Tech Brew Ride Home - Tue. 07/18 – Checking In With Threads

Episode Date: July 18, 2023

It’s been… two weeks. Let’s check in on how Threads is doing. Streaming players continue to raise prices. Microsoft still plans on fighting for its prize. Are the incumbents winning the AI race? And the interesting startup that wants to use light instead of electricity in computer chips. Sponsors: Notion.com/ride Links: The spam bots have now found Threads, as company announces its own ‘rate limits’ (TechCrunch) Five reasons Threads could still go the distance (Platformer) Peacock to raise its subscription prices on August 17 (TechCrunch) Microsoft-Activision Deal Poised to Close Later Than Planned (Bloomberg) Wix’s new tool can create entire websites from prompts (TechCrunch) UK chip designer raises millions from Agnelli fund (FT) 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 TechMame right home for Tuesday, July 18th, 2020. I'm Brian McCullough today. It's been almost two weeks.

Let's check in on how Threads is doing. Streaming players continue to raise prices. Microsoft's still plans on fighting for its prize are the incumbents winning the AI race and the interesting startup that wants to use light instead of electricity in computer chips. Here's what you miss today in the world of tech. Let's check in on threads. Let's do a thread on threads. According to similar web, threads usage has dropped by half after its initial surge.

Dow's were 49 million in its first week, and that's now down to 23.6 million more recently. And guess what? Threads seems to be having a problem that might sound familiar. Adam Masseri says that spam attacks on threads have picked up, so meta is tightening things like rate limits, and is warning of, quote, unintentionally limiting active people. Quoting TechCrunch. It looks like Twitter isn't the only one having to turn to rate limits or limits on how many posts users can view. It's an amusing turn of events.

Twitter's latest rival Instagram threads announced this afternoon that it, too, has to tighten up on rate limits due to spam attacks. Laughed Twitter owner Elon Musk in a reply to a screenshot of the announcement posted on Twitter. LMAO copycat. cat emoji, end quote. Instagram head, Adam Maseri, explained the problem in a post on the Threads app this afternoon, noting that spam attacks have picked up so we're going to have to get tighter on things like rate limits, which is going to mean more unintentionally limiting active people false positives. If you get caught up in those protections, let us know, end quote.

In other words, the most prolific threads users may face limits on their ability to use the app and view posts. However, unlike Twitter's hard limits on viewable posts, Miseri is suggesting that people reach out if they start to experience this problem. That sounds like the Threads team is prepared to work with legitimate users to not negatively impact their experience. In the replies to most series announcement, several people are complaining that comment spam on the platform has gotten significantly worse in recent days, with one person even remarking that half their posts were seeing a response from bots like gambling-related bots or bait messages. Another complaint they

were wasting half their time blocking bots pushing gambling and crypto. sites. Without getting bots and spam under control, threads will be in the same boat as Twitter, copycat indeed, end quote. To which, in his platformer newsletter, Casey Newton yesterday wrote this, quote, I feel compelled to offer some early thoughts on why I believe threads is on its way to fully supplanting Twitter in the role that that company once played in shaping public conversation. One, threads proved decisively the demand for a new text-based conversation app. Until this month, it was unclear that tens of millions of people even wanted something Twitter-like in their lives. Twitter itself has been in a period of steep decline and the various clones that have sprung up in its wake

have stalled out in the low millions of users. That threads attracted so many downloads in so short a period offers compelling evidence that lots of people have been waiting for a company to do public conversations the right way. Two, threads immediately attracted the sort of high-profile user base that made Twitter so addictive for so long. Within days, my feed was populated with posts from athletes like Shaquille O'Neal, journalists like Katie Couric and Ezra Klein, and comedians like Kathy Griffin. They brought an instant legitimacy to threads that rivals like Mastodon never quite cracked. Other Twitter clones, particularly the decentralized ones, have struggled to persuade people that they aren't just for nerds. Threads never had that problem. Three, Instagram can serve as a long-term growth driver for threads.

One of the most impressive things about the threads launch was how it connects to Instagram. A badge on your Instagram profile lets everyone know how early you join threads, spurring others to race to create accounts of their own. And from the start, threads could be shared two Instagram stories with a couple of taps, bridging the two apps together in a smart and useful way. As both apps evolve, I expect we'll see many more touches like this, with each leveraging its own strengths to promote the other. Four, meta still has many other growth levers it can pool, many of which simply involve building basic features the user base has already requested. It will soon let users post and browse from the desktop, for example. It will let users browse a feed of post created only by users they follow, a must for news junkies.

Once it works through various data privacy issues, threads will come to the European Union, with its hundreds of millions of potential users. It's a good sign for meta that EU citizens are so intent on using it. The company has had to block them at the VPN level. Meta will also be able to promote threads across its family of apps in ways both expected and not. What happens once public figures on Facebook can add their most recent threads post to their pages? I bet we'll find out. Five.

Twitter's deterioration continues to accelerate. Ad revenue is down by 50% according to Elon Musk, and despite the company choosing not to pay many of its bills, the company is losing money. Rate limits continue to make the site unusable to many free users and even some paid ones. Spam is overwhelming users' direct messages so much that the company disabled open DMs to free users. The company has lately been reduced to issuing bribe-like payouts to a handful of handpicked creators, many of whom are aligned with right-wing politics. If that's not a death spiral, what is? In Puck, William Cohen has written persuasively that Twitter could soon be subject to involuntary bankruptcy. And while that could be in Musk's financial interests, making billions of dollars in debt disappear, the resulting chaos seems unlikely to restore the site to its former usability, end quote.

Given yesterday's streaming conversation, especially how it ended, interesting to note that Peacock is raising its premium price by $1 to $5.99 per month and premium plus by $2 to $11.99 a month. It's doing this immediately for new customers and on August 17th for current subscribers, quoting TechCrunch. The reason for the change the company claims is so it can continue to invest in providing high-quality content and user experience. The price hike will also allow Peacock to remain competitive in the marketplace given rivals like Netflix and Macs are charging upwards of $1999 a month. Last year, Apple TV Plus raised its subscription cost to $6.99 per month. Plus, Paramount Plus recently upped its ad plan to $5.99 a month and its new ad-free tier, Paramount

Plus with Showtime, to $11.99. While Peacock will be the same price as Paramount Plus, the streaming service doesn't exactly have dozens of Showtime originals to boast about. However, the streamer does tout its live sports offerings, which it calls the largest of any direct-to-consumer streaming service in the U.S. with over 5,000 hours of content. This includes the Women's World Cup, Saturday Night Football, Premier League, Big Ten, and more, end quote. Yes, it is the soccer, which is why I'm likely to be a Peacock subscriber for the foreseeable future. Something, something, live sports as the current vector for streaming. Sources are saying that Microsoft and Activision Blizzard do plan to keep

seeking the final regulatory approvals for their $69 billion deal, despite that deal not closing by the deadline which was today. Quoting Bloomberg. The potentially missed deadline underscores the sway held by regulators in the UK, one of the biggest markets for Microsoft and Activision Games and consoles. The CMA is concerned the deal would reduce competition and innovation and give gamers fewer options. Microsoft, which embarked on the deal 19 months ago to become a stronger gaming company with a foothold in mobile games has had to make compromises, agreeing to give rivals Sony and Nintendo access to Activision's Call of Duty games. The merger agreement set July 18th as the date at which both companies could walk away

with Microsoft bound to pay Activision $3 billion if the acquisition is terminated. The companies could proceed under the current deal, which would allow Activision to walk away at any time. They could also seek to amend the agreement, though doing so would open the possibility of changes to financial terms. U.K. Regulators vetoed the deal in April amid concerns about its impact on the cloud gaming market. A May 5th order bars the companies from closing the purchase, even though it has now received government approval in 39 countries. The CMA has so far maintained its veto while negotiations continue. A violation of the U.K. order would lead to fines of up to five percent of the company's combined global revenue. British enforcers could opt to change

their order to allow Microsoft and Activision to close outside the UK while keeping the company separate inside the country. The UK discussions are expected to take several days or weeks to resolve, and the CMA has officially extended its target date on the probe to August 29, although officials have said they aim to conclude earlier. In another positive step for the deal, a British antitrust tribunal judge provisionally agreed on Monday to pause an appeal case targeting the CMA's initial veto, lifting another obstacle toward a new UK decision. He said, the court had been gifted with new circumstances that showed, quote, the game has moved on, end quote.

One of the things a lot of people have noticed about the AI space, at least so far, is kind of that the incumbents are winning, at least for now. I mean, that, of course, with the likes of Microsoft and Meta and Google, at least all at first seeing all the action accrue to them. But also, like, this at least has not yet been a case of a thousand nimble AI startups rising up and doing what the incumbents do, but better with AI. On the contrary, the incumbents seem to be scrambling just as nimbly to incorporate AI into what they already do well. Case and point. I've seen a million use AI prompts to create a website from scratch, no-code required startups for the ride

home fund, like literally a million. There's tons of them out there. But why couldn't incumbents do that? There's no reason. And so, case in point, Wix has debuted AI Site Generator, a tool that can create websites from chat prompts including e-commerce scheduling, food ordering, and event-ticking components. Quoting TechCrunch. AI Site Generator might be Wix's most ambitious AI experiment to date, but it's not the company's first. Wix's recently launched Text Creator Taps ChatGPT to give users the ability to generate personalized content for particular sections of a website. Meanwhile, it's AI template text creator generates all the text for a given site. There's also the AI domain generator for

brainstorming web domain names, which sits alongside Wix's suite of AI image editing, fine-tuning, and creation tools. The way Avishay Abrahami, Wix's co-founder and CEO, tells it, Wix isn't jumping on AI because it's the Silicon Valley darling of the moment. He sees the tech as a genuine way to streamline and simplify the process of building back-end business functionality, infrastructure, payments, capabilities, and more for customers' websites. To Abraham's point, small businesses in particular struggle to launch and maintain sites, potentially causing them to miss income opportunities. A 2022 survey by top design firms, a directory for finding creative agencies, found that nearly 27% of small businesses still don't

have a website, and that low traffic followed by adding advanced functionalities and cost are the top challenges they face with their websites. AI site generator takes several prompts, any descriptions of sites, and uses a combination of in-house and third-party AI systems to create the envisioned site. In a chatbot-like interface, the tool asks a series of questions about the nature of the site and business attempting to translate this into a custom web template. ChatGPT generates the text for the website while Wix's AI, the site design, and images. Other platforms like Speedy Brand, which TechCrunch recently profiled, already accomplished something like this. But Wix claims that AI site generator is unique in that it can build in e-commerce, scheduling,

food ordering and event ticketing components automatically, depending on a customer's specs and requirements. Customers aren't constrained to AI site generator's designs, a not-so-suttle acknowledgement that AI isn't at the point where it can replace human designers, assuming it ever gets there. The full suite of Wix's editing tools, both manual and AI-driven, is available to AI site-generator users, letting them make tweaks and changes as they see fit. New capabilities focused on editing will arrive alongside AI Site Generator, too, like an AI page and section creator that'll enable customers to add a new page or section to a site simply by describing their needs. The forthcoming object eraser will let users extract objects from images and manipulate them,

while the new AI assistant tool will suggest site improvements, e.g. adding a product or changing a design, and create personalized strategies based on analytics and site trends, end quote. Finally today, an interesting raise. Leeds UK-based chip designer Optalysis, which is developing optical chips that use light instead of electricity to perform calculations has raised a 21 million pound series A, quoting the Financial Times. The 10-year-old company is developing technology in the field of silicon photonics. Optical chips that use light instead of electricity to perform calculations. This groundbreaking technology is particularly suited to new kinds of encryption that its creators say will allow more private and secure data sharing between companies and countries. Optical chips

are seeing an uptick in investment as the semiconductor industry grapples with slower advances and rising costs with each new generation of traditional silicon processors. As the cadence of innovation underpinned by Moore's Law, which for decades held that the number of transistors packed on a chip would roughly double every two years, begins to break down, semiconductor designers and manufacturers are having to go to greater lengths to meet ever-growing demand for computing power. By radically accelerating processing speeds without a commensurate increase in energy consumption, Optalysis co-founder and chief executive Nick New claims the technology can power a new level of encryption that is able to withstand hacking attempts from even quantum computers.

Our vision is to become the Nvidia for this kind of encryption and secure processing, said New, referring to the success of the California-based company's accelerator chips empowering a wide range of new artificial intelligence applications. Researchers have been warning that in the coming years, large-scale quantum computers will be able to overpower the cryptography algorithms that applications, that applications from online payments to private messaging apps have relied upon for decades igniting a race to develop post-quantum encryption. Optalysis's accelerator chips will power a new kind of encryption technology that allows

data to be processed without having to unlock it first. It is working with partners including Google and IBM on fully homomorphic encryption, which promises to allow encrypted data to be processed in the cloud and across untrusted networks. This will enable data sharing between organizations while preserving privacy for customers in sensitive sectors such as health care and financial services. The concept of fully homomorphic encryption is not new, but the computing power required has made it prohibitively expensive to run on traditional data center infrastructure. Optalysis is targeting skilled at production of its

chiplet processors in around three years. For a semiconductor company at this stage, quote, a round of this size in Europe is quite exceptional, said Tom Van Hoot, partner at iMEC.Expand. there are not that many companies in Europe of this size and ambition, he said, end quote. Yes, my little AI side project, I think, is getting close to testing. Of course, I thought it was going to be ready before the fourth, but you know how these things go. Anyway, anyone want to sign up to alpha test it for me? The nature of the product is such that I need to see how it behaves for multiple different users. I can't have it be one size fits all.

If you want to help me alpha test it before I throw it out into the world for strangers, to beta test, send me an email at Brian at Techmeme.com and put the words AlphaTest in the subject line. The testing should take you all of 15 minutes, but your feedback will be invaluable. We'll hopefully do the testing later this week or this weekend. So if you're interested, email me, Brian at Techmeme.com, and put AlphaTest in the subject line.