Snapchat continued to shrink in Q3 2018 but its business is steadily improving. Snapchat’s daily active user count dropped again, this time by 1 percent to 186 million, down from 188M and a negative 1.5 percent growth rate in Q2. User count is still up 5 percent year-over-year, though. Snapchat earned $298 million in revenue with an EPS loss of $0.12, beating Wall Street’s expectations of $283 million in revenue and EPS loss of $0.14, plus a loss of a half a million users.
Snap entered earnings with a $6.99 share price, close to its $6.46 all-time low and way down from its $24 IPO opening price. Snap lost $325 million this quarter compared to $353 million in Q2, so it’s making some progress with its cost cutting. That briefly emboldened Wall Street, which pushed the share price up 8.3 percent to around $7.57 right after earnings were announced.
But then Snap’s share price came crashing down to -9.3 percent to $6.31 in after-hours trading. The stock had been so heavily shorted by investors that it only needed modest growth in its business for shares to perk up, but the fear that Snap might shrink into nothing has investors weary. Projections that Snap will lose users again next quarter further scared off investors.
Worringly, Snapchat’s average revenue per user dropped 12.5 percent in the developing world this quarter. But strong gains in the US and Europe markets grew global ARPU by 14 percent. Snap projects $355 million to $380 million in holiday Q4 revenue, in line with analyst estimates.
In his prepared remarks, CEO Evan Spiegel admitted that “While we have incredible reach among our core demographic of 13- to 34-year-olds in the US and Europe, there are billions of people worldwide who do not yet use Snapchat.” He explained that the 2 million user loss was mostly on Android where Snapchat doesn’t run as well as on iOS. Noticibly absent was an update on monthly active users in the US and Canada. Snap said that was over 100 million monthly users last quarter, probably in an effort to distract from the daily user shrinkage. The company didn’t update that stat, but did say the “over 100 million” stat was still accurate.
Spiegel had said in a memo that his stretch goal was break-even this year and full-year profitability in 2019. But CFO Tim Stone said that “Looking forward to 2019, our internal stretch output goal will be an acceleration of revenue growth and full year free cash flow and profitability. Bear in mind that an internal stretch goal is not a forecast, and it’s not guidance.”
During the call, Spiegel responded to questions about the Android overhaul’s schedule saying, “Quality takes time. We’re going wait until we get it right”. But analysts piled on with inquiries about how Snap would turn things around in 2019. He admitted Snaps created per day had dropped from 3.5 billion to 3 billion per day, but tried to reassure investors by saying over 60% of our users are still creating snaps every day.
Spiegel said that expanding beyond the 13 to 34-year-old age group in the US and Europe, plus scoring more users in the developing world via the improved Android app would be how it restores momentum. But the problem is that courting older users could sour the perception of its younger users who don’t want their parents, teachers, or bosses on the app.
Now down to $1.4 billion in cash and securities, Snap will need to start reaching more of those international users or improving monetization of those it still has to keep afloat without outside capital.
An Uphill Battle
Q3 saw Snapchat’s launch its first in-house augmented reality Snappable games, while plans for an third-party gaming platform leak. The Snappable Tic-Tac-Toe game saw 80 million unique users, suggesting gaming could be the right direction for Snap to move towards.
It launched Lens Explorer to draw more attention to developer and creator-built augmented reality experiences, plus its Storyteller program to connect social media stars to brands to earn sponsorship money. It also shut down its Venmo-like Snapcash feature. But the biggest news came from its Q2 earnings report where it announced it’d lost 3 million users. That scored it a short-lived stock price pop, but competition and user shrinkage has pushed Snap’s shares to new lows.
Snapchat is depending on the Project Mushroom engineering overhaul of its Android app to speed up performance, and thereby accelerate user growth and retention. Snap neglected the developing world’s Android market for years as it focused on iPhone-toting US teens. Given Snapchat is all about quick videos, slow load times made it nearly unusable, especially in markets with slower network connections and older phones.
Looking at the competitive landscape, WhatsApp’s Snapchat Stories clone Status has grown to 450 million daily users while Instagram Stories has reached 400 million dailies — much of that coming in the developing world, thereby blocking Snap’s growth abroad as I predicted when Insta Stories launched.. Snap Map hasn’t become ubiquitous, Snap’s Original Shows still aren’t premium enough to drag in tons of new users, Discover is a clickbait-overloaded mess, and Instagram has already copied the best parts of its ephemeral messaging. Snap could be vulnerable in the developing world if WhatsApp similarly copies its disappearing chats.
At this rate, Snap will run out of money before it’s projected to become profitable in 2020 or 2021. That means the company will likely need to sell new shares in exchange for outside investment or get acquired to survive.
Google introduces Pixel Pass, an all-in-one subscription combining phones and premium services – TechCrunch
Alongside the launch of the new Google Pixel 6 smartphones, the company also introduced a new way to purchase them: Pixel Pass. This all-in-one subscription service allows consumers to purchase a Pixel phone for a low monthly price, rather than paying for it all upfront. The service is available at $45 per month for the Pixel 6 and $55 per month for the Pixel 6 Pro — but it doesn’t just provide access to the phones themselves. Also included with the subscription are Google’s services, like storage, music, YouTube Premium and free apps and games.
Specifically, subscribers will have access to ad-free YouTube, aka YouTube Premium, typically $11.99 per month. This includes YouTube Music Premium, the company’s answer to Spotify and Apple Music, and its replacement for Google Play Music, which was wound down.
Pixel Pass subscribers will also get 200 GB of cloud storage with Google One, Google Store discounts and Google Play Pass — the otherwise $4.99 USD per month or $29.99 per year subscription, which offers a free selection of apps and games without in-app purchase or ads, similar to Apple Arcade.
The subscription additionally includes insurance, with Preferred Care coverage for hassle-free repairs and “life’s little accidents,” says Google. This is Google’s version of something like AppleCare for Apple devices.
The Pixel devices that ship with Pixel Pass are unlocked so they work with all major carriers.
Consumers can buy the service through the Google Store or with a phone plan on Google Fi, the company’s own cell service, Google says.
By paying for Pixel Pass as a subscription, device owners would save up to $294 over the course of two years, Google notes. But if they purchase through Google Fi, you’ll also save an additional $4 off your monthly Fi plan, equaling $414 in savings over the two years.
The subscription is designed for regular updaters who like to always carry the latest devices, but also want access to premium services. It’s clearly aimed to be the Google alternative to Apple’s own iPhone subscription plan, via the iPhone Upgrade Program. But while Apple offers its own set of subscription services separately through its newer Apple One subscription plans, the Pixel Pass bundles them in.
The new Pixel Pass with Pixel 6 is available for preorder today in the U.S. starting at $45 per month on the Google Store or via Google Fi.
Google’s brand new Android 12 operating system launches today – TechCrunch
With Android 12, the world’s most-used mobile operating system continues its steady march of carving out its unique selling points and finding differentiators from Apple’s iOS. Available for Pixel 3 and beyond, the new OS beefs up some of the strengths in the operating system, while adding some new features along the way.
When everyone has a phone that looks essentially like every other smartphone ever made, personalization becomes more important. That’s why Google brings the Material You feature to the OS – when you change your wallpaper, the entire Android 12 experience changes to match its colors. The OS includes color extraction algorithms which helps everything looks integrated and slick. Everything is personalizable, including the lockscreen, notifications, settings, widgets and even apps. Material You comes to Pixel first, and will be rolled out to devices from other device makers further down the line.
Security and privacy are other themes across the OS. For example, Android 12 enables you to keep your precise location private from apps that, strictly, only need an approximate location to work their magic. You can also see when an app is using your mic or camera, with a new status-bar indicator. And if you want to turn off your camera and mic across the entire OS, you can turn them off in the Quick Settings with a pair of new toggles. The OS also adds additional features to lock down apps you’ve forgotten about, by automatically revoking permissions from apps after several months of lack of use.
The OS also finally divorces the connection between location and Bluetooth. As Google puts it: “While your wireless headphones need to connect to your phone, they probably don’t need to know where you are.” Android 12 makes that possible at long last.
Google introduced a ton of new Android features for Google Lens in previous releases of the OS – you can do optical character recognition on any screen shot, for example. Android 12 adds additional extensions to that functionality, such as ‘scrolling screen shots.” Just because you reach the end of your screen doesn’t mean you need to reach the end of your screenshot. New scrolling screenshots will allow you to capture all the content on the page in one image. Clever!
The new features extend beyond functionality; Android 12 also brings power-saving and better accessibility features. The company is also rolling out hot-updates, so you can keep using an app even while an update for the very same app is downloading and installing in the background. God forbid you’d have to put down Pokemon Go for a couple of minutes.
Google’s Android 12 operating system is rolling out to supported phones starting today.
Google’s Pixel 6 camera smartens up snapshots with AI tools – TechCrunch
Google’s latest flagship phones have an impressive set of automated, AI-powered tools to help make your photos look better, with smart blurs, object removal, and skin tone exposure. While we’ll have to test them out to see if they work as advertised, they could be useful for everyone from pixel peepers to casual snapshot takers.
The new cameras themselves are pretty impressive to start with. The main rear camera, shared by the Pixel 6 and Pixel 6 Pro, is a 50-megapixel beast with decent-sized pixel wells and an F/1.85 equivalent aperture (no, it doesn’t capture as much light as an F/1.8 on a DSLR, but it’s still good). The ultrawide one, also shared, is 12 megapixels and f/2.2 on a smaller sensor, so don’t expect mind-blowing image quality. The 6 Pro gets a 48-megapixel telephoto with less low light capability but a 4x equivalent zoom. They’re all stabilized and have laser-assisted autofocus.
Basically if you want the best quality in any situation, stick to the main camera, but if you’re sure about your light go ahead and fire up the wide or zoom. It sounds like all the new camera features work on all the cameras, but generally speaking the better the shot to start with, the better the final result.
The simplest tool to use is probably “face deblur.” How many times have you gotten the perfect shot but it’s not quite sharp? The Pixel Camera will automatically always capture multiple exposures (it’s part of the ordinary process of taking a picture now), and combines the main shot from one camera with a clear shot of the face captured with another. To do it, you just tap on a shot in your gallery that isn’t quite sharp and if there’s a “face deblur” option: boom.
OK, it’s definitely kind of weird to have only the face sharp in a blurry photo, as you can see in the sample, but look: do you want the picture or not? Thought so.
Also in the blur department are two new “motion modes.” One is an “action pan” that assists in capturing a moving subject like a passing car clearly, while blurring the background “creatively.” That means it applies a directed zoom blur instead of the handheld blur it would normally have, so it looks a little ‘shoppy, if you will, but it’s a fun option. The other one is a long exposure helper that adds blur to moving subjects while keeping the background clear. Helpful for doing something like headlight streaks without a tripod. These will be found in their own motion mode area in the camera app.
“Magic Eraser” is the most obviously “AI” thing here. If you take a picture and it’s great except someone just walked into the background or there’s a car parked in the scenic vista, it’ll help you zap those pesky real-world objects so you can forget they ever existed. Tap the tool and it’ll automatically highlight things you might want to remove, like distant people, cars, and according to the example they provided, even unsightly logs and other random features. Driftwood, though, on the beach…really? Fortunately you can pick which to throw in the memory hole, no pressure, or circle unrecognized objects and it will do its best to dispose of them.
“Speech Enhancement” isn’t for images, obviously, but when you’re in front camera mode you can opt to have the device tone down the ambient noise and focus on your voice. Basically Krisp by Google. If it works anywhere near as well you will probably want to use it all the time.
“Real Tone” is an interesting but potentially fraught feature that we’ll be looking into in more detail soon. Here’s how Google describes it: “We worked with a diverse set of expert image makers and photographers to tune our AWB [auto white balance], AE [auto exposure], and stray light algorithms to ensure that Google’s camera and imagery products work for everyone, of every skin tone.”
Basically they wanted to make sure that their “smart” camera’s core features don’t work better or look better on certain skin tones than others. This has happened many, many times before and it’s an insult and embarrassment when billion-dollar companies blow it over and over. Hopefully Real Tone works, but even if it does there is the fundamental question of whether it amounts to lightening or darkening someone’s skin in the photo — a sensitive matter for many people. “This feature cannot be turned off nor disabled,” Google says, so they must be confident. We’ll be testing this and talking with developers and photographers about the feature, so look for a deeper dive into this interesting but complex corner of the field.
It’s not entirely clear how many of these features will be available beyond the Pixel line of phones or when, but we’ll let you know what we find out.
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