the highest end plan, the so-called ultimate plan, goes to $135 a month after a year. So essentially just the old cable TV bundle, except now brought to you via the wonders of the web. According to Bloomberg, Spotify is trying to... trying to pull an AOL. Quick history lesson.

In the earliest days of AOL, the company used to pay content creators millions of dollars to get content on their dial-up online service in order to gain it credibility. Then, in the mid-90s, AOL became the way the majority of Americans got online. So AOL flipped the script and started asking content companies like Sports Illustrated or the New York Times to pay them in order to put their content on AOL services in order to reach all those millions of Americans that were coming online. So, fast forward to today. Now that Spotify has become the new way for a ton of people to listen to music, Spotify is starting to ask labels and musicians to pay them to promote music inside its app. It is a smart, strategic move. It's logical even.

but remember, labels and musicians still need to grant Spotify the right to even have their music on the Spotify platform. So this is a weird, delicate dance that Spotify is trying to pull off. And it's apparently complicating talks surrounding longer-term music rights for Spotify. The streaming giant is asking record labels and artists for money to advertise their songs within its app, arguing that they'll reach new fans and increase their popularity. The service has already introduced one tool called Marquis and is pitching a second, people with knowledge of the matter said. Spotify has already convinced a handful of artists to use Marquis, which sends notifications

to listeners when artists release new songs or albums. Those participating include Justin Bieber and Little Wayne. Gaining wider buy-in for what Spotify calls a two-sided marketplace. Connecting artists and fans is vital. Spotify has inserted sponsored songs in listeners' playlist and has also discussed charging artists and labels for data about their habits. With marquee, artists or their labels can pay a minimum of $5,000 to have fans notified when a new release arrives on the service, end quote. This is actually similar to a product that YouTube has called Premiers. But here's the thing. Again,

Spotify has to pay the record labels just to get the rights to the music in the first place. And then, under the current royalty agreements with the record labels, the labels get a share of all of Spotify's revenue. So if Spotify were to charge for promo, the labels would then be getting that back in their rev share, their own money back. That makes no sense, of course, and Spotify wants to create a new revenue pool to draw from, to even that out. But the record labels think that that would effectively mean that they might be lessening their existing royalty payments. Why should they agree to that? And then, quote, independent labels, meanwhile, fear that Spotify will create an ecosystem that rewards those companies and artists with the most money.

Independence credit the service with boosting their market share in recent years and don't want to see those gains threatened. Quote, people aren't very happy about it, said Richard James Burgess, the head of A2iM, a body that represents independent labels. Some labels feel like they'd promote music to people, they will reach anyway. And it just reduces the royalty you make, end quote. Spotify had told his members the company would never do this, Burgess said. Another concern for the major labels is that they'll set off a promotional arms race with every artist wanting to see their record touted at the top of Spotify's homepage, end quote.

Yeah. In the old days of pale, I mean, sorry, music promotion, there were how many, hundreds, thousands of radio stations across the country so you could liberally and strategically spread your free Coke. Sorry, Coke. I mean promo budget around to all. all those different station directors, right? Now there's just a handful of streaming platforms. And unless I'm wrong, they don't tend to have big Coke habits. That's all for today.

My one concession to COVID-19 so far is that this morning I started commuting via my e-scooter again, which, you know, I was planning on doing that anyway once the weather warmed up sufficiently. but given what's going on, I figured it couldn't hurt to just bundle up over the next few weeks and take the scooter and avoid the train for a while. It is a lovely commute. Straight shot down the slope

over the glorious Gowanus Canal across Carroll Gardens and then up the East River along the waterfront. Manhattan skyline over my shoulder. Sun rising. I should probably do it more anyway. Talk to you tomorrow.