Facebook doesn’t want its hardware like Oculus or its augmented reality glasses to be at the mercy of Google because they rely on its Android operating system. That’s why Facebook has tasked Mark Lucovsky, a co-author of Microsoft’s Windows NT, with building the social network an operating system from scratch, according to The Information’s Alex Heath. To be clear, Facebook’s smartphone apps will remain available on Android.
“We really want to make sure the next generation has space for us,” says Facebook’s VP of Hardware, Andrew ‘Boz’ Bosworth. “We don’t think we can trust the marketplace or competitors to ensure that’s the case. And so we’re gonna do it ourselves.”
By moving to its own OS, Facebook could have more freedom to bake social interaction — and hopefully privacy — deeper into its devices. It could also prevent a disagreement between Google and Facebook from derailing the roadmaps of its gadgets. Facebook tells TechCrunch the focus of this work is on what’s needed for AR glasses. It’s exploring all the options right now, including potentially partnering with other companies or building a custom OS specifically for augmented reality.
One added bonus of moving to a Facebook-owned operating system? It could make it tougher to force Facebook to spin out some of its acquisitions, especially if Facebook goes with Instagram branding for its future augmented reality glasses.
Facebook has always been sore about not owning an operating system and having to depend on the courtesy of some of its biggest rivals. Those include Apple, whose CEO Tim Cook has repeatedly thrown jabs at Facebook and its chief Mark Zuckerberg over privacy and data collection. In a previous hedge against the power of the mobile operating systems, Facebook worked on a secret project codenamed Oxygen circa 2013 that would help it distribute Android apps from outside the Google Play store if necessary, Vox’s Kurt Wagner reported.
That said, its last attempt to wrestle more control of mobile away from the OS giants in 2013 went down in flames. The Facebook phone, built with HTC hardware, ran a forked version of Android and the Facebook Home user interface. But drowning the experience in friends’ photos and Messenger chat bubbles proved wildly unpopular, and both the HTC First and Facebook Home were shelved.
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Now Facebook is hoping to learn from past mistakes as it ramps up its hardware efforts with a new office for the AR/VR team in Burlingame, 15 miles north of the company’s headquarters. The 770,000-square-foot space is designed to house roughly 4,000 employees. Facebook tells TechCrunch the team will move there in the second half of 2020 to make use of its labs, prototype space and testing areas. The AR/VR team will still have members at other offices across California, Washington, New York and abroad.
TechCrunch asked for more info about the space, and Facebook revealed that it’s planning to open a public-facing, experiential space — possibly the first Facebook-branded permanent location that anyone can visit. There, people will be able to come play with its augmented reality and virtual reality products. Those could range from the Oculus Quest headsets and Facebook Portal smart displays it currently sells to potential future products like the camera glasses it’s reportedly building with Ray Ban-maker Luxottica and eventually its full-fledged AR eyewear.
Facebook says it’s considering building true retail space into the Burlingame office to let people try and then buy its hardware products. This would be a significant first step toward self-branded Facebook retail spaces in the vein of Apple and Microsoft’s stores.
Interested in potentially controlling more of the hardware stack, Facebook held acquisition talks with $4.5 billion market cap semiconductor company Cirrus Logic, which makes audio chips for Apple and more, The Information reports. That deal never happened, and it’s unclear how far the talks went given tech giants constantly keep their M&A teams open to discussions. But it shows how serious Facebook is taking hardware, even if Portal and Oculus sales have been slow to date. Facebook declined to comment on the matter.
That could start to change next year, though, as flagship virtual reality experiences hit the market. I got a press preview of the upcoming Medal of Honor first-person shooter that will launch on the Oculus Quest in 2020. An hour of playing the World War II game flew by, and it was one of the first VR games that felt like you could enjoy it week after week rather than being just a tech demo. Medal of Honor could prove to be the killer app that convinces gamers they have to get a Quest.
Facebook has also been working on hardware experiences for the enterprise. Facebook Workplace video calls can now run on Portal, with its smart camera auto-zooming to keep everyone in the board room in frame or focused on the action. The Information reports Facebook is also prototyping a VR videoconferencing system that Boz has been testing with his team. Facebook tells TechCrunch that Boz hosted two internal events where he videoconferenced through VR to about 100 of his team leaders using virtual Q&A software Facebook is prototyping internally. It’s hoping to learn what would be necessary to consistently hold meetings in VR.
The hardware initiatives, meanwhile, feed back into Facebook’s core ad business. It’s now using some data about what people do on their Oculus or Portal to target them with ads. From playing certain games to accessing kid-focused experiences to virtually teleporting to vacation destinations, there’s plenty of lucrative data for Facebook to potentially mine.
Facebook tells TechCrunch that Portal currently takes data — like if you log in, make calls or use certain features — to inform ad targeting. For example, it could show you ads related to video calling if you do that a lot. With Oculus, if you connect your Facebook account, then data about apps you use or events you join could be used to tune its algorithms or target ads.
Facebook even wants to know what’s on our mind before we act on it. The Information reports that Facebook’s brain-computer interface hardware for controlling interfaces by employing sensors to recognize a word a user is thinking has been shrunk down. It’s gone from the size of a refrigerator to something hand-held, but is still far from ready for integration into a phone. Facebook tells TechCrunch it’s making progress, improving the word error rate significantly up the state-of-the-art research and expanding the dictionary of words that can be recognized. Facebook can now decode brain activity in real time, and it’s working on an intermediary system for identifying single words as it pushes toward 100 words-per-minute brain typing.
Selling Oculus headsets, Portal screens and mind-readers might never generate the billions in profits Facebook earns from its efficient ads business, but they could ensure the social network isn’t locked out of the next waves of computing. Whether those are fully immersive like virtual reality, convenient complements to our phones like smart displays or minimally invasive sensors, Facebook wants them to be social. If it can bring your friends along to your new gadgets, Facebook will find some way to squeeze out revenue while keeping these devices from making us more isolated and less human.
Snapcommerce raises $85M to make over your mobile shopping experience – TechCrunch
People are not only shopping digitally more than ever. They’re also shopping using their mobile phones more than ever.
And for mobile-first companies like Snapcommerce, this is good news.
Snapcommerce, formerly known as SnapTravel, has raised $85 million in what the company is describing as a “Pre-IPO” growth round to help further its mission of “changing the way people shop on their phones.”
The Toronto, Ontario-based startup has built out an AI-driven, vertical-agnostic platform that uses messaging in an effort to personalize the mobile shopping experience and “deliver the best promotional prices.” While it was initially focused on the travel industry, the company is now branching out into other consumer verticals – hence its name change.
Inovia Capital and Lion Capital co-led the new growth round, which included participation from Acrew DCF, Thayer Ventures, Full In Partners as well as existing backers Telstra Ventures and Bee Partners. The financing brings Snapcommerce’s total raised since its 2016 inception to over $100 million. Its last raise — a $7.2 million round from Telstra and NBA star Steph Curry — took place in 2019.
The startup was founded by tech entrepreneurs Hussein Fazal, whose prior company AdParlor grew to $100+ million in revenue, then sold to AdKnowledge back in 2011; and Henry Shi, who previously built uMentioned and worked at Google, where he helped launch YouTube Music Insights, according to previous TechCrunch reporting.
Snapcommerce launched its first, travel-focused product in 2017. It works by using chatbots to interact with customers via messaging apps such as SMS, Facebook and Whatsapp. But the company also has human agents ready to help if people need more assistance, in the past essentially serving as on-demand travel agents.
Its service is not just for hotels and flights, but also to help people book restaurants and activities too.
“Our focus has been on building that personal relationship,” Fazal said. “Many people end up coming back to us when they travel again.” In fact, over 40% of its sales in 2020 came from repeat customers.
Over the years, the company claims to have helped more than 10 million users globally save over $75 million. It expects to cross over $1 billion in total mobile sales this year.
And now it’s ready to branch out into helping consumers save money on goods.
“When shopping, it’s hard to find the right product and even if you do, it’s hard to find a good deal,” he said. “On a desktop, there’s ways around it. But on mobile, it’s virtually impossible.”
The company turned the corner to profitability three months into the pandemic in 2020, seeing a 60% spike in sales in the second half of the year compared to H2 2019, according to CEO Fazal.
It then decided to re-invest its profits to continue growing the business.
“The profitability during the pandemic gave us confidence that we could turn to profitability whenever we needed to and gave us control of our own destiny, which enabled this fundraise,” Fazal told TechCrunch. “The third quarter of 2020 ended up being our greatest quarter ever.”
The COVID-19 pandemic, naturally, only accelerated its growth as more consumers turned to mobile.
“We believe the next wave of power purchasers will be via mobile,” Fazal said. “Some of the new generation don’t even have desktops or laptops, and they spend all their time on their mobile phone and messaging. So we’re able to be at the forefront.”
Snapcommerce has an IPO in its sights although no specific timeline. The company did not reveal its current valuation or hard revenue figures. The company makes money by either marking up prices provided by a merchant or charging the merchant a commission.
Chris Arsenault, partner at Inovia and Snapcommerce lead investor, said his firm “tripled up” on its investment in the startup after witnessing its success in the travel space.
“Other companies out there only care about the transaction, and force consumers to look through several services to see if they got the best price, all the while telling them ‘there’s only 2 seats left,’ ” he told TechCrunch. “We believe that consumers aren’t going to accept that type of pressure-selling in the future. And Snapcommerce’s ability to build trust with its customers and service providers has attracted us to them as they are defining what the future of commerce is going to be like.”
Ultimately, the company plans to use its fresh capital to continue to scale with the goal of streamlining the entire mobile search, purchase and fulfillment process and make finding “the right item at the right price as sending a message to a trusted friend.”
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Square buys majority of Tidal, adds Jay Z to its board in bid to shake up the artist economy – TechCrunch
This morning Square, a fintech company that serves both individuals and companies, announced that it has purchased a majority stake in Tidal, a music streaming service. The deal, worth some $297 million, will Tidal allow artist-partners to keep their ownership in the music company.
Square CEO Jack Dorsey used his other company, Twitter, this morning to explain the deal. Dorsey seemed to expect the transaction to generate skepticism – which it definitely has. In his opening message, he asked a rhetorical question: “Why would a music streaming company and a financial services company join forces?!”
Why indeed. Dorsey’s expectation is that his company can replicate the success of Cash App and other Square products in the world of music. Noting that “new ideas are found at the intersection,” Dorsey argued that the confluence of “music and the economy” is one such point of convergence.
The deal also installs musician and businessperson Jay Z on Square’s board.
Some early reaction to the deal has proved negative. It’s not hard to riff on the seeming-strangeness of Square and Tidal as a pair. And Square has made acquisitions in the past that appeared adjacent and failed to stick. The company bought food-delivery service Caviar in 2014 before selling it to DoorDash in 2019, for example; that Square appears to have made a venture-level return on the transaction is immaterial to the focus argument.
But the bull-case for the Square-Tidal tie-up is easy to make as well. The American fintech just spent a minute fraction of a single percent of its market capitalization on the smaller company, and through its choice to let artists keep their stake, has effectively onboarded a host of ambassadors for its brand.
And Dorsey is not wrong that Square did shake up the commerce game for many offline businesses with its original card reader. Why not take a swing at a part of the economy — music — that has migrated from the physical world to the digital in the past few years, much like small businesses in recent quarters?
Square’s business users, it’s “seller ecosystem,” as it likes to call it, are increasingly digital. In its most recent quarterly earnings report, “in-person only” usage is falling as a percentage of seller gross payment volume (GPV), while “online only” and “omnichannel” GPV are taking up the slack.
Square has a known win in its consumer-focused Cash App service, which reached 36 million monthly actives in December of 2020, up from 24 million in the same period one year prior. You can imagine tie-ups between the music company and the youth-skewing Cash App audience. And having Jay Z at the Square boardroom table will hardly make the company less innovative; he may bring fresh perspective.
And then there’s the question of NFTs, or non-fungible tokens, a new form of digital asset that have recently become the cause célèbre of the cryptocurrency community. Given that Square has a growing cryptocurrency business via Cash App, and has invested hundreds of millions of dollars into bitcoin itself. If there is space in the market for Square to bring music-based NFTs to its larger consumer user base is an interesting question. If the answer is yes, Square could now be in a leading position to create that market.
Perhaps the Square-Tidal deal won’t generate the future growth that Square imagines. But the deal is cheap, snagging Jay Z as a leader is a win, and it’s hard to win by only playing corporate defense.
Twitter Spaces arrives on Android ahead of Clubhouse – TechCrunch
Twitter announced today it’s opening up its live audio chat rooms, known as Twitter Spaces, to users on Android. Previously, the experience was only open to select users on iOS following the product’s private beta launch in late December 2020. The company says that Android users will only be able to join and talk in Spaces for the time being, but won’t yet be able to start their own.
That added functionality is expected to ship “soon,” Twitter says, without offering an exact timeframe.
The company has been working quickly to iterate on Twitter Spaces in the months since its beta debut, and has been fairly transparent about its roadmap.
Last month, the team developing Twitter Spaces hosted a Space where users were invited to offer feedback, ask questions, and learn about what Twitter had in the works for the product in both the near-term and further down the road. During this live chat, Twitter confirmed that Spaces would arrive on Android in March.
It also promised a fix to how it displays listeners, which has since rolled out.
Other Spaces features are being shared in public as they’re designed and prototyped, including things like titles and descriptions, scheduling options, support for co-hosts and moderators, guest lists, and more. Twitter has also updated the preview card that appears in the timeline and relabeled its “captions” feature to be more accurate, from an accessibility standpoint.
The time frame of some of its new developments — like Android and scheduling options — were being promised in a matter of weeks, not months.
This fast pace has now led Twitter to beat its rival Clubhouse — the app currently leading the “social audio” market — to offer support for Android. Today, Clubhouse remains iOS-only in addition to being invite-only.
It’s also indicative of the resources Twitter is putting into this new product, which was first announced publicly just in November. Clearly, Twitter believes social audio is a market it needs to win.
The company also sees the broader potential for Spaces as being a key part of a larger creator platform now in the works. During its Investor Day last week, Twitter spoke of tying together its new products like Spaces, Newsletters along with a “Super Follow” paid subscription, for example.
It’s now also testing a Twitter “Shopping Card” that would allow users to tweets posts that link directly to product pages via a “Shop” button — a feature that would seem to fall under this new creator focus, as well.
But now, a separate beta app won’t be required — when live Spaces are available, they’ll appear at the top of the Twitter timeline for Android users to join.
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