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Apple slowdown: iPhone’s shipments fall in China as gap on Huawei widens

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Apple shipped about three million fewer iPhones to China in Q4 2018 than it did in the corresponding quarter a year ago, according to analyst Strategy Analytics’ estimates. 

Apple shipped 10.9 million iPhones to China in the final quarter of 2018, or 22 percent less than the 14 million it shipped at the end of 2017. For the full year, 2018 iPhone shipments reached 34.2 million units, down from 36.7 million in 2017.  

Overall smartphone shipments in China fell 11 percent year over year, down from 121 million units in Q4 2017 to 108 million units this year. It was the fifth consecutive quarter that smartphone shipments fell in China. 

Full-year smartphone shipments to China declined 11 percent too, down from 460 million in 2017 to 408 million in 2018.  

“The Chinese smartphone market is in recession and has declined for five consecutive quarters. The smartphone market is suffering from longer replacement cycles and weak consumer spending,” says Yiwen Wu, a senior analyst at Strategy Analytics. 

iPhone shipments in China have now fallen year over year for eight of the past 12 quarters, according to Strategy Analytics. 

“Apple is in danger of pricing the iPhone out of China,” said Linda Sui, director at Strategy Analytics.   

SEE: Apple iOS 12: An insider’s guide (free PDF)

Of the top five vendors, only Huawei and Vivo increased shipments in China year over year. Huawei, the top vendor, saw shipments rise from 24.3 million in Q4 2017 to 30 million in Q4 2018, with annual shipments up about 15 million to 105 million. 

Vivo, the third largest vendor in China, shipped 22.2 million in Q4 2018, up from 20.5 million a year ago. 

The top five vendors in descending order in Q4 2018 were Huawei, Oppo, Vivo, Apple, and Xiaomi. However, on a yearly basis Apple was the fifth largest vendor by shipments. 

Apple is scheduled to report its first quarter earnings next Tuesday, which corresponds to the fourth quarter of 2018. Apple recently cut its revenue forecast by up to $9bn on earlier estimates, citing poor sales in China. Apple CEO Tim Cook said the company didn’t foresee the magnitude of China’s slowdown.   

Apple is losing market share in China, according to Strategy Analytics estimates.


Image: Strategy Analytics

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Former head of Facebook app Fidji Simo defends company following whistleblower testimony – TechCrunch

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The former head of the Facebook app, who reported directly to CEO Mark Zuckerberg, Fidji Simo, defended the social network at the start of an interview at the WSJ Tech Live event this afternoon. The exec was there to discuss her new role as Instacart CEO and her vision for the future of food delivery, but was asked to comment on the recent Facebook whistleblower’s testimony and the attention it has since raised.

Simo said she understood the scrutiny given Facebook’s impact on people’s lives. But she’s also worried that Facebook will never be able to do enough to appease its critics at this point, despite the complexity of the issues Facebook is grappling with as one of the world’s largest social networks.

“They are spending billions of dollars in keeping people safe. They are doing the most in-depth research of any company I know to understand their impact,” she argued, still very much on Facebook’s side, despite her recent departure. “And I think my worry is that people want ‘yes’ or ‘no’ answers to this question, but really these questions require a lot of nuance,” she added.

While the whistleblower, Frances Haugen, suggested that Facebook’s decision to prioritize user engagement through its algorithms was ultimately putting profits over people, Simo cautioned the choices weren’t quite as binary as have been described to date. She explained that making changes based on the research Facebook had invested in wasn’t just a matter of turning a dial and “all of a sudden, magically problems disappear — because Facebook is fundamentally a reflection of humanity,” she said.

Image Credits: Instacart

Instead, Simo said that the real issues at Facebook were around how every change Facebook makes can have significant societal applications at this point. It has to work to determine how it can improve upon the potentially problematic areas of its business without incidentally affecting other things along the way.

“When we discuss trade-offs, it’s usually trade-offs between two types of societal impacts,” she noted.

As an example, Simo used what would seem like a fairly straightforward adjustment to make: determine which posts make Facebook users angry then show people less of those.

As Haugen had testified, Facebook’s algorithms have been designed to reward engagement. That means posts with “likes” and other interactions spread more widely and are distributed higher up in people’s News Feeds. But she also said engagement doesn’t just come from likes and positive reactions. Engagement-based algorithms will ultimately prioritize clickbait and posts that make people angry. This, in turn, can help to boost the spread of posts eliciting stronger reactions, like misinformation or even toxic and violent content.

Simo, however, said it’s not as simple as it sounds to just dial down the anger across Facebook, as doing so would lead to another type of societal impact.

“You start digging in and you realize that the biggest societal movements were created out of anger,” she said. That led the company to question how it could make a change that could impact people’s activism.

(This isn’t quite how that situation unfolded, according to a report by the WSJ. Instead, when the algorithm was tweaked to prioritize personal posts over professionally produced content, publishers and political parties adjusted their posts toward outrage and sensationalism. And Zuckerberg resisted some of the proposed fixes to this problem, the report said.)

“That’s just a random example,” Simo said of the “anger” problem. “But literally, on every issue, there is always a trade-off that is another type of societal impact. And I can tell you for having been in these rooms for many, many years, it’s really never about like, ‘oh, are we doing the right thing for society, versus the right thing for Facebook and for profits’…the debate was really between some kinds of societal impact and another kind — which is a very hard debate to have as a private company.”

This, she added, was why Facebook wanted regulations.

“It’s not surprising that Facebook has been calling for regulation in this space for a very long time because they never want to be in a position of being the ones deciding which implications, which ramifications, which trade-offs they need to make between one type of societal impact and another type of societal impact. The governments are better positioned to do that,” she said.

Given the increasing amount of evidence coming out that Facebook itself understood, through its own internal research, that there were areas of its business that negatively impact society, Simo didn’t chalk up her departure from the social network to anything that was going on with Facebook itself.

Instead, she said she just wasn’t learning as much after 10 years with the company, and Instacart presented her with a great opportunity where she could learn “a different set of things,” she said.

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Facebook scales back its crypto ambitions once again – TechCrunch

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Facebook is launching a small pilot of its cryptocurrency wallet named Novi. A limited number of people in the U.S. and Guatemala can sign up to Novi and start using it.

Facebook is a founding member of the Diem Association. Instead of taking advantage of the association’s stablecoin (Diem) on the association’s blockchain (the Diem network), the company is partnering with Paxos and Coinbase to let users send and receive USDP, with Coinbase managing crypto custody. But this is just an intermediate step as Facebook still plans to replace USDP with Diem at some point.

Facebook originally had big plans for its crypto project. The company created a consortium of companies called the Libra Association. Together, they were supposed to launch the Libra cryptocurrency, a brand new currency tied to a basket of fiat currencies and securities. Originally, it wouldn’t be based on a single real-world currency, but on a mix of multiple currencies.

But Facebook faced strong opposition from many central banks — they feared that Libra would become a quasi-sovereign currency in some countries. Last year, the association announced that it would reduce its ambitions by focusing on single-currency stablecoins.

A stablecoin is a crypto asset with a fixed value that doesn’t fluctuate over time. For instance, the Libra Association wanted to launch the LibraUSD. One LibraUSD would always be worth one USD.

A few months later, the Libra Association announced some changes once again. The project was rebranded to the Diem Association. Similarly, Facebook’s wallet project was rebranded from Calibra to Novi. But neither Diem nor Novi were ready for prime time.

And now, Facebook is going to start testing Novi with some real users. The company is focusing on remittance between the U.S. and Guatemala. Novi users who want to send money can download the Novi app, create an account and add money using a payment method, such as a debit card.

Whenever you add USD, your money is converted to USDP without any fees. USDP is a stablecoin tied to USD created by Paxos. It used to be called the Pax Dollar (PAX), but Paxos recently rebranded it to USDP.

Behind the scenes, USDP is backed by cash and cash equivalents to ensure its value. User funds are managed by Coinbase Custody, meaning that Coinbase stores USDP funds for Novi users.

Novi users can then send USDP to other Novi users. Once again, there are no fees involved with money transfers. But chances are you can’t use Novi to pay in store or pay your rent. That’s why users can withdraw their Novi balance at a cash location, or transfer their balance to a bank account.

But Novi doesn’t say if there are fees involved when you convert your USDP to Guatemalan quetzal. So we’re back to square one, as Novi has to pick an exchange rate, which involves spread, liquidity and other variables. Novi also has to create fiat-to-crypto on-ramps and off-ramps across all markets where it wants to operate.

Facebook says that this is just the beginning for Novi. First, it is only available as a pilot for some users in Guatemala and the U.S. (except Alaska, Nevada, New York and the U.S. Virgin Islands). Second, Facebook and the Diem Association haven’t shelved plans to launch their own cryptocurrency at some point.

“I do want to be clear that our support for Diem hasn’t changed and we intend to launch Novi with Diem once it receives regulatory approval and goes live. We care about interoperability and we want to do it right,” Novi project lead David Marcus said on Twitter.

Facebook unveiled the Libra cryptocurrency in June 2019. The crypto ecosystem has changed drastically since then. In particular, some stablecoins have become incredibly popular — Tether and USD Coin have a combined circulating supply of more than $100 billion right now. So it’s going to be interesting to see if Diem can catch up with existing stablecoins and unlock some new use cases.

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Instagram is adding ‘Collabs,’ new music features for Reels, desktop posting and more – TechCrunch

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Instagram today announced a number of new features that will roll out this week across both the Instagram Feed and its TikTok competitor, Reels. The creator-focused additions will allow users to collaborate with one another, raise funds, and make better use of music on Reels, among other things. The company will also make its Instagram desktop website more usable, by allowing people to finally be able to post both photos and videos under one minute in length using their desktop web browser.

The latter has been a long-requested new feature, the company notes, and will become available to global audiences as of Thursday, October 21.

The company had previously tested the feature this summer, but it was not widely available.

Image Credits: Instagram

The other new features will drop throughout the week, starting today with “Collabs.”

Instagram describes this feature as a “test,” explaining that it will allow people to co-author both Feed posts and Reels. To do so, users can invite another account to be a collaborator from the tagging screen on Instagram. If the other person accepts, both accounts will appear in the post or the Reels header and content will be shared to both sets of followers. Although Instagram is only announcing the test today, many Instagram users have already spotted the feature in the app, as the company began a small-scale global test of this feature back in July.

At the time, Instagram said only a small number of people would have access to the feature, and it didn’t indicate when it would roll out more broadly.

When two creators choose to collab, the post or Reel will appear on both their Profile Grids and it will have a shared view count, like count and comment thread, Instagram says.

On Wednesday, Instagram will also begin to test a new way to create fundraisers for nonprofits, with the introduction of a feature that lets you start the fundraiser directly from the creation button (the “+” plus button at the top right of the screen.). When you tap this option, instead of selecting Post, Story, Reels, or Live, you’ll see an option to select a nonprofit and add the fundraiser to your Feed post.

Instagram has supported fundraisers for some time, even adding support for nonprofit fundraising during livestreams last year. But it hadn’t before offering a way to create a fundraiser from a standalone spot right from your Instagram profile.

This feature had been spotted ahead of this week’s launch by developer and reverse engineer Alessandro Paluzzi, who found the new fundraiser button in development back in September.

Two other new additions are meant to enhance Instagram Reels, when used with music.

On Thursday, Instagram will introduce two new effects called Superbeat and Dynamic Lyrics, which will help creators who edit and perform using music on Reels. Superbeat will intelligently apply special effects to music to the beat of the user’s song while Dynamic Lyrics will display 3D lyrics that will flow with the song’s “groove,” says Instagram.

These new features follow TikTok’s rollout of a half dozen interactive music effects back in April, including several that add visual effects synced the beat of a song. Reels, meanwhile, has offered a much more limited selection of first-party creative effects until now, instead relying on its community to expand its library beyond the basics like a timer or speed adjustment tool, for instance.

The Reels features will arrive alongside posting from the desktop, which Instagram says will be limited to photos and videos under one minute in length. The company this month dropped its IGTV brand for long-form video, but still allows for videos up to 60 minutes.  That’s now just considered “Instagram Video” — a term that includes anything that’s not video in a Story or in Reels.

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