Tech Brew Ride Home - Wed. 01/02 - What would I have to pay you to give up Facebook for a year?

Episode Date: January 2, 2019

Today, Roku is quietly a major combatant in the Streaming Wars, Tesla slashes prices, how many cameras can we fit on a smartphone, how much would it cost to convince you to quit Facebook, and why Bandersnatch might just be the beginning of the choose your own adventure trend. Sponsor: Mealime.com (iOS App) (Android App) Links: Activision Plans to Fire CFO Neumann, Puts Him on Paid Leave (Bloomberg) ROKU BREAKS FREE FROM BOXES AND TVS (Wired) Tesla slashes EV prices by $2,000 to offset reduced tax credits (Engadget) [Exclusive] Nokia 9 PureView Penta-camera Phone Revealed in Full Glory in First-ever Promo Video (Mysmartprice) Economists calculate the true value of Facebook to its users in new study (ArsTechnica) Popsugar's Twinning app was leaking everyone's uploaded photos (TechCrunch) HOW THE SURPRISE NEW INTERACTIVE BLACK MIRROR CAME TOGETHER (Wired) 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 Mem Ride Home for Wednesday, January 2nd, 2019. I'm Brian McCullough today. Roku is quietly a major combatant in the streaming wars.

Tesla is slashing prices. How many cameras can we fit on a smartphone? How much would it cost to convince you to quit Facebook? And why Bandersnatch might just be the beginning of the Choose Your Own Adventure trend. Here's what you miss today in the world of tech. Odd little bit of executive musical chairs here. Netflix confirmed this morning that it has hired Spencer Newman as its new chief financial officer. Newman was the CFO most recently, a video game company Activision Blizzard.

Now here's where it gets funny. Activision Blizzard apparently fired Newman just this past Monday, saying Newman was fired for cause, but for reasons not related to the company's financial performance. So that's a bit odd firing someone because their jumping ship to another job. Recode is reporting that Activision Blizzard is pissed that Newman was poached while he was still under contract at Activision Blizzard.

Poaching is something apparently that Netflix has been known to do in the past. In fact, Netflix has been sued over that very practice by both 21st Century Fox and Viacom. At his new position at Netflix, Newman replaces David Wells, who held the CFO role at Netflix for 14 years. And obviously, the CFO role is super important at a company like Netflix that is trying to balance the cash flow and billions of dollars of debt that it has taken on in order to finance the $12 to $13 billion. It is plowing each and every year into the

development of exclusive content. Goldman Sachs projects Netflix could spend as much as $22.2.5 billion on content production per year by 2022. Note that this year, 2018, Netflix will probably only do a little under 12 billion in revenue. So there is some juggling for a CFO to do there. And speaking of streaming, perhaps an overlooked player in the streaming wars, is Roku. I think we have covered this before, but Roku is not just about making little hardware boxes anymore. It is now all about streaming content and making money via ads on its Roku channel.

Well, news today that the Roku channel is adding premium subscriptions with networks including Showtime, Stars, and Epics. And more than that, Roku is apparently making a play at being a standalone works on any device platform. Starting at the end of this month, the entire Roku channel catalog will be available to subscribers on the Roku app for iOS or Android. You'll be able to basically watch Roku whether or not you have a physical Roku device. though a Roku subscription is still required. Quoting Wired Magazine, Roku had already set loose the Roku channel on desktop this past summer, but the app represents a larger opportunity.

Roku's Android offering alone has been downloaded over 10 million times, according to its Google Play Store listing. In December, it consistently ranked among the top 10 free entertainment apps in the iOS App Store per app analytics company, AppTopia. Rather than having to establish, a new destination for streaming content, it can simply fill up its existing mobile watering holes, end quote. At the time of this recording, Tesla shares are trading down around 7% after a somewhat disappointing report that Tesla released on its vehicle delivery numbers. Quoting from Engadgett, the company reported that it delivered 90,700 electric cars in the fourth quarter of 2018, including 63,150 Model 3 units, 13,500 Model S units,

and 14,050 Model X units. That's 8% better than the previous all-time high, but CNBC reported that analysts had been expecting more due to promised improvements to production rates, end quote. Also possibly concerning to traders, Tesla announced that it is slashing prices on its vehicles by about $2,000. Why the price cut?

Well, remember that tax credit that you used to be able to claim when you bought an electric vehicle. With the new year, that tax credit has begun to sunset. So Tesla is dropping prices to try to make up for some of that. Teslas are now $2,000 cheaper, but that still doesn't quite make up for the original $7,500 tax credit that you used to get. Get ready, everybody, because CES and Mobile World Congress are nigh upon us,

so we're about to get a flood of product announcements and leaks. The Nokia 9 Pureview smartphone is getting a jump on the competition, though perhaps not intentionally. A promo video of the new flagship Nokia device has leaked, and this Android 1 smartphone looks to be sporting an 18 to 9 aspect ratio on a 6-inch display. We'll reportedly pack a Snapdragon 845 mobile platform, allow for key wireless charging, an in-screen fingerprint sensor, and wait for it. five rear-facing cameras. Yes, it looks like 2019 will not only be the year of bendable phones, but also the year that device makers will keep adding cameras to phones until we reach some as-of-yet-unknowable level of absurdity.

As Anand Jane tweeted, The number of rear-facing cameras on a phone are the new gigahertz. A few stories now from over the long New Year's lull. A bunch of economists did some research using auctions to find out what it would take to entice users to deactivate their Facebook account for a year. Turns out the magic number is around $1,000. This is sort of a neat academic economics question, really. The researchers were trying to figure out the true value of Facebook as a service. Not the price you would pay for Facebook, not the stock market valuation of Facebook.

Facebook. Here's one of the researchers, Sean Cash, quoted in Ars Technica, quote, the value you place on something isn't what you pay for it. It's what you would be willing to pay, said cash. For instance, if your favorite bottle of wine usually costs $15 and you walk into the store one day and the price has gone up to 17, you might be willing to pay that higher price because the wine brings you joy. But if you keep raising that price, eventually it will get sufficiently high that you will decide not to buy your favorite bottle after all. In Akano speak, this is the maximum willingness to pay. The difference between those two amounts is a good indication of how much you value that bottle of wine, the consumer surplus. Facebook doesn't generate the typical

kinds of economic measure we would normally use to evaluate a company's value, and yet it's consistently valued very high, said another researcher, Jay Corrigan. We're trying to look at its value to society, specifically to the users. That's not something you can easily measure in dollars and cents, so instead of asking subjects what they'd be willing to pay for the service, they flipped it around and asked what they would have to be paid to stop using Facebook, end quote. The researchers set up a series of auctions, actually what is called a second price auction in which you're asked to bid on something, but are assured you will only have to pay the second lowest bid, Quoting from Ars Technica again, in one auction involving college students,

the average bid to deactivate one's Facebook account for a single day was $4.17. For three days, it was $13.89, and for one week it was $37. Extrapolate that out to a year, and you get a range of $1,11 to $1,908. In a second auction that included Midwestern adults as well as students, the students required an average of $2,076 to deactivate their accounts for a year, while the adults only needed $1,139. A third auction conducted online using the Amazon Mechanical Turk found that the participating adults required, on average, $1,921 to quit for a year, end quote. Although, given those numbers on average, the auctions kept coming back to around $1,000 as the minimal price people would accept to forgo Facebook for a calendar year.

the researchers stressed that that does not mean that Facebook could actually start charging people a thousand dollars a year. In fact, that's what I found particularly fascinating about this research. In a way, Facebook can't actually capture the true value of their service. Quoting, again, the researcher Corrigan, as much value as it is creating for Facebook and its shareholders, it appears to be creating even more value for its users, Corrigan said. most of the value from its platform is actually going towards the users of the platform rather than to Facebook shareholders, end quote. As several people on Twitter noted, given Facebook's market cap, each of Facebook's 2 billion plus users is currently valued at around $175.

So in essence, there is an uncounted $2 trillion surplus in value created by Facebook. Or as the great Noah Smith tweeted, this study provides some support to the idea. that social media creates a huge consumer surplus, and therefore that free online services really do represent a form of hidden economic growth, end quote. Over the holidays, you also might have noticed everyone posting those twinning photos where people uploaded their selfies to see what celebrity, the algorithm, said they looked like most. The tool was put up by Pop Sugar, who said, quote,

It analyzes a selfie or uploaded photo compares it to a massive data. of celebrity photos to find matches and finally gives you a twinning percentage for your top five lookalikes, end quote. But I guess it wouldn't have been 2018 if this popular sort of parlor game didn't come with a neat little data leak. All of those selfies that people uploaded for a time they were completely accessible from a public AWS storage bucket. The address of that bucket was in the code on the twinning tools website. And before they locked down the bucket, anyone could see the real-time stream of photos being uploaded. As TechCrunch's Zach Whitaker said, in the grand scheme of data leaks, this one wasn't major.

I mean, these weren't passwords or social security numbers or anything like that. But as Whitaker says, quote, like any free app quiz or some viral web tool, it's worth reminding that you're still putting your information out there and you can't always get it back. worse, you almost never know how secure your data will be or how it will end up being used and abused in the future, end quote. So PSA for 2019, as ever, there's no such thing as a free lunch and no viral social media game is without its downsides. And finally, Bander Snatch, that new episode of Black Mirror that you might have enjoyed over the last couple of days. It was indeed a Choose Your Own Adventure episode. It was also pretty good as Black Mirror episodes go,

though weirdly, doesn't it feel to you like the Black Mirror formula is getting a little predictable at this point? I did think, though, it had a decent vibe, though the attention to detail about looking and feeling like the 80s wasn't exactly perfect. That wasn't an 80s house that those guys were living in. Those weren't 80s clothes, a lot of them. No one really gets the 80s feel as perfectly spot on as stranger things does, in my opinion. Although that Tucker Soft logo did look exactly like the Microsoft logo from the era, so points there. Anyway, how did Netflix make the multifaceted, choose-your-own-adventure, multi-stream narrative happen?

Turns out, it was 18 months in the making. The last link in the show notes is a link to a wired piece that explains the entire saga of how this pioneering new way of narrative storytelling came to fruition. Turns out that the producers and screenwriters used Twine, a video game programming language, as well as Scrivener, Final Draft, and various note-taking tools to keep all of the various story threads together. Netflix also built its own tool called Branch Manager because each choice viewers are presented with in Bander Snatch needed to create a cascade of cause and effect throughout the entire story chain. There's a spine of the story. There's a spine of the story.

that we all experienced in Bander Snatch, but chances are only a small percentage of people actually saw the exact same story that you did. Quoting from Wired, The magic of combinatorial math means that there are technically more than a trillion paths through the story, though in reality the number is much smaller, but much smaller is still pretty huge.

There are five main endings with multiple variants of each. Though upon reaching an ending, Netflix will also helpfully bring you back to pivotal decision points so you can ease your FOMO and try the path not traveled, end quote. And guess what? Expect to have choose your own adventure experiences like this again soon because Netflix is really excited about this technology. Netflix's head of product Todd Yellen says in the Wired Piece, we're just beginning to scratch the surface of the kinds of stories that can be

told in this way. We'd love to see an interactive wacky comedy. We'd love to see an interactive horror film. We'd love to see an interactive romance where you choose the prom date that you want to go with. I mean, there's all kinds of great potential stories that are out there, end quote. You know, one of the raps on the universe of content out there on the so-called golden age of television in the explosion of streaming services is that the general broad mainstream audience has so completely been fractured that we're all basically in our own little silos of interest. nowadays. The days where everyone sat down to watch the same must-see TV shows on Thursday night are long, long in the past. But forget not watching the same shows together anymore.

Perhaps in the near future, even if we watch the same episode, we might know two of us have even the exact same narrative experience. Well, I don't know how it was for you, but today was the weirdest feeling Monday ever, at least for me, especially because it was, in fact, Wednesday and not Monday. Nobody felt like they were really back in the swing of things yet. But it did feel good to get back in the swing of things for this pod. As always, I've been your host, Brian McCullough. Follow me on Twitter at Brian MCC by my book.

It's called How the Internet Happened. Follow our friend and occasional guest host, Chris Higgins, at Chris Higgins. and follow the TechMeme editors as they post headlines in real time at TechMeme. Talk to you tomorrow.