This Week in Apps: YouTube TV cancels Apple’s rev share, more bad news for mobile voting, WhatsApp hits 2B users

Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all.

The app industry is as hot as ever, with a record 204 billion downloads in 2019 and $120 billion in consumer spending in 2019, according to App Annie’s recently released “State of Mobile” annual report. People are now spending 3 hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.

In this Extra Crunch series, we help you keep up with the latest news from the world of apps, delivered on a weekly basis.

This week, we look at YouTube TV’s decision to stop revenue-sharing with Apple, another mobile voting app with serious flaws, new Apple launches in coding and AR, Microsoft’s game-streaming service Project xCloud arrival on iOS and other notable app news and trends, including WhatsApp’s big 2 billion user milestone, and more.

Headlines

YouTube TV fights back against Apple’s cut of in-app subscription revenue

This week, YouTube emailed customers subscribed to its YouTube TV service by way of Apple’s in-app purchases to let them know that this subscription offering will be discontinued starting on March 13, 2020. Current subscribers will have their subscription canceled automatically on their billing date after March 13, the letter said.

This is a pretty severe way for Google to end its subscription revenue-sharing with Apple, however. Most companies that decide to shut off in-app subscriptions still continue to honor those from existing subscribers — they just stop selling to new customers. In YouTube TV’s case, it’s actually ending its relationship with all its customers on Apple devices with the hope they’ll return and resubscribe. That’s quite a risk, given that YouTube TV is not the only streaming TV service out there, and customers getting their subscription canceled may take this opportunity to shop around. The timing is also poorly thought-out, given that YouTube TV just picked up new subs following Sony’s PlayStation Vue shutdown — and now it’s kicking them out.

The move makes Google the latest company to rebel against Apple’s 30% cut of all in-app payments (which drops to 15% in year two). A growing number of app publishers are refusing to share a cut of their revenue with Apple — even saying that Apple’s decision to charge this fee is anti-competitive. For example, Spotify believes Apple’s fee makes it more difficult to compete with Apple’s built-in music service, and has raised the issue repeatedly to regulators. Netflix also stopped paying the “Apple tax” over a year ago.

Mobile voting app Voatz, used by several states, was filled with security flaws

Above: Voatz, via The NYT

Last week, we looked at how a smartphone app meant to tabulate votes from the caucuses really screwed things up in Iowa. This week, MIT researchers took a look at mobile voting app Voatz, which has been used to tally votes for federal elections in parts of West Virginia, Oregon, Utah and Washington as part of various mobile voting pilot programs. The researchers found the app was riddled with security flaws that would let attackers monitor votes or even change ballots or block them without users’ knowledge. Attackers could also create a tainted paper trail, making a reliable audit impossible — despite Voatz’s promise of using blockchain technology to increase security. One security expert, speaking to VICE, called the app “sloppy” and filled with “elementary” mistakes.

Coming on the heels of the Iowa caucus mobile voting disaster, this latest news delivers another huge blow to the promise of mobile voting in the U.S.

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Apple expands “Quick Look” to let retailers sell things directly in augmented reality

That couch you’re thinking about sure would look good in your living room… or would it?

To drag up a decade (!) old catchphrase: there’s an app for that. There’s a ton of apps for that, really. Seeing what furniture might look like in a room is one of the go-to examples of what augmented reality is good for, and there’s no shortage of retailers doing it in their apps.

But when you’ve already got someone interested in making a purchase and poking around the item in, say, Safari, getting them to stop and download an app is kind of a big ask.

With cases like that in mind, Apple introduced a feature in 2018 that baked the “See this thing, but in your room!” concept right into iOS/iPad OS.

Called “Quick Look“, it allows for instant/one-tap AR experiences right within the apps the user already has, like Safari, Messages, Mail, etc. The retailer provides the 3D model (as a USDZ, a file format built in collaboration with Pixar), and Apple taps ARkit to render it as it would appear in the real world, handling everything from scaling to lighting and shadows.

At first, though, Quick Look was really just for that — looking. You could look at an item in AR, but that was about it.

Apple is expanding upon the concept a bit, allowing developers to bring a customizable button into the mix. It could be a purchase button, triggering an Apple Pay prompt on the spot. Or it can be wired up to do just about any other single action a retailer might want. It could initiate a customer support chat, to let a customer ask about color options — or it could point them to local retailers who have it in stock so they can see it in person.

Apple is also quietly rolling support for spatial audio into Quick Look in the latest developer builds of iOS and iPad OS, allowing these 3D models to emanate sound — like, say, the bleeps and bloops of a toy, or music from a speaker — from wherever they’ve been virtually placed in the room. Move around the room, and the sound should shift accordingly.

Bringing more of the user experience directly into the built-in AR tool may seem like  a small move, but it’s an interesting one. In 2018, Houzz CEO Adi Tatarko said that users of their AR tools were 11x more likely to make a purchase. Build.com found that people who checked an item out in AR were 22% less likely to return it. There are clearly benefits to AR in the mobile purchasing process — but the whole thing only works if it’s easy to use, quick, and feels native. The more friction there is in the mix, the more people will drop out along the way.

Apple first previewed the feature at WWDC last year; this week, a handful of big retailers — Home Depot, Wayfair, Bang & Olufsen, and 1-800-Flowers – are rolling out their implementations. If improved sales/return numbers like the aforementioned hold true here, I’d expect it to become fairly commonplace across major retailers… and just like that, AR takes one big step closer to the mainstream.

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Will Apple, Facebook or Microsoft be the future of augmented reality?

Tim Merel Contributor

Tim Merel is managing director of Digi-Capital.

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Apple is seen by some as critical to the future of augmented reality, despite limited traction for ARKit so far and its absence from smartglasses (again, so far). Yet Facebook, Microsoft and others are arguably more important to where the market is today.

While there are more AR platforms than just these companies, they represent the top of the pyramid for three different types of AR roadmap. And while startup insurgents could make a huge difference, big platforms can exert disproportionate influence on the future of tech markets. Let’s see what this could mean for the future of AR.

 

Facebook: The messaging play

Facebook has talked about its long-term potential to launch smartglasses, but in 2020, its primary presence in the AR market is as a mobile AR platform (note: Facebook is also a VR market leader with Oculus). Although there are other ways to define them, mobile AR platforms can be thought of as three broad types:

1. messaging-based (e.g. Facebook Messenger, Instagram, TikTok, Snapchat, Line)
2. OS-based (e.g. Apple ARKit, Google ARCore)
3. web-based (e.g. 8th Wall, Torch, others)
   
   
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Google’s Gboard introduces Emoji Kitchen, a tool to mash up emojis to use as stickers

If you’re ever felt like there just weren’t enough emoji options to express how you’re feeling, a new addition to Google’s Gboard keyboard, launching today, aims to help. Gboard for Android is introducing a feature called “Emoji Kitchen” which allows users to mash up different emoji then use them as stickers when messaging.

The stickers will work across apps, including Gmail, Messages by Google, Messenger, Snapchat, Telegram, WhatsApp, and others.

For example, you could add glasses to the various smiley emoji, add a cowboy hat to a ghost, have a robot cry tears, put a monkey face on a cactus (idk either), make the happy poop emoji express love with a heart, and so on.

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To be clear, you can’t just mash up any of the thousands of emoji with any other one — it only works with those Google supports, which are mainly variations on the smileys. That’s because the emoji aren’t being mashed up in real-time through some sort of A.I. system. Instead, Google designers have created this set of mashups for Gboard, specifically.

To use the option, you first tap on any smiley emoji and Emoji Kitchen will show which mashups are available to you.

Google’s Gboard has long been an experimental app for trying out new ideas in self-expression, including with launches like its own set of personalized emoji, called Emoji Minis, as well as with features like doodling, Morse code input, emoji suggestions and GIFs, and others in years past.

The app has been well-received by Android users, as a result — despite being years old, it’s still in a top 50 app in the Tools category and has over a billion downloads worldwide to date. It’s also now the default keyboard on some Android devices, like Google’s Pixel smartphones.

However, Google’s larger goal with Gboard is to make it compelling enough for users to keep it installed, giving the company a way to bring Google’s properties, like Search, directly to the end-user. That’s more important than ever at a time when mobile search has become bigger than desktop. Unfortunately for Google, mobile search has been much more expensive,  as the company now relies on deals with mobile device makers, like Apple, to make its search engine the default.

Gboard gives Google another way to hedge its bets — by skipping the need to use a browser app to get to Google. Users can just use their keyboard instead.

Google says Emoji Kitchen rolls out today to Android users.

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Siri will now answer your election questions

Apple’s built-in voice assistant won’t help you figure out who to vote for, but it will be able to update you on different races around the U.S. during election season as well as deliver live results as votes are counted. The new feature, announced today, is part of Apple News’ 2020 election coverage, which also includes a series of curated news, resources, and data from a variety of sources, with the goal of serving users on both sides of the political spectrum.

With the added Siri integration, you’ll be able to ask the assistant both informational queries, plus those requiring real-time information.

For example, you may ask Siri something like “When are the California primaries?,” which is a more straightforward question, or “Who’s winning the New Hampshire primaries?,” which requires updated information.

 

Siri will speak the answers to the question in addition to presenting the information visually, which makes the feature useful from an accessibility standpoint, too.

The live results are being delivered via the Associated Press, Apple says. The company is also leveraging the AP’s real-time results in its Apple News app in order to give county-by-county results and a national map tracking candidate wins by each state primary, among other things.

As it has done in previous years, Apple’s news editorial team has added special coverage of the U.S. election to its app, by working with news partners. This year, Apple’s coverage comes from news organizations inducing ABC News, CBS News, CNN, FiveThirtyEight, Fox News, NBC News, ProPublica, Reuters, The Los Angeles Times, The New York Times, The Wall Street Journal, The Washington Post, TIME, USA Today and others.

In Apple News, readers are able to learn about candidates and their positions, track major election moments — like the debates, conventions, and Super Tuesday — and stay on top of election news and analysis all the way through election night in the U.S. and the subsequent presidential inauguration. A partnership with ABC News announced in December will also bring video coverage, including real-time streams, into the app.

The Siri feature draws on Apple News for its answers and offers a link to “Full Coverage” in the Apple News app, if you want to learn more.

The feature appears to still be rolling out. In tests, Siri was able to answer some questions but defaulted to web results for others, as before. A staggered rollout is standard for Apple launches, however, as new features take time to reach all users.

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FTC to examine every acquisition by Alphabet, Amazon, Apple, Facebook and Microsoft in 2010-2019 over antitrust issues

Companies like Apple, Amazon and Google do not always disclose every acquisition they make, especially when the companies in question are little fish in the big tech pond. But in aggregate, all that M&A could pose bigger questions about how they are using their financial power and market influence in anticompetitive ways.

That idea is the subject of the latest announcement from the U.S. Federal Trade Commission, which today issued Special Orders to five big tech firms — Alphabet (including Google), Amazon, Apple, Facebook and Microsoft — “requiring them to provide information about prior acquisitions not reported to the antitrust agencies under the Hart-Scott-Rodino (HSR) Act.”

The five companies will need to come clean and report on every deal they have made — whether or not the media has spilled the beans on the acquisition or not — including the terms (that is, price and other financial details), scope, structure and purpose of each transaction made between January 1, 2010 and December 31, 2019.

“The orders will help the FTC deepen its understanding of large technology firms’ acquisition activity, including how these firms report their transactions to the federal antitrust agencies, and whether large tech companies are making potentially anticompetitive acquisitions of nascent or potential competitors that fall below HSR filing thresholds and therefore do not need to be reported to the antitrust agencies,” the FTC said in a notice on the investigation.

The FTC has not ruled out whether it would retroactively do anything around any of those past acquisitions.

“It’s conceivable we could go back,” and level enforcement actions “to deal with transactions,” said FTC Chairman Joe Simons in a press call today.

But it also seems to be educating themselves. In a further statement, the FTC describes how it wants to use the information to better inform its policy, it said, and decide how to reform its policies to fit market practice in a better way.

“The FTC has a statutory right under the HSR Act to review acquisitions and mergers over a certain size before they are consummated, and the study will help the Commission consider whether additional transactions should be subject to premerger notification requirements,” it noted. “The orders will also contribute broadly to the FTC’s understanding of technology markets, and thereby support the FTC’s program of vigorous and effective enforcement to promote competition and protect consumers in digital markets.”

“Digital technology companies are a big part of the economy and our daily lives,” Simons said in a statement. “This initiative will enable the Commission to take a closer look at acquisitions in this important sector, and also to evaluate whether the federal agencies are getting adequate notice of transactions that might harm competition. This will help us continue to keep tech markets open and competitive, for the benefit of consumers.”

Essentially what it will mean is that these smaller deals will need to be reported in the same way that these big companies report larger deals. Up to now, companies do not have to report certain details about deals — or, indeed, the deals themselves — unless they have a material impact on the company, as specified by the Hart-Scott-Rodino Act. (These have incidentally also been modified in the last month to set a slightly higher notification threshold.)

Some, like Apple, have even developed a special stock statement that it will issue in cases where it does come clean on a specific deal when presented with enough evidence of it having happened. “Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans,” it likes to note.

The HSR Act, as it’s known, does leave a lot of wiggle room, where acquisitions, when they are reported, can be noted in the vaguest of terms without a lot of detail as to specific purposes, so it’s not clear what kind of information we will get out of this. Nor is it known just how much of the FTC’s new orders will trickle out as public information.

But the FTC notes that what it will be requiring includes the same kinds of details that are typically requested around HSR, including “information and documents on their corporate acquisition strategies, voting and board appointment agreements, agreements to hire key personnel from other companies, and post-employment covenants not to compete. Last, the orders ask for information related to post-acquisition product development and pricing, including whether and how acquired assets were integrated and how acquired data has been treated.”

Updated with details from the press call.

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Caffeine inks exclusive agreement with Drake preps Ultimate Rap League for launch

Two years after getting a $100 million commitment from 21st Century Fox to build a mobile-based live streaming platform that could compete with Twitch, the startup Caffeine has scored another coup by partnering with the biggest name in music — Drake.

With buying power of Fox (now owned by The Walt Disney Co.), a Murdoch on the board (Lachlan), and an exclusive contract with Drake, Caffeine is hoping to take its streaming service beyond gamers and sports and become the platform for live streaming entertainment of all stripes.

“The combination of the Caffeine platform with a content studio that benefits from Fox Sports’ expertise in live events and programming will help position Caffeine to deliver compelling experiences in esports, video gaming and entertainment,” said Lachlan Murdoch, in a 2018 statement. “We are excited to partner with Caffeine and build something special for fans in the growing live social streaming esports and gaming space.”

The multi-year collaboration with Drake, terms of which were not disclosed, will debut with the launch of Ultimate Rap League, a battle rap platform which was distributed on its own app as well as through YouTube.

As part of the deal Caffeine will live stream and co-produce new rap battles alongside Ultimate Rap League. It’s the first property that Drake ad Caffeine are jointly bringing to market and presages other live events and content that Drake will shepherd to production, the company said.

“I’ve always loved URL and admired what Smack and his team have been able to create, it just wasn’t accessible. It’s exciting to be in a position where I’m able to bring Caffeine to the table and help provide URL with the tools they need to elevate the viewing experience and make it more accessible to fans,” said Drake in a statement.

Drake has a history with SmackURL. He was called out to battle rap on the platform back in 2015, but declined to show.

Initially created by Troy “Smack White” Mitchell as an event series in New York’s Queens borough, home of hip-hop artists Nas, Run-DMC, LL Cool J, Mobb Deep, and A Tribe called Quest, the Ultimate Rap League boasts a roster of boosters including Busta Rhymes, Q-Tip, Joe Budden, Jay-Z, Beanie Sigel, Kid Capre, Lupe Fiasco, Mos Def and Method Man. 

“We are proud to partner with Drake and support him as he brings his vision and channel to life,” said Ben Keighran, Caffeine’s founder and chief executive, in a statement. “As a platform, Caffeine gives Drake the freedom to pursue his creative ideas and we are excited about the whole slate of fresh content that he will share with his communities.”

Keighran, a former wunderkind product designer at Apple, has grounded Caffeine’s pitch in the technology that the company has developed from its Silicon Valley headquarters to stream live video. The company boasts that its streams are 15 seconds to a minute faster than other streaming platforms. In addition, the company prides itself on its moderation technologies and use of human moderators to ensure a zero-tolerance policy for bullying, hate speech and racism, the company said.

Caffeine bases its appeal to artists on a revenue share model that is more generous than other streaming platforms like Twitch or Mixer — a model based on in-app purchases and tipping.

Drake may be the biggest artist to join the Caffeine platform, but he’s far from the only one. The company’s roster of talent includes the musicians Offset and Doja Cat, athletes like JuJu Smith-Schuster, Collin Sexton, and Kyle Kuzma and gamers including Cartoonz, Ohmwrecker and Crainer.

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