Tech Brew Ride Home - Mon. 04/17 – Is Google About To Lose Samsung?

Episode Date: April 17, 2023

Hey everybody, back from Ireland, and man, the universe dumped all the news on me this morning. Google is rushing to add AI to search because they’re afraid Samsung is about to jump ship to Bing. More chaos at Twitter. Meta has to make nice with advertisers. Spotify seems to be abandoning it’s paywall podcast strategy. And is Apple’s Watch OS about to get its biggest overhaul ever? Sponsors: Grammarly.com/techmeme GetSunday.com/ride Links: Google Devising Radical Search Changes to Beat Back A.I. Rivals (NYTimes) Sega to acquire Angry Birds maker Rovio for $776 million (CNBC) U.S. House Committee Publishes Draft Stablecoin Bill (CoinDesk) Elon Musk just shut down automation for important public safety accounts (Mashable) Is Twitter finally dying? (Vox) Meta Tries to Lure Advertisers With Reels Discounts, AI Tools (The Information) Spotify will drop paywall for Gimlet podcasts (Semafor) Apple Plans to Launch More Than Just Its New Headset at WWDC (Bloomberg) 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 TechMeme right home for Monday, April 17th, 2020. I'm Brian McCullough today. Hey, everybody, back from Ireland and, man, the universe dumped all the news on me this

morning all at once. Google is rushing to add AI to search because they're afraid Samsung is about to jump ship to Bing. More chaos at Twitter. Meta has to make nice with advertisers. Spotify seems to be abandoning its paywall podcast strategy and is Apple's watchOS about to get its biggest overhaul ever? Here's what you miss today in the world of tech.

Over the weekend, the New York Times had a piece looking at Google's Project Magi, which is apparently the code name for their initiative to upgrade Google Search by incorporating AI into it. But hidden in that piece was a little nugget as to why they're doing this. Sources are saying Samsung is considering changing the default search on their phones to Bing instead of Google Search, which would be friggin huge. Like the whole reason Google did Android in the first place was an attempt to protect. their search franchise on mobile. Quote,

Google's reaction to the Samsung threat was panic, according to internal messages reviewed by the New York Times. An estimated $3 billion in annual revenue was at stake with the Samsung contract. An additional $20 billion is tied to a similar Apple contract that will be up for renewal this year. AI competitors, like the new Bing, are quickly becoming the most serious threat to Google's search business in 25 years. And in response, Google is racing to build an all-new search engine powered by the technology. It is also upgrading the existing one with AI features, according to internal documents reviewed by the Times. The new features under the project name Magi are being created by designers, engineers, and executives working in so-called sprint rooms to tweak and test the latest versions.

The new search engine would offer users a far more personalized experience than the company's current service attempting to anticipate users' needs. Modernizing its search engine has become an obsession at Google, and the plan changes could put new AI technology in phones and homes all over the world. it was not clear whether Microsoft's work with AI was the main reason Samsung was considering a change after the last 12 years. That was the assumption inside Google. The contract is under negotiation, and Samsung could still stick with Google, but Google is worried. The idea that Samsung, which makes hundreds of millions of smartphones with Google's Android software every year, would even consider switching search engines, shocked Google's employees. The proposed new Google search would offer lists of pre-selected options for objects to buy, information to research,

and other information. It would also be more conversational, a bit like chatting with a helpful person. But long before the search engine can be rebuilt, the Magi Project will add features to the existing search engine according to internal documents. Google has more than 160 people working full-time on it, a person with knowledge of the work said, end quote. Real quick, Sega has acquired Rovio, which is probably best known for its Angry Birds franchise, for 706 million euros, which, considering Savvy, acquired scoply recently for four. $4.9 billion, take two acquired Zinca for $12.7 billion. This is a bit of a come-down for Rovio, right? According to CNBC. Robio games have been downloaded over five billion times,

according to Statements Monday. Meanwhile, its Angry Birds franchise has been licensed into other entertainment and consumer products. Tokyo-based Sega, was founded in 1960 and is best known for its Sonic the Hedgehog and Total War franchises, as well as consoles, including the Sega Genesis Mega Drive, popular outside of Japan in the 1990s. It wants to use Rovio to expand its presence in the mobile gaming market and said it would use its live-operated mobile game development capabilities to boost development of mobile-based versions of its existing games. The Wall Street Journal had previously reported the Rovio deal was expected to be worth around $1 billion, end quote. The U.S. House Financial Services Committee has published a draft Stablecoin bill

proposing a moratorium on stable coins backed by other cryptocurrencies and requested a CBDC study, quoting Coin Desk. The bill, available on the committee's hearing page, represents the first major piece of crypto legislation to move in 2023 and follows two key incidents over the past year involving stable coins, the blowup of TerraUSD or UST, which was backed by a token called Luna and the second largest one, USD coin, USDC, temporarily becoming unmoored from one dollar. The moratorium on stablecoins like UST would last until a study can be conducted. The bill also seeks a study of the potential impact of a CBDC issued by the Federal Reserve. A House Financial Services Subcommittee will hold a hearing on stable coins on Wednesday,

featuring Dante Disparte from Circle Internet Financial, which issues USDC. The hearing will come a day after the full Financial Services Committee meets to hear from Securities and Exchange Commission Chair Gary Gensler, end quote. Over the weekend, numerous public service and safety Twitter accounts, including the account for the U.S. National Weather Service offices, said Twitter's new API rules limited their ability to issue automated alerts. As an example, the MTA here in New York was unable to publish tweets about subway disruptions and timetables briefly, though it looks like they're back online right now, quoting Mashable. Twitter has been removing API access, which allows many of these.

accounts to post in an authorized way by the platform as it switches to Elon Musk's new high-price paid API system. Many of these affected Twitter accounts have automated updates, but aren't the type of hands-off bot accounts that some may think of when they hear the term bot. For example, numerous National Weather Service accounts that provide consistent updates, both automated and manually posted by humans, shared that they could no longer provide their up-to-the-minute, potentially life-saving updates. Other important services like the official account for the MTA, which runs New York City's public transit, and BART, which services San Francisco, shared similar issues with their access to Twitter's API. Some of these accounts could potentially

run off of Twitter's new basic $100 per month API plan. However, this plan has very limited access and may not provide what some of these services require, especially when considering they used to be able to get everything they needed to basically provide Twitter with more content for free. After the $100 plan, Twitter's new API tiers start at a whopping $42,000 per month, end quote. So things continue to go swimmingly over at Twitter, including this news, which frankly is the longer-term existential problem for Twitter. According to similar web, in March 2023, Twitter's traffic overall fell 7.7% year-over-year, and that's the third straight month of declines measured by similar web. So this is a trend and not a good one if you're Twitter.

Web visitors fell 3.3% year over year, and Android app daily active users fell 9.8% year over year. So for all of the false alarms in previous months, is Twitter actually actively dying now? Quoting Vox. Vox spoke with over half a dozen current and former Twitter employees, advertising and marketing experts and users about the current state of the company. Many of those who worked at Twitter said the platform was only alive because of the technical strength and reputation it's built over the past 17 years. You can blow both engines on a jet and the jet is still going to glide, said one former Twitter employee of seven years, who spoke on the condition of anonymity due to fear of professional repercussions. They added, however, that people should worry about Twitter's recent privacy bugs,

including one that affected Twitter circles, a feature that's supposed to send certain tweets only to specific users. Instead, these tweets were made public. If there are ways the product is breaking apart behind the scenes and ways you don't see, the former employee said, then that's a really, really bad sign, end quote. Two more stories of things not working out the way people had hoped. The first is from the information, which is reporting that, after its first ever ad sales drop, meta is ditching its traditional brash tone it usually takes with advertisers and is instead offering sweeteners to keep them spending,

on their platform, including a 25% discount for Reels ads. Reels, of course, is supposed to be the growth area of Meta. Quote, instead of demanding that ad agencies commit to increases in spending of 20% or more, as they typically did in years past, meta's salespeople are signaling their content with spending staying level with last year, according to two senior ad agency executives. Meta is offering advertisers sweeteners, such as discounts of as much as 25%, for those willing to spend a certain amount testing different ad products on its TikTok rival feature reels, according to an ad executive whose firm spends more than $200 million annually with Meta. Well, Meta frequently offers discounts to encourage usage of new ad products. This one is unusually large, the executive said.

And salespeople have stopped spending time in meetings with marketers talking up the Metaverse, and instead are pitching advertisers on Meta's artificial intelligence-powered ad delivery and measurement tools in hopes of boosting ad sales in the short-term ad executives say. So far, the results have been mixed. Meta's change of strategy reflects in ad markets so weak that some smaller digital media firms have seen declines of as much as 20 to 25% in revenue in the first quarter, according to two senior digital publishing executives. While Meta's scale would allow it to do better, it is also facing competition for ad dollars from ByteDances TikTok, although the threat of a government ban on TikTok may have offset some of those competitive pressures.

The company's ad sales efforts have been complicated by layoffs in its ad sales department and high-level changes, including the departure this summer of Marnie Levine, META's chief business officer. Meta has forecast that its first-quarter revenue, which is made up mostly of advertising, will be from as much as 6% down on the year earlier to possibly up by a mere 2%. The company will report first-quarter earnings on April 26. One ad agency executive said the agency was keeping its ad spending on meta roughly flat compared to last year, while another said it was slightly increasing its spending, end quote. And Spotify is apparently planning to drop its subscription wall around some of its Gimlet podcasts in the coming months. So is this the continued reversal

of Spotify's entire podcasting strategy? Quoting semaphore. Spotify acquired Gimlet for $230 million in the hopes that exclusive access to podcasts like Reply All would bring new subscribers to the streaming service. The shift away from using exclusive podcasts to acquire subscribers marks the end of that experiment, though it's good news for the fans who can now listen anywhere. While Gimlet's podcasts were exclusive to the platform, some other podcasts and companies under the Spotify umbrella are not, including shows from the sports and pop culture company The Ringer. As Semaphore reported earlier this year, Ringer founder Bill Simmons personally lobbied Spotify CEO Daniel Eck against putting the podcast company's shows behind a strict exclusivity window.

argued that the ringer would miss out on the advertising revenue on other platforms, which was growing in areas such as sports gambling, and quote. And finally today, in his usual weekend newsletter, Mark German had some details on what to expect from Apple's WWDC this year. According to Mark, the new mixed reality headset is still coming, is still scheduled to debut at WWDC, though the actual release of the product might still be delayed. But also, maybe we can expect one of the biggest updates to the Apple Watch software, maybe ever. Quoting Mark. The Mixed Reality headset will be the star of the show, but the annual conference will be packed with other products too. That includes new Mac laptops and the biggest update to the Apple Watch's software since the first version

was introduced in 2015, I'm told. Altogether, the company is planning to unveil the reality headset, the first major new Apple product category in nearly a decade, a new XROS operating system and software development kit for that headset, new MacBooks, iOS 17, iPadOS 17, MacOS 14, and a major watchOS 10 update. The updated versions of iOS and iPadOS aren't likely to offer major new features, unlike last year's software, which ushered in a new lock screen. But they should satisfy a checklist of user requirements with more minor improvements. I'm also not expecting major MacOS or TVOS changes. The new Apple Watch operating system, however, will bring bigger enhancements, including an updated interface. With the reality headset,

Apple is preparing for a future beyond the iPhone and iPad. I'm told the device will come with a clear story for developers in terms of how they'll want to use it, and much of the week-long conference will showcase the headset's onboard App Store for accompanying tools. The headset is unlikely to go on sale for several months after its unveiling, giving developers time to create mixed-reality apps and services. When Apple previously intended to introduce the headset in March, the idea was to release it publicly in September. With the debut now coming in June and recent production hiccups potentially slowing the process, I now believe that Apple will be happy just to get it out in time for the holidays. Moving on to the Mac, Apple has several new models in the works,

a 15-inch MacBook Air, an updated 13-inch MacBook Air, an entry-level 13-inch MacBook Pro, a refreshed 24-inch iMac, the first Mac Pro with in-house chips, and updated high-end MacBook Pro models, and all of these should go on sale either this year or in early 2024. There are also two Mac Studio follow-ups planned, but that timing is less clear. At least some of the new laptops will be announced at WWDC, I've been told, but there's a big caveat. The models coming in June probably won't boast major new M3 chips. Instead, they'll run something in line with the current M2 processors. New Mac models in this vein started showing up in developer test logs this past week. That includes what appears to be a larger MacBook Air. The logs show machines running chips with an eight-core

CPU split between four high-performance cores and four efficiency cores, and a 10-core graphics processor. They also include 8 gigabytes of memory. The new machines can't arrive quickly enough. Apple suffered a more than 40% drop in Mac shipments last quarter, its steepest decline in more than 22 years. The watchOS update will tell you most of what you need to know about the Apple Watch in 2023. That's because hardware changes are expected to be minimal, so the operating system upgrade will be the focus. Apple's iPad OS17 will lay the software groundwork for revamped iPad Pro models coming next year with OLED displays and iOS 17 will cause some noise beyond WWDC itself. Apple is working to overhaul the software to open up the iPhone to sideloding, the downloading

of apps outside of its official store, to comply with new European regulations by next year, end quote. So first up, thanks to Jack for filling in for me ably. last week. Amazing job by him as always. And yeah, the Ireland trip. It was great and amazing. And if you followed my Twitter account, you saw some pretty pictures from Ireland. I think people telling stories about their vacation is usually a boring thing to do. So I'll spare you generally, except for this one story. We ran into President Biden over there, almost literally. First day we got to our hotel in Dublin, we saw police putting up barricades on the street outside the hotel. but since the hotel was across the street from a major concert venue,

Bob Odenkirk was playing there this weekend. We saw him in the hotel lobby. We thought maybe the barricades were because of that for some reason. Maybe Bob Odenkirk is huge in Ireland, but then the next day there were like 30 cops milling about, and the barricades were getting larger. In fact, they had started blocking off our street. That day, we tried to go to Dublin Castle, but it was closed,

and a shopkeeper told us, yeah, It's closed because your President Biden is coming this week and they're going to have dinner there. So at that point we thought, cool, the president's coming, but we didn't think he was coming to our hotel, at least not yet. Well, the day after that, it was clear he was staying at our hotel. There were, no exaggeration, hundreds of police outside all of a sudden. The whole street was closed off. The night before, we couldn't even use our Apple Maps to guide us back to our hotel because Apple Maps said the hotel no longer existed. the whole address had been taken offline.

We were driving down to Kilkenny for two days in the middle of the week, so we actually figured fine. The president's coming, but we'll miss him. So that's kind of sad, but also maybe kind of good for us. And indeed, the two days in Kilkenny, we saw on the news the president's visit. We figured he'd be gone by the time we came back Friday night. But then Friday night, we're driving back to the hotel. It's like 9 p.m.

It's dark out. The road is still blocked off. But we drove up to the security gate. We got out to have the car checked by bomb sniffing dogs and go through the metal detectors. We were used to that at this point because we'd done it several times. But again, we were still assuming Biden was gone. No. Suddenly, we're in the security tent, remember, they're all like, quick, quick, quick, get out.

Get your car out of here. Back up. You're in the way. Move, move, move. So we rush out of the tent, back our car up onto the sidewalk, and boom, the entire presidential motorcade comes rushing out right past us. The Beast, the president's car, rushes like almost ran this over. I saw President Biden's profile in the window of the car. Max being on the passenger side of the car was like three feet away from the president as he passed.

So we didn't get to meet Biden or anything like that, but that was our brush with the president. If he was five minutes late to that appearance in county mail, which you might have seen video of over the weekend, it is entirely the fault of the McCullough family being in his way briefly. Anyway, fun times. Glad to be back. Talk to you tomorrow.