Advertising Tech

AppLovin acquires SafeDK to improve brand safety

Posted by | Advertising Tech, applovin, Fundings & Exits, M&A, Mobile, safedk, Startups | No Comments

Mobile marketing company AppLovin is announcing that it has acquired SafeDK.

While AppLovin started out as a mobile ad business, it now bills itself as “a comprehensive mobile gaming platform,” offering tools for game developers around user acquisition, monetization, analytics and (through Lion Studios, launched last year) publishing. SafeDK, meanwhile, allows developers to manage all the different SDKs on which their apps rely.

Palo Alto-headquartered AppLovin says that by incorporating SafeDK technology, it will help its publishers ensure GDPR compliance and brand safety.

It also says SafeDK will continue to support existing customers, while its headquarters in Herzliya, Israel will become AppLovin’s first office in Israel. Co-founders Orly Shoavi and Ronnie Sternberg will remain on-board as the heads of SafeDK and general managers of AppLovin Israel.

The companies are not disclosing the financial terms of the deal, except to say that it was all-cash. According to Crunchbase, SafeDK has raised a total of $5.8 million from investors, including Samsung Next Tel Aviv, Marius Nacht, StageOne Ventures and Kaedan Capital.

“We are delighted to be working with the AppLovin team to help mobile game publishers grow their businesses,” Shoavi said in a statement. “AppLovin has been a trusted partner for the biggest mobile game studios around the world and SafeDK’s technology will strengthen that trust.”

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File-storage app 4shared caught serving invisible ads and making purchases without consent

Posted by | 4shared, Advertising Tech, Android, app-store, computing, file-sharing, Google Play, instagram, malaysia, mobile software, privacy, Security | No Comments

With more than 100 million installs, file-sharing service 4shared is one of the most popular apps in the Android app store.

But security researchers say the app is secretly displaying invisible ads and subscribes users to paid services, racking up charges without the user’s knowledge — or their permission — collectively costing millions of dollars.

“It all happens in the background… nothing appears on the screen,” said Guy Krief, chief executive of London-based Upstream, which shared its research exclusively with TechCrunch.

The researchers say the app contains suspicious third-party code that allowed the app to automate clicks and make fraudulent purchases. They said the component, built by Hong Kong-based Elephant Data, downloads code which is “directly responsible” for generating the automated clicks without the user’s knowledge. The code also sets a cookie to determine if a device has previously been used to make a purchase, likely as a way to hide the activity.

Upstream also said the code deliberately obfuscates the web addresses it accesses and uses redirection chains to hide the suspicious activity.

Over the past few weeks Upstream said it’s blocked more than 114 million suspicious transactions originating from two million unique devices, according to data from its proprietary security platform, which the company said would cost consumers if they are not blocked. Upstream only has visibility in certain parts of the world — Brazil, Indonesia and Malaysia to name a few — suggesting the number of observed suspicious transactions was likely a fraction of the total number.

Then in mid-April, 4shared’s app suddenly disappeared from Google Play and was replaced with a near-identical app with the suspicious components removed.

At the time of writing, 4shared’s new app has more than 10 million users.

Irin Len, a spokesperson for 4shared, told TechCrunch that the company was “unaware” of the fraudulent ad activity in its app until we reached out, but confirmed the company no longer works with Elephant Data.

Len said the old app was removed by Google “without reason,” but its suspicions quickly fell on the third-party components, which the company removed and resubmitted the app for approval. But because their old app was pulled from Android’s app store, 4shared said it wasn’t allowed to push an update to existing users to remove the suspicious components from their devices.

Google did not respond to TechCrunch’s request for comment.

We sent Elephant Data several questions and follow-up emails prior to publication but we did not hear back.

4shared, owned by New IT Solutions based in the British Virgin Islands, makes a brief reference to Elephant Data in its privacy policy but doesn’t explicitly say what the service does. 4shared said since it’s unable to control or disable Elephant Data’s components in its old app, “we’re bound to keep the detailed overview of which data may be processed and how it may be shared” in its privacy policy.

Little else is known about Elephant Data, except that it bills itself as a “market intelligence” solution designed to “maximize ad revenue.”

The ad firm has drawn criticism in several threads on Reddit, one of which accused the company of operating a “scam” and another called the offering “dodgy.” One developer said he removed the components from his app after it began to suffer from battery-life issues, but Elephant Data was “still collecting data” from users who hadn’t updated their apps.

The developer said Google also banned his app, forcing him to resubmit an entirely new version of his app to the store.

It’s the latest app in recent months to be accused of using invisible ads to generate fraudulent revenue. In May, BuzzFeed News reported similar suspicious behavior and fraudulent purchases in Chinese video app VidMate.

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Facebook squeezes money from Instagram with new ads in Explore

Posted by | Advertising Tech, Apps, Facebook, instagram, instagram ads, Instagram Explore, Media, Mobile, Social, TC | No Comments

Half of Instagram’s billion-plus users open its Explore tab each month to find fresh content and creators. Now the Facebook-owned app will do more to carry its weight by injecting ads into Instagram Explore for the first time. But rather than bombard users with marketing right on the Explore grid, Instagram will instead only show ads after users tap into a post and then start scrolling through similar imagery.

The move feels like a respectful way to monetize Explore without annoying users too much or breaking the high visual quality of the space. Instagram’s director of business product marketing Susan Bucker Rose tells me she believes the ads will feel natural because users already come to Explore “in the mindset of discovery. They want to be exposed to new accounts, people, and brands.”

Instagram Ads In Explore Tab

Instagram will test the ad slots itself at first to promote its ailing IGTV feature before they “launch to a handful of brands over the coming weeks” Rose says. That includes both big name corporations and smaller advertisers looking to drive conversions, video views, or reach. Instagram hopes to roll the ad format out broadly in the next few months.

Advertisers will buy the slots through the same Facebook ads manager and API they use to buy Instagram feed and Stories space. At first advertisers will have to opt in to placing their ads in Instagram Explore too, but eventually that will be the default with an opportunity to opt out.

Here’s how ads work in Instagram Explore. When you open the tab it will look the same as always with a scrollable grid of posts with high engagement that are personalized based on your interests. When you tap into a photo or video, you’ll first see that full-screen. But if you keep scrolling down, Instagram will show you a contextual feed of content similar to the original post where it will insert photo and video ads. And if you tap into one of the themed video channels and then keep scrolling after watching the clip to check out more videos in the same vein, you may see Instagram video ads.

Instagram describes the introduction as “slowly and thoughtfully” — which makes it sound like the volume of ads will ramp up over time.

Explore was first launched in 2012, some two years after Instagram itself, as a merger of the app’s search and “popular” tabs, with an aim of using algorithms that were informed by your existing interests to give you a new way to discover new people and themes to follow in the app beyond those you might pick up by way of you own social circles. It’s had a few revamps, such as the addition of topical channels and hashtags, and the addition of Stories, the format that has proven to be such a hit on Instagram itself. There won’t be any ads in Stories that recently started appearing in Explore.

But interestingly, through all of that, Instagram stayed hands-off when it came to advertising and Explore. The idea is that the content that each person sees in Explore is individualized, with algorithms detecting the kinds of things you like to show you photos, videos and subjects you might most want to see. Apparently Instagram didn’t want to deter browsing of this content.

On the other side of the coin, this has meant that up to now, individuals and brands have not been able to proactively request or pay to be in anyone’s specific Explore tab — although that doesn’t mean that people don’t game this situation (just Google “how to get on Instagram Explore” and you will find many how-to’s to show you the way).

Instagram Explore Ads

The move to bring ads into the Explore experience has some logic to it. Even before monetization made its way to Instagram in the form of feed advertising, shoppable links and sponsored content posted by influencers, brands and businesses had started using the platform to promote products and to connect with customers. Instagram says that today, 80 percent of its users follow at least one business on Instagram. Now instead of trying desperately to game the Explore algorithm, Instagram can just sell businesses space instead.

With Facebook’s News Feed usage in danger as attention shifts to Stories that it’s still learning to monetize, the company is leaning more on Instagram to keep revenue growing. But Instagram must be sure not to suffocate the golden goose with too many ads.

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Target Circle and TapHeaven team up in a mobile marketing merger

Posted by | Advertising Tech, Fundings & Exits, M&A, Mobile, Startups, tapheaven, Target Circle, TC | No Comments

Target Circle and TapHeaven announced they’re merging into a single company under the Target Circle brand.

TapHeaven co-founder and CEO Chris Hoyt, who is becoming chief growth officer at the combined organization, said the two companies have been “trying to solve the same problem” — namely, eliminating many of the inefficiencies in the mobile advertising business.

Hoyt said that for Target Circle, that meant trying to “unify this fragmented ecosystem into a single dashboard for contracts, invoices and offers.” And for TapHeaven, that meant a focus on automation, resulting in the launch of what the company calls a “command center” for user acquisition, where advertisers can optimize their ad campaigns “at the source level, by country” while getting high-quality traffic without fraud.

The companies also complement each other geographically — Target Circle is headquartered in Oslo, Norway, while TapHeaven is headquartered in San Francisco.

According to Hoyt, they first came across each other because they were talking to the same mobile studio about supporting the launch of a new game, and it became clear they “both had the same vision for our businesses, the same future with a unified dashboard wrapped in automation and machine learning to simplify and help the ecosystem perform for these advertisers.”

Target Circle founder and CEO Heiko Hildebrandt will continue to serve as chief executive for the combined companies — in the announcement, he said TapHeaven allows the company to “strengthen and expand its technology in the automation of advertising and fraud prevention and resolution.” Meanwhile, TapHeaven executives Brian Krebs and Jeremy Jones will become CIO and chief of user experience, respectively.

The financial terms of the deal were not disclosed. Moving forward, Hoyt said Target Circle will continue to support its existing products while focusing on the new UA Command Center as “the future of our business.” He also suggested that the platform could help advertisers move away from Facebook and Google, allowing them to get the performance they need from other ad networks.

“What impact this is going to have on the market is really lifting up the rest of the ecosystem,” he said. “I feel like Facebook and Google have had their day, a little bit … With the serious things that are going on with these companies, advertisers are desperate for the answers to where [else] can they spend their money and diversify their portfolio.”

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Alexa, does the Echo Dot Kids protect children’s privacy?

Posted by | Advertising Tech, Amazon, Amazon Echo, Amazon.com, artificial intelligence, center for digital democracy, coppa, Disney, echo, echo dot kids, eCommerce, Federal Trade Commission, Gadgets, nickelodeon, privacy, privacy policy, smart assistant, smart speaker, Speech Recognition, terms of service, United States, voice assistant | No Comments

A coalition of child protection and privacy groups has filed a complaint with the Federal Trade Commission (FTC) urging it to investigate a kid-focused edition of Amazon’s Echo smart speaker.

The complaint against Amazon Echo Dot Kids, which has been lodged with the FTC by groups including the Campaign for a Commercial-Free Childhood, the Center for Digital Democracy and the Consumer Federation of America, argues that the e-commerce giant is violating the Children’s Online Privacy Protection Act (COPPA) — including by failing to obtain proper consents for the use of kids’ data.

As with its other smart speaker Echo devices, the Echo Dot Kids continually listens for a wake word and then responds to voice commands by recording and processing users’ speech. The difference with this Echo is it’s intended for children to use — which makes it subject to U.S. privacy regulation intended to protect kids from commercial exploitation online.

The complaint, which can be read in full via the group’s complaint website, argues that Amazon fails to provide adequate information to parents about what personal data will be collected from their children when they use the Echo Dot Kids; how their information will be used; and which third parties it will be shared with — meaning parents do not have enough information to make an informed decision about whether to give consent for their child’s data to be processed.

They also accuse Amazon of providing at best “unclear and confusing” information per its obligation under COPPA to also provide notice to parents to obtain consent for children’s information to be collected by third parties via the online service — such as those providing Alexa “skills” (aka apps the AI can interact with to expand its utility).

A number of other concerns about Amazon’s device are also being raised with the FTC.

Amazon released the Echo Dot Kids a year ago — and, as we noted at the time, it’s essentially a brightly bumpered iteration of the company’s standard Echo Dot hardware.

There are differences in the software, though. In parallel, Amazon updated its Alexa smart assistant — adding parental controls, aka its FreeTime software, to the child-focused smart speaker.

Amazon said the free version of FreeTime that comes bundled with the Echo Dot Kids provides parents with controls to manage their kids’ use of the product, including device time limits; parental controls over skills and services; and the ability to view kids’ activity via a parental dashboard in the app. The software also removes the ability for Alexa to be used to make phone calls outside the home (while keeping an intercom functionality).

A paid premium tier of FreeTime (called FreeTime Unlimited) also bundles additional kid-friendly content, including Audible books, ad-free radio stations from iHeartRadio Family and premium skills and stories from the likes of Disney, National Geographic and Nickelodeon .

At the time it announced the Echo Dot Kids, Amazon said it had tweaked its voice assistant to support kid-focused interactions — saying it had trained the AI to understand children’s questions and speech patterns, and incorporated new answers targeted specifically at kids (such as jokes).

But while the company was ploughing resource into adding a parental control layer to Echo and making Alexa’s speech recognition kid-friendly, the COPPA complaint argues it failed to pay enough attention to the data protection and privacy obligations that apply to products targeted at children — as the Echo Dot Kids clearly is.

Or, to put it another way, Amazon offers parents some controls over how their children can interact with the product — but not enough controls over how Amazon (and others) can interact with their children’s data via the same always-on microphone.

More specifically, the group argues that Amazon is failing to meet its obligation as the operator of a child-directed service to provide notice and obtain consent for third parties operating on the Alexa platform to use children’s data — noting that its Children’s Privacy Disclosure policy states it does not apply to third-party services and skills.

Instead, the complaint says Amazon tells parents they should review the skill’s policies concerning data collection and use. “Our investigation found that only about 15% of kid skills provide a link to a privacy policy. Thus, Amazon’s notice to parents regarding data collection by third parties appears designed to discourage parental engagement and avoid Amazon’s responsibilities under Coppa,” the group writes in a summary of their complaint.

They are also objecting to how Amazon is obtaining parental consent — arguing its system for doing so is inadequate because it’s merely asking that a credit or debit/debit gift card number be inputted.

“It does not verify that the person ‘consenting’ is the child’s parent as required by Coppa,” they argue. “Nor does Amazon verify that the person consenting is even an adult because it allows the use of debit gift cards and does not require a financial transaction for verification.”

Another objection is that Amazon is retaining audio recordings of children’s voices far longer than necessary — keeping them indefinitely unless a parent actively goes in and deletes the recordings, despite COPPA requiring that children’s data be held for no longer than is reasonably necessary.

They found that additional data (such as transcripts of audio recordings) was also still retained even after audio recordings had been deleted. A parent must contact Amazon customer service to explicitly request deletion of their child’s entire profile to remove that data residue — meaning that to delete all recorded kids’ data a parent has to nix their access to parental controls and their kids’ access to content provided via FreeTime — so the complaint argues that Amazon’s process for parents to delete children’s information is “unduly burdensome” too.

Their investigation also found the company’s process for letting parents review children’s information to be similarly arduous, with no ability for parents to search the collected data — meaning they have to listen/read every recording of their child to understand what has been stored.

They further highlight that children’s Echo Dot Kids’ audio recordings can of course include sensitive personal details — such as if a child uses Alexa’s “remember” feature to ask the AI to remember personal data such as their address and contact details or personal health information like a food allergy.

The group’s complaint also flags the risk of other children having their data collected and processed by Amazon without their parents’ consent — such as when a child has a friend or family member visiting on a play date and they end up playing with the Echo together.

Responding to the complaint, Amazon has denied it is in breach of COPPA. In a statement, a company spokesperson said: “FreeTime on Alexa and Echo Dot Kids Edition are compliant with the Children’s Online Privacy Protection Act (COPPA). Customers can find more information on Alexa and overall privacy practices here: https://www.amazon.com/alexa/voice [amazon.com].”

An Amazon spokesperson also told us it only allows kid skills to collect personal information from children outside of FreeTime Unlimited (i.e. the paid tier) — and then only if the skill has a privacy policy and the developer separately obtains verified consent from the parent, adding that most kid skills do not have a privacy policy because they do not collect any personal information.

At the time of writing, the FTC had not responded to a request for comment on the complaint.

In Europe, there has been growing concern over the use of children’s data by online services. A report by England’s children’s commissioner late last year warned kids are being “datafied,” and suggested profiling at such an early age could lead to a data-disadvantaged generation.

Responding to rising concerns the U.K. privacy regulator launched a consultation on a draft Code of Practice for age appropriate design last month, asking for feedback on 16 proposed standards online services must meet to protect children’s privacy — including requiring that product makers put the best interests of the child at the fore, deliver transparent T&Cs, minimize data use and set high privacy defaults.

The U.K. government has also recently published a whitepaper setting out a policy plan to regulate internet content that has a heavy focus on child safety.

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Takeaways from F8 and Facebook’s next phase

Posted by | Advertising Tech, Apps, artificial intelligence, augmented reality, conference call, data privacy, data security, dating, Developer, eCommerce, Enterprise, Entertainment, events, Extra Crunch Conference Call, Facebook, Facebook Dating, facebook groups, Facebook Marketplace, facebook messenger, Facebook Watch, Gadgets, Gaming, hardware, investment opportunities, marketplace, Media, Oculus, Oculus Quest, Oculus Rift, privacy, Security, Social, Startups, TC, transcript, Venture Capital, Virtual reality, WhatsApp | No Comments

Extra Crunch offers members the opportunity to tune into conference calls led and moderated by the TechCrunch writers you read every day. This week, TechCrunch’s Josh Constine and Frederic Lardinois discuss major announcements that came out of Facebook’s F8 conference and dig into how Facebook is trying to redefine itself for the future.

Though touted as a developer-focused conference, Facebook spent much of F8 discussing privacy upgrades, how the company is improving its social impact, and a series of new initiatives on the consumer and enterprise side. Josh and Frederic discuss which announcements seem to make the most strategic sense, and which may create attractive (or unattractive) opportunities for new startups and investment.

“This F8 was aspirational for Facebook. Instead of being about what Facebook is, and accelerating the growth of it, this F8 was about Facebook, and what Facebook wants to be in the future.

That’s not the newsfeed, that’s not pages, that’s not profiles. That’s marketplace, that’s Watch, that’s Groups. With that change, Facebook is finally going to start to decouple itself from the products that have dragged down its brand over the last few years through a series of nonstop scandals.”

(Photo by Justin Sullivan/Getty Images)

Josh and Frederic dive deeper into Facebook’s plans around its redesign, Messenger, Dating, Marketplace, WhatsApp, VR, smart home hardware and more. The two also dig into the biggest news, or lack thereof, on the developer side, including Facebook’s Ax and BoTorch initiatives.

For access to the full transcription and the call audio, and for the opportunity to participate in future conference calls, become a member of Extra Crunch. Learn more and try it for free. 

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You might hate it, but Facebook Stories now has 500M users

Posted by | Advertising Tech, Apps, Facebook, Facebook ads, Facebook Earnings, Facebook Earnings Q1 2019, Facebook Stories, Facebook Stories Ads, instagram, Instagram Stories, Mobile, Social, TC, WhatsApp, WhatsApp Status | No Comments

You might think it’s redundant with Instagram Stories, or just don’t want to see high school friends’ boring lives, but ephemeral Snapchat-style Stories now have 500 million daily users across Facebook and Messenger. WhatsApp’s Stories feature Status has 500 million dailies too, and Instagram hit that milestone three months ago. That’s impressive, because it means one-third of Facebook’s 1.56 billion daily users are posting or watching Stories each day, up from zero when Facebook launched the feature two years ago.

For reference, Stories inventor Snapchat has just 190 million total daily users.

Facebook Stories

CEO Mark Zuckerberg announced the new stats on today’s Facebook Q1 2019 earnings call, which showed it’s user growth rate had increased but it had to save $3 billion for a potential FTC fine over privacy practices.

Facebook isn’t just using Stories to keep people engaged, but to squeeze more cash out of them. Today COO Sheryl Sandberg announced that 3 million advertisers have now bought Stories ads across Facebook’s family of apps. I’d expect Facebook to launch a Stories Ad Network soon so other apps can show Facebook’s vertical video ads and get a cut of the revenue.

Facebook’s aggressive move to clone Snapchat Stories not just in Instagram but everywhere might have pissed users off at first, but many of them have come around. If you give people a place to put their face at the top of their friends’ phones, they’ll fill it. And if someone dangles a window into the lives of people you know and people you wish you did, you’ll open that window regularly.

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Facebook reserves $3B for FTC fine, but keeps growing with 2.38B users in Q1

Posted by | Advertising Tech, Apps, Earnings, Facebook, Facebook ads, Facebook Earnings, facebook privacy, Facebook Stories, Facebook Stories Ads, Government, Mobile, privacy, Social, TC | No Comments

A massive penalty hangs over Facebook’s head, but it otherwise had a very strong Q1 earnings report. Facebook reached 2.38 billion monthly users, up 2.5 percent from 2.32 billion in Q4 2018 when it grew 2.2 percent, and it now has 1.56 billion daily active users, up 2.63 percent from 1.52 billion last quarter when it grew 2 percent. Facebook pulled in $15.08 in revenue, up 26 percent year-over-year compared to Refinitiv’s consensus estimates of $14.98 billion in revenue.

Facebook recorded earnings per share of $0.85 compared to estimates of $1.63 EPS. However, that’s because Facebook has set aside $3 billion to cover a potential FTC fine that it’s still resolving. Without that fine, it would have had an EPS of $1.89. Despite the set-aside, Facebook still earned $2.429 billion in profit, though that’s down from $4.988 a year ago and $6.8 billion in Q4 2018.

Facebook’s share price rose 8.3 percent to $197.84 after closing before earnings at $182.58, way up from its recent low of $124.06 in December. Wall Street seems to have already priced in the potential FTC fine. Facebook has agreed to strict oversight of how it handled user privacy in a 2011 deal with the FTC. It promised to not misrepresent its privacy practices or change privacy controls without user permission, and it’s now negotiating the fine for potentially breaking those terms.

Facebook wrote in its earnings release about the FTC fine that:

“In the first quarter of 2019, we reasonably estimated a probable loss and recorded an accrual of $3.0 billion in connection with the inquiry of the FTC into our platform and user data practices, which accrual is included in accrued expenses and other current liabilities on our condensed consolidated balance sheet. We estimate that the range of loss in this matter is $3.0 billion to $5.0 billion. The matter remains unresolved, and there can be no assurance as to the timing or the terms of any final outcome.”

It’s possible Facebook escapes with a lesser fine that would likely still dwarf Google’s $22.5 million penalty for violating an FTC privacy deal. But it also might have to drag down a future quarter of earnings if the fine ranges as high as $5 billion or larger. Though Facebook does have $45.2 billion in cash and securities on hand to pay that fine and make any necessary acquisitions. Facebook’s headcount grew 36% year-over-year to 37,773 as it staffs up its security team, but it still has a 22 percent operating margin.

Facebook has managed to hold on to its 66 percent daily to monthly user ratio, showing people aren’t necessarily using it less despite all the backlash. It added 39 million daily users, compared to Snapchat’s addition of 4 million in Q1. But Facebook failed to grow past its 186 million daily user count in the US & Canada where it got stuck last quarter, but at least it added 4 million in its lucrative Europe market, plus it had atypically large gains in Asia-Pacific and the Rest Of World regions. As for monetization, Facebook made modest gains in average revenue per user across markets compared to Q3 2018 (excluding the holiday-laden Q4). Europe did especially well, growing ARPU 8.2 percent.

Zooming out, Facebook now has over 2.7 billion total mothly users across its family of Facebook, Messenger, Instagram, and WhatsApp, the same as last quarter. 2.1 billion people use at least one of those apps daily, up from 2 billion last quarter. Instagram Stories, WhatsApp Status, and Facebook Stories on Facebook and Messenger combined each now have 500 million daily users. Facebook also now has 3 million advertisers buying Stories ads across its apps, so the ephemeral format will likely start to contribute meaningful revenue soon.

Color From The Earnings Call

In March, Zuckerberg announced plans for a massive privacy-centric overhaul of Facebook to turn it from just a townsquare into also a “living room”. That means unifying its messaging apps with a backend that supports end-to-end encryption, and promoting ephemerality in content sharing and communication. That could help deter calls for regulation, make Facebook harder to break up, and help it stay ahead of competitors like Snapchat, but will also be a massive product and engineering undertaking.

Today, Zuckerberg focused on providing more details to this plan to expand privacy, encryption, impermanence, safety, interoperability, and secure data storage. He stressed that given people traditionally spend more time communicating and consuming content privately than publicly, strengthening Facebook’s “living room” could boost its business. Zuckerberg noted that since Facebook already doesn’t use messaging content for ad targeting and recent content is more useful for its business, encryption and impermanence shouldn’t be a big risk either. Refusing to store data in countries with poor records of privacy could lead to Facebook being banned there, which Zuckerberg admitted is a major business threat, but one it’s grappled with over content policies for years.

In fact, impermanence is already earning money for Facebook. It said that Instagram Stories was the greatest contributor of additional ad impressions this quarter. And while the Facebook and Instagram feeds are already jammed full of ads with little room for more, Facebook says there’s still room to significantly increase Instagram Stories ad load.

Another highlight of the call was Zuckerberg’s discussion of Facebook’s payments strategy. He confirmed that Facebook plans to build out ways for people to pay merchants through its messaging apps. “So I think that what we’re going to end up seeing is building out payments, which is going to end up being something that we do country by country . . . The goal is to have something where you could do discovery through the broader townsquare-like platforms like Instagram and Facebook, and then you can complete the transactions and follow up with businesses individually and have an ongoing relationship through Messenger and WhatsApp.”

This is the first earnings report of a full quarter following Facebook’s worst-ever security breach in September that impacted 50 million users, shaking confidence in the social network’s privacy and security. It’s also the first full quarter in which Facebook sold its own branded hardware — its Portal video chat device that was well received by critics except for the fact that it was made by Facebook.

Yet the defining story continues to be Facebook’s struggle with claims that its user research and developer platform efforts endangered user privacy and steamrolled competitors in search of growth. That includes TechCrunch’s big scoop that Facebook was paying teens to snoop on their data with a VPN app, which eventually led Facebook to shut down its Onavo user surveillance apps. The fact that Facebook isn’t losing massive numbers of users after years of sustained scandals is a testament to how deeply it’s woven itself into people’s lives.

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Down to Shop is a tongue-in-cheek mobile shopping network

Posted by | Advertising Tech, Apps, eCommerce, Media, Mobile, Startups | No Comments

Cyrus Summerlin and Max Hellerstein, who previously created the Push for Pizza app (which allowed users to order a pizza with the push of a button), are officially launching their new startup today, Down to Shop.

The app bills itself as both a modern reinvention of QVC and “the funnest way to shop.” It allows users to watch funny videos featuring products that can be purchased directly from the app.

In an email, Hellerstein said the pair created Down to Shop out of dissatisfaction with existing advertising and e-commerce. Summerlin described it as “a hypermedia commerce platform.”

“We’ve created a self-aware, fun and entertaining, interactive environment that gets customers to engage with brands like never before — because they want to,” Summerlin said. “What a concept!”

To do this, Down to Shop says it has recruited a creative team of Upright Citizens Brigade alums and Instagram influencers to star in its shows, which are written, filmed and edited in the startup’s Los Angeles studios. The content is built around four-week seasons, with daily episodes across five shows each season.

Down to Shop

You can download the iOS app now, then swipe through different videos and games. Judging from the videos available at launch, the app is holding true to its promise of “content first, advertising second,” with laid-back, tongue-in-cheek shows that also happen to feature promoted products.

By playing games and watching videos, you also earn Clout, the in-app currency that be used to make purchases. As for the products available to purchase, the company says it’s already working with more than 60 brands, including Sustain Condoms, Dirty Lemon (water) and Pretty Litter (cat litter).

Down to Shop’s investors include Greycroft, Lerer Hippeau and Firstmark. The startup isn’t disclosing the size of its funding, but according a regulatory filing, it raised $5.9 million last fall.

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Facebook prototypes a swipeable hybrid carousel of feed posts & Stories

Posted by | Advertising Tech, Apps, Facebook, Facebook ads, Facebook News Feed, Facebook Stories, Facebook Stories Ads, Mobile, Snapchat Stories Clone, Social | No Comments

Feed and Stories unite! Facebook is so eager to preempt the shift to Stories that it might even let us use the same interface of horizontally swipeable cards to sift through News Feed posts. If users won’t scroll down any more, Facebook’s ad business could take a huge hit. But by allowing traditional feed posts and ads to appear amidst Stories in the same carousel you’re more prone to swipe through, it could squeeze more views and dollars out of that content. This would help Facebook gracefully transition to the post-News Feed era while it teaches advertisers how to use the full-screen Stories ad format.

In this image, you can see a user in mid-swipe through the hybrid carousel between a News Feed story about a friend updating their profile photo to an animated GIF-style video on the left and a Stories video on the right.

We’re awaiting comment from Facebook about this. There’s a chance it was just caused by a bug like the briefly side-scrollable Instagram feed that popped up in December, or that it will never be publicly tested, let alone launch. But given the significance of Facebook potentially reimagining navigation of its main revenue stream, we considered it worth covering immediately. After all, Facebook predicts that Stories sharing will surpass feed sharing across all social apps sometime this year. It already has 300 million daily users across Stories on Facebook and Messenger, plus another 500 million on Instagram Stories and 450 million on WhatsApp Status.

[Update: Facebook confirms that this feature is a very early-stage prototype of a new way to navigate News Feed posts. A Facebook spokesperson tells TechCrunch that “We are currently not testing this publicly” as the company still needs do a lot more user research before any public experimentation.]

This swipeable hybrid carousel was first spotted by reverse-engineering specialist and frequent TechCrunch tipster Jane Manchun Wong. She discovered this unreleased feature inside the Android version of Facebook and screenrecorded the new navigation method. In this prototype, when a News Feed post’s header or surrounding space is tapped, users see a full-screen version of the post. From there they can swipe left to reveal the next content in the hybrid carousel, which can include both traditional News Feed posts, News Feed ads and purposefully vertical Stories and Stories ads.

Users can tap to Like, react to or comment on feed posts while still in the carousel interface. Facebook has been offering ways to syndicate your News Feed posts to Stories since last year, but those posts got reformatted to look like Stories rather than retaining their old design and white background as we see here.

Facebook is testing to turn News Feed into Story Feed pic.twitter.com/83H7VWcgmD

— Jane Manchun Wong (@wongmjane) April 15, 2019

If Facebook moved forward with offering this as an optional way to browse its social network, it would hedge the business against the biggest behavior change it’s seen since the move from desktop to mobile. Vertically scrolling News Feeds are useful for browsing text-heavy content, but the navigation requires more work. Users have to stop and start scrolling precisely to get a whole post in view, and it takes longer to move between pieces of content.

In contrast, swipeable Stories carousels offer a more convenient lean-back navigation style where posts always appear fully visible. All it takes to advance to the next full-screen piece of content is a single tap, which is easier on your joints. This allows rapid-fire fast-forwarding through friends’ lives, which works well with more visual, instantly digestible content. While cramming text-filled News Feed posts may not be ideal, at least they might get more attention. If Facebook combined all this with unskippable Stories ads like Snapchat is increasingly using, the medium shift could lure more TV dollars to the web.

The hybrid posts and Stories carousel can contain both traditional image plus caption News Feed posts and News feed ads as well as Stories

Facebook has repeatedly warned that it’s out of space for more ads in the News Feed, and that users are moving their viewing time to Stories, where advertisers are still getting acclimated. When Facebook made it clear on its Q2 2018 earnings call that this could significantly reduce revenue growth, its share price dropped 20 percent, vaporizing $120 billion in value. Wall Street is rightfully concerned that the Stories medium shift could upend Facebook’s massive business.

Stories is a bustling up-and-coming neighborhood. News Feed is a steadily declining industrial city that’s where Facebook’s money is earned but that’s on its way to becoming a ghost town. A hybrid Stories/posts carousel would build a super highway between them, connecting where Facebook users want to spend time with where the municipality generates the taxes necessary to keep the lights on.

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